Common use of Tax Advances Clause in Contracts

Tax Advances. At least fifteen (15) calendar days prior to the end of each fiscal quarter, the Company shall make advances (“Tax Advances”) to the Members so that each Member shall have received Tax Advances equal to such Member’s Tax Amount for such fiscal quarter (or, in the event that Net Available Cash is less than the total required Tax Advances for such fiscal quarter, the Company shall distribute the Net Available Cash pro rata among the Members in proportion to such required Tax Advances for such fiscal quarter). If after the end of any Fiscal Year it is determined that a Member’s Tax Amount for the Fiscal Year exceeds the sum of the cumulative Tax Advances made to the Member hereunder and the Distributions made to such Member under Section 7.2, if any, for such Fiscal Year (any such excess, a “Shortfall Amount”), then the Company shall, on or before March 15 of the following Fiscal Year, make an additional Tax Advance to the Members of their respective Shortfall Amounts. If the aggregate Tax Advances to any Member pursuant to this Section 7.1 for a Fiscal Year exceed the Member’s Tax Amount for such Fiscal Year, such excess shall be deducted when calculating the Tax Advances to be made to such Member for each subsequent Fiscal Year until the excess has been fully accounted for. All Tax Advances to a Member shall be treated as advances against any subsequent Distributions to be made to such Member under Sections 7.2 or 13.3(c) and shall be repaid by reducing the amount of the next succeeding Distribution to such Member under Sections 7.2 or 13.3(c). If any Distributions to a Member provided for in Sections 7.1, 7.2 or 13.3(c) are reduced pursuant to the preceding sentences of this Section 7.1, for all other purposes of this Agreement, such Member shall be treated as having received all Distributions without taking into account such reduction, and the Member shall be treated as having repaid to the Company the Tax Advance.