Common use of Allocation of Profits and Losses Clause in Contracts

Allocation of Profits and Losses. (a) Except as otherwise set forth in this Section 6.01, for Capital Account purposes, Net Income (and items thereof) and Net Loss (and items thereof) for any fiscal period shall be allocated among the Members pro rata in accordance with each Member’s respective Membership Units. (b) For federal, state and local income tax purposes, items of income, gain, loss, deduction and expense shall be allocated to the Members in accordance with the allocations of the corresponding amount of Net Income (and items thereof) or amount of Net Loss (and items thereof) of which such items of income, gain, loss, deduction or expense are components for Capital Account purposes under this Section 6.01, except that items with respect to Company property for which there is a difference between tax basis and the Book Value of such property shall be allocated in accordance with Section 704(c) of the Code, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i). The Company shall specially allocate long-term capital gains with respect to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership Units. (c) Notwithstanding any provision of this Section 6.01, no item of deduction, loss or expense shall be allocated to a Member to the extent the allocation would cause a negative balance in such Member’s Capital Accounts (after taking into account the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) that exceeds the sum of (i) the amount that such Member would be required to reimburse the Company pursuant to this Agreement or under applicable law and (ii) the amount that such Member is deemed obligated to reimburse pursuant to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5). In the event some but not all of the Members would have such excess Capital Account deficits as a consequence of such allocation of loss, deduction or expense, the limitation set forth in this Section 6.01(c) shall be applied on a Member-by-Member basis so as to allocate the maximum permissible deduction, loss or expense to each Member under Section 1.704-1(b)(2)(ii)(d) of the Treasury Regulations. In the event any loss, deduction or expense shall be specially allocated to a Member pursuant to the preceding sentence, an equal amount of income or gain of the Company shall be specially allocated to such Member prior to any allocation pursuant to Section 6.01(a). (d) In the event any Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6), items of Company income and gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c) created by such adjustments, allocations or distributions. Any special allocations of items of income or gain pursuant to this Section 6.01(d) shall be taken into account in computing subsequent allocations pursuant to this Section 6.01 so that the net amount of any items so allocated and all other items allocated to each Member pursuant to this Section 6.01 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 this Section 6.01 if such unexpected adjustments, allocations or distributions had not occurred. (e) In the event the Company incurs any nonrecourse liabilities, income and gain shall be allocated in accordance with the “minimum gain chargeback” provisions of Section 1.704-1(b)(4)(iv) and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of the Members shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) to reflect the fair market value (as determined by the Managing Member in its good faith judgment) of Company property whenever Membership Units are relinquished to the Company, whenever an additional Member is admitted to the Company in accordance with Section 4.03, upon any termination of the Company within the meaning of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) in the case of a distribution of any property (other than cash). (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Company).

Allocation of Profits and Losses. (a) Except as otherwise set forth in this Section 6.01Subject to Sections 5.1(b), 5.2 and 5.3, Profits and Losses of the Company for Capital Account purposes, Net Income (and items thereof) and Net Loss (and items thereof) for any fiscal period each Fiscal Year shall be allocated among the Capital Accounts of the Members in a manner that as closely as possible gives economic effect to the provisions of Article VI, Section 13.3 and other relevant provisions, hereof. If a Unit is the subject of a transfer or the number of Units of a Member is changed pursuant to the terms of this Agreement during any Fiscal Year, the amount of Profit and Loss to be allocated to the Members for such entire Fiscal Year shall be allocated to the portion of such Fiscal Year which precedes the date of such transfer or change (and if there shall have been a prior transfer or change in such Fiscal Year, which commences on the date of such prior transfer or change) and to the portion of such Fiscal Year which occurs on and after the date of such transfer or change (and if there shall be a subsequent transfer or change in such Fiscal Year, which precedes the date of such subsequent transfer or change), in proportion to the number of days in each such portion (or, in the case of a transfer, in accordance with an interim closing of the books at the election and the expense of the transferee and the transferor), and the amounts of the items so allocated to each such portion shall be credited or charged to the Members pro rata during each such portion of the Fiscal Year in accordance question. Such allocation shall be made without regard to the date, amount or receipt of any distributions that may have been made with each Member’s respective Membership respect to the transferred Units. (b) For federal, state and local income tax purposes, items Notwithstanding anything to the contrary in Section 5.1(a): (i) The Losses allocated pursuant to Section 5.1(a) to any Member for any Fiscal Year shall not exceed the maximum amount of income, gain, loss, deduction and expense shall Losses that may be allocated to the Members in accordance with the allocations of the corresponding amount of Net Income (and items thereof) or amount of Net Loss (and items thereof) of which such items of income, gain, loss, deduction or expense are components for Member without causing such Member to have an Adjusted Capital Account purposes under this Section 6.01, except that items with respect to Company property for which there is a difference between tax basis and Deficit at the Book Value end of such property shall be allocated in accordance with Section 704(c) of the Code, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i). The Company shall specially allocate long-term capital gains with respect to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership UnitsFiscal Year. (c) Notwithstanding any provision of this Section 6.01, no item of deduction, loss or expense shall be allocated to a Member to the extent the allocation would cause a negative balance in such Member’s Capital Accounts (after taking into account the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) that exceeds the sum of (i) the amount that such Member would be required to reimburse the Company pursuant to this Agreement or under applicable law and (ii) the amount that such Member is deemed obligated to reimburse pursuant to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5). In the event If some but not all of the Members would have such excess an Adjusted Capital Account deficits Deficit as a consequence of such an allocation of loss, deduction or expenseLosses pursuant to Section 5.1(a), the limitation limitations set forth in this Section 6.01(c5.1(b) shall be applied on a Member-by-Member basis so as to allocate the maximum permissible deduction, loss or expense to each Member under Section 1.704-1(b)(2)(ii)(d) of the Treasury Regulations. In the event any loss, deduction or expense shall be specially allocated to a Member by allocating Losses pursuant to this Section 5.1(b) only to those Members who would not have an Adjusted Capital Account Deficit as a consequence of receiving such an allocation of Losses (with the preceding sentenceallocation of such Losses among such Members to be determined by the Management Committee, an equal amount of income or gain of based on the Company shall be specially allocated allocation that is most likely to such Member prior to any allocation pursuant to effectuate the distribution priorities set forth in Section 6.01(a6.1). (diii) In the event any If no Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6), items may receive an additional allocation of Company income and gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c) created by such adjustments, allocations or distributions. Any special allocations of items of income or gain Losses pursuant to this Section 6.01(d5.1(b)(ii) above, such additional Losses not allocated pursuant to Section 5.1(b)(ii) shall be taken into account in computing subsequent allocations pursuant to this Section 6.01 so that the net amount of any items so allocated and all other items allocated to each Member pursuant to this Section 6.01 shall, solely to the extent possible, be equal Members in proportion to their interests in the net amount that would have been allocated to each such Member pursuant to Company (as determined in accordance with the provisions of this Section 6.01 if such unexpected adjustments, allocations or distributions had not occurred. (e) In the event the Company incurs any nonrecourse liabilities, income and gain shall be allocated in accordance with the “minimum gain chargeback” provisions of Section 1.704-1(b)(4)(iv) and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of the Members shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) to reflect the fair market value (as determined by the Managing Member in its good faith judgment) of Company property whenever Membership Units are relinquished to the Company, whenever an additional Member is admitted to the Company in accordance with Section 4.03, upon any termination of the Company within the meaning of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) in the case of a distribution of any property (other than cash5.1). (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Company).

