Common use of Member's Capital Accounts Clause in Contracts

Member's Capital Accounts. a. The Company will maintain a separate capital account for each Member. Each Member’s capital account will reflect the Member’s capital contributions and increases for the Member’s share of any net income or gain of the Company. Each Member’s capital account will also reflect decreases for distributions made to the Member and the Member’s share of any losses and deductions of the Company. b. Each Member’s capital account will be increased by: 1) the amount of money or the fair market value of property contributed by the Member to the Company (net of any liabilities secured by such contributed property that the Company is considered to assume or take subject to), 2) the amount of any Company liabilities assumed by the Member, and 3) allocations to the Member of profit, income or gain. c. Each Member’s capital account will be decreased by: 1) the amount of money and the fair market value of property distributed to the Member by the Company (net of any liabilities secured by such distributed property that the Member is considered to assume or take subject to), and 2) allocations to the Member of losses, deductions, and expenses. d. In the event of a permitted sale or exchange of an interest in the Company, the capital account of the transferor will become the capital account of the transferee. e. The manner in which capital accounts are to be maintained pursuant to this Operating Agreement is intended to comply with the requirements of Internal Revenue Code Sec. 704(b) and the regulations thereunder. It is the specific intent of the Members that all adjustments as may be required pursuant to Section 704 and any regulations thereunder be made, so as to cause the allocations prescribed hereunder to be respected for tax purposes. f. The fiscal year of the Company will be a calendar year. The books and records of the Company will be maintained in accordance with generally accepted accounting principles and Section 704(b) of the Internal Revenue Code and the regulations thereunder.

Member's Capital Accounts. a. The Company will maintain a separate capital account for each Member. Each Member’s 's capital account will reflect the Member’s 's capital contributions and increases for the Member’s 's share of any net income or gain of the Company. Each Member’s 's capital account will also reflect decreases for distributions made to the Member and the Member’s 's share of any losses and deductions of the Company. b. Each Member’s 's capital account will be increased by: 1) the amount of money or the fair market value of property contributed by the Member to the Company (net of any liabilities secured by such contributed property that the Company is considered to assume or take subject to), 2) the amount of any Company liabilities assumed by the Member, and 3) allocations to the Member of profit, income or gain. c. Each Member’s 's capital account will be decreased by: 1) the amount of money and the fair market value of property distributed to the Member by the Company (net of any liabilities secured by such distributed property that the Member is considered to assume or take subject to), and 2) allocations to the Member of losses, deductions, and expenses. d. In the event of a permitted sale or exchange of an interest in the Company, the capital account of the transferor will become the capital account of the transferee. e. The manner in which capital accounts are to be maintained pursuant to this Operating Agreement is intended to comply with the requirements of Internal Revenue Code Sec. 704(b) and the regulations thereunder. It is the specific intent of the Members that all adjustments as may be required pursuant to Section 704 and any regulations thereunder be made, so as to cause the allocations prescribed hereunder to be respected for tax purposes. f. The fiscal year of the Company will be a calendar year. The books and records of the Company will be maintained in accordance with generally accepted accounting principles and Section 704(b) of the Internal Revenue Code and the regulations thereunder.