Allocations to Members. Allocations for Capital Account purposes shall be in accordance with the following: (a) Exploration expenses and development cost deductions shall be allocated among the Members in accordance with their respective contributions to such expenses and costs. (b) Depreciation and amortization deductions with respect to a depreciable Asset shall be allocated among the Members in accordance with their respective contributions to the adjusted basis of the Asset which gives rise to the depreciation, amortization or loss deduction. (c) Production and operating cost deductions shall be allocated among the Members in accordance with their respective contributions to such costs. (d) Deductions for depletion (to the extent of the amount of such deductions that would have been determined for Capital Account purposes if only cost depletion were allowable for federal income tax purposes) shall be allocated to the Members in accordance with their respective contributions to the adjusted basis of the depletable property. Any remaining depletion deductions shall be allocated to the Members so that, to the extent possible, the Members receive the same total amounts of percentage depletion as they would have received if percentage depletion were allocated to the Members in proportion to their respective shares of the gross income used as the basis for calculating the federal income tax deduction for percentage depletion. (e) Subject to Subparagraph 3.3(g) below, gross income on the sale of production shall be allocated in accordance with the Members’ rights to share in the proceeds of such sale based on the ratio of the Members’ Capital Accounts, during the month the production is sold, prior to Payout and based on the ratio of the Members’ Ownership Interest, during the month of the production is sold, after Payout. (f) Except as provided in Subparagraph 3.3(g), below, gain or loss on the sale of a depreciable or depletable asset shall be allocated so that, to the extent possible, the net amount EXHIBIT C reflected in the Members’ Capital Account with respect to such property (taking into account the cost of such property, depreciation, amortization, depletion or other cost recovery deductions and gain or loss) most closely reflects the Members’ Ownership Interests. (g) Gains and losses on the sale of all or substantially all the Assets of the Company shall be allocated so that, to the extent possible, the Members’ resulting Capital Account balances are in the same ratio as their Ownership Interests at the time of such sale. (h) The Members acknowledge that expenses and deductions allocable under the preceding provisions of this Paragraph may be required to be capitalized into production under Section 263A of the Code. With respect to such capitalized expenses or deductions, the allocation of gross income on the sale of production shall be adjusted, in any reasonable manner consistently applied by the Manager, so that the same net amount (subject possibly to timing differences) is reflected in the Capital Accounts as if such expenses or deductions were instead deductible and allocated pursuant to the preceding provisions of this Paragraph. (i) All deductions and losses that are not otherwise allocated in this Paragraph shall be allocated among the Members in accordance with their respective contributions to the costs producing each such deduction or to the adjusted basis of the Asset producing each such loss. (j) Any recapture of exploration expenses under Section 617(b)(1)(A) of the Code, and any disallowance of depletion under Section 617(b)(1)(B) of the Code, shall be borne by the Members in the same manner as the related exploration expenses were allocated to, or claimed by, them. (k) All other items of income and gain shall be allocated to the Members in accordance with their Vested Units. (l) If a reduced Ownership Interest is restored pursuant to Section 10.6 of the Agreement, the Manager shall endeavor to allocate items of income, gain, loss, and deduction (in the same year as the restoration of such Ownership Interest or, if necessary, in subsequent years) so as to cause the Capital Account balances of the Members to be the same as they would have been if the restored Ownership Interest had never been reduced. (m) If the Members’ Ownership Interests change during any taxable year of the Company, the distributive share of items of income, gain, loss and deduction of each Member shall be determined in any manner (1) permitted by Section 706 of the Code, and (2) agreed by both Members. If the Members cannot agree on a method, the method shall be determined by the Manager in consultation with the Company’s tax advisers, with preference given to the interim closing-of-the-books method except where application of that method would result in undue administrative expense in relationship to the amount of the items to be allocated. (n) For purposes of this Paragraph 3.3, items financed through indebtedness of, or from revenues of, the Company shall be treated as funded from contributions made by the Members to the Company in accordance with their Ownership Interests. “Nonrecourse EXHIBIT C deductions,” as defined by Treas. Reg. § 1.704-2(b)(1) shall be allocated between the Members in proportion to their Ownership Interests.
Appears in 1 contract
Allocations to Members. Allocations for Capital Account purposes shall be in accordance with the following:
(a) Exploration expenses and development cost deductions shall be allocated among the Members in accordance with their respective contributions to such expenses and costs.
(b) Depreciation and amortization deductions with respect to a depreciable Asset shall be allocated among the Members in accordance with their respective contributions to the adjusted basis of the Asset which gives rise to the depreciation, amortization or loss deduction.
(c) Production and operating cost deductions shall be allocated among the Members in accordance with their respective contributions to such costs.
(d) Deductions for depletion (to the extent of the amount of such deductions that would have been determined for Capital Account purposes if only cost depletion were allowable for federal income tax purposes) shall be allocated to the Members in accordance with their respective contributions to the adjusted basis of the depletable property. Any remaining depletion deductions shall be allocated to the Members so that, to the extent possible, the Members receive the same total amounts of percentage depletion as they would have received if percentage depletion were allocated to the Members in proportion to their respective shares of the gross income used as the basis for calculating the federal income tax deduction for percentage depletion.
(e) Subject to Subparagraph 3.3(g) below, gross income on the sale of production shall be allocated in accordance with the Members’ rights to share in the proceeds of such sale based on the ratio of the Members’ Capital Accounts, during the month the production is sold, prior to Payout and based on the ratio of the Members’ Ownership Interest, during the month of the production is sold, after Payoutsale.
(f) Except as provided in Subparagraph 3.3(g), below, gain or loss on the sale of a depreciable or depletable asset shall be allocated so that, to the extent possible, the net amount EXHIBIT C reflected in the Members’ Capital Account with respect to such property (taking into account the cost of such property, depreciation, amortization, depletion or other cost recovery deductions and gain or loss) most closely reflects the Members’ Ownership Percentage Interests.
(g) Gains and losses on the sale of all or substantially all the Assets of the Company shall be allocated so that, to the extent possible, the Members’ resulting Capital Account balances are in the same ratio as their Ownership relative Percentage Interests at the time of (“Balance Capital Accounts”) after taking into account such sale. In making the allocations under this Subparagraph 3.3(g), to the extent necessary to Balance Capital Accounts, gain and loss shall be calculated on an asset-by-asset basis, and any property contributed by a Member shall be treated as a separate asset from the property contributed by or created with funds contributed by the other Member. If the Company does not have sufficient items of gain and loss to Balance Capital Accounts, the liquidator may take other actions, as it determines are reasonably appropriate, to Balance Capital Accounts, including reallocating items among the Members or creating notional items of income, gain, deduction and loss and allocating those items in accordance with this Subparagraph 3.3(g).
(h) The Members acknowledge that expenses and deductions allocable under the preceding provisions of this Paragraph 3.3 may be required to be capitalized into production under Section 263A of the Code. With respect to such capitalized expenses or deductions, the allocation of gross income on the sale of production shall be adjusted, in any reasonable manner consistently applied by the Manager, so that the same net amount (subject possibly to timing differences) is reflected in the Capital Accounts as if such expenses or deductions were instead deductible and allocated pursuant to the preceding provisions of this ParagraphParagraph 3.3.
(i) All deductions and losses that are not otherwise allocated in this Paragraph 3.3 shall be allocated among the Members in accordance with their respective contributions to the costs producing each such deduction or to the adjusted basis of the Asset producing each such loss.
(j) Any recapture of exploration expenses under Section 617(b)(1)(A) of the Code, and any disallowance of depletion under Section 617(b)(1)(B) of the Code, shall be borne by the Members in the same manner as the related exploration expenses were allocated to, or claimed by, them.
(k) All other items of income and gain shall be allocated to the Members in accordance with their Vested UnitsPercentage Interests.
(l) If a reduced Ownership Interest is restored pursuant to Section 10.6 of the Agreement, the Manager shall endeavor to allocate items of income, gain, loss, and deduction (in the same year as the restoration of such Ownership Interest or, if necessary, in subsequent years) so as to cause the Capital Account balances of the Members to be the same as they would have been if the restored Ownership Interest had never been reduced.
