Common use of Tax Treatment; Purchase Price Allocation Clause in Contracts

Tax Treatment; Purchase Price Allocation. (i) For income Tax purposes, the Parties agree that the transactions contemplated hereby shall be treated as a partnership merger in accordance with Section 1.708-1(c) of the Treasury Regulations. Accordingly, the Company shall be treated as though it contributed its assets to NGL in exchange for the NGL Units in an exchange described in Section 721(a) of the Code, and immediately thereafter, the Company shall be treated as though it distributed the NGL Units to the members of the Company. The Parties agree to treat HSE’s payment of the Actual Earn-Out Amount, if any, as a distribution by NGL under Section 731 of the Code. The Parties further agree that the initial capital account of each NGL Unit as of the Closing Date shall equal the capital account of a common unit representing a limited partner interest in NGL (as appropriately adjusted to reflect the forbearance of any distribution described under Section 5.12) that is publicly traded on the New York Stock Exchange under the symbol “NGL,” and that such initial capital account shall be increased by the Actual Earn-Out Amount, if any. (ii) Within sixty (60) days of the final determination of the Final Net Working Capital, as finally determined, HSE shall deliver to Representative a schedule allocating the total consideration payable hereunder (and the relevant liabilities of the Company) among the assets of the Company (the “Purchase Price Allocation Schedule”). The Purchase Price Allocation Schedule shall be prepared in accordance with the applicable provisions of the Code and consistent with the methodologies set forth in Section 5.11(f)(ii) of the Transferor Disclosure Schedule. HSE and each Transferor shall file all Tax Returns (and cause their respective Affiliates and persons that are treated as owning the shares of the Company for income Tax purposes to file all Tax Returns) consistently with the Purchase Price Allocation Schedule (as appropriately adjusted) and shall not take any position during the course of any audit or other legal proceeding that is inconsistent with such election, forms, or schedule, unless required by a determination of the applicable Governmental Entity that is final.

Tax Treatment; Purchase Price Allocation. (ia) For income Tax purposes, the Parties The parties agree that the transactions contemplated hereby purchase and sale of the Shares shall be treated for U.S. federal income tax purposes as a partnership merger an acquisition by Purchaser of all of the assets of the Transferred Company and that the purchase and sale of Shares will be treated as an “applicable asset acquisition” within the meaning of Section 1060 of the Code with respect to Purchaser (the “Transaction Tax Treatment”). (b) The parties agree that any amounts payable to Seller, as increased by any liabilities of the Transferred Company and as adjusted to reflect such other relevant items, as determined by the parties in good faith, shall be allocated among the assets of the Transferred Company for U.S. federal income tax purposes in the manner required by Section 1060 of the Code and the Treasury Regulations promulgated thereunder, and in accordance with the following provisions of this Section 1.708-1(c2.9(b) of and the Treasury Regulationsmethodology set forth in Schedule 2.9. Accordingly, the Company shall be treated as though it contributed its assets to NGL in exchange for the NGL Units in an exchange described in Section 721(a) of the Code, and immediately thereafter, the Company shall be treated as though it distributed the NGL Units to the members of the Company. The Parties agree to treat HSE’s payment of the Actual Earn-Out Amount, if any, as a distribution by NGL under Section 731 of the Code. The Parties further agree that the initial capital account of each NGL Unit as of the Closing Date shall equal the capital account of a common unit representing a limited partner interest in NGL (as appropriately adjusted to reflect the forbearance of any distribution described under Section 5.12) that is publicly traded on the New York Stock Exchange under the symbol “NGL,” and that such initial capital account shall be increased by the Actual Earn-Out Amount, if any. (ii) Within No later than sixty (60) days of Business Days after the final determination of the Final Net Working CapitalClosing Date, as finally determined, HSE Seller shall deliver to Representative a schedule allocating Purchaser an allocation of the total consideration payable hereunder Purchase Price (and the all other relevant liabilities of the Companyamounts) among the assets of the Transferred Company in accordance with Section 1060 of the Code and the Treasury Regulations promulgated thereunder, which allocation shall be consistent with the principles established in this Section 2.9(b) and the methodology set forth in Section 2.9 of the Seller Disclosure Schedule (the “Purchase Price Allocation ScheduleDraft Allocation”). The In the event Purchaser disagrees with the Draft Allocation, Purchaser may, within twenty (20) Business Days after delivery of the Draft Allocation, deliver a notice to such effect (the “Purchaser’s Allocation Notice”) to Seller, specifying those items as to which Purchaser reasonably disagrees and setting forth Purchaser’s proposed allocation of the Purchase Price (and all other relevant amounts). If Purchaser does not timely deliver Purchaser’s Allocation Schedule Notice, the Draft Allocation shall become final. If Purchaser’s Allocation Notice is duly delivered, Purchaser and Seller shall, during the fifteen (15) Business Days following such delivery, use their commercially reasonable efforts to reach agreement on the disputed items or amounts in order to determine the allocation of the Purchase Price (and all other relevant amounts). If Purchaser and Seller are unable to resolve the dispute within the fifteen (15) Business Day period following the delivery of Purchaser’s Allocation Notice, then the matter will be prepared submitted to a neutral accounting firm (the “Accounting Firm”) to resolve the dispute in accordance with the applicable provisions of the Code and consistent with the methodologies standards set forth in this Section 5.11(f)(ii) 2.9(b). All of the Transferor Disclosure Schedulefees and expenses of the Accounting Firm retained pursuant to this Section 2.9(b) shall be allocated between Purchaser, on the one hand, and Seller, on the other hand, in the same proportion that the aggregate amount of the items unsuccessfully disputed or defended, as the case may be, by such party (as finally determined by the Accounting Firm) bears to the total amount of the disputed items. HSE and each Transferor The allocation as finally determined pursuant to this Section 2.9(b) (the “Allocation”) shall file all Tax Returns be appropriately adjusted to the extent necessary to reflect any payments made hereunder that represent an adjustment to the purchase price for U.S. federal income tax purposes, including any indemnity payments made pursuant to Article VII or Article X. (c) Except as required by Law or as would be inconsistent with prevailing commercial or tax practice in a particular jurisdiction (not including, for the avoidance of doubt, the United States or any of its political subdivisions), the Parties shall (and shall cause their respective Affiliates and persons that are treated as owning to) report the shares relevant Tax consequences of the Company for income Tax purposes to file all Tax Returns) consistently purchase and sale contemplated under this Agreement in a manner consistent with the Purchase Price Allocation Schedule (as appropriately adjusted) Transaction Tax Treatment and the Allocation. Seller shall not promptly provide Purchaser with any other information required to complete IRS Form 8594. None of the parties or any of their respective affiliates shall take any position during the course of any audit or other legal proceeding that is inconsistent with the Transaction Tax Treatment or the Allocation on any U.S. income Tax Return or in any U.S. income Tax proceeding relating to such electionTaxes, formsin each case, or schedule, unless except to the extent required by pursuant to a determination “determination” within the meaning of Section 1313(a) of the applicable Governmental Entity that is finalCode (or any analogous provision of U.S. state or local law).

