Common use of Allocation of Net Profit and Net Loss Clause in Contracts

Allocation of Net Profit and Net Loss. (a) If the Company has a Net Profit for the Fiscal Year, such Net Profit shall be allocated among the Members for purposes of maintaining the Members’ capital accounts in the following manner: (1) First, to all Class 2 Members in proportion to their respective Class 2 Interests until the cumulative amounts allocated to the Class 2 Members pursuant to this Section 3.3(a)(1) (net of cumulative Net Loss allocated to the Class 2 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 2 Members pursuant to Section 3.4(b) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i)); (2) Second, to all Class 3 Members in proportion to their respective Class 3 Interests until the cumulative amounts allocated to the Class 3 Members pursuant to this Section 3.3(a)(2) (net of cumulative Net Loss allocated to the Class 3 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 3 Members pursuant to Section 3.4(c) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i)); (3) Third, to all Class 4 Members in proportion to their respective Class 4 Interests until the cumulative amounts allocated to the Class 4 Members pursuant to this Section 3.3(a)(3) (net of cumulative Net Loss allocated to the Class 4 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 4 Members pursuant to Section 3.4(d) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i)); (4) Fourth, to all Class 7 Members in proportion to their respective Class 7 Interests until the cumulative amounts allocated to the Class 7 Members pursuant to this Section 3.3(a)(4) (net of cumulative Net Loss allocated to the Class 7 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 7 Members pursuant to Section 3.4(e) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i)); (5) Fifth, to all Class 8 Members in proportion to their respective Class 8 Interests until the amounts allocated to the Class 8 Members pursuant to this Section 3.3(a)(5) (net of cumulative Net Loss allocated to the Class 8 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 8 Members pursuant to Section 3.4(f) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i)); (6) Sixth, to all Class 9 Members in proportion to their respective Class 9 Interests until the amounts allocated to the Class 9 Members pursuant to this Section 3.3(a)(6) (net of cumulative Net Loss allocated to the Class 9 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 9 Members pursuant to Section 3.4(g) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i)); (7) Seventh, to all Class 10 Members in proportion to their respective Class 10 Interests until the amounts allocated to the Class 10 Members pursuant to this Section 3.3(a)(7) (net of cumulative Net Loss allocated to the Class 10 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 10 Members pursuant to Section 3.4(h) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i)); and (8) Thereafter, all such Net Profits shall be allocated solely to the Class 1 Members in proportion to their respective Class 1 Interests. (b) For each Fiscal Year, if the Company has a Net Loss for the Fiscal Year, such Net Loss shall be allocated: (1) First, to the Class 1 Members in proportion to their respective positive capital account balances until such balances are reduced to zero; (2) Second, to the Class 2 Members, Class 3 Members, Class 4 Members, Class 7 Members, Class 8 Members, Class 9 Members and Class 10 Members in proportion to their respective positive capital account balances until such balances are reduced to zero; and (3) Thereafter, solely to the Class 1 Members in proportion to their respective Class 1 Interests. (c) It is the intent of the Members that each Member’s distributive share of income, gain, loss, deduction, or credit (or item thereof) shall be determined and allocated for federal income tax purposes in accordance with this Section 3.3 to the fullest extent permitted by §§ 704(b) and (c) of the Code and the Treasury Regulations promulgated thereunder. This Agreement shall be deemed to include a “qualified income offset” in accordance with Treasury Regulation section 1.704-1(b)(2)(ii)(d). The Managing Member will be authorized to make appropriate amendments to the allocations of items pursuant to this Section 3.3 if necessary in order to comply with Section 704 of the Code or applicable Treasury Regulations thereunder or to effect the terms, purposes and conditions of this Agreement; provided that no such change has a material adverse effect upon the amount distributable to any Member hereunder. (d) For purposes of this Section 3.3, Depreciation shall be allocated solely to the Class 1 Members in proportion to their Class 1 Interests. A portion of the gain attributable to the sale or other disposition of a Company asset (including any gain treated as recognized upon the upward revaluation of the Gross Asset Value of a Company asset), in a cumulative amount up to the amount of Depreciation previously recognized with respect to such asset, shall be allocated solely to the Class 1 Members in proportion to their Class 1 Interests.

