Common use of Transfer Compensation Amount Clause in Contracts

Transfer Compensation Amount. If a Member Transfers its Interest to a Corporate Affiliate pursuant to Section 17.2.1 or to a third party pursuant to Section 17.2.2, and if such Transfer results in a termination of the tax partnership pursuant to Section 708(b)(1)(B) of the Code, then the Member transferring its Interest shall pay the Member who is not transferring its Interest a cash amount equal to the excess of (a) the present value of the depreciation and amortization deductions that the non-transferring Member would have received with respect to the assets owned by the Company on the Transfer date if such transfer had not occurred over (b) the present value of such deductions after giving effect to Section 168(i)(7) of the Code, which has the effect of restarting the depreciation or amortization period for such assets (such amount the “Transfer Compensation Amount”). “Present value” for purposes of the preceding sentence shall be determined (i) by using as the discount rate the prime rate as published by The Wall Street Journal for the date of the Transfer, (ii) by using as the tax rate the highest federal and Oklahoma combined corporate income tax rate in effect on the date of the transfer, and (iii) by assuming that the Company will depreciate or amortize all of the assets that it owns on the Transfer date over their entire tax lives. The non-transferring Member shall calculate the Transfer Compensation Amount and make written demand for its payment on the transferring Member, who shall pay such amount within ten (10) Business Days of receipt of such demand. The Members shall submit any dispute over the operation of this Section 17.4 to the Arbitrator for resolution. A Member Transferring its Interest pursuant to Section 17.2.1 or 17.2.2 may effect such Transfer in a series of transactions for the purpose of avoiding a termination of the tax partnership; provided, however, that such series results in the Transfer of such Member’s entire interest within a period that does not exceed thirteen (13) calendar months. This Section 17.4 shall not apply to any Transfer pursuant to Section 17.2.4. Table of Contents

Transfer Compensation Amount. If a Member Transfers all or any portion of its Membership Interest to a Corporate Affiliate pursuant to Section 17.2.1 12.2 or all of its Membership Interest to a third party pursuant to Section 17.2.212.3, and if such Transfer results in a termination of the tax partnership Company pursuant to Code Section 708(b)(1)(B) of the Code), then the Member transferring its Membership Interest shall pay the Member who is not transferring its Membership Interest a cash amount equal to the tax savings attributable to the excess of (a) the present value of the depreciation and amortization deductions that the non-transferring Member would have received with respect to the assets owned by the Company on the Transfer date if such transfer had not occurred over (b) the present value of such deductions after giving effect to Code Section 168(i)(7) of the Code), which has the effect of restarting the depreciation or amortization period for such assets (such amount the “Transfer Compensation Amount”). “Present value” for purposes of the preceding sentence The Transfer Compensation Amount shall be determined (i) by using as the discount rate the prime rate as published by The Wall Street Journal for the date of the Transfer, (ii) by using as the tax rate the highest federal and Oklahoma New Hampshire combined corporate income tax rate in effect on the date of the transfer, and (iii) by assuming that the Company will depreciate or amortize all of the its depreciable assets that it owns on the Transfer date over their entire tax livesdepreciation periods. The non-transferring Member shall calculate the Transfer Compensation Amount and make written demand for its payment on the transferring Member, who shall pay such amount within ten (10) Business Days of receipt of such demand. The Members shall submit any dispute over the operation of this Section 17.4 to the Arbitrator for resolution. A Member Transferring all or any portion of its Membership Interest pursuant to Section 17.2.1 12.2 or 17.2.2 all of its Membership Interest pursuant to Section 12.3 may effect such Transfer in a series of transactions for the purpose of avoiding a termination of the tax partnershipCompany pursuant to Code Section 708(b)(1)(B); provided, however, that such series results in the such Transfer of such Member’s entire interest within a period that does not exceed thirteen (13) calendar months. This Section 17.4 12.9 shall not apply to any Transfer pursuant to Section 17.2.412.5. Table of ContentsExecution Copy