Tax Treatment; Purchase Price Allocation. (ia) For The Parties agree that for U.S. federal and applicable state income Tax purposes, (i) the Parties agree that the transactions contemplated hereby shall Transaction is intended to be treated as a the merger of two (2) partnerships into one (1) partnership merger in accordance with under the “assets-over form” (within the meaning of Treasury Regulation Section 1.708-1(c1(c)(3)) with the resulting partnership being considered the continuation of the Buyer pursuant to Treasury Regulations. AccordinglyRegulation Section 1.708-1(c)(1); (ii) pursuant to Treasury Regulation Section 1.708-1(c)(3), the Company shall will be treated as though it contributed its contributing the assets of the Company to NGL in exchange for the NGL Units in an exchange described in Buyer pursuant to a transaction governed by Section 721(a) 721 of the Code, ; and immediately thereafter, (iii) the Company shall will be treated as though it distributed the NGL Units to the members of the Company. The Parties agree to treat HSE’s payment of the Actual Earn-Out Amount, if any, as a distribution by NGL under Section 731 of the Code. The Parties further agree that the initial capital account of each NGL Unit terminating as of the Closing Date shall equal under Treasury Regulation Section 1.708-1(c)(1), and (iv) each Contributor who receives cash in the capital account Transaction will be treated as selling a portion of a common unit representing a limited partner interest their interests in NGL the merging partnership pursuant to Treasury Regulation Section 1.708-1(c)(4) (as appropriately adjusted and each Contributor hereby consents to reflect treat the forbearance of any distribution described under Section 5.12Transaction accordingly for U.S. federal income Tax purposes) that is publicly traded on (clauses (i), (ii), (iii), and (iv), collectively, the New York Stock Exchange under the symbol “NGL,” and that such initial capital account shall be increased by the Actual Earn-Out Amount, if anyIntended Tax Treatment”). (iib) Within sixty (60) days of the final determination of the Final Net Working CapitalPurchase Price Adjustment Statement, as finally determined, HSE Buyer shall deliver provide to the Contributors Representative a schedule allocating the total aggregate value of the consideration payable hereunder for the Contributed Equity Interests (including the value of the OP Units, any positive cash adjustments to the consideration for the Contributed Equity Interests, and the relevant applicable liabilities of the Company) among the assets of the Company (the “Purchase Price Allocation Schedule”). The Purchase Price Allocation Schedule shall will be prepared in accordance with the applicable provisions of the Code and consistent with the methodologies set forth on Schedule B. If within thirty (30) days following the delivery of a Purchase Price Allocation Schedule to the Contributors Representative, the Contributors Representative has not objected, the Purchase Price Allocation shall be final and binding. If within thirty (30) days, the Contributors Representative objects to the Purchase Price Allocation Schedule, the Contributors Representative and Buyer shall cooperate in good faith to agree on a final Purchase Price Allocation Schedule, provided that if after thirty (30) days, the Contributors Representative and Buyer are unable to agree, the parties shall retain the Accounting Arbitrator to resolve their dispute under procedures similar to those set forth in Section 5.11(f)(ii) 1.6, provided that the Accounting Arbitrator shall be instructed to utilize the methodologies for determining fair market value as set forth on Schedule B. The determination of the Transferor Disclosure ScheduleAccounting Arbitrator shall be final and binding on the parties. HSE and each Transferor shall file all Tax Returns (and cause their respective Affiliates and persons that are treated as owning the shares The cost of the Company for income Tax purposes Accounting Arbitrator shall be borne equally by the Contributors, on the one hand, and Xxxxx, on the other hand. (c) The parties hereto shall make appropriate adjustments to file all Tax Returns) consistently with the Purchase Price Allocation Schedule (to reflect changes in the purchase price. The parties hereto agree for all Tax reporting purposes to report the transactions in accordance with the Intended Tax Treatment and the Purchase Price Allocation Schedule, as appropriately adjusted) adjusted pursuant to the preceding sentence, and shall to not take any position during the course of any audit or other legal proceeding that is inconsistent with such election, forms, the Intended Tax Treatment or schedule, the Purchase Price Allocation Schedule unless required by a determination “determination” within the meaning of the applicable Governmental Entity that is finalCode Section 1313(a).