Common use of Distributions upon Termination Clause in Contracts

Distributions upon Termination. Upon termination of the provisions of this Attachment pursuant to paragraph 3 above, the activities of the parties under this Attachment shall be concluded and the assets subject to the Agreement and this Attachment shall be distributed to the parties in the manner and in the order set forth below: (a) Debts of the parties created pursuant to operations under the Agreement, other than to the parties, shall be paid. (b) Debts owed among the parties with respect to operations pursuant to the Agreement shall be paid. (c) All cash on hand representing unexpended contributions by any party shall be returned to the contributor. (d) The parties' capital accounts shall be adjusted by (i) assuming the sale of all remaining assets subject to the Agreement for cash at their respective fair market values as of the date of termination of the Agreement and (ii) debiting or crediting each party's capital account with the party's respective share of the hypothetical gains or losses resulting from such assumed sales in the same manner as such party's capital account would be debited or credited under subparagraph (b) of paragraph 4 for gains or losses on actual dispositions of such properties. (e) If the capital account of any party (stated as a percentage of the aggregate capital accounts of all parties) is less than that party's undivided interest in Leases owned by the Participants, as set forth in Section 2(a) of the Agreement, then such party may elect, upon ten days notice to the other parties, to contribute cash to the tax partnership for distribution to the other parties in an amount sufficient to cause such contributing party's capital account (stated as a percentage of the aggregate capital accounts of all parties) and its undivided interest in Leases owned by the Participants, as set forth in Section 2(a) of the Agreement, to be equal. (f) Thereafter, all remaining assets shall be distributed to the parties by the later of (i) the end of the tax partnership taxable year in which the termination occurs or (ii) 90 days after the date of such termination, in accordance with their respective capital account balances as so adjusted; provided, however that any party that has a capital account of less than zero after taking into account the adjustments and distributions provided for pursuant to and in the subparagraphs of this paragraph 9 shall contribute an amount of cash to the tax partnership sufficient to cause its capital account to have a zero balance by the later of (i) the end of the tax partnership taxable year in which the termination occurs or (ii) 90 days after the date of such termination. Any such contributions by parties having deficit capital account balances shall be distributed to the remaining parties in accordance with their respective positive capital account balances by the later of (i) the end of the tax partnership taxable year in which the termination occurs or (ii) 90 days after the date of such termination. If property subject to the Agreement is distributed pursuant to this paragraph, the amount of the distribution shall be equal to the fair market value of the distributed property. In the event the parties do not agree as to the fair market value of such property, the Program Manager shall cause a qualified independent petroleum engineer to prepare an evaluation of the fair market value of such property. It is understood and agreed that it shall be the obligation of each party to make such assignments as are required upon termination of the provisions of this Attachment in accordance with the provisions of this paragraph 9. Such assignments shall be made subject to the liability of each assignee for costs, expenses and liabilities theretofore incurred or for which commitment had been made by the Program Manager prior to the date of termination and such costs, expenses and liabilities shall be allocated to such assignee pursuant to this Attachment.

