Special Allocation Provisions. 1. For purposes of determining the amount of gain or loss to be allocated pursuant to Article V of the Agreement, any basis adjustments permitted pursuant to Section 743 of the Code shall be disregarded. 2. Income, loss, deductions and credits shall be allocated to the Members in accordance with the portion of the year during which the Members have held their respective interests except that special allocations may be permitted if approved by a Required Interest. All items of income, loss and deduction shall be considered to have been earned ratably over the period of the fiscal year of the Company, except that gains and losses arising from the disposition of assets shall be taken into account as of the date thereof. 3. Notwithstanding any other provision of the Agreement, to the extent required by law, income, gain, loss and deduction attributable to property contributed to the Company by a Member shall be shared among the Members so as to take into account any variation between the basis of the property and the fair market value of the property at the time of contribution in accordance with the requirements of Section 704 (c) of the Code and the applicable regulations thereunder as more fully described in Part B hereof. 4. Notwithstanding any other provision of the Agreement, in the event the Company is entitled to a deduction for interest imputed under any provision of the Code on any loan or advance from a Member (whether such interest is currently deducted, capitalized or amortized), such deduction shall be allocated solely to such Member. 5. Notwithstanding any provision of the Agreement to the contrary, to the extent any payments in the nature of fees made to a Member are finally determined by the IRS to be distributions to a Member for federal income tax purposes, there will be a gross income allocation to such Member in the amount of such distribution. (a) Notwithstanding any provision of the Agreement to the contrary and subject to the exceptions set forth in Section 1.704-2 (f) (2)-(5) of the Treasury Regulations, if there is a net decrease in Company Minimum Gain during any Company fiscal year, each Member shall be specially allocated items of Company income and gain for such year (and, if necessary, subsequent years) in an amount equal to such Member's share of the net decrease in Company Minimum Gain determined in accordance with Section 1.704-2(g)(2) of the Treasury Regulations. Allocations pursuant to the previous sentence shall be made in proportion to the respective amounts required to be allocated to each Member pursuant thereto. The items to be so allocated shall be determined in accordance with Section 1.704-2(f) of the Treasury Regulations. This paragraph 6 (a) is intended to comply with the minimum gain chargeback requirement in such Section of the Regulations and shall be interpreted consistently therewith. To the extent permitted by such Section of the Regulations and for purposes of this paragraph 6(a) only, each Member's Adjusted Capital Account Balance shall be determined prior to any other allocations pursuant to Article V of the Agreement with respect to such fiscal year and without regard to any net decrease in Member Minimum Gain during such fiscal year. (b) Notwithstanding any provision of the Agreement to the contrary, except paragraph 6(a) of this Exhibit and subject to the exceptions set forth in Section 1.704-2(i)(4) of the Treasury Regulations, if there is a net decrease in Member Nonrecourse Debt Minimum Gain during any Company fiscal year, each Member who has a share of the Member Nonrecourse Debt Minimum Gain, determined in accordance with Section 1.704-2(i)(3) of the Treasury Regulations, shall be specially allocated items of Company income and gain for such year (and, if necessary, subsequent years) in an amount equal to such Member's share of the net decrease in Member Nonrecourse Debt Minimum Gain, determined in accordance with Section 1.704-2(i)(5) of the Treasury Regulations. Allocations pursuant to the previous sentence shall be made in proportion to the respective amounts required to be allocated to each Member pursuant thereto. The items to be so allocated shall be determined in accordance with Section 1.704-2(i)(4) of the Regulations. This paragraph 6(b) is intended to comply with the minimum gain chargeback requirement in such Section of the Regulations and shall be interpreted consistently therewith. Solely for purposes of this paragraph 6(b), each Member's Adjusted Capital Account Balance shall be determined prior to any other allocations pursuant to Article V of the Agreement with respect to such fiscal year, other than allocations pursuant to paragraph 6(a) hereof. 7. Notwithstanding any provision of the Agreement to the contrary, in the event any Members unexpectedly receive any adjustments, allocations or distributions described in Treasury Regulation Section 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), items of Company income and gain shall be specially allocated to such Members in an amount and manner sufficient to eliminate the deficits in their Adjusted Capital Account Balances created by such adjustments, allocations or distributions as quickly as possible. 