Allocation of Profits and Losses. (a) Except as otherwise set forth provided in this Section 6.01Agreement, Profits, Losses, gains, deductions and credits for Capital Account purposes, Net Income (tax and items thereof) and Net Loss (and items thereof) for any fiscal period accounting purposes shall be allocated among the Members pro rata in accordance with each the Members’ then current percentage ownership of shares for such period calculated pursuant to Section 3.05. In a taxable year in which any Member has a Capital Account with a negative balance attributable in whole or part to non-recourse deductions, then, before any other allocations are made under this Section 4.04, the Members whose Capital Accounts have a negative balance shall be allocated gain or income of the Company in an amount sufficient to constitute a minimum gain chargeback as described in Treasury Regulations promulgated under Section 704 of the Code and to the extent a Member has a Capital Account with a negative balance in excess of such Member’s respective Membership Unitsshare of minimum gain, such Member shall be allocated gain or income in an amount equal to the excess of such Member’s Capital Account negative balance over such Member’s share of minimum gain. (b) For federalIn any taxable year in which the Interests of the Members in the Company may change ownership, state the Members’ interest in Profits, Losses, gains, deductions and local income tax purposescredits or any item thereof and Disbursable Cash shall be determined by taking into account their varying interests during the taxable year as described in Section 706 of the Code and any proposed or final Treasury Regulations promulgated thereunder. In so doing, items the Members intend that their varying interests be based upon the number of incomedays of the taxable year each Member owned such Member’s Interests rather than upon the actual results of the Company’s operations; except that the Initial Members shall be deemed to have acquirex their Shares on the date of the initial closing of the Equity Private Placement.. (c) Except as provided in Section 4.04(d), gainupon liquidation of the Company pursuant to Section 10.03, lossall gain recognized by the Company upon the sale of Company property, deduction and expense shall be allocated to the Members pro rata in accordance with the allocations Members’ then current ownership of the corresponding amount of Net Income (and items thereof) or amount of Net Loss (and items thereof) of which such items of income, gain, loss, deduction or expense are components for Capital Account purposes under this Section 6.01, except that items with respect to Company property for which there is a difference between tax basis and the Book Value of such property shall be allocated in accordance with Section 704(c) of the Code, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i). The Company shall specially allocate long-term capital gains with respect to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership Units. (c) Notwithstanding any provision of this Section 6.01, no item of deduction, loss or expense shall be allocated to a Member to the extent the allocation would cause a negative balance in such Member’s Capital Accounts (after taking into account the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) that exceeds the sum of (i) the amount that such Member would be required to reimburse the Company pursuant to this Agreement or under applicable law and (ii) the amount that such Member is deemed obligated to reimburse pursuant to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5). In the event some but not all of the Members would have such excess Capital Account deficits as a consequence of such allocation of loss, deduction or expense, the limitation set forth in this Section 6.01(c) shall be applied on a Member-by-Member basis so as to allocate the maximum permissible deduction, loss or expense to each Member under Section 1.704-1(b)(2)(ii)(d) of the Treasury Regulations. In the event any loss, deduction or expense shall be specially allocated to a Member pursuant to the preceding sentence, an equal amount of income or gain of the Company shall be specially allocated to such Member prior to any allocation pursuant to Section 6.01(a)Shares. (d) It is the intent of the Members that each Member’s distributive share of Profits, gains, Losses, deductions or credits (or items thereof) shall be determined and allocated in accordance with this Section to the fullest extent permitted by Section 704(b) of the Code. In order to preserve and protect the event determination and allocations provided for in this Section 4.04, the Managers are authorized and directed to allocate Profits, gains, Losses, deductions or credits (or items thereof) arising in any Member unexpectedly receives any adjustmentsyear differently than otherwise provided for in this Section if, allocationsand to the extent that, allocating Profits, gains, Losses, deductions or distributions described credits (or item thereof) in the manner provided for in this Section 4.04 would cause allocations of each Member’s distributive share of Profits, gains, Losses, deductions or credits (or items thereof) not to be permitted by Section 704(b) of the Code and Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6), items of Company income and gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c) created by such adjustments, allocations or distributionspromulgated thereunder. Any special allocations of items of income or gain made pursuant to this Section 6.01(d4.04(d) shall be taken into account deemed to be a complete substitute for any allocation otherwise provided for in computing subsequent allocations pursuant to this Section 6.01 so that the net amount this Agreement, and no amendment of this Agreement or approval of any items so allocated and all other items allocated to each Member pursuant to this Section 6.01 shall, to the extent possible, shall be equal to the net amount that would have been allocated to each such Member pursuant to the provisions of this Section 6.01 if such unexpected adjustments, allocations or distributions had not occurredrequired. (e) In making any allocation (the event “new allocation”) under Section 4.04(d), the Managers are authorized to act only after having been advised by counsel or the accountants for the Company incurs any nonrecourse liabilitiesthat, income and gain shall be allocated in accordance with the “minimum gain chargeback” provisions of Section 1.704-1(b)(4)(iv) and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of the Members shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) to reflect the fair market value (as determined by the Managing Member in its good faith judgment) of Company property whenever Membership Units are relinquished to the Company, whenever an additional Member is admitted to the Company in accordance with Section 4.03, upon any termination of the Company within the meaning of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) in the case of a distribution of any property (other than cash). (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 704(b) of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units (i) the new allocation is necessary, and (ii) the new allocation is the minimum modification of the Company allocations otherwise provided for in this Section 4.04 necessary to assure that, either in the then current year or in any preceding year, each Member’s distributive share of Profits, gains, Losses, deductions or credits (or items thereof) is determined and allocated in accordance with respect this Section 4.04 to certain distributions the fullest extent permitted by Section 704(b) of property by the Company)Code and the Treasury Regulations thereunder.