Transfer Compensation Amount. If a Member Transfers all or any portion of its Membership Interest to a Corporate Affiliate pursuant to Section 17.2.1 12.2 or all of its Membership Interest to a third party pursuant to Section 17.2.212.3, and if such Transfer results in a termination of the tax partnership Company pursuant to Code Section 708(b)(1)(B) of the Code), then the Member transferring its Membership Interest shall pay the Member who is not transferring its Membership Interest a cash amount equal to the tax savings attributable to the excess of (a) the present value of the depreciation and amortization deductions that the non-transferring Member would have received with respect to the assets owned by the Company on the Transfer date if such transfer had not occurred over (b) the present value of such deductions after giving effect to Code Section 168(i)(7) of the Code), which has the effect of restarting the depreciation or amortization period for such assets (such amount the “Transfer Compensation Amount”). “Present value” for purposes of the preceding sentence The Transfer Compensation Amount shall be determined (i) by using as the discount rate the prime rate as published by The Wall Street Journal for the date of the Transfer, (ii) by using as the tax rate the highest federal and Oklahoma New Hampshire combined corporate income tax rate in effect on the date of the transfer, and (iii) by assuming that the Company will depreciate or amortize all of the its depreciable assets that it owns on the Transfer date over their entire tax livesdepreciation periods. The non-transferring Member shall calculate the Transfer Compensation Amount and make written demand for its payment on the transferring Member, who shall pay such amount within ten (10) Business Days of receipt of such demand. The Members shall submit any dispute over the operation of this Section 17.4 to the Arbitrator for resolution. A Member Transferring all or any portion of its Membership Interest pursuant to Section 17.2.1 12.2 or 17.2.2 all of its Membership Interest pursuant to Section 12.3 may effect such Transfer in a series of transactions for the purpose of avoiding a termination of the tax partnershipCompany pursuant to Code Section 708(b)(1)(B); provided, however, that such series results in the such Transfer of such Member’s entire interest within a period that does not exceed thirteen (13) calendar months. This Section 17.4 12.9 shall not apply to any Transfer pursuant to Section 17.2.412.5. Table of Contents-41- Execution Copy Northern Pass LLC Operating Agreement

Transfer Compensation Amount. If a Member Transfers all or any portion of its Membership Interest to a Corporate Affiliate pursuant to Section 17.2.1 12.2 or all of its Membership Interest to a third party pursuant to Section 17.2.212.3, and if such Transfer results in a termination of the tax partnership Company pursuant to Code Section 708(b)(1)(B) of the Code), then the Member transferring its Membership Interest shall pay the Member who is not transferring its Membership Interest a cash amount equal to the tax savings attributable to the excess of (a) the present value of the depreciation and amortization deductions that the non-transferring Member would have received with respect to the assets owned by the Company on the Transfer date if such transfer had not occurred over (b) the present value of such deductions after giving effect to Code Section 168(i)(7) of the Code), which has the effect of restarting the depreciation or amortization period for such assets (such amount the “Transfer Compensation Amount”). “Present value” for purposes of the preceding sentence The Transfer Compensation Amount shall be determined (i) by using as the discount rate the prime rate as published by The Wall Street Journal for the date of the Transfer, (ii) by using as the tax rate the highest federal and Oklahoma New Hampshire combined corporate income tax rate in effect on the date of the transfer, and (iii) by assuming that the Company will depreciate or amortize all of the its depreciable assets that it owns on the Transfer date over their entire tax livesdepreciation periods. The non-transferring Member shall calculate the Transfer Compensation Amount and make written demand for its payment on the transferring Member, who shall pay such amount within ten (10) Business Days of receipt of such demand. The Members shall submit any dispute over the operation of this Section 17.4 to the Arbitrator for resolution. A Member Transferring all or any portion of its Membership Interest pursuant to Section 17.2.1 12.2 or 17.2.2 all of its Membership Interest pursuant to Section 12.3 may effect such Transfer in a series of transactions for the purpose of avoiding a termination of the tax partnershipCompany pursuant to Code Section 708(b)(1)(B); provided, however, that such series results in the such Transfer of such Member’s entire interest within a period that does not exceed thirteen (13) calendar months. This Section 17.4 12.9 shall not apply to any Transfer pursuant to Section 17.2.412.5. Table of ContentsExecution Copy Northern Pass LLC Operating Agreement