(m) If the Members’ Ownership Percentage Interests change during any taxable year of the Company, the distributive share of items of income, gain, loss and deduction of each Member shall be determined in any manner (1) permitted by Section 706 of the Code, and (2) agreed by both Members. If the Members cannot agree on a method, the method shall be determined by the Manager in consultation with the Company’s tax advisers, with preference given to the interim closing-of-the-books method except where application of that method would result in undue administrative expense in relationship to the amount of the items to be allocated.
(nm) For purposes of this Paragraph 3.3, items financed through indebtedness of, or from revenues of, the Company shall be treated as funded from contributions made by the Members to the Company in accordance with their Ownership Percentage Interests. “Nonrecourse EXHIBIT C deductions,” as defined by TreasXxxxx. Reg. § 1.704-2(b)(1) shall be allocated between the Members in proportion to their Ownership Percentage Interests.
Appears in 1 contract
Samples: Limited Liability Company Agreement
Allocations to Members. Allocations for Capital Tax Allocation Account purposes shall be in accordance with the following:
(a) Exploration expenses and development cost deductions shall be allocated among the Members in accordance with their respective contributions to such expenses and costs.
(b) Depreciation and amortization deductions with respect to a depreciable Asset shall be allocated among the Members in accordance with their respective contributions to the adjusted basis of the Asset which gives rise to the depreciation, amortization or loss deduction.
(c) Production and operating cost deductions shall be allocated among the Members in accordance with their respective contributions to such costscosts in respect of contributed properties or incurred during start-up operations.
(d) Deductions for depletion (to the extent of the amount of such deductions that would have been determined for Capital Tax Allocation Account purposes if only cost depletion were allowable for federal income tax purposes) shall be allocated to the Members in accordance with their respective contributions to the adjusted basis of the depletable property. Any remaining depletion deductions shall be allocated to the Members so that, subject to the extent possibleParagraph 3(j), the Members receive to the extent possible the same total amounts of percentage depletion as they would have received if percentage depletion were allocated to the Members in proportion to their respective shares of the gross income used as the basis for calculating the federal income tax deduction for percentage depletion.
(e) Subject to Subparagraph 3.3(g) below, gross income on the sale of production shall be allocated in accordance with the Members’ rights to share in the proceeds of such sale based on the ratio of the Members’ Capital Accounts, during the month the production is sold, prior to Payout and based on the ratio of the Members’ Ownership Interest, during the month of the production is sold, after Payout.
(f) Except as provided in Subparagraph 3.3(gParagraph 3(f), below, to the extent permitted under Treas. Reg § 1.1245-1(e)(2), gain or loss on the sale of a depreciable or depletable asset shall be allocated so that, to the extent possible, the net amount EXHIBIT C reflected in the Members’ Capital ' Tax Allocation Account with respect to such property (taking into account the cost of such property, depreciation, amortization, depletion or other cost recovery deductions and gain or loss) most closely reflects the Members’ Ownership ' Percentage Interests.
(gf) Gains and losses on the sale of all or substantially all the Assets of the Company shall be allocated so that, to the extent possible, the Members’ ' resulting Capital Tax Allocation Account balances are in the same ratio as their Ownership Percentage Interests at the time of such sale.
(g) Income and gain (other than items of income or gain allocated pursuant to Paragraphs 3(e) and 3(f)) shall be allocated to the Members in accordance with their Percentage Interests.
(h) The Members acknowledge that expenses and deductions allocable under the preceding provisions of this Paragraph 3 may be required to be capitalized into production under Section 263A of the Code. With respect to such capitalized expenses or deductions, the allocation of gross income on the sale of production shall be adjusted, in any reasonable manner consistently applied by the ManagerManagement Team, so that the same net amount (subject possibly to timing differences) is reflected in the Capital Tax Allocation Accounts as if such expenses or deductions were instead deductible and allocated pursuant to the preceding provisions of this Paragraph.
(i) All deductions and losses that are not otherwise allocated in this Paragraph 3 shall be allocated among the Members in accordance with their respective contributions to the costs producing each such deduction or to the adjusted basis of the Asset producing each such deduction or loss.
(j) Any recapture of exploration expenses under Section 617(b)(1)(A) of the Code, and any disallowance of depletion under Section 617(b)(1)(B) of the Code, shall be borne by the Members in the same manner as the related exploration expenses were allocated to, or claimed by, themthem as deductions pursuant to Section 617(a) of the Code.
(k) All other items of income and gain shall be allocated to the Members in accordance with their Vested Units.
(l) If a reduced Ownership Percentage Interest is restored pursuant to Section 10.6 of the Agreementthis Agreement and if this Agreement does not otherwise cause a shift in Tax Allocation Accounts, the Manager Management Team shall endeavor to allocate items of income, gain, loss, and deduction (in the same year as the restoration of such Ownership Percentage Interest or, if necessary, in subsequent years) so as to cause the Capital Tax Allocation Account balances of the Members to be the same as they would have been if the restored Ownership Percentage Interest had never been reduced.
(ml) If the Members’ Ownership ' Percentage Interests change during any taxable year of the Company, the distributive share of items of income, gain, loss and deduction of each Member shall be determined in any manner (1) permitted by Section 706 of the Code, and (2) agreed by both Members. If the Members cannot agree on a method, the method shall be determined by the Manager in consultation with Management Team having been advised by the Company’s 's tax advisers, with preference . Preference shall be given to the interim closing-of-the-books method except where application of that method would result in undue administrative expense in relationship to the amount of the items to be allocated.
(nm) For purposes of this Paragraph 3.33, items financed through indebtedness of, or from revenues of, the Company shall be treated as funded from contributions made by the Members to the Company in accordance with their Ownership Interests. “Nonrecourse EXHIBIT C deductions,” as defined by Treas. Reg. § 1.704-2(b)(1) shall be allocated between the Members in proportion to their Ownership Percentage Interests.
Appears in 1 contract
Samples: Limited Liability Company Agreement (Polymet Mining Corp)
Allocations to Members. Allocations for Capital Tax Allocation Account purposes shall be in accordance with the following:
(a) Exploration expenses and development cost deductions shall be allocated among the Members in accordance with their respective contributions to such expenses and costs.
(b) Depreciation and amortization deductions with respect to a depreciable Asset shall be allocated among the Members in accordance with their respective contributions to the adjusted basis of the Asset which gives rise to the depreciation, amortization or loss deduction.
(c) Production and operating cost deductions shall be allocated among the Members in accordance with their respective contributions to such costscosts in respect of contributed properties or incurred during start-up operations.
(d) Deductions for depletion (to the extent of the amount of such deductions that would have been determined for Capital Tax Allocation Account purposes if only cost depletion were allowable for federal income tax purposes) shall be allocated to the Members in accordance with their respective contributions to the adjusted basis of the depletable property. Any remaining depletion deductions shall be allocated to the Members so that, subject to the extent possibleParagraph 3(j), the Members receive to the extent possible the same total amounts of percentage depletion as they would have received if percentage depletion were allocated to the Members in proportion to their respective shares of the gross income used as the basis for calculating the federal income tax deduction for percentage depletion.
(e) Subject to Subparagraph 3.3(g) below, gross income on the sale of production shall be allocated in accordance with the Members’ rights to share in the proceeds of such sale based on the ratio of the Members’ Capital Accounts, during the month the production is sold, prior to Payout and based on the ratio of the Members’ Ownership Interest, during the month of the production is sold, after Payout.
(f) Except as provided in Subparagraph 3.3(gParagraph 3(f), below, to the extent permitted under Treas. Reg § 1.1245-1(e)(2), gain or loss on the sale of a depreciable or depletable asset shall be allocated so that, to the extent possible, the net amount EXHIBIT C reflected in the Members’ Capital ' Tax Allocation Account with respect to such property (taking into account the cost of such property, depreciation, amortization, depletion or other cost recovery deductions and gain or loss) most closely reflects the Members’ Ownership ' Percentage Interests.
(gf) Gains and losses on the sale of all or substantially all the Assets of the Company shall be allocated so that, to the extent possible, the Members’ ' resulting Capital Tax Allocation Account balances are in the same ratio as their Ownership Percentage Interests at the time of such sale.
(g) Income and gain (other than items of income or gain allocated pursuant to Paragraphs 3(e) and 3(f)) shall be allocated to the Members in accordance with their Percentage Interests.
