Common use of Nonrecourse Debt Clause in Contracts

Nonrecourse Debt. (a) Except as otherwise provided in Treasury Regulations section 1.704-2(f), if there is a net decrease in Partnership Minimum Gain during any Period, each Member shall be specially allocated items of Company income and gain for such period (and, if necessary, subsequent periods) in proportion to, and to the extent of, an amount equal to the portion of such Member’s share of the net decrease in Partnership Minimum Gain, determined in accordance with Treasury Regulations section 1.704-2(g). This Section 8.7(a) is intended to comply with the chargeback of items of income and gain requirement in Treasury Regulations section 1.704-2(f) and shall be interpreted consistently therewith. (b) Except as otherwise provided in Treasury Regulations section 1.704-2(i), if there is a net decrease in Minimum Gain Attributable to Partner Nonrecourse Debt during any Period, each Member with a share of Minimum Gain Attributable to Partner Nonrecourse Debt shall be specially allocated items of Company income and gain for such Period (and, if necessary, subsequent periods) in proportion to, and to the extent of, an amount equal to the portion of such Member’s share of the net decrease in the Minimum Gain Attributable to Partner Nonrecourse Debt, determined in accordance with Treasury Regulations section 1.704-2(i)(4). This Section 8.7(b) is intended to comply with the chargeback of items of income and gain requirement in Treasury Regulations section 1.704-2(i)(4) and shall be interpreted consistently therewith. (c) Nonrecourse Deductions for any Period shall be allocated to the Members in proportion to their respective Percentage Interests in accordance with Treasury Regulations section 1.704-2(b)(1). (d) Partner Nonrecourse Deductions for any Period shall be allocated 100% to the Member that bears the economic risk of loss (as defined in Treasury Regulations section 1.704-2(b)) with respect to the Partner Nonrecourse Debt to which such Partner Nonrecourse Deductions are attributable in accordance with Treasury Regulations section 1.704-2(i). If more than one Member bears the economic risk of loss with respect to a Partner Nonrecourse Debt, such Partner Nonrecourse Deductions attributable thereto shall be allocated between or among such Members in accordance with the ratios in which they share such economic risk of loss.

Nonrecourse Debt. (a) Except as otherwise provided in Treasury Regulations section 1.704-2(f), if there is a net decrease in Partnership Minimum Gain during any Period, each Member shall be specially allocated items of Company income and gain for such period (and, if necessary, subsequent periods) in proportion to, and to the extent of, an amount equal to the portion of such Member’s share of the net decrease in Partnership Minimum Gain, determined in accordance with Treasury Regulations section 1.704-2(g). This Section 8.7(a) is intended to comply with the chargeback of items of income and gain requirement in Treasury Regulations section 1.704-2(f) and shall be interpreted consistently therewith. (b) Except as otherwise provided in Treasury Regulations section 1.704-2(i), if there is a net decrease in Minimum Gain Attributable to Partner Nonrecourse Debt during any Period, each Member Partner with a share of Minimum Gain Attributable to Partner Nonrecourse Debt shall be specially allocated items of Company income and gain for such Period (and, if necessary, subsequent periods) in proportion to, and to the extent of, an amount equal to the portion of such Member’s share of the net decrease in the Minimum Gain Attributable to Partner Nonrecourse Debt, determined in accordance with Treasury Regulations section 1.704-2(i)(4). This Section 8.7(b) is intended to comply with the chargeback of items of income and gain requirement in Treasury Regulations section 1.704-2(i)(4) and shall be interpreted consistently therewith. (c) Nonrecourse Deductions for any Period shall be allocated to the Members in proportion to their respective Percentage Interests in accordance with Treasury Regulations section 1.704-2(b)(1). (d) Partner Nonrecourse Deductions for any Period shall be allocated 100% to the Member that bears the economic risk of loss (as defined in Treasury Regulations section 1.704-2(b)) with respect to the Partner Nonrecourse Debt to which such Partner Nonrecourse Deductions are attributable in accordance with Treasury Regulations section 1.704-2(i). If more than one Member bears the economic risk of loss with respect to a Partner Nonrecourse Debt, such Partner Nonrecourse Deductions attributable thereto shall be allocated between or among such Members in accordance with the ratios in which they share such economic risk of loss.