Federal Income Tax Treatment of the Unsecured Claims Trust Sample Clauses

Federal Income Tax Treatment of the Unsecured Claims Trust. (a) Notwithstanding Section 1.2(a) hereof, for all federal income tax purposes, all parties (including, without limitation, the Debtors, the Reorganized Debtors, the Unsecured Claims Trust, the Unsecured Claims Trustee, the Unsecured Claims Trust Board, the Unsecured Claims Trust Beneficiaries and the holders of Unsecured Claims Trust Interests) shall treat the transfer of the Unsecured Claims Trust Assets to the Unsecured Claims Trust for the benefit of the Unsecured Claims Trust Beneficiaries, whether their Claims are Allowed on or after the Effective Date, as (a) a transfer of the Unsecured Claims Trust Assets directly to those holders of Allowed Claims receiving Unsecured Claims Trust Interests (other than to the extent allocable to Disputed Claims), followed by (b) the transfer by such Persons to the Unsecured Claims Trust of the Unsecured Claims Trust Assets in exchange for beneficial interests in the Unsecured Claims Trust (and in respect of the Unsecured Claims Trust Assets allocable to the Unsecured Claims Trust Fund Reserve Amount, as a transfer to the Unsecured Claims Trust Fund Reserve Amount by the Debtors or the Reorganized Debtors, as the case may be). Accordingly, those holders of Allowed Claims receiving Unsecured Claims Trust Interests shall be treated for federal income tax purposes as the grantors and deemed owners of their respective interest in the Unsecured Claims Trust Assets. The foregoing treatment also shall apply, to the extent permitted by applicable law, for state and local income tax purposes.
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Related to Federal Income Tax Treatment of the Unsecured Claims Trust

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