(h) The Members acknowledge that expenses and deductions allocable under the preceding provisions of this Paragraph 3 may be required to be capitalized into production under Section 263A of the Code. With respect to such capitalized expenses or deductions, the allocation of gross income on the sale of production shall be adjusted, in any reasonable manner consistently applied by the ManagerManagement Team, so that the same net amount (subject possibly to timing differences) is reflected in the Capital Tax Allocation Accounts as if such expenses or deductions were instead deductible and allocated pursuant to the preceding provisions of this Paragraph.
(i) All deductions and losses that are not otherwise allocated in this Paragraph 3 shall be allocated among the Members in accordance with their respective contributions to the costs producing each such deduction or to the adjusted basis of the Asset producing each such deduction or loss.
(j) Any recapture of exploration expenses under Section 617(b)(1)(A) of the Code, and any disallowance of depletion under Section 617(b)(1)(B) of the Code, shall be borne by the Members in the same manner as the related exploration expenses were allocated to, or claimed by, themthem as deductions pursuant to Section 617(a) of the Code.
(k) All other items of income and gain shall be allocated to the Members in accordance with their Vested Units.
(l) If a reduced Ownership Percentage Interest is restored pursuant to Section 10.6 of the Agreementthis Agreement and if this Agreement does not otherwise cause a shift in Tax Allocation Accounts, the Manager Management Team shall endeavor to allocate items of income, gain, loss, and deduction (in the same year as the restoration of such Ownership Percentage Interest or, if necessary, in subsequent years) so as to cause the Capital Tax Allocation Account balances of the Members to be the same as they would have been if the restored Ownership Percentage Interest had never been reduced.
(ml) If the Members’ Ownership ' Percentage Interests change during any taxable year of the Company, the distributive share of items of income, gain, loss and deduction of each Member shall be determined in any manner (1) permitted by Section 706 of the Code, and (2) agreed by both Members. If the Members cannot agree on a method, the method shall be determined by the Manager in consultation with Management Team having been advised by the Company’s 's tax advisers, with preference . Preference shall be given to the interim closing-of-of- the-books method except where application of that method would result in undue administrative expense in relationship to the amount of the items to be allocated.
(nm) For purposes of this Paragraph 3.33, items financed through indebtedness of, or from revenues of, the Company shall be treated as funded from contributions made by the Members to the Company in accordance with their Ownership Interests. “Nonrecourse EXHIBIT C deductions,” as defined by Treas. Reg. § 1.704-2(b)(1) shall be allocated between the Members in proportion to their Ownership Percentage Interests.
Appears in 1 contract
Allocations to Members. Allocations Except as provided in Section 11.5(b), allocations for Capital Account tax purposes shall be in accordance with the following:
(a) If the right to take in kind is interpreted to mean only that a Member is authorized to direct the disposition of its share of Products by the Company, all income, gains, losses, deductions or tax attributes realized by the Company from any disposition of Products shall be allocated to such Member, and any deductions arising from expenditures incurred by such Member in connection with such disposition (to the extent they are attributed to the Company) shall also be allocated to such Member. If, pursuant to Section 11.5(b), a Manager purchases a Member's share of Products for its own account, or sells such share of Products, the net profits or losses from such sale (computed after taking into account the reasonable expenses incurred) shall be allocated to the Member.
(b) Exploration expenses and development cost deductions shall be allocated among the Members in accordance with their respective contributions to such expenses and costs.
(bc) Depreciation Subject to Section 11.2(l), depreciation and amortization loss deductions with respect to a depreciable Asset shall be allocated among the Members in accordance with their respective contributions to the adjusted basis of the Asset which gives rise to the depreciation, amortization depreciation or loss deduction.
(cd) Production and operating cost deductions shall be allocated among the Members in accordance with their respective contributions to such costs.
(de) Deductions for Subject to Section 11.2(l), cost depletion and any loss deduction with respect to a depletable property (to the extent as defined in Section 614 of the amount of such deductions that would have been determined for Capital Account purposes if only cost depletion were allowable for federal income tax purposesCode) shall be allocated to the Members in accordance with their respective contributions to the adjusted basis of the depletable property. Any remaining Percentage depletion deductions under Section 613 of the Code shall be allocated (i) first in the same manner as cost depletion to the Members so thatextent it does not exceed cost depletion and (ii) second, to the extent possible, the Members receive the same total amounts of percentage depletion as they would have received if percentage depletion were allocated exceeds cost depletion, to the Members in the same proportion to as their respective shares distributive share of gross income from the depletable property (as determined under Section 613(c) of the gross income used as Code) for the basis for calculating the federal income tax deduction for percentage depletion.
(e) Subject to Subparagraph 3.3(g) below, gross income on the sale of production shall be allocated year in accordance with the Members’ rights to share in the proceeds of which such sale based on the ratio of the Members’ Capital Accounts, during the month the production depletion is sold, prior to Payout and based on the ratio of the Members’ Ownership Interest, during the month of the production is sold, after Payoutallowable.
(f) Except as provided in Subparagraph 3.3(g), below, gain or loss on the sale of a depreciable or depletable asset shall be allocated so that, to the extent possible, the net amount EXHIBIT C reflected in the Members’ Capital Account with respect to such property (taking into account the cost of such property, depreciation, amortization, depletion or other cost recovery deductions and gain or loss) most closely reflects the Members’ Ownership Interests.
(g) Gains and losses on the sale of all or substantially all the Assets of the Company shall be allocated so that, to the extent possible, the Members’ resulting Capital Account balances are in the same ratio as their Ownership Interests at the time of such sale.
(h) The Members acknowledge that expenses and deductions allocable under the preceding provisions of this Paragraph may be required to be capitalized into production under Section 263A of the Code. With respect to such capitalized expenses or deductions, the allocation of gross income on the sale of production shall be adjusted, in any reasonable manner consistently applied by the Manager, so that the same net amount (subject possibly to timing differences) is reflected in the Capital Accounts as if such expenses or deductions were instead deductible and allocated pursuant to the preceding provisions of this Paragraph.
(i) All deductions and losses that which are not otherwise allocated described in this Paragraph Subsections 11.2(a) through (e), shall be allocated among the Members in accordance with their respective contributions to the costs producing each such deduction or to the adjusted basis of the Asset producing each such loss.
(jg) Any recapture Subject to Section 11.2(l), any gain recognized on the sale or other disposition of exploration expenses under Section 617(b)(1)(A) of the Code, and any disallowance of depletion under Section 617(b)(1)(B) of the Code, a depreciable Asset shall be borne by allocated (i) first, to the extent such gain does not exceed the amount of depreciation claimed with respect to such Asset, to the Members in proportion to the same manner as the related exploration expenses were amount of such depreciation previously allocated to, or claimed by, them.
; and (kii) All other items of income and gain shall be allocated second, to the Members in accordance with their Vested UnitsOwnership Interests.
(lh) If a reduced Ownership Interest is restored pursuant Subject to Section 10.6 11.2(l), any gain recognized on the sale or other disposition of the Agreement, the Manager shall endeavor to allocate items of income, gain, loss, and deduction a depletable property (as defined in the same year as the restoration of such Ownership Interest or, if necessary, in subsequent years) so as to cause the Capital Account balances of the Members to be the same as they would have been if the restored Ownership Interest had never been reduced.
(m) If the Members’ Ownership Interests change during any taxable year of the Company, the distributive share of items of income, gain, loss and deduction of each Member shall be determined in any manner (1) permitted by Section 706 614 of the Code) shall be allocated (i) first, to the extent such gain does not exceed the total Recapturable Deductions (as defined below) with respect to such Property, to the Members in proportion to the total Recapturable Deductions previously allocated to, or claimed by, them with respect to such property (adjusted for any recapture of such deductions previously allocated to, or recognized by, the Members), and (2ii) agreed by both Members. If second, to the Members cannot agree on a method, the method shall be determined by the Manager in consultation with the Company’s tax advisers, with preference given to the interim closing-of-the-books method except where application of that method would result in undue administrative expense in relationship to the amount of the items to be allocated.
(n) For purposes of this Paragraph 3.3, items financed through indebtedness of, or from revenues of, the Company shall be treated as funded from contributions made by the Members to the Company in accordance with their Ownership Interests. “Nonrecourse EXHIBIT C As used in the previous sentence, "Recapturable Deductions" shall mean depletion deductions (to the extent reflected in the capital accounts of the Members), exploration expense deductions,” as defined , and development expense deductions attributable to a depletable property, reduced (but not below zero) by Treas. Reg. § 1.704-2(b)(1) shall be allocated between the Members in proportion to their Ownership Interestsany prior recapture of such deductions.
