Common use of Limit on Allocation of Losses Clause in Contracts

Limit on Allocation of Losses. Notwithstanding anything to the contrary in Section 18.3, Losses allocated pursuant to Section 18.3 shall not exceed the maximum amount that can be so allocated without causing any Member to have an Adjusted Capital Account Deficit at the end of any allocation period. In the event that some but not all of the Members would have Adjusted Capital Account Deficits as a consequence of an allocation pursuant to Section 18.3, the limitation set forth in this Section 18.5.1 shall be applied on a Member-by-Member basis so as to allocate the maximum permissible Losses to each Member under Treasury Regulations Section 1.704-1(b)(2)(ii)(d).