Allocation of Profits and Losses. (a) Except as otherwise set forth in this Allocations of Profit and Loss. After taking into account any special allocations pursuant to Section 6.01, for Capital Account purposes, Net Income (and items thereof7(b) and Net Loss (and items thereof) subject to any limitations contained therein, Profits or Losses for any fiscal period Fiscal Year or portion thereof shall be allocated among the Members pro rata Class A Preferred Holders and the Common Holders in accordance a manner such that the Capital Account of each such Partner, immediately after making such allocation, is, as nearly as possible, equal (proportionately) to (i) the Distributions that would be made to such Partner if the Partnership sold all of its assets for cash equal to their Gross Asset Value, paid all Partnership liabilities (limited with respect to each Member’s respective Membership Units. (b) For federal, state and local income tax purposes, items of income, gain, loss, deduction and expense shall be allocated nonrecourse liability to the Members Gross Asset Value of the assets securing such liability), and distributed the remaining net cash to the Partners in accordance with the allocations priority set forth in Sections 9(a)(ii) and 9(a)(iii) (increased, in the case of the corresponding amount of Net Income (and items thereof) or amount of Net Loss (and items thereof) of which such items of incomeRockpoint Class B Preferred Holder, gain, loss, deduction or expense are components for by the Class B Capital Account purposes under this Section 6.01, except that items with respect to Company property for which there is a difference between tax basis and Contributions made by the Book Value of such property shall be allocated in accordance with Section 704(c) of the Code, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i). The Company shall specially allocate long-term capital gains with respect to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership Units. (c) Notwithstanding any provision of this Section 6.01, no item of deduction, loss or expense shall be allocated to a Member to the extent the allocation would cause a negative balance in such Member’s Capital Accounts (after taking into account the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4Rockpoint Class B Preferred Holder), (5) and (6)) that exceeds the sum of (i) the amount that such Member would be required to reimburse the Company pursuant to this Agreement or under applicable law and less (ii) the amount that such Member is deemed obligated to reimburse pursuant Partner’s share of Partnership Minimum Gain and Partner Nonrecourse Debt Minimum Gain, computed immediately prior to the penultimate sentences hypothetical sale of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5)assets. In the event some but Profits or Losses are not all sufficient to enable the Capital Accounts to equal the amounts described above, then Profits or Losses shall be allocated first, to cause the Capital Account of the Members would have such excess Capital Account deficits as a consequence Rockpoint Class A Preferred Holder to equal the amount described in Section 9(a)(ii), plus the amount of such allocation any Distribution Make-Whole that has not theretofore been paid, reduced by its share of loss, deduction or expensethe amount described in clause (ii) above. For purposes of clause (i), the limitation set forth in this Section 6.01(c) requirement to pay or distribute a Distribution Make-Whole shall not be applied on a Member-by-Member basis so as taken into account unless and until the occurrence of an event giving rise to allocate the maximum permissible deduction, loss Rockpoint Class A Preferred Holder’s right with respect or expense to each Member under Section 1.704-1(b)(2)(ii)(d) of the Treasury Regulations. In the event any loss, deduction or expense shall be specially allocated reference to a Member pursuant Distribution Make-Whole, in which case the Distribution Make-Whole payable with respect to the preceding sentence, an equal amount of income or gain of the Company shall be specially allocated to such Member prior to any allocation pursuant to Section 6.01(a). (d) In the event any Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6), items of Company income and gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c) created by such adjustments, allocations or distributions. Any special allocations of items of income or gain pursuant to this Section 6.01(d) Rockpoint Class A Preferred Holders shall be taken into account as necessary in computing subsequent allocations pursuant to this Section 6.01 so that the net amount of any items so allocated and all other items allocated to each Member pursuant to this Section 6.01 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 this Section 6.01 if such unexpected adjustments, allocations or distributions had not occurred. (e) In the event the Company incurs any nonrecourse liabilities, income and gain shall be allocated in accordance with the “minimum gain chargeback” provisions of Section 1.704-1(b)(4)(iv) and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of the Members shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) order to reflect the fair market value (as determined by the Managing Member in its good faith judgment) of Company property whenever Membership Units are relinquished rights to the Company, whenever an additional Member is admitted to the Company in accordance with Section 4.03, upon any termination of the Company within the meaning of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704such Distribution Make-1(b)(2)(iv)(e) in the case of a distribution of any property (other than cash)Whole. (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Company).