Appears in 1 contract
Samples: Limited Liability Company Agreement (Hecla Mining Co/De/)
Allocations to Members. Allocations for Capital Account purposes shall be in accordance with the following:
(a) Exploration expenses and development cost deductions shall be allocated among the Members in accordance with their respective contributions to such expenses and costs.
(b) Depreciation and amortization deductions with respect to a depreciable Asset shall be allocated among the Members in accordance with their respective contributions to the adjusted basis of the Asset which gives rise to the depreciation, amortization or loss deduction.
(c) Production and operating cost deductions shall be allocated among the Members in accordance with their respective contributions to such costs.
(d) Deductions for depletion (to the extent of the amount of such deductions that would have been determined for Capital Account purposes if only cost depletion were allowable for federal income tax purposes) shall be allocated to the Members in accordance with their respective contributions to the adjusted basis of the depletable property. Any remaining depletion deductions shall be allocated to the Members so that, to the extent possible, the Members receive the same total amounts of percentage depletion as they would have received if percentage depletion were allocated to the Members in proportion to their respective shares of the gross income used as the basis for calculating the federal income tax deduction for percentage depletion.
(e) Subject to Subparagraph 3.3(g) belowof this Exhibit C, gross income on the sale of production Products shall be allocated in accordance with the Members’ ' rights to share in the proceeds of such sale based on the ratio of the Members’ Capital Accounts, during the month the production is sold, prior to Payout and based on the ratio of the Members’ Ownership Interest, during the month of the production is sold, after Payoutsale.
(f) Except as provided in Subparagraph 3.3(g), below) of this Exhibit C, gain or loss on the sale of a depreciable or depletable asset shall be allocated so that, to the extent possible, the net amount EXHIBIT C reflected in the Members’ ' Capital Account with respect to such property (taking into account the cost of such property, depreciation, amortization, depletion or other cost recovery deductions and gain or loss) most closely reflects the Members’ ' respective Ownership Interests.. EXHIBIT C Page 4 of 10
(g) Gains and losses on the sale of all or substantially all of the Assets of the Company shall be allocated so that, that to the extent possible, the Members’ ' resulting Capital Account balances are in the same ratio as their Ownership Interests at the time of such sale.
(h) The Members acknowledge that expenses and deductions allocable under the preceding provisions of this Paragraph 3.3 may be required to be capitalized into production under Section 263A of the Code. With respect to any such capitalized expenses or deductions, the allocation of gross income on the sale of production Products shall be adjusted, adjusted in any reasonable manner consistently applied by the Manager, so that the same net amount (subject possibly to timing differences) is reflected in the Capital Accounts as if such expenses or deductions were instead deductible and allocated pursuant to the preceding provisions of this Paragraph.
(i) All deductions and losses that are not otherwise allocated in this Paragraph 3.3 shall be allocated among the Members in accordance with their respective contributions to the costs producing each such deduction or to the adjusted basis of the Asset producing each such loss.
(j) Any recapture of exploration expenses under Section 617(b)(1)(A617(b) (1) (A) of the Code, and any disallowance of depletion under Section 617(b)(1)(B) of the Code, shall be borne by the Members in the same manner as the related exploration expenses were allocated to, to or claimed by, by them.
(k) All other items of income and gain shall be allocated to the Members in accordance with their Vested Unitsrespective Ownership Interests.
(l) If a reduced Ownership Interest is restored pursuant to Section 10.6 of the LLC Operating Agreement, the Manager shall endeavor to allocate items of income, gain, loss, loss and deduction (in the same year as the restoration of such Ownership Interest or, if necessary, in subsequent years) so as to cause the respective Capital Account balances of the Members to be the same as they would have been if the restored Ownership Interest had never been reduced.
(m) If the Members’ ' respective Ownership Interests change during any taxable year of the Company, the distributive share of items of income, gain, loss and deduction of each Member shall be determined in any manner (1i) permitted by Section 706 of the Code, Code and (2ii) agreed upon by both Members. If the Members cannot agree on upon a method, the method shall be determined by the Manager in consultation with the Company’s 's tax advisers, with preference given to the interim closing-of-the-books method except where application of that method would result in undue administrative expense in relationship to the amount of the items to be allocated.
(n) For purposes of this Paragraph 3.33.3 of this Exhibit C, items financed through indebtedness of, or from revenues of, of the Company shall be treated as funded from contributions made by the Members to the Company in accordance with their respective Ownership Interests. “"Nonrecourse EXHIBIT C deductions,” " as defined by Treas. Reg. § Section 1.704-2(b)(12(b) (1), shall be allocated between the Members in proportion to their respective Ownership Interests.
Appears in 1 contract
Allocations to Members. Allocations for Capital Account purposes shall be in accordance with the following:
(a) a. Exploration expenses and development cost deductions shall be allocated among the Members in accordance with their respective contributions to such expenses and costs.
(b) b. Depreciation and amortization deductions with respect to a depreciable Asset shall be allocated among the Members in accordance with their respective contributions to the adjusted basis of the Asset which gives rise to the depreciation, amortization or loss deduction.
(c) c. Production and operating cost deductions shall be allocated among the Members in accordance with their respective contributions to such costs.
(d) d. Deductions for depletion (to the extent of the amount of such deductions that would have been determined for Capital Account purposes if only cost depletion were allowable for federal income tax purposes) shall be allocated to the Members in accordance with their respective contributions to the adjusted basis of the depletable property. Any remaining depletion deductions shall be allocated to the Members so that, to the extent possible, the Members receive the same total amounts of percentage depletion as they would have received if percentage depletion were allocated to the Members in proportion to their respective shares of the gross income used as the basis for calculating the federal income tax deduction for percentage depletion.
(e) e. Subject to Subparagraph 3.3(g) Section C.3.g. below, gross income on the sale of production shall be allocated in accordance with the Members’ rights to share in the proceeds of such sale based on the ratio of the Members’ Capital Accounts, during the month the production is sold, prior to Payout and based on the ratio of the Members’ Ownership Interest, during the month of the production is sold, after Payoutsale.
(f) f. Except as provided in Subparagraph 3.3(g)Section C.3.g., below, gain or loss on the sale of a depreciable or depletable asset shall be allocated so that, to the extent possible, the net amount EXHIBIT C reflected in the Members’ Capital Account with respect to such property (taking into account the cost of such property, depreciation, amortization, depletion or other cost recovery deductions and gain or loss) most closely reflects the Members’ Ownership Interests.
(g) g. Gains and losses on the sale of all or substantially all the Assets of the Company shall be allocated so that, to the extent possible, the Members’ resulting Capital Account balances are in the same ratio as their Ownership Interests at the time of such sale.
(h) h. The Members acknowledge that expenses and deductions allocable under the preceding provisions of this Paragraph Section may be required to be capitalized into production under Section 263A of the Code. With respect to such capitalized expenses or deductions, the allocation of gross income on the sale of production shall be adjusted, in any reasonable manner consistently applied by the Manager, so that the same net amount (subject possibly to timing differences) is reflected in the Capital Accounts as if such expenses or deductions were instead deductible and allocated pursuant to the preceding provisions of this ParagraphSection.
(i) i. All deductions and losses that are not otherwise allocated in this Paragraph Section shall be allocated among the Members in accordance with their respective contributions to the costs producing each such deduction or to the adjusted basis of the Asset producing each such loss.
(j) j. Any recapture of exploration expenses under Section 617(b)(1)(A) of the Code, and any disallowance of depletion under Section 617(b)(1)(B) of the Code, shall be borne by the Members in the same manner as the related exploration expenses were allocated to, or claimed by, them.
(k) k. All other items of income and gain shall be allocated to the Members in accordance with their Vested UnitsOwnership Interests.
(l) l. If a reduced Ownership Interest is restored pursuant to Section 10.6 of the Agreement, the Manager shall endeavor to allocate items of income, gain, loss, and deduction (in the same year as the restoration of such Ownership Interest or, if necessary, in subsequent years) so as to cause the Capital Account balances of the Members to be the same as they would have been if the restored Ownership Interest had never been reduced.