8. No loss shall be allocated to any Member to the extent that such allocation would result in a deficit in its Adjusted Capital Account Balance while any other Member continues to have a positive Adjusted Capital Account Balance; in such event losses shall first be allocated to any Members with positive Adjusted Capital Account Balances, and in proportion to such balances, to the extent necessary to reduce their positive Adjusted Capital Account Balances to zero. 9. Any special allocations of items pursuant to this Part A shall be taken into account in computing subsequent allocations so that the net amount of any items so allocated and the profits, losses and all other items allocated to each such Member pursuant to Article V of the Agreement shall, to the extent possible, be equal to the net amount that would have been allocated to each such Member pursuant to the provisions of Article V of the Agreement if such special allocations had not occurred. 10. Notwithstanding any provision of the Agreement to the contrary, Nonrecourse Deductions for any fiscal year or, other period shall be specially allocated to the Members in accordance with the percentages set forth in Section 5.1(a). 11. Notwithstanding any provision of the Agreement to the contrary, any Member Nonrecourse Deduction for any fiscal year or other period shall be specially allocated to the Member who bears the economic risk of loss with respect to the Member Nonrecourse Debt to which such Member Nonrecourse Deductions are attributable in accordance with Section 1.704-2(i) of the Treasury Regulations.
Appears in 1 contract
Samples: Operating Agreement (Navtrans International Freight Forwarding Inc)
Special Allocation Provisions. 1. For purposes of determining the amount of gain or loss to be allocated pursuant to Article V of the Agreement, any basis adjustments permitted pursuant to Section 743 of the Code shall be disregarded.
2. Income, loss, deductions and credits shall be allocated to the Members members in accordance with the portion of the year during which the Members have held their respective interests except that special allocations may be permitted if approved by a Required Interestinterests. All items of income, loss and deduction shall be considered to have been earned ratably over the period of the fiscal year of the Company, except that gains and losses arising from the disposition of assets shall be taken into account as of the date thereof.
3. Notwithstanding any other provision of the Agreement, to the extent required by law, income, gain, loss and deduction attributable to property contributed to the Company by a Member shall be shared among the Members so as to take into account any variation between the basis of the property and the fair market value of the property at the time of contribution in accordance with the requirements of Section 704 (c704(c) of the Code and the applicable regulations Regulations thereunder as more fully described in Part B hereof.
4. Notwithstanding any other provision of the AgreementAgreement to the contrary, in the event the Company is entitled to a deduction for interest imputed under any provision of the Code on any loan or advance from a Member (whether such interest is currently deducted, capitalized or amortized), such deduction shall be allocated solely to such Member.
5. Notwithstanding any provision of the Agreement to the contrary, to the extent any payments in the nature of fees made to a Member are finally determined by the IRS to be distributions to a Member for federal income tax purposes, there will be a gross income allocation to such Member in the amount of such distribution.
(a) Notwithstanding any provision of the Agreement to the contrary and subject to the exceptions set forth in Section 1.704-2 (f) (2)-(52(f)(2)-(5) of the Treasury Regulations, if there is a net decrease in Company Partnership Minimum Gain during any Company fiscal year, each Member shall be specially allocated items of Company income and gain for such year (and, if necessary, subsequent years) in an amount equal to such Member's share of the net decrease in Company Partnership Minimum Gain determined in accordance with Section 1.704l.704-2(g)(22(gX2) of the Treasury Regulations. Allocations pursuant to the previous sentence shall be made in proportion to the respective amounts required to be allocated to each Member pursuant thereto. The items to be so allocated shall be determined in accordance with Section 1.704-2(f) of the Treasury Regulations. This paragraph 6 6
(a) is intended to comply with the minimum gain chargeback requirement in such Section of the Regulations and shall be interpreted consistently therewith. To the extent permitted by such Section of the Regulations and for purposes of this paragraph 6(a) only, each Member's Adjusted Capital Account Balance shall be determined prior to any other allocations pursuant to Article V of the Agreement with respect to such fiscal year and without regard to any net decrease in Member Partner Minimum Gain during such fiscal year.