Allocation of Net Profit and Net Loss. (a) If the Company has a Net Profit for the Fiscal Year, such Net Profit shall be allocated among the Members for purposes of maintaining the Members’ capital accounts in the following manner: (1) First, to all Class 2 Members in proportion to their respective Class 2 Interests until the cumulative amounts allocated to the Class 2 Members pursuant to this Section 3.3(a)(1) (net of cumulative Net Loss allocated to the Class 2 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 2 Members pursuant to Section 3.4(b) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i)); (2) Second, to all Class 3 Members in proportion to their respective Class 3 Interests until the cumulative amounts allocated to the Class 3 Members pursuant to this Section 3.3(a)(2) (net of cumulative Net Loss allocated to the Class 3 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 3 Members pursuant to Section 3.4(c) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i)); (3) Third, to all Class 4 Members in proportion to their respective Class 4 Interests until the cumulative amounts allocated to the Class 4 Members pursuant to this Section 3.3(a)(3) (net of cumulative Net Loss allocated to the Class 4 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 4 Members pursuant to Section 3.4(d) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i)); (4) Fourth, to all Class 7 Members in proportion to their respective Class 7 Interests until the cumulative amounts allocated to the Class 7 Members pursuant to this Section 3.3(a)(43.3(a)(1) (net of cumulative Net Loss allocated to the Class 7 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 7 Members pursuant to Section 3.4(e3.4(b) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i3.4(f)); (52) FifthSecond, to all Class 8 Members in proportion to their respective Class 8 Interests until the amounts allocated to the Class 8 Members pursuant to this Section 3.3(a)(53.3(a)(2) (net of cumulative Net Loss allocated to the Class 8 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 8 Members pursuant to Section 3.4(f3.4(c) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i3.4(f)); (63) SixthThird, to all Class 9 Members in proportion to their respective Class 9 Interests until the amounts allocated to the Class 9 Members pursuant to this Section 3.3(a)(63.3(a)(3) (net of cumulative Net Loss allocated to the Class 9 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 9 Members pursuant to Section 3.4(g3.4(d) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i3.4(f)); (74) SeventhFourth, to all Class 10 Members in proportion to their respective Class 10 Interests until the amounts allocated to the Class 10 Members pursuant to this Section 3.3(a)(73.3(a)(4) (net of cumulative Net Loss allocated to the Class 10 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 10 Members pursuant to Section 3.4(h3.4(e) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i3.4(f)); and (8) 5) Thereafter, all such Net Profits shall be allocated solely to the Class 1 Members in proportion to their respective Class 1 Interests. (b) For each Fiscal Year, if the Company has a Net Loss for the Fiscal Year, such Net Loss shall be allocated: (1) First, to the Class 1 Members in proportion to their respective positive capital account balances until such balances are reduced to zero; (2) Second, to the Class 2 Members, Class 3 Members, Class 4 Members, Class 7 Members, Class 8 Members, Class 9 Members and Class 10 Members in proportion to their respective positive capital account balances until such balances are reduced to zero; and (3) Thereafter, solely to the Class 1 Members in proportion to their respective Class 1 Interests. (c) It is the intent of the Members that each Member’s distributive share of income, gain, loss, deduction, or credit (or item thereof) shall be determined and allocated for federal income tax purposes in accordance with this Section 3.3 to the fullest extent permitted by §§ 704(b) and (c) of the Code and the Treasury Regulations promulgated thereunder. This Agreement shall be deemed to include a “qualified income offset” in accordance with Treasury Regulation section 1.704-1(b)(2)(ii)(d). The Managing Member will be authorized to make appropriate amendments to the allocations of items pursuant to this Section 3.3 if necessary in order to comply with Section 704 of the Code or applicable Treasury Regulations thereunder or to effect the terms, purposes and conditions of this Agreement; provided that no such change has a material adverse effect upon the amount distributable to any Member hereunder. (d) For purposes of this Section 3.3, Depreciation shall be allocated solely to the Class 1 Members in proportion to their Class 1 Interests. A portion of the gain attributable to the sale or other disposition of a Company asset (including any gain treated as recognized upon the upward revaluation of the Gross Asset Value of a Company asset), in a cumulative amount up to the amount of Depreciation previously recognized with respect to such asset, shall be allocated solely to the Class 1 Members in proportion to their Class 1 Interests.