(m) m. If the Members’ Ownership Interests change during any taxable year of the Company, the distributive share of items of income, gain, loss and deduction of each Member shall be determined in any manner (1) permitted by Section 706 of the Code, and (2) agreed by both Members. If the Members cannot agree on a method, the method shall be determined by the Manager in consultation with the Company’s tax advisers, with preference given to the interim closing-of-the-books method except where application of that method would result in undue administrative expense in relationship to the amount of the items to be allocated.
(n) For purposes of this Paragraph 3.3, items financed through indebtedness of, or from revenues of, the Company shall be treated as funded from contributions made by the Members to the Company in accordance with their Ownership Interests. “Nonrecourse EXHIBIT C deductions,” as defined by Treas. Reg. § 1.704-2(b)(1) shall be allocated between the Members in proportion to their Ownership Interests.)
Appears in 1 contract
Allocations to Members. Allocations for Capital Account purposes shall be in accordance with the following:
(a) Exploration expenses and development cost deductions shall be allocated among the Members in accordance with their respective contributions to such expenses and costs.
(b) Depreciation and amortization deductions with respect to a depreciable Asset shall be allocated among the Members in accordance with their respective contributions to the adjusted basis of the Asset which gives rise to the depreciation, amortization or loss deduction.
(c) Production and operating cost deductions shall be allocated among the Members in accordance with their respective contributions to such costsMembership Interest.
(d) Deductions for depletion (to the extent of the amount of such deductions that would have been determined for Capital Account purposes if only cost depletion were allowable for federal income tax purposes) shall be allocated to the Members in accordance with their respective contributions to the adjusted basis of the depletable property. Any remaining depletion deductions shall be allocated to the Members so that, to the extent possible, the Members receive the same total amounts of percentage depletion as they would have received if percentage depletion were allocated to the Members in proportion to their respective shares of the gross income used as determined by Subparagraph 3.3(e), below, as the basis for calculating the federal income tax deduction for percentage depletion.
(e) Subject to Subparagraph 3.3(g) below, gross income on the sale of production shall be allocated in accordance with the Members’ rights to share in the proceeds of such sale based on the ratio of the Members’ Capital Accounts, during the month the production is sold, prior to Payout and based on the ratio of the Members’ Ownership Interest, during the month of the production is sold, after Payoutrespective Membership Interests.
(f) Except as provided in Subparagraph 3.3(g), ) below, gain or loss on the sale of a depreciable or depletable asset shall be allocated so that, to the extent possible, the net amount EXHIBIT C reflected in the Members’ Capital Account with respect to such property (taking into account the cost of such property, depreciation, amortization, depletion or other cost recovery deductions and gain or loss) most closely reflects the Members’ Ownership Membership Interests.
(g) Gains and losses on the sale of all or substantially all the Assets of the Company shall be allocated so that, to the extent possible, the Members’ resulting Capital Account balances are in the same ratio as their Ownership Membership Interests at the time of such sale.
(h) The Members acknowledge that expenses and deductions allocable under the preceding provisions of this Paragraph may be required to be capitalized into production under Section 263A of the Code. With respect to such capitalized expenses or deductions, the allocation of gross income on the sale of production shall be adjusted, in any reasonable manner consistently applied by the Manager, so that the same net amount (subject possibly to timing differences) is reflected in the Capital Accounts as if such expenses or deductions were instead deductible and allocated pursuant to the preceding provisions of this Paragraph.
(i) All deductions and losses that are not otherwise allocated in this Paragraph shall be allocated among the Members in accordance with their respective contributions to the costs producing each such deduction or to the adjusted basis of the Asset producing each such lossMembership Interests.
(j) Any recapture of exploration expenses under Section 617(b)(1)(A) of the Code, and any disallowance of depletion under Section 617(b)(1)(B) of the Code, shall be borne by the Members in the same manner as the related exploration expenses were allocated to, or claimed by, them.
(k) All other items of income and gain shall be allocated to the Members in accordance with their Vested UnitsMembership Interests.
(l) If a reduced Ownership Membership Interest is restored pursuant to Section 10.6 of the Agreement, the Manager shall endeavor to allocate items of income, gain, loss, and deduction (in the same year as the restoration of such Ownership Membership Interest or, if necessary, in subsequent years) so as to cause the Capital Account balances of the Members to be the same as they would have been if the restored Ownership Membership Interest had never been reduced.
(m) If the Members’ Ownership Membership Interests change during any taxable year of the Company, the distributive share of items of income, gain, loss and deduction of each Member shall be determined in any manner (1) permitted by Section 706 of the Code, and (2) agreed by both Members. If the Members cannot agree on a method, the method shall be determined by the Manager in consultation with the Company’s tax advisers, with preference given to the interim closing-of-the-books method except where application of that method would result in undue administrative expense in relationship to the amount of the items to be allocated.
(n) For purposes of this Paragraph 3.3, items financed through indebtedness of, or from revenues of, the Company shall be treated as funded from contributions made by the Members to the Company in accordance with their Ownership Interests. “Nonrecourse EXHIBIT C deductions,” as defined by Treas. Reg. § 1.704-2(b)(1) shall be allocated between the Members in proportion to their Ownership Interests.)
Appears in 1 contract
Samples: Exploration, Development & Mine Operating Agreement (Crosshair Exploration & Mining Corp)
Allocations to Members. Allocations for Capital Account purposes shall be in accordance with the following:
(a) Exploration expenses and development cost deductions shall be allocated among the Members in accordance with their respective contributions to such expenses and costs.
(b) Depreciation and amortization deductions with respect to a depreciable Asset shall be allocated among the Members in accordance with their respective contributions to the adjusted basis of the Asset which gives rise to the depreciation, amortization or loss deduction.Asset
(c) Production and operating cost deductions shall be allocated among the Members in accordance with their respective contributions to such costs.
(d) Deductions for depletion (to the extent of the amount of such deductions that would have been determined for Capital Account purposes if only cost depletion were allowable for federal income tax purposes) shall be allocated to the Members in accordance with their respective contributions to the adjusted basis of the depletable property. Any remaining depletion deductions shall be allocated to the Members so that, to the extent possible, the Members receive the same total amounts of percentage depletion as they would have received if percentage depletion were allocated to the Members in proportion to their respective shares of the gross income used as the basis for calculating the federal income tax deduction for percentage depletion.
(e) Subject to Subparagraph 3.3(gSUBPARAGRAPH 3.3(G) below, gross income on the sale of production shall be allocated in accordance with the Members’ ' rights to share in the proceeds of such sale based on the ratio of the Members’ Capital Accounts, during the month the production is sold, prior to Payout and based on the ratio of the Members’ Ownership Interest, during the month of the production is sold, after Payoutsale.
(f) Except as provided in Subparagraph 3.3(g), SUBPARAGRAPH 3.3(G) below, gain or loss on the sale of a depreciable or depletable asset shall be allocated so that, to the extent possible, the net amount EXHIBIT C reflected in the Members’ ' Capital Account with respect to such property (taking into account the cost of such property, depreciation, amortization, depletion or other cost recovery deductions and gain or loss) most closely reflects the Members’ ' Ownership Interests.
(g) Gains and losses on the sale of all or substantially all the Assets of the Company shall be allocated so that, to the extent possible, the Members’ ' resulting Capital Account balances are in the same ratio as their Ownership Interests at the time of such sale.
(h) The Members acknowledge that expenses and deductions allocable under the preceding provisions of this Paragraph may be required to be capitalized into production under Section 263A of the Code. With respect to such capitalized expenses or deductions, the allocation of gross income on the sale of production shall be adjusted, in any reasonable manner consistently applied by the Manager, so that the same net amount (subject possibly to timing differences) is reflected in the Capital Accounts as if such expenses or deductions were instead deductible and allocated pursuant to the preceding provisions of this Paragraph.
(i) All deductions and losses that are not otherwise allocated in this Paragraph shall be allocated among the Members in accordance with their respective contributions to the costs producing each such deduction or to the adjusted basis of the Asset producing each such loss.
(j) Any recapture of exploration expenses under Section 617(b)(1)(A) of the Code, and any disallowance of depletion under Section 617(b)(1)(B) of the Code, shall be borne by the Members in the same manner as the related exploration expenses were allocated to, or claimed by, them.
(k) All other items of income and gain shall be allocated to the Members in accordance with their Vested UnitsOwnership Interests.