(b) Notwithstanding any provision of the Agreement to the contrary, except paragraph 6(a) of this Exhibit and subject to the exceptions set forth in Section 1.7041 .704-2(i)(4) of the Treasury Regulations, if there is a net decrease in Member Partner Nonrecourse Debt Minimum Gain during any Company fiscal year, each Member who has a share of the Member Partner Nonrecourse Debt Minimum Gain, determined in accordance with Section 1.704-2(i)(3) of the Treasury Regulations, shall be specially allocated items of Company income and gain for such year (and, if necessary, subsequent years) in an amount equal to such Member's share of the net decrease in Member partner Nonrecourse Debt Minimum Gain, determined in accordance with Section 1.704-2(i)(5) of the Treasury Regulations. Allocations pursuant to the previous sentence shall be made in proportion to the respective amounts required to be allocated to each Member pursuant thereto. The items to be so allocated shall be determined in accordance with Section 1.704-2(i)(4) of the Regulations. This paragraph 6(b6
(b) is intended to comply with the minimum gain chargeback requirement in such Section of the Regulations and shall be interpreted consistently therewith. Solely for purposes of this paragraph 6(b), each Member's Adjusted adjusted Capital Account Balance shall be determined prior to any other allocations pursuant to Article V of the Agreement with respect to such fiscal year, other than allocations pursuant to paragraph 6(a) hereof.
7. Notwithstanding any provision of the Agreement to the contrary, in the event any Members unexpectedly receive any adjustments, allocations or distributions described in Treasury Regulation Section 1.704-1(b)(2)(ii)(d)(41 (b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(51 (b)(2)(ii)(d)(5) or 1.704-1(b)(2)(ii)(d)(61.704- l(b)(2)(ii)(d)(6), items of Company income and gain shall be specially allocated to such Members in an amount and manner sufficient to eliminate the deficits in their Adjusted Capital Account Balances created by such adjustments, allocations or distributions as quickly as possible.
8. No loss shall be allocated to any Member to the extent that such allocation would result in a deficit in its Adjusted Capital Account Balance while any other Member member continues to have a positive Adjusted Capital Account Balance; in such event losses shall first be allocated to any Members members with positive Adjusted Capital Account Balances, and in proportion to such balances, to the extent necessary to reduce their positive Adjusted Capital Account Balances to zero.
9. Any special allocations of items pursuant to this Part A shall be taken into account in computing subsequent allocations so that the net amount of any items so allocated and the profits, losses and all other items allocated to each such Member pursuant to Article V of the Agreement shall, to the extent possible, be equal to the net amount that would have been allocated to each such Member pursuant to the provisions of Article V of the Agreement if such special allocations had have not occurred.
10. Notwithstanding any provision of the Agreement to the contrary, Nonrecourse Liabilities and Nonrecourse Deductions for any fiscal year or, or other period shall be specially allocated to the Members in accordance with the percentages set forth in Section 5.1(a)5.1.
11. Notwithstanding any provision of the Agreement to the contrary, any Member Partner Nonrecourse Deduction for any fiscal year or other period shall be specially allocated to the Member who bears the economic risk of loss with respect to the Member Partner Nonrecourse Debt to which such Member Partner Nonrecourse Deductions are attributable in accordance with Section 1.704-2(i) of the Treasury Regulations.
Appears in 1 contract
Special Allocation Provisions. 1. For purposes of determining the amount of gain or loss to be allocated pursuant to Article V of the Agreement, any basis adjustments permitted pursuant to Section 743 of the Code shall be disregarded.
2. Income, loss, deductions and credits shall be allocated to the Members members in accordance with the portion of the year during which the Members have held their respective interests except that special allocations may be permitted if approved by a Required Interestinterests. All items of income, loss and deduction shall be considered to have been earned ratably over the period of the fiscal year of the Company, except that gains and losses arising from the disposition of assets shall be taken into account as of the date thereof.