Distributions upon Termination. Upon termination of the provisions of this Attachment pursuant to paragraph 3 above, the activities of the parties under this Attachment shall be concluded and the assets subject to the Agreement and this Attachment shall be distributed to the parties in the manner and in the order set forth below: (a) Debts of the parties created pursuant to operations under the Agreement, other than to the parties, shall be paid. (b) Debts owed among the parties with respect to operations pursuant to the Agreement shall be paid. (c) All cash on hand representing unexpended contributions by any party shall be returned to the contributor. (d) The parties' ’ capital accounts shall be adjusted by (i) assuming the sale of all remaining assets subject to the Agreement for cash at their respective fair market values as of the date of termination of the Agreement and (ii) debiting or crediting each party's ’s capital account with the party's ’s respective share of the hypothetical gains or losses resulting from such assumed sales in the same manner as such party's ’s capital account would be debited or credited under subparagraph (b) of paragraph 4 for gains or losses on actual dispositions of such properties. (e) If the capital account of any party (stated as a percentage of the aggregate capital accounts of all parties) is less than that party's ’s undivided interest in Leases owned by the Participants, as set forth in Section 2(a) of the Agreement, then such party may elect, upon ten days notice to the other parties, to contribute cash to the tax partnership for distribution to the other parties in an amount sufficient to cause such contributing party's ’s capital account (stated as a percentage of the aggregate capital accounts of all parties) and its undivided interest in Leases owned by the Participants, as set forth in Section 2(a) of the Agreement, to be equal. (f) Thereafter, all remaining assets shall be distributed to the parties by the later of (i) the end of the tax partnership taxable year in which the termination occurs or (ii) 90 days after the date of such termination, in accordance with their respective capital account balances as so adjusted; provided, however that any party that has a capital account of less than zero after taking into account the adjustments and distributions provided for pursuant to and in the subparagraphs of this paragraph 9 shall contribute an amount of cash to the tax partnership sufficient to cause its capital account to have a zero balance by the later of (i) the end of the tax partnership taxable year in which the termination occurs or (ii) 90 days after the date of such termination. Any such contributions by parties having deficit capital account balances shall be distributed to the remaining parties in accordance with their respective positive capital account balances by the later of (i) the end of the tax partnership taxable year in which the termination occurs or (ii) 90 days after the date of such termination. If property subject to the Agreement is distributed pursuant to this paragraph, the amount of the distribution shall be equal to the fair market value of the distributed property. In the event the parties do not agree as to the fair market value of such property, the Program Manager shall cause a qualified independent petroleum engineer to prepare an evaluation of the fair market value of such property. It is understood and agreed that it shall be the obligation of each party to make such assignments as are required upon termination of the provisions of this Attachment in accordance with the provisions of this paragraph 9. Such assignments shall be made subject to the liability of each assignee for costs, expenses and liabilities theretofore incurred or for which commitment had been made by the Program Manager prior to the date of termination and such costs, expenses and liabilities shall be allocated to such assignee pursuant to this Attachment.

Distributions upon Termination. Upon termination of the provisions of this Attachment pursuant to paragraph 3 above, the activities of the parties under this Attachment shall be concluded and the assets subject to the Agreement and this Attachment shall be distributed to the parties in the manner and in the order set forth below: (a) Debts of the parties created pursuant to operations under the Agreement, other than to the parties, shall be paid. (b) Debts owed among the parties with respect to operations pursuant to the Agreement shall be paid. (c) All cash on hand representing unexpended contributions by any party shall be returned to the contributor. (d) The parties' capital accounts shall be adjusted by (i) assuming the sale of all remaining assets subject to the Agreement for cash at their respective fair market values as of the date of termination of the Agreement and (ii) debiting or crediting each party's capital account with the party's respective share of the hypothetical gains or losses resulting from such assumed sales in the same manner as such party's capital account would be debited or credited under subparagraph (b) of paragraph 4 for gains or losses on actual dispositions of such properties. (e) If the capital account of any party (stated as a percentage of the aggregate capital accounts of all parties) is less than that party's undivided interest in Leases owned by the Participants, as set forth in Section 2(a) of the Agreement, then such party may elect, upon ten days notice to the other parties, to contribute cash to the tax partnership for distribution to the other parties in an amount sufficient to cause such contributing party's capital account (stated as a percentage of the aggregate capital accounts of all parties) and its undivided interest in Leases owned by the Participants, as set forth in Section 2(a) of the Agreement, to be equal. (f) Thereafter, all remaining assets shall be distributed to the parties by the later of (i) the i)the end of the tax partnership taxable year in which the termination occurs or (ii) 90 days after the date of such termination, in accordance with their respective capital account balances as so adjusted; provided, however that any party that has a capital account of less than zero after taking into account the adjustments and distributions provided for pursuant to and in the subparagraphs of this paragraph 9 shall contribute an amount of cash to the tax partnership sufficient to cause its capital account to have a zero balance by the later of (i) the end of the tax partnership taxable year in which the termination occurs or (ii) 90 days after the date of such termination. Any such contributions by parties having deficit capital account balances shall be distributed to the remaining parties in accordance with their respective positive capital account balances by the later of (i) the end of the tax partnership taxable year in which the termination occurs or (ii) 90 days after the date of such termination. If property subject to the Agreement is distributed pursuant to this paragraph, the amount of the distribution shall be equal to the fair market value of the distributed property. In the event the parties do not agree as to the fair market value of such property, the Program Manager shall cause a qualified independent petroleum engineer to prepare an evaluation of the fair market value of such property. It is understood and agreed that it shall be the obligation of each party to make such assignments as are required upon termination of the provisions of this Attachment in accordance with the provisions of this paragraph 9. Such assignments shall be made subject to the liability of each assignee for costs, expenses and liabilities theretofore incurred or for which commitment had been made by the Program Manager prior to the date of termination and such costs, expenses and liabilities shall be allocated to such assignee pursuant to this Attachment.