Capital Account Maintenance. The Partnership shall maintain a separate Capital Account (the “Capital Account”) for each Partner. The Capital Account of each Partner shall be credited with the cash and the fair market value of any property (net of liabilities assumed by the Partnership and liabilities to which such property is subject) contributed to the Partnership by such Partner, plus all income, gain, or Profits of the Partnership allocated to such Partner pursuant to Section 7.2 of this Agreement (including for purposes of this Section income and gain exempt from tax), and shall be debited by the sum of all Losses or deductions of the Partnership allocated to such Partner pursuant to Section 7.2 of this Agreement, such Partner’s distributive share of expenditures of the Partnership described in Section 705(a)(2)(B) of the Code and expenditures treated as such pursuant to Treasury Regulations Section 1.704- l(b)(2)(iv)(i) and all cash and the fair market value of any property (net of liabilities assumed by the Partner and the liabilities to which such property is subject) distributed by the Partnership to such Partner pursuant to Sections 7.1 and 13.2 of this Agreement. The computation of the amount of the Capital Account of a Partner shall be determined in all events solely in accordance with the rules set forth in Treasury Regulations Section 1.704-l(b)(2)(iv), as it now exists and may be amended, and, in the event that the treatment called for in such regulation is inconsistent with the provisions of this Agreement, the rules of the aforementioned regulation shall control. Any reference in any section of this Agreement to the Capital Account of a Partner shall be deemed to refer to such Capital Account as the same may be credited or debited from time to time as set forth above.
(a) The Capital Accounts of all Partners shall be adjusted at such time as the Book Values (as hereinafter defined) of Partnership properties are adjusted, the amount of such adjustment to Capital Accounts being computed as if the aggregate net adjustment to such Book Values had resulted from the recognition of gain or loss by the Partnership in an amount equal to the amount of such net adjustment.
(b) The Book Value of any Partnership property shall be the adjusted basis of such property for federal income tax purposes, subject to the following modifications:
(i) The Book Value of property contributed by a Partner to the Partnership shall be the gross fair market value of such property as reasonably dete...
Capital Account Maintenance. A separate “Capital Account” shall be maintained for each Member under Section 18.2 for the full term of this Agreement in accordance with the requirements of Section 704(b) of the Code and the Treasury Regulations thereunder. A Member’s Capital Account shall be determined as provided in Section 18.2.
Capital Account Maintenance. An individual Capital Account shall be established and maintained by the Partnership for each Unit Holder in accordance with the applicable provisions of the Regulations.
(a) The Capital Account of each Unit Holder shall be credited with (i) an amount equal to such Unit Holder or predecessor Partner’s Capital Contributions including the amount of any cash contributed and the fair market value of property contributed to the Partnership by such Unit Holder or predecessor Partner, (ii) such Unit Holder’s allocable share of the Partnership’s items of income and gain, (iii) the amount of any Partnership liabilities assumed by such Unit Holder or that are secured by property distributed to such Unit Holder, and (iv) any other item of income or gain, including simulated gain, allocated to it pursuant to this Agreement.
(b) The Capital Account of each Unit Holder shall be debited by (i) the amount of cash and the fair value of property distributed to such Unit Holder, (ii) such Unit Holder’s allocable share of the Partnership’s items of loss and deduction, (iii) the amount of any liabilities of such Unit Holder assumed by the Partnership or that are secured by any property contributed by such Unit Holder to the Partnership, and (iv) any other item of loss or deduction, including simulated depletion and simulated loss, allocated to it pursuant to this Agreement.
(c) In addition, for purposes of computing the Capital Accounts of the Unit Holders only: (i) the Unit Holders will be allocated a share of the Partnership’s adjusted tax basis in the Partnership’s oil and gas properties in the proportion each Unit Holder’s Capital Contribution bears to the aggregate Capital Contributions of all Unit Holders holding any class of Units (notwithstanding the foregoing, the Unit Holders shall at all times be allocated those percentages of such adjusted tax basis as is necessary to insure that subsequent adjustments to each Unit Holder’s Capital Account for allocations of simulated depletion, simulated gain, and simulated loss do not lack substantial economic effect for purposes of Section 704(b) of the Code); (ii) the Unit Holders will be allocated simulated depletion, based upon cost or percentage depletion as the Managing Partner may elect, in the same percentages as the adjusted tax basis of the oil and gas properties is allocated, but not in excess of such adjusted tax basis, and the Unit Holders will be allocated simulated loss in proportion to each Unit Holder’s distribut...
Capital Account Maintenance. The method by which the Capital Accounts are maintained is intended to comply with Section 704(b) of the Code and the Treasury Regulations thereunder and shall be interpreted and applied in a manner consistent therewith.
Capital Account Maintenance. (a) The Company will maintain the Capital Accounts in accordance with Treasury Regulation 1.704-1(b)(2)(iv).
(b) If the Company liquidates itself or a Member’s Membership interest, the Company will make liquidating distributions in accordance with Article XIII.