3. Notwithstanding any other provision of the Agreement, to the extent required by law, income, gain, loss and deduction attributable to property contributed to the Company by a Member shall be shared among the Members so as to take into account any variation between the basis of the property and the fair market value of the property at the time of contribution in accordance with the requirements of Section 704 (c704(c) of the Code and the applicable regulations Regulations thereunder as more fully described in Part B hereof.
4. Notwithstanding any other provision of the AgreementAgreement to the contrary, in the event the Company is entitled to a deduction for interest imputed under any provision of the Code on any loan or advance from a Member (whether such interest is currently deducted, capitalized or amortized), such deduction shall be allocated solely to such Member.
5. Notwithstanding any provision of the Agreement to the contrary, to the extent any payments in the nature of fees made to a Member are finally determined by the IRS to be distributions to a Member for federal income tax purposes, there will be a gross income allocation to such Member in the amount of such distribution.
(a) Notwithstanding any provision of the Agreement to the contrary and subject to the exceptions set forth in Section 1.704-2 (f) (2)-(52(f)(2)-(5) of the Treasury Regulations, if there is a net decrease in Company Partnership Minimum Gain during any Company fiscal year, each Member shall be specially allocated items of Company income and gain for such year (and, if necessary, subsequent years) in an amount equal to such Member's ’s share of the net decrease in Company Partnership Minimum Gain determined in accordance with Section 1.704-2(g)(2) of the Treasury Regulations. Allocations pursuant to the previous sentence shall be made in proportion to the respective amounts required to be allocated to each Member pursuant thereto. The items to be so allocated shall be determined in accordance with Section 1.704-2(f2(b) of the Treasury Regulations. This paragraph 6 (a6(a) is intended to comply with the minimum gain chargeback requirement in such Section of the Regulations and shall be interpreted consistently therewith. To the extent permitted by such Section of the Regulations and for purposes of this paragraph 6(a) only, each Member's ’s Adjusted Capital Account Balance shall be determined prior to any other allocations pursuant to Article V of the Agreement with respect to such fiscal year and without regard to any net decrease in Member Partner Minimum Gain during such fiscal year.
(b) Notwithstanding any provision of the Agreement to the contrary, except paragraph 6(a) of this Exhibit and subject to the exceptions set forth in Section 1.704-2(i)(4) of the Treasury Regulations, if there is a net decrease in Member Partner Nonrecourse Debt Minimum Gain during any Company fiscal year, each Member who has a share of the Member Partner Nonrecourse Debt Minimum Gain, determined in accordance with Section 1.704-2(i)(3) of the Treasury Regulations, shall be specially allocated items of Company income and gain for such year (and, if necessary, subsequent years) in an amount equal to such Member's ’s share of the net decrease in Member Partner Nonrecourse Debt Minimum Gain, determined in accordance with Section 1.704-2(i)(52(g)(2) of the Treasury Regulations. Allocations pursuant to the previous sentence shall be made in proportion to the respective amounts required to be allocated to each Member pursuant thereto. The items to be so allocated shall be determined in accordance with Section 1.704-2(i)(42(b) of the Regulations. This paragraph 6(b) is intended to comply with the minimum gain chargeback requirement in such Section of the Regulations and shall be interpreted consistently therewith. Solely for purposes of this paragraph 6(b), each Member's ’s Adjusted Capital Account Balance shall be determined prior to any other allocations pursuant to Article V of the Agreement with respect to such fiscal year, other than allocations pursuant to paragraph 6(a) hereof.
7. Notwithstanding any provision of the Agreement to the contrary, in the event any Members unexpectedly receive any adjustments, allocations or distributions described in Treasury Regulation Section 1.704-1(b)(2)(ii)(d)(41 (b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(51 (b)(2)(ii)(d)(5) or 1.704-1(b)(2)(ii)(d)(61 (b)(2)(ii)(d)(6), items of Company income and gain shall be specially allocated to such Members in an amount and manner sufficient to eliminate the deficits in their Adjusted Capital Account Balances created by such adjustments, allocations or distributions as quickly as possible.