(l) If a reduced Ownership Interest is restored pursuant to Section SECTION 10.6 of the ------------ Agreement, the Manager shall endeavor to allocate items of income, gain, loss, and deduction (in the same year as the restoration of such Ownership Interest or, if necessary, in subsequent years) so as to cause the Capital Account balances of the Members to be the same as they would have been if the restored Ownership Interest had never been reduced.
(m) If the Members’ ' Ownership Interests change during any taxable year of the Company, the distributive share of items of income, gain, loss and deduction of each Member shall be determined in any manner (1) permitted by Section 706 of the Code, and (2) agreed by both Members. If the Members cannot agree on a method, the method shall be determined by the Manager in consultation with the Company’s tax advisers, with preference given to the interim closing-of-the-books method except where application of that method would result in undue administrative expense in relationship to the amount of the items to be allocated.
(n) For purposes of this Paragraph 3.3, items financed through indebtedness of, or from revenues of, the Company shall be treated as funded from contributions made by the Members to the Company in accordance with their Ownership Interests. “Nonrecourse EXHIBIT C deductions,” as defined by Treas. Reg. § 1.704-2(b)(1) shall be allocated between the Members in proportion to their Ownership Interests.)
Appears in 1 contract
Samples: Members' Agreement (Battle Mountain Gold Exploration Corp.)
Allocations to Members. Allocations Subject to Paragraph 3.4 and Paragraph 3.7, allocations for Capital Account purposes for each fiscal year, or allocation period in such fiscal year, shall be in accordance with the following:
(a) Exploration expenses and development cost deductions shall be allocated among the Members in accordance with their respective contributions Capital Contributions used to fund such expenses and costs.
(b) Depreciation and amortization deductions with respect to a depreciable Asset shall be allocated among the Members in accordance with their respective contributions Capital Contributions of the Asset, to the extent the associated adjusted basis of the Asset which gives rise to the such depreciation, amortization or loss deduction.
(c) Production and operating cost deductions shall be allocated among the Members in accordance with their respective contributions Capital Contributions used to fund such costs.
(d) Deductions for depletion with respect to a depletable Asset (to the extent of the amount of such deductions that would have been determined for the Capital Account purposes if only cost depletion were allowable for federal income tax purposes) shall be allocated to the Members in accordance with their respective contributions Capital Contributions of the Asset, to the extent the associated adjusted basis of the depletable propertyAsset gives rise to such depletion deduction. Any remaining depletion deductions shall be allocated to the Members so that, to the extent possible, the Members receive the same total amounts of percentage depletion as they would have received if percentage depletion were allocated to the Members in proportion to their respective shares of the gross income used as the basis for calculating the federal income tax deduction for percentage depletion.
(e) Subject to Subparagraph 3.3(g) below, gross income on the sale of production productions shall be allocated in accordance with the Members’ respective rights to share in the proceeds of such sale based on the ratio of the Members’ Capital Accounts, during the month the production is sold, prior to Payout and based on the ratio of the Members’ Ownership Interest, during the month of the production is sold, after Payoutsale.
(f) Except as provided in Subparagraph 3.3(g), ) below, gain or loss on the sale of a depreciable or depletable asset (including unrealized gain and loss arising from a revaluation of the Company’s Assets pursuant to made in accordance with Treas. Reg. §1.704-1(b)(2)(iv(f) and (g)) shall be allocated so that, to the extent possible, the net amount EXHIBIT C reflected in the Members’ Capital Account with respect to such property property, (taking into account the cost of such property, depreciation, amortization, depletion or other cost recovery deductions and gain or loss) most closely reflects the Members’ Ownership Member’s Percentage Interests.
(g) Gains and losses on the sale of all or substantially all the Assets of Company (including unrealized gain and loss arising from a revaluation of the Company Company’s Assets pursuant to or made in accordance with Treas. Reg. §1.704-1(b)(2)(iv)(f) and (g)) shall be allocated so that, to the extent possible, the Members’ resulting Capital Account balances are in the same range ratio as their Ownership Percentage Interests at the time tie of such sale.
(h) The Members acknowledge that expenses and deductions allocable under the preceding provisions of this Paragraph may be required to be capitalized into production under Section 263A of the Code. With respect to such capitalized expenses or deductions, the allocation of gross income on the sale of production shall be adjusted, in any reasonable manner consistently applied by the Manager, so that the same net amount (subject possibly to timing differences) is reflected in the Capital Accounts as if such expenses or deductions were instead deductible and allocated pursuant to the preceding provisions of this Paragraph.
(i) All deductions and losses that are not otherwise allocated in this Paragraph shall be allocated among the Members in accordance with their respective contributions to the costs producing each such deduction or to the adjusted basis of the Asset producing each such loss.
(j) Any recapture of exploration expenses under Section 617(b)(1)(A) of the Code, and any disallowance of depletion under Section 617(b)(1)(B) of the Code, shall be borne by the Members in the same manner as the related exploration expenses were allocated to, or claimed by, them.
(j) In the event that any amount claimed by the Company to constitute a deductible expense is treated for applicable tax purposes as a distribution made to a Member in its capacity as a member of the Company (and thus as a partner of a partnership), and not a guaranteed payment as defined in Code Section 707(c) or payment to a partner not acting in its capacity as a partner under Code Section 707(a), the Member who is determined to have received such distribution shall be first allocated an amount of the Company’s gross income equal to such payment and its capital Account shall be reduced to reflect a distribution. In the event that the Company is deemed to have made a payment to any Member as a deductible expense in excess of the amount actually paid to such Member, such Member shall be allocated an amount of the Company’s deductions reflecting such excess amount, and such Member shall be deemed to have made a Capital Contribution to the Company in the amount of such excess amount.
(k) All deductions and losses that are not otherwise allocated above in this Paragraph shall be allocated among the Members in accordance with their respective Capital Contributions used to fund such deductions and losses and, thereafter, pursuant to Section 3.3(l) below.
(l) All other items of income income, gain, loss, and gain deduction shall be allocated to the Members in accordance with their Vested Units.
(l) If a reduced Ownership Interest is restored pursuant to Section 10.6 of the Agreement, the Manager shall endeavor to allocate items of income, gain, loss, and deduction (in the same year as the restoration of such Ownership Interest or, if necessary, in subsequent years) so as to cause the Capital Account balances of the Members to be the same as they would have been if the restored Ownership Interest had never been reducedPercentage Interests.
(m) If the Members’ Ownership Percentage Interests change during any taxable year of the Company, the distributive share of items of income, gain, loss and deduction of each Member shall be determined in any manner (1) permitted by Section 706 of the Code, and (2) agreed on by both Members. If the Members cannot agree on a method, the method shall be determined by the Manager Tax Matters Partner in consultation with the Company’s tax advisers, with preference given to the interim closing-of-the-books method except where application of that method would result in undue administrative expense in relationship to the amount of the items to be allocated.
(n) For purposes of this Paragraph 3.3, items financed through indebtedness of, or from revenues of, the Company shall be treated as funded from contributions made by the Members to the Company in accordance with their Ownership Interests. “Nonrecourse EXHIBIT C deductions,” as defined by Treas. Reg. § 1.704-2(b)(1) shall be allocated between the Members in proportion to their Ownership Percentage Interests.
Appears in 1 contract
Samples: Limited Liability Company Agreement (Contango ORE, Inc.)
Allocations to Members. Allocations for Capital Account purposes shall be in accordance with the following:
(a) a. Exploration expenses and development cost deductions shall be allocated among the Members in accordance with their respective contributions to such expenses and costs.
(b) b. Depreciation and amortization deductions with respect to a depreciable Asset shall be allocated among the Members in accordance with their respective contributions to the adjusted basis of the Asset which gives rise to the depreciation, amortization or loss deduction.
(c) c. Production and operating cost deductions shall be allocated among the Members in accordance with their respective contributions to such costs.
(d) d. Deductions for depletion (to the extent of the amount of such deductions that would have been determined for Capital Account purposes if only cost depletion were allowable for federal income tax purposes) shall be allocated to the Members in accordance with their respective contributions to the adjusted basis of the depletable property. Any remaining depletion deductions shall be allocated to the Members so that, to the extent possible, the Members receive the same total amounts of percentage depletion as they would have received if percentage depletion were allocated to the Members in proportion to their respective shares of the gross income used as the basis for calculating the federal income tax deduction for percentage depletion.