Allocation of Profits and Losses. (a) Except as otherwise set forth Subject to Section 5.6(b), and after the application of the allocation rules in this Section 6.015.7, Profits and Losses and, if the Board in its discretion determines it to be necessary, individual items thereof, for Capital Account purposes, Net Income an Allocation Year (and items thereofor other relevant period) and Net Loss (and items thereof) for any fiscal period shall be allocated among the Members pro rata for such Allocation Year (or other relevant period) in a manner determined by the Board so as to produce, as nearly as possible, the sum of (a) the Capital Account balance for each Member at the end of such Allocation Year (or other relevant period) and (b) such Member’s share of Company Minimum Gain and Member Nonrecourse Debt Minimum Gain, if any, equal to the hypothetical cash that would be distributed to such Member if (x) the Company were dissolved, its affairs wound up and its assets sold for an amount of hypothetical cash equal to the sum of the Gross Asset Values of the assets at the end of such Allocation Year (or other relevant period), (y) the Company paid all of its liabilities in accordance with their terms up to the amount of the hypothetical cash (limited with respect to each Member’s respective Membership Units. Nonrecourse Liability to the Gross Asset Value of the asset securing such liability), and (bz) For federal, state and local income tax purposes, items of income, gain, loss, deduction and expense shall be allocated the remaining hypothetical cash from the deemed sale were immediately distributed to the Members in accordance with the allocations of the corresponding amount of Net Income (and items thereof) or amount of Net Loss (and items thereof) of which such items of income, gain, loss, deduction or expense are components for Capital Account purposes under this Section 6.01, except that items with respect to Company property for which there is a difference between tax basis and the Book Value of such property shall be allocated in accordance with Section 704(c) of the Code, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i). The Company shall specially allocate long-term capital gains with respect to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership Units5.3. (cb) Notwithstanding the foregoing provisions of Section 5.6(a), the Losses (or items of expense or deduction or loss) allocated pursuant to Section 5.6(a) shall not exceed the maximum amount that can be so allocated without causing any provision of this Section 6.01, no item of deduction, loss or expense shall be allocated to a Member to have an Adjusted Capital Account Deficit at the extent the allocation would cause a negative balance in such Member’s Capital Accounts end of any Allocation Year (after taking into account the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) that exceeds the sum of (i) the amount that such Member would be required to reimburse the Company pursuant to this Agreement or under applicable law and (ii) the amount that such Member is deemed obligated to reimburse pursuant to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5other relevant period). In the event some some, but not all all, of the Members would have such excess an Adjusted Capital Account deficits Deficit as a consequence of such an allocation of loss, deduction or expenseLosses pursuant to Section 5.6(a), the limitation set forth in this Section 6.01(c5.6(b) shall be applied on a Member-by-Member basis so as to allocate the maximum permissible deduction, loss or expense Losses to each Member under Section 1.704-1(b)(2)(ii)(d) of the Treasury Regulations. In the event any loss, deduction or expense shall be specially allocated to a Member pursuant to the preceding sentence, an equal amount of income or gain of the Company shall be specially allocated to such Member prior to any allocation pursuant to Section 6.01(a). (d) In the event any Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6), items of Company income and gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c) created by such adjustments, allocations or distributions. Any special allocations of items of income or gain pursuant to this Section 6.01(d) shall be taken into account in computing subsequent allocations pursuant to this Section 6.01 so that the net amount of any items so allocated and all other items allocated to each Member pursuant to this Section 6.01 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 this Section 6.01 if such unexpected adjustments, allocations or distributions had not occurred. (e) In the event the Company incurs any nonrecourse liabilities, income and gain shall be allocated in accordance with the “minimum gain chargeback” provisions of Section 1.704-1(b)(4)(iv) and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of the Members shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f1(b)(2)(ii)(d). All Losses (or items of expense or deduction or loss) in excess of the limitation set forth in this Section 5.6(b) shall be allocated to reflect the fair market value (as determined by the Managing Member in its good faith judgment) of Company property whenever Membership Units are relinquished to the Company, whenever an additional Member is admitted to the Company other Members in accordance with Section 4.03, upon any termination of the Company within positive balances in such Members’ Adjusted Capital Accounts so as to allocate the meaning of Section 708 of the Code, and when the Company is liquidated pursuant maximum permissible Losses to Article XI, and shall be adjusted in accordance with each Member under Treasury Regulations Section 1.704-1(b)(2)(iv)(e) in the case of a distribution of any property (other than cash1(b)(2)(ii)(d). (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Company).

Allocation of Profits and Losses. (a) Except as otherwise After giving effect to the Regulatory Allocations set forth in Section 5.02 of this Section 6.01Agreement, for Capital Account purposes, Net Income (Profits and items thereof) and Net Loss (and items thereof) Losses for any fiscal year or other period of the Company shall be credited to the Capital Accounts of the Members as follows: Profits and Losses shall be allocated among the Members pro rata so as to produce, as nearly as possible, Capital Account balances for the Members (taking into account all prior allocations and distributions) which would equal the amount to which the Members would be entitled as a liquidating distribution from the Company upon a hypothetical liquidation in which the net proceeds were distributed in accordance with each Member’s respective Membership Units. the priorities set forth in ARTICLE VI and as if the net proceeds available for distribution were an amount equal to the aggregate positive balance in the Members’ Capital Accounts computed after taking into account all allocations of Profit and Loss (bor items thereof) For federalfor the fiscal period, state and local income tax purposesincluding those pursuant to this Section 5.01; provided, however, that if the allocation of all or any portion of the Company Losses (or items thereof) causes or increases an Adjusted Capital Account Deficit of incomea Member or Members with respect to such fiscal year to which the allocation of such Company Losses relates, gainthe excess, lossif any, deduction and expense shall be allocated to those Members, if any, having positive remaining Capital Account balances, to the Members extent of any such positive balances, and thereafter in accordance with the allocations Members’ respective economic risk of the corresponding amount of Net Income (and items thereof) or amount of Net Loss (and items thereof) of which such items of income, gain, loss, deduction or expense are components for Capital Account purposes under this Section 6.01, except that items loss with respect to Company property for any indebtedness to which there is a difference between tax basis and the Book Value of such property shall be allocated in accordance with Section 704(c) remaining Loss or deductions are attributable. All items of the CodeProfit for any fiscal year having a like character and treatment for federal income tax purpose, the Treasury Regulations thereunder(e.g., and Treasury Regulations Section 1.704ordinary income, as opposed to short-1(b)(4)(i). The Company shall specially allocate term capital gain, as opposed to long-term capital gains with respect to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership Units. (cgain) Notwithstanding any provision of this Section 6.01, no item of deduction, loss or expense shall be allocated to a Member to the extent the allocation would cause a negative balance in such Member’s Capital Accounts (after taking into account the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) that exceeds the sum of (i) the amount that such Member would be required to reimburse the Company pursuant to this Agreement or under applicable law and (ii) the amount that such Member is deemed obligated to reimburse pursuant to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5). In the event some but not all of the Members would have such excess Capital Account deficits as a consequence of such allocation of loss, deduction or expense, the limitation set forth in this Section 6.01(c) shall be applied on a Member-by-Member basis so as to allocate the maximum permissible deduction, loss or expense to each Member under Section 1.704-1(b)(2)(ii)(d) of the Treasury Regulations. In the event any loss, deduction or expense shall be specially allocated to a Member pursuant to the preceding sentence, an equal amount of income or gain of the Company shall be specially allocated to such Member prior to any allocation pursuant to Section 6.01(a). (d) In the event any Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6), items of Company income and gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c) created by such adjustments, allocations or distributions. Any special allocations of items of income or gain pursuant to this Section 6.01(d) shall be taken into account in computing subsequent allocations pursuant to this Section 6.01 so that the net amount of any items so allocated and all other items allocated to each Member pursuant to this Section 6.01 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 this Section 6.01 if such unexpected adjustments, allocations or distributions had not occurred. (e) In the event the Company incurs any nonrecourse liabilities, income and gain shall be allocated proportionately in accordance with the “minimum gain chargeback” provisions of Section 1.704-1(b)(4)(iv) and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of the Members shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) to reflect the fair market value (as determined by the Managing Member in its good faith judgment) of Company property whenever Membership Units are relinquished foregoing principles to the Companymaximum extent possible, whenever an additional Member is admitted to the Company in accordance with Section 4.03, upon any termination as if there were no items of the Company within the meaning Profit of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) in the case of a distribution of any property (other than cash)another character. (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Company).