8. No loss shall be allocated to any Member to the extent that such allocation would result in a deficit in its Adjusted Capital Account Balance while any other Member member continues to have a positive Adjusted Capital Account Balance; in such event losses shall first be allocated to any Members members with positive Adjusted Capital Account Balances, and in proportion to such balances, to the extent necessary to reduce their positive Adjusted Capital Account Balances to zero.
9. Any special allocations of items pursuant to this Part A shall be taken into account in computing subsequent allocations so that the net amount of any items so allocated and the profits, losses and all other items allocated to each such Member pursuant to Article V of the Agreement shall, to the extent possible, be equal to the net amount that would have been allocated to each such Member pursuant to the provisions of Article V of the Agreement if such special allocations had have not occurred.
10. Notwithstanding any provision of the Agreement to the contrary, Nonrecourse Liabilities and Nonrecourse Deductions for any fiscal year or, or other period shall be specially allocated to the Members in accordance with the percentages set forth in Section 5.1(a)5.1.
11. Notwithstanding any provision of the Agreement to the contrary, any Member Partner Nonrecourse Deduction for any fiscal year or other period shall be specially allocated to the Member who bears the economic risk of loss with respect to the Member Partner Nonrecourse Debt to which such Member Partner Nonrecourse Deductions are attributable in accordance with Section 1.704-1.704- 2(i) of the Treasury Regulations.
Appears in 1 contract
Special Allocation Provisions. 1. For purposes of determining the amount of gain or loss to be allocated pursuant to Article V of the Agreement, any basis adjustments permitted pursuant to Section 743 of the Code shall be disregarded.
2. Income, loss, deductions and credits shall be allocated to the Members in accordance with the portion of the year during which the Members have held their respective interests except that special allocations may be permitted if approved by a Required Interest. All items of income, loss and deduction shall be considered to have been earned ratably over the period of the fiscal year of the Company, except that gains and losses arising from the disposition of assets shall be taken into account as of the date thereof.
3. Notwithstanding any other provision of the Agreement, to the extent required by law, income, gain, loss and deduction attributable to property contributed to the Company by a Member shall be shared among the Members so as to take into account any variation between the basis of the property and the fair market value of the property at the time of contribution in accordance with the requirements of Section 704 (c) of the Code and the applicable regulations thereunder as more fully described in Part B hereof.
4. Notwithstanding any other provision of the Agreement, in the event the Company is entitled to a deduction for interest imputed under any provision of the Code on any loan or advance from a Member (whether such interest is currently deducted, capitalized or amortized), such deduction shall be allocated solely to such Member.
5. Notwithstanding any provision of the Agreement to the contrary, to the extent any payments in the nature of fees made to a Member are finally determined by the IRS to be distributions to a Member for federal income tax purposes, there will be a gross income allocation to such Member in the amount of such distribution.