(c) A Member is not liable to fund any deficit in the Member’s Capital Account at any time. Notwithstanding any other provision in this Agreement, if a member unexpectedly receives an adjustment, allocation or distribution described in Treasury Regulation 1.704- 1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5), or 1.704-1(b)(2)(ii)(d)(6), and the unexpected adjustment allocation, or distribution results in a deficit balance in the Capital Account for the member, the member will be allocated items of income and gain in an amount and manner sufficient to eliminate the deficit balance or the increase in the deficit balance as quickly as possible. It is intended that this subdivision will meet the requirements of a “qualified income offset” as defined in Treasury Regulation 1.704-1(b)(2)(ii)(d), and this subdivision is to be interpreted and applied consistent with that intention.
(d) If a Member’s Capital Account has a deficit balance at any time and the deficit or increase in deficit was caused by the allocation of nonrecourse deductions as defined in Treasury Regulation 1.704-2(b), then beginning in the first taxable year of the Company in which there are nonrecourse deductions or in which the Company makes a distribution of proceeds of a nonrecourse liability that are allocable to an increase in minimum gain as defined in Treasury Regulation 1.704-2(d) and thereafter throughout the full term of the Company, the following rules shall apply:
(i) Nonrecourse deductions shall be allocated to the Members in a manner that is reasonably consistent with the allocations that have substantial economic effect as defined in Treasury Regulation 1.704-1 or some other significant item attributable to the property securing the nonrecourse liabilities, if applicable; and
(ii) If there is a net decrease in minimum gain for a taxable year, each member will be allocated items of Company income and gain for that year equal to that Member’s share of the net decrease in minimum gain as defined in Treasury Regulation 1.704-2(g)(2).
Capital Account Maintenance. The Company shall maintain for each Shareholder (or a beneficial owner of Member Interests held by a nominee in any case in which the nominee has furnished the identity of such owner to the Company in accordance with Section 6031(c) of the Code or any other method acceptable to the Board of Directors in its sole discretion) a separate Capital Account in accordance with the rules of Treasury Regulation Section 1.704-1(b)(2)(iv). Such Capital Account shall be increased by (i) the amount of all Capital Contributions made by such Shareholder to the Company and (ii) that portion of the Company's Net Income allocated to such Shareholder under Section 9.5 and all items of income and gain specially allocated to such Shareholder under Section 9.6, and decreased by (x) the amount of cash or Net Agreed Value of all actual and deemed distributions of cash or property made to such Shareholder pursuant to this Agreement and (y) that portion of the Company's Net Loss allocated to such Shareholder under Section 9.5 and all items of Company deduction and loss specially allocated to such Shareholder under Section 9.6.
Capital Account Maintenance. The Company shall establish and maintain for each Member a separate capital account (a “Capital Account”) on its books and records in accordance with Section 704(b) of the Code and Section 1.704-1(b)(2)(iv) of the Regulations and in accordance with such other provisions of Section 1.704-1(b) of the Regulations that must be complied with in order for the Capital Accounts to be determined in accordance with the provisions of such Regulations. In furtherance of the foregoing, the Capital Accounts shall be maintained in compliance with Section 1.704-1(b)(2)(iv) of the Regulations, and the provisions hereof shall be interpreted and applied in a manner consistent therewith.
Capital Account Maintenance. 11 3.4 Withdrawals. . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Capital Account Maintenance. (a) A Capital Account shall be --------------------------- established for each Partner on the books of the Partnership, which account, shall be maintained in accordance with the provisions of Treasury Regulation Section 1.704-1(b)(2)(iv) and, to the extent not in conflict with such Regulations, this Paragraph 4.01(a). As to a Limited Partner, the Capital Account shall be initially equal to the capital contribution, if any, of such Limited Partner and, as to a General Partner, shall be initially equal to zero and thereafter, in each case, shall be increased by (i) additional cash contributions, if any, made by the Partner to the Partnership, (ii) the fair market value of any property contributed by the Partner to the Partnership (net of any liability considered to be assumed by the Partnership pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(c) and any liability to which such property is subject); and (iii) the amount of any income or gain allocated to the Partner pursuant to Paragraph 4.02 and decreased by (i) the amount of any distributions of cash made to the Partner, (ii) the fair market value of any property distributed by the Partnership to the Partner (net of any liability considered to be assumed by the Partner pursuant to Treasury Regulation Section 1.701- 1(b)(2)(iv)(c) and any liability to which such property is subject), (iii) the amount of any losses or deduction allocated to the Partner pursuant to Paragraph 4.02 and, (iv) the amount of any allocation to the Partner of expenditures of the Partnership (as described in Section 705(a)(2)(B) of the Code).
(b) For purposes of computing the amount of any item of income, gain, deduction or loss to be reflected in the Partners' Capital Accounts, the determination, recognition and classification of any such item shall be the same as its determination, recognition and classification for federal income tax purposes; provided, however, that:
(i) Capital Accounts shall be adjusted for Simulated Depletion Allowance. Any Simulated Depletion Allowance deductions attributable to a separate oil and gas property (as defined in Section 614 of the Code) shall be computed by the Partnership using cost depletion. The Simulated Depletion Allowance determined with respect to an oil and gas property shall, in the aggregate, reduce the Capital Accounts of the Partners only to the extent of the Partnership's Simulated Basis with respect to such property. The allocations of basis, depletion deductions and amount...