Allocation of Net Profit and Net Loss. (a) If Subject to Section 3.3(c), for each Fiscal Year, if the Company has a Net Profit for the Fiscal Year, such Net Profit shall be allocated among the Members for purposes of maintaining the Members’ capital accounts in the following manner: (1) First, to all Class 2 2A Members in proportion to their respective Class 2 2A Interests until the cumulative amounts allocated to the Class 2 2A Members pursuant to this Section 3.3(a)(1) (net of cumulative Net Loss allocated to the Class 2 2A Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 2 Members pursuant to Section 3.4(b) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i)); (2) Second, to all Class 3 Members in proportion to their respective Class 3 Interests until the cumulative amounts allocated to the Class 3 Members pursuant to this Section 3.3(a)(2) (net of cumulative Net Loss allocated to the Class 3 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 3 Members pursuant to Section 3.4(c) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i)); (3) Third, to all Class 4 Members in proportion to their respective Class 4 Interests until the cumulative amounts allocated to the Class 4 Members pursuant to this Section 3.3(a)(3) (net of cumulative Net Loss allocated to the Class 4 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 4 Members pursuant to Section 3.4(d) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i)); (4) Fourth, to all Class 7 Members in proportion to their respective Class 7 Interests until the cumulative amounts allocated to the Class 7 Members pursuant to this Section 3.3(a)(4) (net of cumulative Net Loss allocated to the Class 7 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 7 2A Members pursuant to Section 3.4(e) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i3.4(k)); (52) FifthSecond, to all Class 8 2B Members in proportion to their respective Class 8 2B Interests until the amounts allocated to the Class 8 2B Members pursuant to this Section 3.3(a)(53.3(a)(2) (net of cumulative Net Loss allocated to the Class 8 2B Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 8 2B Members pursuant to Section 3.4(f) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i3.4(k)); (63) SixthThird, to all Class 9 5 Members in proportion to their respective Class 9 5 Interests until the amounts allocated to the Class 9 5 Members pursuant to this Section 3.3(a)(63.3(a)(3) (net of cumulative Net Loss allocated to the Class 9 5 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 9 5 Members pursuant to Section Sections 3.4(g) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i3.4(k));; and (74) SeventhFourth, to all Class 10 6 Members in proportion to their respective Class 10 6 Interests until the amounts allocated to the Class 10 6 Members pursuant to this Section 3.3(a)(73.3(a)(4) (net of cumulative Net Loss allocated to the Class 10 6 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 10 6 Members pursuant to Section Sections 3.4(h) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i3.4(k)); and (8) 5) Thereafter, all such Net Profits shall be allocated solely to the Class 1 Members in proportion to their respective Class 1 Interests. (b) For each Fiscal Year, if the Company has a Net Loss for the Fiscal Year, such Net Loss shall be allocated: (1) First, to the Class 1 Members in proportion to their respective positive capital account balances until such balances are reduced to zero; (2) Second, to the Class 2 2A Members, Class 3 2B Members, Class 4 5 Members, Class 7 Members, Class 8 Members, Class 9 Members and Class 10 6 Members in proportion to their respective positive capital account balances until such balances are reduced to zero; and (3) Thereafter, solely to the Class 1 Members in proportion to their respective Class 1 Interests. (c) Upon completion of any Post-Effective Gain Transaction, an amount of Net Profit equal to the resulting Post-Effective Gain shall be allocated among the Members for purposes of maintaining the Members’ capital accounts in the same proportions in which the Post-Effective Gains are distributed as provided in Section 3.4(j). (d) It is the intent of the Members that each Member’s distributive share of income, gain, loss, deduction, or credit (or item thereof) shall be determined and allocated for federal income tax purposes in accordance with this Section 3.3 to the fullest extent permitted by §§ 704(b) and (c) of the Code and the Treasury Regulations promulgated thereunder. This Agreement shall be deemed to include a “qualified income offset” in accordance with Treasury Regulation section 1.704-1(b)(2)(ii)(d). The Managing Member will be authorized to make appropriate amendments to the allocations of items pursuant to this Section 3.3 if necessary in order to comply with Section 704 of the Code or applicable Treasury Regulations thereunder or to effect the terms, purposes and conditions of this Agreement; provided that no such change has a material adverse effect upon the amount distributable to any Member hereunder. (de) For purposes of this Section 3.3, Depreciation shall be allocated solely to the Class 1 Members in proportion to their Class 1 Interests. A portion of the gain attributable to the sale or other disposition of a Company asset (including any gain treated as recognized upon the upward revaluation of the Gross Asset Value of a Company asset), in a cumulative amount up to the amount of Depreciation previously recognized with respect to such asset, shall be allocated solely to the Class 1 Members in proportion to their respective Class 1 Interests.