(a) Notwithstanding any provision of the Agreement anything to the contrary and subject to the exceptions set forth in Section 1.704-2 (f) (2)-(5) of the Treasury Regulations, if there is a net decrease in Company Minimum Gain during any Company fiscal year, each Member shall be specially allocated items of Company income and gain for such year (and, if necessary, subsequent years) in an amount equal to such Member's share of the net decrease in Company Minimum Gain determined in accordance with Section 1.704-2(g)(2) of the Treasury Regulations. Allocations pursuant to the previous sentence shall be made in proportion to the respective amounts required to be allocated to each Member pursuant thereto. The items to be so allocated shall be determined in accordance with Section 1.704-2(f) of the Treasury Regulations. This paragraph 6 (a) is intended to comply with the minimum gain chargeback requirement in such Section of the Regulations and shall be interpreted consistently therewith. To the extent permitted by such Section of the Regulations and for purposes of this paragraph 6(a) only, each Member's Adjusted Capital Account Balance shall be determined prior to any other allocations pursuant to Article V of the Agreement with respect to such fiscal year and without regard to any net decrease in Member Minimum Gain during such fiscal year.contained herein:
(b) Notwithstanding any provision of the Agreement to the contrary, except paragraph 6(a) of this Exhibit and subject to the exceptions set forth in Section 1.704-2(i)(4) of the Treasury Regulations, if there is a net decrease in Member Nonrecourse Debt Minimum Gain during any Company fiscal year, each Member who has a share of the Member Nonrecourse Debt Minimum Gain, determined in accordance with Section 1.704-2(i)(3) of the Treasury Regulations, shall be specially allocated items of Company income and gain for such year (and, if necessary, subsequent years) in an amount equal to such Member's share of the net decrease in Member Nonrecourse Debt Minimum Gain, determined in accordance with Section 1.704-2(i)(5) of the Treasury Regulations. Allocations pursuant to the previous sentence shall be made in proportion to the respective amounts required to be allocated to each Member pursuant thereto. The items to be so allocated shall be determined in accordance with Section 1.704-2(i)(4) of the Regulations. This paragraph 6(b) is intended to comply with the minimum gain chargeback requirement in such Section of the Regulations and shall be interpreted consistently therewith. Solely for purposes of this paragraph 6(b), each Member's Adjusted Capital Account Balance shall be determined prior to any other allocations pursuant to Article V of the Agreement with respect to such fiscal year, other than allocations pursuant to paragraph 6(a) hereof.
7. Notwithstanding any provision of the Agreement to the contrary, in A. In the event that any Members Member unexpectedly receive receives any adjustments, allocations or distributions described in Treasury Regulation Section 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5(5) or 1.704-1(b)(2)(ii)(d)(6)(6) of the Allocation Regulations, items of Company income and gain shall be specially allocated to each such Members Member in an amount and manner sufficient to eliminate eliminate, to the deficits extent required by the Allocation Regulations, the adjusted capital account deficit of such Member as quickly as possible. This Section is intended to constitute a “qualified income offset” provision within the meaning of the Allocation Regulations and shall be interpreted consistently therewith.
B. In no event shall any Member be allocated Losses which would cause it to have an adjusted capital account deficit as of the end of any Company's fiscal year ended December 31 (“Fiscal Year”). Any Losses which are not allocated to a Member by reason of the application of the provisions of this Section shall be allocated to the other Members (to the extent otherwise permitted under the terms of this Section). In the event that any Member has an adjusted capital account deficit at the end of any Company Fiscal Year, items of Company income and gain shall be specially allocated to each such Member in their Adjusted Capital Account Balances created by the amount of such adjustments, allocations or distributions adjusted capital deficit as quickly as possible.
8. No loss shall C. To the extent that interest on loans (or other advances which are deemed to be allocated to loans) made by any Member to the extent that Company is determined to be deductible by the Company in excess of the amount of interest actually paid by the Company, such allocation would result in a deficit in its Adjusted Capital Account Balance while any other Member continues to have a positive Adjusted Capital Account Balance; in such event losses additional interest deduction(s) shall first be allocated to any Members with positive Adjusted Capital Account Balances, and in proportion solely to such balances, to the extent necessary to reduce their positive Adjusted Capital Account Balances to zeroMember.
9. Any special allocations of items pursuant to this Part A D. If there is a net decrease in "Company Minimum Gain" for a Company Fiscal Year, the Members shall be taken into account in computing subsequent allocations so that the net amount allocated items of any items so allocated Company income and the profits, losses and all other items allocated to each such Member pursuant to Article V of the Agreement shall, to the extent possible, be equal to the net amount that would have been allocated to each such Member pursuant to the provisions of Article V of the Agreement if such special allocations had not occurred.
10. Notwithstanding any provision of the Agreement to the contrary, Nonrecourse Deductions for any fiscal year or, other period shall be specially allocated to the Members gain in accordance with the percentages set forth in provisions of Section 5.1(a).