(e) e. Subject to Subparagraph 3.3(g) Section C.3.g. below, gross income on the sale of production shall be allocated in accordance with the Members’ ' rights to share in the proceeds of such sale based on the ratio of the Members’ Capital Accounts, during the month the production is sold, prior to Payout and based on the ratio of the Members’ Ownership Interest, during the month of the production is sold, after Payoutsale.
(f) f. Except as provided in Subparagraph 3.3(g)Section C.3.g., below, gain or loss on the sale of a depreciable or depletable asset shall be allocated so that, to the extent possible, the net amount EXHIBIT C reflected in the Members’ ' Capital Account with respect to such property (taking into account the cost of such property, depreciation, amortization, depletion or other cost recovery deductions and gain or loss) most closely reflects the Members’ ' Ownership Interests.
(g) g. Gains and losses on the sale of all or substantially all the Assets of the Company shall be allocated so that, to the extent possible, the Members’ ' resulting Capital Account balances are in the same ratio as their Ownership Interests at the time of such sale.
(h) h. The Members acknowledge that expenses and deductions allocable under the preceding provisions of this Paragraph Section may be required to be capitalized into production under Section 263A of the Code. With respect to such capitalized expenses or deductions, the allocation of gross income on the sale of production shall be adjusted, in any reasonable manner consistently applied by the Manager, so that the same net amount (subject possibly to timing differences) is reflected in the Capital Accounts as if such expenses or deductions were instead deductible and allocated pursuant to the preceding provisions of this ParagraphSection.
(i) i. All deductions and losses that are not otherwise allocated in this Paragraph Section shall be allocated among the Members in accordance with their respective contributions to the costs producing each such deduction or to the adjusted basis of the Asset producing each such loss.
(j) j. Any recapture of exploration expenses under Section 617(b)(1)(A) of the Code, and any disallowance of depletion under Section 617(b)(1)(B) of the Code, shall be borne by the Members in the same manner as the related exploration expenses were allocated to, or claimed by, them.
(k) k. All other items of income and gain shall be allocated to the Members in accordance with their Vested UnitsOwnership Interests.
(l) 1. If a reduced Ownership Interest is restored pursuant to Section 10.6 of the Agreement, the Manager shall endeavor to allocate items of income, gain, loss, and deduction (in the same year as the restoration of such Ownership Interest or, if necessary, in subsequent years) so as to cause the Capital Account balances of the Members to be the same as they would have been if the restored Ownership Interest had never been reduced.
(m) m. If the Members’ ' Ownership Interests change during any taxable year of the Company, the distributive share of items of income, gain, loss and deduction of each Member shall be determined in any manner (1) permitted by Section 706 of the Code, and (2) agreed by both Members. If the Members cannot agree on a method, the method shall be determined by the Manager in consultation with the Company’s tax advisers, with preference given to the interim closing-of-the-books method except where application of that method would result in undue administrative expense in relationship to the amount of the items to be allocated.
(n) For purposes of this Paragraph 3.3, items financed through indebtedness of, or from revenues of, the Company shall be treated as funded from contributions made by the Members to the Company in accordance with their Ownership Interests. “Nonrecourse EXHIBIT C deductions,” as defined by Treas. Reg. § 1.704-2(b)(1) shall be allocated between the Members in proportion to their Ownership Interests.)
Appears in 1 contract
Allocations to Members. Allocations for Capital Account purposes shall be in accordance with the following:
(a) Exploration expenses and development cost deductions shall be allocated among the Members in accordance with their respective contributions to such expenses and costs.
(b) Depreciation and amortization deductions with respect to a depreciable Asset shall be allocated among the Members in accordance with their respective contributions to the adjusted basis of the Asset which gives rise to the depreciation, amortization or loss deduction.
(c) Production and operating cost deductions shall be allocated among the Members in accordance with their respective contributions to such costs.
(d) Deductions for depletion (to the extent of the amount of such deductions that would have been determined for Capital Account purposes if only cost depletion were allowable for federal income tax purposes) shall be allocated to the Members in accordance with their respective contributions to the adjusted basis of the depletable property. Any remaining depletion deductions shall be allocated to the Members so that, to the extent possible, the Members receive the same total amounts of percentage depletion as they would have received if percentage depletion were allocated to the Members in proportion to their respective shares of the gross income used as the basis for calculating the federal income tax deduction for percentage depletion.
(e) Subject to Subparagraph 3.3(g) belowof this Exhibit C, gross income on the sale of production Products shall be allocated in accordance with the Members’ ' rights to share in the proceeds of such sale based on the ratio of the Members’ Capital Accounts, during the month the production is sold, prior to Payout and based on the ratio of the Members’ Ownership Interest, during the month of the production is sold, after Payoutsale.
(f) Except as provided in Subparagraph 3.3(g), below) of this Exhibit C, gain or loss on the sale of a depreciable or depletable asset shall be allocated so that, to the extent possible, the net amount EXHIBIT C reflected in the Members’ ' Capital Account with respect to such property (taking into account the cost of such property, depreciation, amortization, depletion or other cost recovery deductions and gain or loss) most closely reflects the Members’ ' respective Ownership Interests.
(g) Gains and losses on the sale of all or substantially all of the Assets of the Company shall be allocated so that, that to the extent possible, the Members’ ' resulting Capital Account balances are in the same ratio as their Ownership Interests at the time of such sale.
(h) The Members acknowledge that expenses and deductions allocable under the preceding provisions of this Paragraph 3.3 may be required to be capitalized into production under Section 263A of the Code. With respect to any such capitalized expenses or deductions, the allocation of gross income on the sale of production Products shall be adjusted, adjusted in any reasonable manner consistently applied by the Manager, so that the same net amount (subject possibly to timing differences) is reflected in the Capital Accounts as if such expenses or deductions were instead deductible and allocated pursuant to the preceding provisions of this Paragraph.
(i) All deductions and losses that are not otherwise allocated in this Paragraph 3.3 shall be allocated among the Members in accordance with their respective contributions to the costs producing each such deduction or to the adjusted basis of the Asset producing each such loss.
(j) Any recapture of exploration expenses under Section 617(b)(1)(A617(b) (1) (A) of the Code, and any disallowance of depletion under Section 617(b)(1)(B) of the Code, shall be borne by the Members in the same manner as the related exploration expenses were allocated to, to or claimed by, by them.
(k) All other items of income and gain shall be allocated to the Members in accordance with their Vested Unitsrespective Ownership Interests.
(l) If a reduced Ownership Interest is restored pursuant to Section 10.6 of the LLC Operating Agreement, the Manager shall endeavor to allocate items of income, gain, loss, loss and deduction (in the same year as the restoration of such Ownership Interest or, if necessary, in subsequent years) so as to cause the respective Capital Account balances of the Members to be the same as they would have been if the restored Ownership Interest had never been reduced.
(m) If the Members’ ' respective Ownership Interests change during any taxable year of the Company, the distributive share of items of income, gain, loss and deduction of each Member shall be determined in any manner (1i) permitted by Section 706 of the Code, Code and (2ii) agreed upon by both Members. If the Members cannot agree on upon a method, the method shall be determined by the Manager in consultation with the Company’s 's tax advisers, with preference given to the interim closing-of-the-books method except where application of that method would result in undue administrative expense in relationship to the amount of the items to be allocated.
(n) For purposes of this Paragraph 3.33.3 of this Exhibit C, items financed through indebtedness of, or from revenues of, of the Company shall be treated as funded from contributions made by the Members to the Company in accordance with their respective Ownership Interests. “"Nonrecourse EXHIBIT C deductions,” " as defined by Treas. Reg. § Section 1.704-2(b)(12(b) (1), shall be allocated between the Members in proportion to their respective Ownership Interests.
Appears in 1 contract
Samples: Limited Liability Company Operating Agreement (Uranium Energy Corp)
Allocations to Members. Allocations for Capital Account purposes shall be in accordance with the followinginitial Ownership Interest specified in Article II and that these allocations cannot change without unanimous agreement between the Members, except as provided in Article II:
(a) a. Exploration expenses and development cost deductions shall be allocated among the Members in accordance with their respective contributions to such expenses and costs.
(b) b. Depreciation and amortization deductions with respect to a depreciable Asset shall be allocated among the Members in accordance with their respective contributions to the adjusted basis of the Asset which gives rise to the depreciation, amortization or loss deduction.
