Common use of REIT Matters Clause in Contracts

REIT Matters. (a) The Company acknowledges that an Affiliate of the PC Member intends to qualify at all times as a REIT, and that its ability to so qualify will depend in part upon the nature of the assets and operations of the Company and any Subsidiary. Accordingly, for so long as the PC Member holds an Interest in the Company, the Company shall at all times exercise reasonable best efforts to conduct the business of the Company and any Subsidiary in a manner that the PC Member advises the Manager in writing is necessary to enable the PC Member and its Affiliates to satisfy all the requirements for REIT status under Sections 856 through 860 of the Code. The Company and the Manager shall be entitled to consult with the PC Member on matters relating to REIT compliance, and shall not be deemed to have violated their obligations hereunder based on any actions taken in reliance on such advice or instructions from the PC Member. Without limiting the generality of the foregoing, the Company and the Manager shall use reasonable best efforts to ensure that the Company’s operations are conducted in accordance with the following limitations: i. As of the end of each quarter of each fiscal year, except for securities of a taxable REIT subsidiary, if any, neither the Company, any Series, nor any Subsidiary shall own, directly or indirectly, securities that would cause an Affiliated REIT to be treated as holding securities (as determined for purposes of Section 856(c)(4)(B) of the Code) (x) possessing more than ten percent (10%) of the total voting power of the outstanding securities of any one issuer, (y) having a value of more than ten percent (10%) of the total value of the outstanding securities of any one issuer, or (z) issued by one issuer and having a value of more than five percent (5%) of the gross value of such Affiliated REIT; ii. At no time may the aggregate value of all securities owned by the Company, any Series, and all Subsidiaries in entities that have elected to be treated as “taxable REIT subsidiaries” exceed the percentage of the total value of the assets of the Company, any Series, and all Subsidiaries set forth in Section 856(c)(4)(B)(ii) of the Code; iii. At least ninety-five percent (95%) of the gross income of Series One for each taxable year (or portion thereof, if applicable) shall be derived from the items described in Section 856(c)(2) of the Code; iv. At least seventy-five percent (75%) of the gross income of Series One for each taxable year (or portion thereof, if applicable) shall be derived from the items described in Section 856(c)(3) of the Code; v. As of the end of each quarter of each fiscal year, at least seventy-five percent (75%) of the value of the assets of Series One shall be represented by the items described in Section 856(c)(4)(A) of the Code (that is, real estate assets, cash and cash items (including receivables) and government securities (each as defined in Section 856 of the Code); vi. Neither the Company, any Series, nor any Subsidiary, nor any Member (solely in its capacity as a Member) shall take any action (or fail to take any action permitted under this Agreement) that would otherwise cause Series One’s gross income to consist of more than five percent (5%) of income not described in Section 856(c)(2) of the Code or more than twenty-five percent (25%) of income not described in Section 856(c)(3) of the Code, or cause more than twenty-five percent (25%) of Series One’s assets to consist of assets other than cash and “real estate assets” within the meaning of Section 856(c)(5)(B) of the Code; vii. Series One shall not furnish or render services to tenants or other persons, and shall not manage or operate a property, other than through the Series One Property Manager or its replacement; viii. As of the end of each quarter of each fiscal year, except for a taxable REIT subsidiary, if any, Series One shall not own, directly or indirectly or by attribution (in accordance with attribution rules referred to in Section 856(d)(5) of the Code), in the aggregate more than 10% of the total value of all classes of stock or more than 10% of the total voting power (or, with respect to any such Person which is not a corporation, an interest of 10% or more in the assets or net profits of such Person) of a lessee or sublessee of all or any part of a property or of any other assets of Series One except in each case with the specific written approval of the Affiliated REIT for whom such ownership would cause a related party rent issue under Section 856(d)(2) of the Code; and ix. None of the Company, any Series, or any Subsidiary (other than a taxable REIT Subsidiary) shall engage in any “prohibited transactions” within the meaning of Section 857(b)(6)(B)(iii) of the Code. (b) Notwithstanding the foregoing: i. The Members acknowledge and agree that no action of the Manager, the Company, or any Series shall be in violation of this Section 9.6 if such action is (A) pursuant to an approval from the PC Member in accordance with Section 9.6, (B) done or caused by the Series One Property Manager, or (C) otherwise approved in writing by the PC Member. Furthermore, none of the Company, any Series, or the Manager shall have any liability to the PC Member for actions taken in accordance with the guidance or instructions provided to the Company or the Manager by the PC Member; and ii. In the event of any dispute between the Company, any Series, or the Manager on the one hand, and the PC Member on the other hand, with respect to whether any action or inaction is necessary for the PC Member or any of its Affiliates to maintain REIT status, the determination of the PC Member shall be binding.