11. Notwithstanding any provision 1.704-2(f) of the Agreement to the contrary, any Member Nonrecourse Deduction Allocation Regulations. If for any fiscal year or other period shall be specially allocated to Fiscal Year the Member who bears application of the minimum gain charge back provisions herein provided would cause a distortion in the economic risk arrangement among the Members and it is not expected that the Company will have sufficient other income to correct that distortion, the Managing Member may request a waiver from the Commissioner of loss with respect to the Member Nonrecourse Debt to which such Member Nonrecourse Deductions are attributable IRS of the application in whole or in part of any provisions hereof in accordance with Section 1.704-2(i2(f)(4) of the Treasury Allocation Regulations. Furthermore, if additional exceptions to the minimum gain charge back requirements of the Allocation Regulations have been provided through revenue rulings or other Internal Revenue Service pronouncements, the Managing Member are authorized to cause the Company to take advantage of such exceptions if to do so would be in the best interest of a majority of the Members.
E. Any cancellation of debt income realized by the Company shall be allocated to the Members in the same proportions as the debt which was discharged was included in each Member’s tax basis in accordance with the applicable provisions of the Allocation Regulations.
F. Except as otherwise specifically provided in this Agreement, all items of Company income, gain, loss, deduction and other items not specifically provided for shall be allocated to and among the Members in the same manner as Profits and Losses are allocated pursuant to the provisions of this Section.
Appears in 1 contract
Special Allocation Provisions. 1. For purposes of determining the amount of gain or loss to be allocated pursuant to Article V 9 of the Agreement, any basis adjustments permitted pursuant to Section 743 of the Code shall be disregarded.
2. IncomeExcept as otherwise provided in Section 10.8, income, loss, deductions and credits shall be allocated to the Members in accordance with the portion of the year during which the Members have held their respective interests except that special allocations may be permitted if approved by a Required Interestinterests. All items of income, loss and deduction shall be considered to have been earned ratably over the period of the fiscal year of the Company, except that gains and losses arising from the disposition of assets shall be taken into account as of the date thereof.
3. Notwithstanding any other provision of the Agreement, to the extent required by law, income, gain, loss and deduction attributable to property contributed to the Company by a Member Contributed Property shall be shared among the Members so as to take into account any variation between the basis of the property Contributed Property and the fair market value Agreed Value of the property Contributed Property at the time of contribution in accordance with the requirements of Section 704 (c704(c) of the Code and the applicable regulations thereunder as more fully described in Part B C hereof.
4. Notwithstanding any other provision of the Agreement, in the event the Company is entitled to a deduction for interest imputed under any provision of the Code on any loan or advance from a Member (whether such interest is currently deducted, capitalized or amortized), such deduction shall be allocated solely to such Member.
5. Notwithstanding any provision of the Agreement to the contrary, to the extent any payments in the nature of fees made to a Member are finally determined by the IRS to be distributions to a Member for federal income tax purposes, there will be a gross income allocation to such Member in the amount of such distribution.
(a) Notwithstanding any provision of the Agreement to the contrary and subject to the exceptions set forth in Section 1.704-2 (f) (2)-(5) 2(f)(2)-5 of the Treasury Regulations, if there is a net decrease in Company Minimum Gain during any Company fiscal year, each Member shall be specially allocated items of Company income and gain for such year (and, if necessary, subsequent years) in an amount equal to such Member's share of the net decrease decreased in Company Minimum Gain determined in accordance with Section 1.704-2(g)(2) of the Treasury Regulations. Allocations pursuant to the previous sentence shall be made in proportion to the respective amounts required to be allocated to each Member pursuant thereto. The items to be so allocated shall be determined in accordance with Section 1.704-2(f2(f)(6) of the Treasury Regulations. This paragraph 6 Paragraph 6
(a) is intended to comply with the minimum gain chargeback requirement in such Section of the Regulations and shall be interpreted consistently therewith. To the extent permitted by such Section of the Regulations and for purposes of this paragraph Paragraph 6(a) only, each Member's Adjusted Capital Account Balance shall be determined prior to any other allocations pursuant to Article V 9 of the Agreement with respect to such fiscal year and without regard to any net decrease in Member Minimum Gain during such fiscal year.
