Common use of Tax Savings Clause in Contracts

Tax Savings. If EME indemnifies the Owner Participant for a Tax Loss under clause (iii) of Section 6.7 and the Owner Participant realizes (or would have realized had it had sufficient taxable income and tax liability) during any taxable year a reduction in U.S. federal or state income taxes (including any offset or refund of income taxes and interest thereon) that is attributable to, and would not have occurred but for: (i) any Indemnified Tax Loss, or (ii) any circumstances or adjustments giving rise to such Indemnified Tax Loss, and that, in either such case, was not previously taken into account in computing an indemnity with respect thereto, then, the Owner Participant shall pay to EME an amount or amounts that, on an After-Tax Basis, shall be equal to the reduction or deemed reduction in U.S. federal and state income taxes plus the amount of any interest attributable to such refund. Any reverse indemnity payment will not be in excess of the amount of the indemnity previously paid by EME (with any excess reverse indemnity payments being available as an offset against future federal income tax indemnities otherwise payable by EME). No such payment shall be required to be made while a Lease Event of Default shall have occurred and be continuing. Any subsequent loss of benefits assumed to be realized by the Owner Participant in making such reverse indemnity payment shall be indemnified against by EME.