REIT Matters. (ai) The Company acknowledges that an Affiliate of the PC Member intends to qualify at all times as a REIT, and that its ability to so qualify will depend in part upon the nature of the assets and operations of the Company and any Subsidiary. Accordingly, for so long as the PC Member holds an Interest interest in the Company, the Company shall at all times shall exercise diligent and commercially reasonable best efforts to conduct the business of the Company and any Subsidiary in a manner that the PC Member advises the Manager in writing is necessary to will enable the PC Member and its Affiliates to satisfy all the requirements for REIT status under Sections 856 through 860 of the CodeCode to the extent possible. The parties acknowledge that the Company shall rely on guidance from ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, acting as tax advisor to TCG Member and the Manager Company. ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP shall be entitled to consult cooperate with the tax advisors of PC Member on matters relating and its Affiliates in fulfilling its duties pursuant to REIT compliance, and shall not be deemed to have violated their obligations hereunder based on any actions taken in reliance on such advice or instructions from the PC Memberthis Section 9.1(c)(i). Without limiting the generality of the foregoing, the Company shall cooperate with PC Member (e.g., by jointly structuring all forms of contracts used to sell timber and sharing advice provided by the Manager shall use reasonable best efforts Company’s tax advisors) to ensure that the Company’s operations are conducted in accordance with the following limitations: i. As of (1) Neither the end of each quarter of each fiscal year, except for securities of a taxable REIT subsidiary, if any, neither the Company, any Series, Company nor any Subsidiary shall own, directly or indirectly, securities that would cause an Affiliated REIT to be treated as holding securities (as determined for purposes of Section 856(c)(4)(B) of the Code) (x) possessing own more than ten percent (10%) of the total voting power of the outstanding securities of any one issuer, (y) having a value of or more than ten percent (10%) of the total value of the outstanding securities of any one issuer, or issuer (z) issued by one issuer and having a value as determined for purposes of more than five percent (5%Section 856(c)(4)(B) of the gross value of such Affiliated REITCode); ii. (2) At no time may the aggregate value of all securities owned by the Company, any Series, Company and all Subsidiaries in entities that have elected to be treated as “taxable REIT subsidiaries” exceed the percentage of the total value of the assets of the Company, any Series, ’s and all Subsidiaries set forth in Section 856(c)(4)(B)(ii) of the Code; iii. At least ninety-five percent (95%) of the gross income of Series One for each taxable year (or portion thereof, if applicable) shall be derived from the items described in Section 856(c)(2) of the Code; iv. At least seventy-five percent (75%) of the gross income of Series One for each taxable year (or portion thereof, if applicable) shall be derived from the items described in Section 856(c)(3) of the Code; v. As of the end of each quarter of each fiscal year, at least seventy-five percent (75%) of the value of the assets of Series One shall be represented by the items described in Section 856(c)(4)(A) of the Code (that is, real estate assets, cash and cash items (including receivables) and government securities (each as defined in Section 856 of the Code); vi. (3) Neither the Company, any Series, Company nor any Subsidiary, nor any Member (solely in its capacity as a MemberMember of the Company) shall take any action (or fail to take any action permitted under this Agreement) that would otherwise cause Series Onethe Company’s gross income to consist of more than five percent (5%) of income not described in Section 856(c)(2) of the Code or more than twenty-five percent (25%) of income not described in Section 856(c)(3) of the Code, or cause more than twenty-five percent (25%) of Series Onethe Company’s assets to consist of assets other than cash and “real estate assets” within the meaning of Section 856(c)(5)(B) of the Code; vii. Series One shall not furnish or render services to tenants or other persons, and shall not manage or operate a property, other than through the Series One Property Manager or its replacement; viii. As of the end of each quarter of each fiscal year, except for a taxable REIT subsidiary, if any, Series One shall not own, directly or indirectly or by attribution (in accordance with attribution rules referred to in Section 856(d)(5) of the Code), in the aggregate more than 10% of the total value of all classes of stock or more than 10% of the total voting power (or, with respect to any such Person which is not a corporation, an interest of 10% or more in the assets or net profits of such Person) of a lessee or sublessee of all or any part of a property or of any other assets of Series One except in each case with the specific written approval of the Affiliated REIT for whom such ownership would cause a related party rent issue under Section 856(d)(2) of the Code; and ix. None of the Company, any Series, or any (4) The Company and each Subsidiary (other than a taxable REIT Subsidiary) shall not engage in any “prohibited transactions” within the meaning of Section 857(b)(6)(B)(iii) of the Code. (bii) Notwithstanding the foregoing: i. (1) The Members acknowledge and agree that no action of the Manager, Manager or the Company, or any Series Company shall be in violation of this Section 9.6 9.1(c)(i) if such action is (A) pursuant to an approval from the PC Member in accordance with Section 9.6, 9.11 or (B) done or caused by the Series One Property Manager, or (C) otherwise approved in writing by the PC Member. Furthermore, none of neither the Company, any Series, or Company nor the Manager shall have any liability to the PC Member for actions taken in accordance with the guidance or and/or instructions provided to the Company or the Manager by PC Member and/or any advisors engaged by the Company with PC Member’s consent to assist in the Company’s compliance with REIT requirements provided that Company (or the Manager on behalf of the Company) timely communicates and consults with PC Member concerning any such guidance and/or instructions provided by any such advisors prior to taking any action in connection with or reliance upon any such guidance and/or instructions; and ii. (2) In the event of any dispute between the Company, any Seriesthe Manager, TCG Member or advisors engaged by the Manager Company on the one hand, hand and the PC Member on the other hand, hand with respect to whether any action of the matters provided for under this Section 9.1(c) or inaction is otherwise determined by PC Member as necessary for the PC Member or any of its Affiliates to maintain REIT status, the determination of the PC Member shall be binding.