Allocation of Profits and Losses. (ai) Except as otherwise set forth in After taking account of the special allocations of Exhibit C to this Section 6.01Agreement, Profits and Losses for Capital Account purposes, Net Income (and items thereof) and Net Loss (and items thereof) for any each fiscal period year or portion thereof shall be allocated among the Members pro rata so as to, as nearly as possible, increase or decrease, as the case may be, each Member’s Capital Account to the extent necessary such that each Member’s Capital Account is equal to the amount that would be made as a distribution to such Member pursuant to Section 6(b)(ii) if the Company were dissolved, its assets sold for cash equal to their Book Value, its liabilities satisfied in accordance with their terms (limited with respect to each nonrecourse liability to the Book Value of the assets securing such liability) and all remaining amounts distributed to the Members in accordance with Section 6(b)(ii) of this Agreement immediately after making such allocation, minus the sum of (1) such Member’s respective Membership Unitsshare of Company Minimum Gain or Member Nonrecourse Debt Minimum Gain, and (2) the amount, if any, that such Member is obligated (or deemed obligated) to contribute, in its capacity as a Member, to the Company; computed immediately prior to the hypothetical sale of Company assets. (bii) For federalThe intent of the foregoing allocation is to comply with Treasury Regulations Section 1.704-1(b) and ensure that the Members receive allocations of Profits and Losses pursuant to this Section 7(a) in accordance with their relative interests in the Company, state with the interest of each Member in the Company determined by reference to such Member’s relative rights to receive distributions from the Company pursuant to Section 6(b)(ii). If the Capital Accounts of the Members are in such ratios or balances that distributions in the manner set forth in Section 6(b)(ii) would not be in accordance with the positive Capital Accounts of the Members, such failure shall not affect or alter the distributions set forth in Section 6(b)(ii). Instead, the officers of the Company will have the authority to make other allocations of Profits and local income tax purposesLosses, or items of income, gain, lossloss or deduction, deduction and expense shall be allocated among the Members which will result to the Members extent possible in accordance with the allocations Capital Accounts of each Member having a balance prior to such distributions equal to the corresponding amount of Net Income (and items thereof) or amount of Net Loss (and items thereof) of which distributions to be received by such items of income, gain, loss, deduction or expense are components for Capital Account purposes under this Section 6.01, except that items with respect to Company property for which there is a difference between tax basis and the Book Value of such property shall be allocated Member in accordance with Section 704(c) of the Code, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i). The Company shall specially allocate long-term capital gains with respect to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership Units. (c) Notwithstanding any provision of this Section 6.01, no item of deduction, loss or expense shall be allocated to a Member to the extent the allocation would cause a negative balance in such Member’s Capital Accounts (after taking into account the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) that exceeds the sum of (i) the amount that such Member would be required to reimburse the Company pursuant to this Agreement or under applicable law and (ii) the amount that such Member is deemed obligated to reimburse pursuant to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5). In the event some but not all of the Members would have such excess Capital Account deficits as a consequence of such allocation of loss, deduction or expense, the limitation set forth in this Section 6.01(c) shall be applied on a Member-by-Member basis so as to allocate the maximum permissible deduction, loss or expense to each Member under Section 1.704-1(b)(2)(ii)(d) of the Treasury Regulations. In the event any loss, deduction or expense shall be specially allocated to a Member pursuant to the preceding sentence, an equal amount of income or gain of the Company shall be specially allocated to such Member prior to any allocation pursuant to Section 6.01(a6(b)(ii). (d) In the event any Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6), items of Company income and gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c) created by such adjustments, allocations or distributions. Any special allocations of items of income or gain pursuant to this Section 6.01(d) shall be taken into account in computing subsequent allocations pursuant to this Section 6.01 so that the net amount of any items so allocated and all other items allocated to each Member pursuant to this Section 6.01 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 this Section 6.01 if such unexpected adjustments, allocations or distributions had not occurred. (e) In the event the Company incurs any nonrecourse liabilities, income and gain shall be allocated in accordance with the “minimum gain chargeback” provisions of Section 1.704-1(b)(4)(iv) and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of the Members shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) to reflect the fair market value (as determined by the Managing Member in its good faith judgment) of Company property whenever Membership Units are relinquished to the Company, whenever an additional Member is admitted to the Company in accordance with Section 4.03, upon any termination of the Company within the meaning of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) in the case of a distribution of any property (other than cash). (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Company).

