Special Allocation. Notwithstanding the other provisions in this Section (but subject to Sections 5.11 and 5.12), in the year of the liquidation of the Partnership, Net Income and Net Loss from all sources (or gross income or gross expense) shall be allocated, to the greatest extent possible, so that the positive Capital Account balance of each Partner shall be equal to the distributions to be made to the Partners, provided, however, that in no event shall this Section 5.8 be interpreted or applied in a manner that would cause any LTIP Unit to fail to qualify as a “profits interest” under IRS Revenue Procedure 93-27, 1993-2 C.B. 343 (June 9, 1993) and IRS Revenue Procedure 2001-43, 2001-2 C.B. 191 (August 3, 2001) (for example, this Section 5.8 shall not cause an LTIP Unit Limited Partner to receive a gross income allocation with respect to an LTIP Unit, or other Partners to receive gross expense allocations, if such allocation(s) would result in a reduction of the LTIP Unit Limited Partner’s Book-Up Target with respect to its LTIP Unit in excess of the amount by which such Book-Up Target would have been reduced in the absence of this Section 5.8). This Section 5.8 shall be interpreted in a manner consistent with the Partnership’s intention to treat the LTIP Units as “profits interests” for U.S. federal income tax purposes.
Appears in 3 contracts
Samples: Limited Partnership Agreement (Cottonwood Communities, Inc.), Limited Partnership Agreement (Cottonwood Communities, Inc.), Agreement and Plan of Merger (Cottonwood Communities, Inc.)
Special Allocation. Notwithstanding the other provisions in this Section (but subject to Sections 5.11 and 5.12), in the year of the liquidation sale of the Partnershiplast Property, Net Income and Net Loss from all sources (or gross income or gross expense) shall be allocated, to the greatest extent possible, so that the positive Capital Account balance of each Partner shall be equal to the distributions to be made to the Partners, provided, however, that in no event shall this Section 5.8 be interpreted or applied in a manner that would cause any LTIP Unit to fail to qualify as a “profits interest” under IRS Revenue Procedure 93-27, 1993-2 C.B. 343 (June 9, 1993) and IRS Revenue Procedure 2001-43, 2001-2 C.B. 191 (August 3, 2001) (for example, this Section 5.8 shall not cause an LTIP Unit Limited Partner to receive a gross income allocation with respect to an LTIP Unit, or other Partners to receive gross expense allocations, if such allocation(s) would result in a reduction of the LTIP Unit Limited Partner’s Book-Up Target with respect to its LTIP Unit in excess of the amount by which such Book-Up Target would have been reduced in the absence of this Section 5.8). This Section 5.8 shall be interpreted in a manner consistent with the Partnership’s intention to treat the LTIP Units as “profits interests” for U.S. federal income tax purposes.
Appears in 1 contract
Samples: Limited Partnership Agreement (Cottonwood Communities, Inc.)