(b) Notwithstanding any provision of the Agreement to the contrary, except paragraph Paragraph 6(a) of this Exhibit Schedule and subject to the exceptions set forth in Section 1.704-2(i)(4) of the Treasury Regulations, if there is a net decrease in Member Nonrecourse Debt Minimum Gain during any Company fiscal year, each Member who has a share of the Member Nonrecourse Debt Minimum Gain, determined in accordance with Section 1.704-2(i)(3) of the Treasury Regulations, shall be specially allocated items of Company income and gain for such year (and, if necessary, subsequent years) in an amount equal to such Member's share of the net decrease in Member Nonrecourse Debt Minimum Gain, determined in accordance with Section 1.704-2(i)(52(i)(9) of the Treasury Regulations. Allocations pursuant to the previous sentence shall be made in proportion to the respective amounts required to be allocated to each Member pursuant thereto. The items to be so allocated shall be determined in accordance with Section 1.704-2(i)(4) of the Regulations. This paragraph 6(bParagraph 6
(b) is intended to comply with the minimum gain chargeback requirement in such Section of the Regulations and shall be interpreted consistently therewith. Solely for purposes of this paragraph Paragraph 6(b), each Member's Adjusted Capital Account Balance shall be determined prior to any other allocations pursuant to Article V 9 of the Agreement with respect to such fiscal year, other than allocations pursuant to paragraph Paragraph 6(a) hereof.
7. Notwithstanding any provision of the Agreement to the contrary, in the event any Members unexpectedly receive any adjustments, allocations or distributions described in Treasury Regulation Section 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5) or 1.704-1(b)(2)(ii)(d)(61(b)(2) (ii)(d)(6), items of Company income and gain shall be specially allocated to such Members in an amount and manner sufficient to eliminate the deficits in their Adjusted Capital Account Balances created by such adjustments, allocations or distributions as quickly as possible.
8. No loss Loss shall be allocated to any Member to the extent that such allocation would result in a deficit in its Adjusted Capital Account Balance (as defined above) while any other Member continues to have a positive Adjusted Capital Account Balance; in such event losses shall first be allocated to any Members with positive Adjusted Capital Account Balances, and in proportion to such balances, to the extent necessary to reduce their positive Adjusted Capital Account Balances to zero.
9. Any special allocations of items pursuant to this Part A Except as otherwise provided herein, Nonrecourse Deductions for any fiscal year or other period shall be taken into account allocated among the Members in computing subsequent allocations so that the net amount of any items so allocated and the profits, losses and all other items allocated proportion to each such Member pursuant to Article V of the Agreement shall, to the extent possible, be equal to the net amount that would have been allocated to each such Member pursuant to the provisions of Article V of the Agreement if such special allocations had not occurred.
10their respective Membership Interests. Notwithstanding the foregoing (or any other provision of the Agreement to the contrary, Nonrecourse Deductions for any fiscal year or, other period shall be specially allocated to the Members in accordance with the percentages set forth in Section 5.1(a).
11. Notwithstanding any provision of the Agreement to the contrary, any Member Nonrecourse Deduction for any fiscal year or other period shall be specially allocated to the Member who bears the economic risk of loss with respect to the Member Nonrecourse Debt to which such Member Nonrecourse Deductions are attributable in accordance with Section 1.704-2(i) of the Treasury Regulations.
10. The allocations set forth in this Part B (the "Regulatory Allocations") are intended to comply with certain requirements of Regulations Sections 1.704-1(b) and 1.704-2. The Regulatory Allocations may not be consistent with the manner in which the Members intend to divide Company distributions. Accordingly, the Managers are hereby authorized to make special allocations of items of income, gain, loss or deduction among the Members so as to prevent the Regulatory Allocations from distorting the manner in which Company distributions are intended to be divided among the members pursuant to the Agreement. In general, the Members anticipate that this will be accomplished by specially allocating other items of income, gain, loss or deduction among the Members so that the net amount of the Regulatory Allocations and such special allocations to each such Person is zero. However, the Managers shall have discretion to accomplish this result in any reasonable manner.
Appears in 1 contract
Samples: Limited Liability Company Agreement (Apcoa Capital Corp)