Allocation of Profits and Losses. (a) Except as otherwise set forth in this Section 6.014.02, for Capital Account purposes, Net Income (all items of income, gain, loss and items thereof) and Net Loss (and items thereof) for any fiscal period deduction shall be allocated among to the Members pro rata Member in a manner such that if the Company were dissolved, its affairs wound up and its assets distributed to the Member in accordance with each Member’s respective Membership Unitsits Capital Account balance immediately after making such allocation, such distribution would, as nearly as possible, be equal to the distributions that would be made pursuant to Section 5.03. (b) For federal, state and local income tax purposes, items of income, gain, loss, deduction and expense credit shall be allocated to the Members Member in accordance with the allocations of the corresponding amount of Net Income (and items thereof) or amount of Net Loss (and items thereof) of which such items of income, gain, loss, deduction or expense are components for Capital Account purposes under this Section 6.014.02, except that items with respect to Company property for which there is a difference between tax and book basis and the Book Value of such property shall will be allocated in accordance with Section 704(c) of the Code, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i). The Company shall specially allocate long-term capital gains with respect to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership Units. (c) Notwithstanding any provision of set forth in this Section 6.014.02, no item of deduction, deduction or loss or expense shall be allocated to a the Member to the extent the allocation would cause a negative balance in such the Member’s Capital Accounts Account (after taking into account the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) that exceeds the sum of (i) the amount that such the Member would be required to reimburse the Company pursuant to this Agreement or under applicable law and (ii) the amount that such Member is deemed obligated to reimburse pursuant to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5). In the event some but not all of the Members would have such excess Capital Account deficits as a consequence of such allocation of loss, deduction or expense, the limitation set forth in this Section 6.01(c) shall be applied on a Member-by-Member basis so as to allocate the maximum permissible deduction, loss or expense to each Member under Section 1.704-1(b)(2)(ii)(d) of the Treasury Regulations. In the event any loss, deduction or expense shall be specially allocated to a Member pursuant to the preceding sentence, an equal amount of income or gain of the Company shall be specially allocated to such Member prior to any allocation pursuant to Section 6.01(a)law. (d) In the event any the Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6), items of Company the Company’s income and gain shall be specially allocated to such the Member in an amount and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c4.02(c) created by such adjustments, allocations or distributions. Any special allocations of items of income or gain pursuant to this Section 6.01(d4.02(d) shall be taken into account in computing subsequent allocations pursuant to this this Section 6.01 4.02 so that the net amount of any items so allocated and all other items allocated to each the Member pursuant to this Section 6.01 4.02 shall, to the extent possible, be equal to the net amount that would have been allocated to each such the Member pursuant to the provisions of this Section 6.01 4.02 if such unexpected adjustments, allocations or distributions had not occurred. (e) In the event the Company incurs any nonrecourse liabilities, income and gain shall be allocated in accordance with the “minimum gain chargeback” provisions of Section 1.704-1(b)(4)(iv) and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of the Members shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) to reflect the fair market value (as determined by the Managing Member in its good faith judgment) of Company property whenever Membership Units are relinquished to the Company, whenever an additional Member is admitted to the Company in accordance with Section 4.03, upon any termination of the Company within the meaning of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) in the case of a distribution of any property (other than cash). (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Company).

Allocation of Profits and Losses. (a) The Company's Profits and Losses shall be determined on an annual basis and shall be allocated to the Members in accordance with this Section 5.02. (b) Except as otherwise set forth provided in this Section 6.01, for Capital Account purposes, Net Income (and items thereof5.02(c) and Net Loss (and items thereof) d), Profits or Losses for any each fiscal period year shall be allocated among the Members pro rata (and credited or debited to their Capital Accounts) in such manner that if the Company were to liquidate completely immediately after the end of such fiscal year and in connection with such liquidation sell all of its assets and settle all of its liabilities at their then Adjusted Book Values (i.e., without any Profits or Losses resulting therefrom); (i) the distribution by the Company of any remaining cash to the Members in accordance with each Member’s their respective Membership Units. positive Capital Account balances (bafter crediting or debiting Capital Accounts for Profits or Losses for such fiscal year) would correspond as closely as possible to the distributions that would result if the liquidating distributions has instead been made in accordance with the provisions of Section 5.01(b), and (ii) any resulting deficit Capital Account balances (after crediting or debiting Capital Accounts for Profits and Losses for such fiscal year) would correspond as closely as possible to the manner in which economic responsibility for Company deficit balances (as determined in accordance with the principles of Treasury Regulations under Section 704 of the Code) would be borne by the Members under the terms of this Agreement and any collateral agreements. For federal, state and local income tax purposespurposes of maintaining the Capital Accounts, items of income, gain, loss, deduction deduction, expense and expense credit shall be allocated to the Members in accordance with the allocations same manner as are Profits and Losses, except where otherwise necessary to more closely achieve the result contemplated by the first sentence of the corresponding amount of Net Income (and items thereof) or amount of Net Loss (and items thereof) of which such items of income, gain, loss, deduction or expense are components for Capital Account purposes under this Section 6.01, except that items with respect to Company property for which there is a difference between tax basis and the Book Value of such property shall be allocated in accordance with Section 704(c) of the Code, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i5.02(b). The Company shall specially allocate long-term capital gains with respect to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership Units. (c) Notwithstanding any provision Allocations necessary to fulfill the requirements of this Section 6.01, no item of deduction, loss or expense shall be allocated to a Member to the extent the allocation would cause a negative balance in such Member’s Capital Accounts (after taking into account the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) that exceeds the sum of (i) the amount that such Member would be required to reimburse the Company pursuant to this Agreement or "qualified income offset" under applicable law and (ii) the amount that such Member is deemed obligated to reimburse pursuant to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5)Treas. In the event some but not all of the Members would have such excess Capital Account deficits as a consequence of such allocation of loss, deduction or expense, the limitation set forth in this Section 6.01(c) shall be applied on a Member-by-Member basis so as to allocate the maximum permissible deduction, loss or expense to each Member under Section Reg. ss. 1.704-1(b)(2)(ii)(d) and a "minimum gain chargeback" under Treas. Reg. ss. 1.704-2(f) shall be made, but shall be neutralized to the extent feasible by offsetting allocations made for subsequent periods. (d) To the extent practicable, distributions to PHC in respect of the Treasury Regulations. In the event any loss, deduction or expense shall be specially allocated to a Member PHC Priority pursuant to the preceding sentencefirst sentence of Section 5.01(b) shall not be considered made out of Profits, an equal amount of and taxable income or and gain of the Company shall not be specially allocated to PHC on account of such Member prior to any allocation pursuant to Section 6.01(a). distributions (d) In the event any Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6), items of Company income and gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c) created by such adjustments, allocations or distributions. Any special allocations of items of income or gain pursuant to this Section 6.01(d) shall be taken into account in computing subsequent allocations pursuant to this Section 6.01 so that the net amount of any items so allocated and all other items allocated to each Member pursuant to this Section 6.01 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 this Section 6.01 if such unexpected adjustments, allocations or distributions had not occurred. (e) In the event the Company incurs any nonrecourse liabilities, income and gain shall be allocated in accordance with the “minimum gain chargeback” provisions of Section 1.704-1(b)(4)(iv) and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of the Members shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) to reflect the fair market value (as determined by the Managing Member in its good faith judgment) of Company property whenever Membership Units are relinquished to the Company, whenever an additional Member is admitted to the Company in accordance with Section 4.03, upon any termination of the Company within the meaning of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) in the case of a distribution of any property (other than cash). (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding except with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Companyamounts representing notional interest).

