Common use of Eligible Investors Clause in Contracts

Eligible Investors. A. If the General Partner determines that a Unit Holder or Substituted Limited Partner is not an Eligible Investor (i) then the Unit Holder shall immediately be divested of its rights to Consent on matters submitted to Unit Holders and Substituted Limited Partners (and no such Depositary Units shall be Consented by the Depositary or otherwise deemed outstanding for purposes of Consents of Unit Holders under this Agreement), and (ii) if such Person is subject to a higher rate of windfall profits tax than the rate imposed upon other Unit Holders and Substituted Limited Partners, the General Partner shall adjust actual cash distributions payable to such Person in order to reflect accurately any varying rate of windfall profits tax imposed. Any amounts so withheld shall be deemed to have been distributed and the tax shall be treated as paid by the Person. B. If at any time (i) the Limited Partnership, the General Partner or the Depositary receives an opinion of counsel to the effect that the citizenship or other status of a Unit Holder or Substituted Limited Partner may result in the forfeiture or cancellation of a federal Lease or otherwise affects the eligibility of the Production Partnership to hold federal Leases or (ii) the Limited Partnership, the General Partner or the Depositary is named a party in any judicial or administrative proceeding that seeks the cancellation or forfeiture of any property in which the Limited Partnership or Production Partnership has an interest because of the citizenship (or any other status that subjects the Production Partnership to the risk of losing its eligibility to acquire or hold interests in federal Leases) of any one or more Unit Holders or Substituted Limited Partners, the General Partner may notify the Unit Holder or Substituted Limited Partner and purchase the Depositary Units or Limited Partner Interests of such Unit Holder or Substituted Limited Partner, as the case may be, at such time and for such amount as the General Partner may determine in its sole discretion. Nothing in this Section 8.4 shall prevent a Unit Holder from transferring its Depositary Units or Limited Partner Interests prior to the date set for such purchase by the General Partner. At any time after it can and does certify that it has become an Eligible Investor a Unit Holder may, upon application to the General Partner, retain all of the economic benefits attributable to its Depositary Units or Limited Partner Interests, as the case may be.