Tax Liability of Ownership Entity. Notwithstanding anything to the contrary contained herein, if any Ownership Entity other than a TRS Entity is not a pass-through entity with no entity-level income tax obligations, distributions to the Initial Member pursuant to Section 6.6 (including for the purposes of Section 9.2(c)) will be allocated before accrual or payment of any income tax payable by such Ownership Entity, the amount of such accrual or payment shall be deemed distributed to the Private Owner pursuant to Section 6.6, and the Private Owner (or its successors or assigns) must indemnify and hold harmless the Initial Member from and against any liability for any income taxes payable by the Ownership Entity; provided, however, that the foregoing special allocation and indemnity will not apply if (i) the Private Owner (and each of its successors and assigns) has taken all steps necessary to secure pass-through treatment of the Ownership Entity and (ii) the liability for income taxes payable by the Ownership Entity arises solely as a result of a change in Law applicable to pass-through entities occurring after the date hereof and not as a result of action (or inaction) by the Private Owner (or its successors or assigns).
Appears in 6 contracts
Samples: Limited Liability Company Operating Agreement, Interest Sale and Assignment Agreement, Limited Liability Company Operating Agreement