Allocation of Profits and Losses. (a) Except as otherwise set forth provided in this Section 6.01, for Capital Account purposes, Net Income 3.3: (and items thereofi) Subject to the allocations specified in Sections 3.3(a)(ii) and Net Loss (3.3(a)(iii) below, all Profits and items thereof) for any fiscal period Losses of the Company shall be allocated among the Members pro rata in accordance with each Member’s respective Membership Units. (b) For federal, state and local income tax purposes, items of income, gain, loss, deduction and expense shall be allocated charged to the Members in accordance with the allocations of the corresponding amount of Net Income (and items thereof) or amount of Net Loss (and items thereof) of which such items of income, gain, loss, deduction or expense are components for Capital Account purposes under this Section 6.01, except that items with respect to Company property for which there is a difference between tax basis and the Book Value of such property shall be allocated in accordance with Section 704(c) of the Code, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i). The Company shall specially allocate long-term capital gains with respect to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership Unitstheir respective Unit Percentages. (cii) Notwithstanding any provision of this Section 6.013.3(a)(i) above, in no item of deduction, loss or expense event shall Losses be allocated to a Member to the extent the such allocation would cause result in any limitation on the use of such Losses under Section 704(d) of the Internal Revenue Code of 1986, as amended from time to time (the “Code”). All the Losses subject to the foregoing limitation shall be reallocated to the Members having a negative balance positive tax basis in such Member’s Capital Accounts their Units (after taking into account all components there- of, including, without limitation, the adjustments, allocations and distributions described share of Members in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) that exceeds the sum liabilities of (i) the amount that such Member would be required to reimburse the Company pursuant to this Agreement or under applicable law and (ii) the amount that such Member is deemed obligated to reimburse pursuant to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5). In the event some but not all Section 752 of the Members would have such excess Capital Account deficits as a consequence of such allocation of loss, deduction or expense, the limitation set forth in this Section 6.01(c) shall be applied on a Member-by-Member basis so as to allocate the maximum permissible deduction, loss or expense to each Member under Section 1.704-1(b)(2)(ii)(d) of the Treasury Regulations. In the event any loss, deduction or expense shall be specially allocated to a Member pursuant to the preceding sentence, an equal amount of income or gain of the Company shall be specially allocated to such Member prior to any allocation pursuant to Section 6.01(aCode). (diii) Notwithstanding Section 3.3(a)(i) above, Profits equal to the excess (if any) of Losses reallocated under Section 3.3(a)(ii) at any time since the Formation Date over Profits previously allocated under this Section 3.3(a)(iii) since the Formation Date, shall be allo- cated 100% to Members in the proportion and amounts in which such excess was allocated. (b) In the event case of any property contributed to the Company by any Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)which at the time of contribution has an adjusted tax basis which differs from its fair market value, items of Company Profits, Losses, income, gain and deduction for income and gain tax purposes shall be specially allocated to such Member in an amount and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted required under Section 6.01(c704(c) created by of the Code to take into account such adjustmentsdifference. (c) Any item of taxable income, allocations gain, loss or distributionsdeduction of the Company (as well as any credits or the basis of property to which such credits apply) as determined for federal income tax purposes shall be allocated in the same manner as the corresponding income, gain, loss, or deduction is allocated under Section 3.3(a). Any special allocations of items of income or gain Allocations pursuant to this Section 6.01(d3.3(c) are solely for purposes of federal, state, and local taxes and shall not affect, or in any way be taken into account in computing subsequent allocations computing, any Member’s Capital Account or share of Profits, Losses, other items, or distributions pursuant to this Section 6.01 so that the net amount of any items so allocated and all other items allocated to each Member pursuant to this Section 6.01 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 this Section 6.01 if such unexpected adjustments, allocations or distributions had not occurred. (e) In the event the Company incurs any nonrecourse liabilities, income and gain shall be allocated in accordance with the “minimum gain chargeback” provisions of Section 1.704-1(b)(4)(iv) and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of the Members shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) to reflect the fair market value (as determined by the Managing Member in its good faith judgment) of Company property whenever Membership Units are relinquished to the Company, whenever an additional Member is admitted to the Company in accordance with Section 4.03, upon any termination of the Company within the meaning of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) in the case of a distribution of any property (other than cash). (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms provision of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Company).