Allocation of Net Profit and Net Loss. (a) If the Company has a Net Profit for the Fiscal Year, such Net Profit shall be allocated among the Members for purposes of maintaining the Members’ capital accounts in the following manner: (1) First, to all Class 2 Members in proportion to their respective Class 2 Interests until the cumulative amounts allocated to the Class 2 Members pursuant to this Section 3.3(a)(1) (net of cumulative Net Loss allocated to the Class 2 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 2 Members pursuant to Section 3.4(b) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i)); (2) Second, to all Class 3 Members in proportion to their respective Class 3 Interests until the cumulative amounts allocated to the Class 3 Members pursuant to this Section 3.3(a)(2) (net of cumulative Net Loss allocated to the Class 3 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 3 Members pursuant to Section 3.4(c) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i)); (3) Third, to all Class 4 Members in proportion to their respective Class 4 Interests until the cumulative amounts allocated to the Class 4 Members pursuant to this Section 3.3(a)(3) (net of cumulative Net Loss allocated to the Class 4 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 4 Members pursuant to Section 3.4(d) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i)); (4) Fourth, to all Class 7 Members in proportion to their respective Class 7 Interests until the cumulative amounts allocated to the Class 7 Members pursuant to this Section 3.3(a)(43.3(a)(1) (net of cumulative Net Loss allocated to the Class 7 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 7 Members pursuant to Section 3.4(e3.4(c) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i3.4(f)); (52) Fifth, to all Class 8 Members in proportion to their respective Class 8 Interests until the amounts allocated to the Class 8 Members pursuant to this Section 3.3(a)(5) (net of cumulative Net Loss allocated to the Class 8 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 8 Members pursuant to Section 3.4(f) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i)); (6) SixthSecond, to all Class 9 Members in proportion to their respective Class 9 Interests until the cumulative amounts allocated to the Class 9 Members pursuant to this Section 3.3(a)(63.3(a)(2) (net of cumulative Net Loss allocated to the Class 9 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 9 Members pursuant to Section 3.4(g3.4(d) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i3.4(f)); (73) SeventhThird, to all Class 10 11 Members in proportion to their respective Class 10 11 Interests until the cumulative amounts allocated to the Class 10 11 Members pursuant to this Section 3.3(a)(73.3(a)(3) (net of cumulative Net Loss allocated to the Class 10 11 Members in prior Fiscal Years) equal the cumulative amounts required to be distributed to the Class 10 11 Members pursuant to Section 3.4(h3.4(e) with respect to the current and each prior Fiscal Year (disregarding the limitation set forth in Section 3.4(i3.4(f)); and (8) 4) Thereafter, all such Net Profits shall be allocated solely to the Class 1 and Class 2 Members in proportion to their respective Class 1 and Class 2 Interests, with 51% of such Net Profits allocated to the Class 1 Members, as a group, and 49% of such Net Profits allocated to the Class 2 Members, as a group. (b) For each Fiscal Year, if the Company has a Net Loss for the Fiscal Year, such Net Loss shall be allocated: (1) First, to the Class 1 and Class 2 Members in proportion to their respective positive capital account balances until such balances are reduced to zero, with 51% of such Net Loss allocated to the Class 1 Members, as a group, and 49% of such Net Loss allocated to the Class 2 Members, as a group; (2) Second, to the Class 2 Members, Class 3 Members, Class 4 Members, Class 7 Members, Class 8 Members, Class 9 Members and Class 10 11 Members in proportion to their respective positive capital account balances until such balances are reduced to zero; and (3) Thereafter, solely to the Class 1 and Class 2 Members in proportion to their respective Class 1 and Class 2 Interests, with 51% of such Net Loss allocated to the Class 1 Members, as a group, and 49% of such Net Loss allocated to the Class 2 Members, as a group. (c) It is the intent of the Members that each Member’s distributive share of income, gain, loss, deduction, or credit (or item thereof) shall be determined and allocated for federal income tax purposes in accordance with this Section 3.3 to the fullest extent permitted by §§ 704(b) and (c) of the Code and the Treasury Regulations promulgated thereunder. This Agreement shall be deemed to include a “qualified income offset” in accordance with Treasury Regulation section 1.704-1(b)(2)(ii)(d). The Managing Member will be authorized to make appropriate amendments to the allocations of items pursuant to this Section 3.3 if necessary in order to comply with Section 704 of the Code or applicable Treasury Regulations thereunder or to effect the terms, purposes and conditions of this Agreement; provided that no such change has a material adverse effect upon the amount distributable to any Member hereunder. (d) For purposes of this Section 3.3, Depreciation shall be allocated solely to the Class 1 and Class 2 Members in proportion to their Class 1 and Class 2 Interests, with 51% of such Depreciation allocated to the Class 1 Members, as a group, and 49% of such Depreciation allocated to the Class 2 Members, as a group. A portion of the gain attributable to the sale or other disposition of a Company asset (including any gain treated as recognized upon the upward revaluation of the Gross Asset Value of a Company asset), in a cumulative amount up to the amount of Depreciation previously recognized with respect to such asset, shall be allocated solely to the Class 1 and Class 2 Members in proportion to their Class 1 and Class 2 Interests, with 51% of such Depreciation allocated to the Class 1 Members, as a group, and 49% of such Depreciation allocated to the Class 2 Members, as a group. (e) Notwithstanding anything to the contrary contained herein, in the event of the sale of all or substantially all of the assets of the Company (or an adjustment to the Gross Asset Value of any Company assets pursuant to subparagraph (2) or (3) of the definition of Gross Asset Value), Net Profit or Net Loss, as the case may be, for the Fiscal Year in which such sale is consummated (or such adjustment occurs) will be allocated in a manner that has the effect of reducing the difference between the Capital Account of each Member and the fair market value of the Interests held by each such Member (based on the relative fair market value of all such Interests and the price in such sale), in proportion to such differences. For purposes of this