(c) c. Production and operating cost deductions deductions, if any, shall be allocated among the Members in accordance with their respective contributions to such costs.
(d) d. Deductions for depletion (to the extent of the amount of such deductions that would have been determined for Capital Account purposes if only cost depletion were allowable for federal income tax purposes) shall be allocated to the Members in accordance with their respective contributions to the adjusted basis of the depletable property. Any remaining depletion deductions shall be allocated to the Members so that, to the extent possible, the Members receive the same total amounts of percentage depletion as they would have received if percentage depletion were allocated to the Members in proportion to their respective shares of the gross income used as the basis for calculating the federal income tax deduction for percentage depletiondepletion (i.e. Ownership Interest).
(e) e. Subject to Subparagraph 3.3(g) Section C.3.g. below, gross income income, if any, on the sale of production shall be allocated in accordance with the Members’ rights to share in the proceeds of such sale based on the ratio of the Members’ Capital Accounts, during the month the production is sold, prior to Payout and based on the ratio of the Members’ Ownership Interest, during the month of the production is sold, after Payoutsale.
(f) f. Except as provided in Subparagraph 3.3(g)Section C.3.g., below, gain or loss on the sale of a depreciable or depletable asset Asset shall be allocated so that, to the extent possible, the net amount EXHIBIT C reflected in the Members’ Capital Account Accounts with respect to such property (taking into account the cost of such property, depreciation, amortization, depletion or other cost recovery deductions and gain or loss) most closely reflects the Members’ Ownership Interests.
(g) g. Gains and losses on the sale of all or substantially all the Assets of the Company shall be allocated so that, to the extent possible, the Members’ resulting Capital Account balances are in the same ratio as their Ownership Interests at the time of such sale.
(h) h. The Members acknowledge that expenses and deductions allocable under the preceding provisions of this Paragraph Section may be required to be capitalized into production under Section 263A of the Code. With respect to such capitalized expenses or deductions, the allocation of gross income on the sale of production shall be adjusted, in any reasonable manner consistently applied by the Manager, so that the same net amount (subject possibly to timing differences) is reflected in the Capital Accounts as if such expenses or deductions were instead deductible and allocated pursuant to the preceding provisions of this ParagraphSection.
(i) i. All deductions and losses that are not otherwise allocated in this Paragraph Section shall be allocated among the Members in accordance with their respective contributions to the costs producing each such deduction or to the adjusted basis of the Asset producing each such loss.
(j) j. Any recapture of exploration expenses under Section 617(b)(1)(A) of the Code, and any disallowance of depletion under Section 617(b)(1)(B) of the Code, shall be borne by the Members in the same manner as the related exploration expenses were allocated to, or claimed by, them.
(k) k. All other items of income and gain shall be allocated to the Members in accordance with their Vested UnitsOwnership Interests.
(l) l. If a reduced Ownership Interest is restored pursuant to Section 10.6 a reversal or revision of the Agreementa change in Ownership Interest under Article II, the Manager TMP shall endeavor to allocate items of income, gain, loss, and deduction (in the same year as the restoration of such Ownership Interest or, if necessary, in subsequent years) so as to cause the Capital Account balances of the Members to be the same as they would have been if the restored Ownership Interest had never been reduced.
(m) m. If the Members’ Ownership Interests change during any taxable year of the Company, the distributive share of items of income, gain, loss and deduction of each Member shall be determined in any manner (1) permitted by Section 706 of the Code, and (2) agreed by both Members. If the Members cannot agree on a method, the method shall be determined by the Manager in consultation with the Company’s tax advisers, with preference given to the interim closing-of-the-books method except where application of that method would result in undue administrative expense in relationship to the amount of the items to be allocated.
(n) For purposes of this Paragraph 3.3, items financed through indebtedness of, or from revenues of, the Company shall be treated as funded from contributions made by the Members to the Company in accordance with their Ownership Interests. “Nonrecourse EXHIBIT C deductions,” as defined by Treas. Reg. § 1.704-2(b)(1) shall be allocated between the Members in proportion to their Ownership Interests.)
Appears in 1 contract
Samples: Operating Agreement (Golden Phoenix Minerals Inc /Mn/)
Allocations to Members. Allocations for Capital Account purposes shall be in accordance with the following:
(a) Exploration expenses and development cost deductions shall be allocated among the Members in accordance with their respective contributions to such expenses and costs.
(b) Depreciation and amortization deductions with respect to a depreciable Asset shall be allocated among the Members in accordance with their respective contributions to the adjusted basis of the Asset which gives rise to the depreciation, amortization or loss deduction.
(c) Production and operating cost deductions shall be allocated among the Members in accordance with their respective contributions to such costs.
(d) Deductions for depletion (to the extent of the amount of such deductions that would have been determined for Capital Account purposes if only cost depletion were allowable for federal income tax purposes) shall be allocated to the Members in accordance with their respective contributions to the adjusted basis of the depletable property. Any remaining depletion deductions shall be allocated to the Members so that, to the extent possible, the Members receive the same total amounts of percentage depletion as they would have received if percentage depletion were allocated to the Members in proportion to their respective shares of the gross income used as the basis for calculating the federal income tax deduction for percentage depletion.
(e) Subject to Subparagraph 3.3(g) below, gross income on the sale of production shall be allocated in accordance with the Members’ rights to share in the proceeds of such sale based on the ratio of the Members’ Capital Accounts, during the month the production is sold, prior to Payout and based on the ratio of the Members’ Ownership Interest, during the month of the production is sold, after Payoutsale.
(f) Except as provided in Subparagraph 3.3(g), below, gain or loss on the sale of a depreciable or depletable asset shall be allocated so that, to the extent possible, the net amount EXHIBIT C reflected in the Members’ Capital Account with respect to such property (taking into account the cost of such property, depreciation, amortization, depletion or other cost recovery deductions and gain or loss) most closely reflects the Members’ Ownership Interests.
(g) Gains and losses on the sale of all or substantially all the Properties and Assets of the Company shall be allocated so that, to the extent possible, the Members’ resulting Capital Account balances are in the same ratio as their Ownership Interests at the time of such sale.
(h) The Members acknowledge that expenses and deductions allocable under the preceding provisions of this Paragraph may be required to be capitalized into production under Section 263A of the Code. With respect to such capitalized expenses or deductions, the allocation of gross income on the sale of production shall be adjusted, in any reasonable manner consistently applied by the Manager, so that the same net amount (subject possibly to timing differences) is reflected in the Capital Accounts as if such expenses or deductions were instead deductible and allocated pursuant to the preceding provisions of this Paragraph.
(i) All deductions and losses that are not otherwise allocated in this Paragraph shall be allocated among the Members in accordance with their respective contributions to the costs producing each such deduction or to the adjusted basis of the Asset producing each such loss.
(j) Any recapture of exploration expenses under Section 617(b)(1)(A) of the Code, and any disallowance of depletion under Section 617(b)(1)(B) of the Code, shall be borne by the Members in the same manner as the related exploration expenses were allocated to, or claimed by, them.
(k) All other items of income and gain shall be allocated to the Members in accordance with their Vested UnitsOwnership Interests.
(l) If a reduced Ownership Interest is restored pursuant to Section 10.6 of the Agreement, the Manager shall endeavor to allocate items of income, gain, loss, and deduction (in the same year as the restoration of such Ownership Interest or, if necessary, in subsequent years) so as to cause the Capital Account balances of the Members to be the same as they would have been if the restored Ownership Interest had never been reduced.
(m) If the Members’ Ownership Interests change during any taxable year of the Company, the distributive share of items of income, gain, loss and deduction of each Member shall be determined in any manner (1) permitted by Section 706 of the Code, and (2) agreed by both Members. If the Members cannot agree on a method, the method shall be determined by the Manager in consultation with the Company’s tax advisers, with preference given to the interim closing-of-the-books method except where application of that method would result in undue administrative expense in relationship to the amount of the items to be allocated.
(n) For purposes of this Paragraph 3.3, items financed through indebtedness of, or from revenues of, the Company shall be treated as funded from contributions made by the Members to the Company in accordance with their Ownership Interests. “Nonrecourse EXHIBIT C deductions,” as defined by Treas. Reg. § 1.704-2(b)(1) shall be allocated between the Members in proportion to their Ownership Interests.
Appears in 1 contract