Allocation of Profits and Losses. (a) Except as otherwise set forth in this Section 6.01, for Capital Account purposes, Net Income (and items thereof) and Net Loss (and items thereof) for any fiscal period shall be allocated among the Members pro rata in accordance with each Member’s respective Membership Units. (b) For federal, state and local income tax purposes, items of income, gain, loss, deduction and expense shall be allocated to the Members in accordance with the allocations of the corresponding amount of Net Income (and items thereof) or amount of Net Loss (and items thereof) of which such items of income, gain, loss, deduction or expense are components for Capital Account purposes under this Section 6.01, except that items with respect to Company property for which there is a difference between tax basis and the Book Value of such property shall be allocated in accordance with Section 704(c) of the Code, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i). The Company shall specially allocate long-term capital gains with respect to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership Units. (c) Notwithstanding any provision of this Section 6.01, no item of deduction, loss or expense shall be allocated to a Member to the extent the allocation would cause a negative balance in such Member’s Capital Accounts (after taking into account the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) that exceeds the sum of (i) the amount that such Member would be required to reimburse the Company pursuant to this Agreement or under applicable law and (ii) the amount that such Member is deemed obligated to reimburse pursuant to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5). In the event some but not all of the Members would have such excess Capital Account deficits as a consequence of such allocation of loss, deduction or expense, the limitation set forth in this Section 6.01(c) shall be applied on a Member-by-Member basis so as to allocate the maximum permissible deduction, loss or expense to each Member under Section 1.704-1(b)(2)(ii)(d) of the Treasury Regulations. In the event any loss, deduction or expense shall be specially allocated to a Member pursuant to the preceding sentence, an equal amount of income or gain of the Company shall be specially allocated to such Member prior to any allocation pursuant to Section 6.01(a). (d) In the event any Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6), items of Company income and gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c) created by such adjustments, allocations or distributions. Any special allocations of items of income or gain pursuant to this Section 6.01(d) shall be taken into account in computing subsequent allocations pursuant to this Section 6.01 so that the net amount of any items so allocated and all other items allocated to each Member pursuant to this Section 6.01 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 this Section 6.01 if such unexpected adjustments, allocations or distributions had not occurred. (e) In the event the Company incurs any nonrecourse liabilities, income and gain shall be allocated in accordance with the “minimum gain chargeback” provisions of Section 1.704-1(b)(4)(iv1 (b)(4)(iv) and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of the Members shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) to reflect the fair market value (as determined by the Managing Member in its good faith judgment) of Company property whenever Membership Units are relinquished to the Company, whenever an additional Member is admitted to the Company in accordance with Section 4.03, upon any termination of the Company within the meaning of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) in the case of a distribution of any property (other than cash). (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Company).

Allocation of Profits and Losses. (a) Except as otherwise set forth provided in this Section 6.01Agreement, Profits, gains, and credits for Capital Account purposes, Net Income (tax and items thereof) and Net Loss (and items thereof) for any fiscal period accounting purposes shall be allocated among the Members pro rata in accordance with each the Members' then current percentage ownership of shares for such period calculated pursuant to Section 3.04. Losses and deductions shall be allocated pro rata in accordance with the Members’ Capital Accounts. In a taxable year in which any Member has a Capital Account with a negative balance attributable in whole or part to non-recourse deductions, then, before any other allocations are made under this Section 4.04, the Members whose Capital Accounts have a negative balance shall be allocated gain or income of the Company in an amount sufficient to constitute a minimum gain chargeback as described in Treasury Regulations promulgated under Section 704 of the Code and to the extent a Member has a Capital Account with a negative balance in excess of such Member’s respective Membership Unitsshare of minimum gain, such Member shall be allocated gain or income in an amount equal to the excess of such Member’s Capital Account negative balance over such Member’s share of minimum gain. (b) For federal, state and local income tax purposes, items In any taxable year in which the Interests of income, gain, loss, deduction and expense shall be allocated to the Members in accordance with the allocations Company may change ownership, the Members’ interest in Profits, Losses, gains, deductions and credits or any item thereof and Disbursable Cash shall be determined by taking into account their varying interests during the taxable year as described in Section 706 of the corresponding amount Code and any proposed or final Treasury Regulations promulgated thereunder. In so doing, the Members intend that their varying interests be based upon the number of Net Income (and items thereof) or amount of Net Loss (and items thereof) of which such items of income, gain, loss, deduction or expense are components for Capital Account purposes under this Section 6.01, except that items with respect to Company property for which there is a difference between tax basis and the Book Value of such property shall be allocated in accordance with Section 704(c) days of the Code, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i). The Company shall specially allocate long-term capital gains with respect to Membership Units for which a taxable year each Member owned such Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership UnitsInterests rather than upon the actual results of the Company’s operations. (c) Notwithstanding any provision of this Except as provided in Section 6.01, no item of deduction, loss or expense shall be allocated to a Member to the extent the allocation would cause a negative balance in such Member’s Capital Accounts (after taking into account the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(44.04(d), (5) and (6)) that exceeds the sum upon liquidation of (i) the amount that such Member would be required to reimburse the Company pursuant to this Agreement or under applicable law and (ii) Section 10.03, all gain recognized by the amount that such Member is deemed obligated to reimburse pursuant to Company upon the penultimate sentences sale of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5). In the event some but not all of the Members would have such excess Capital Account deficits as a consequence of such allocation of lossCompany property, deduction or expense, the limitation set forth in this Section 6.01(c) shall be applied on a Member-by-Member basis so as to allocate allocated pro rata in accordance with the maximum permissible deduction, loss or expense to each Member under Section 1.704-1(b)(2)(ii)(d) Members' then current ownership of the Treasury Regulations. In the event any loss, deduction or expense shall be specially allocated to a Member pursuant to the preceding sentence, an equal amount of income or gain of the Company shall be specially allocated to such Member prior to any allocation pursuant to Section 6.01(a)shares. (d) It is the intent of the Members that each Member’s distributive share of Profits, gains, Losses, deductions or credits (or items thereof) shall be determined and allocated in accordance with this Section to the fullest extent permitted by Section 704(b) of the Code. In order to preserve and protect the event determination and allocations provided for in this Section 4.04, the Managing Member(s) are authorized and directed to allocate Profits, gains, Losses, deductions or credits (or items thereof) arising in any Member unexpectedly receives any adjustmentsyear differently than otherwise provided for in this Section if, allocationsand to the extent that, allocating Profits, gains, Losses, deductions or distributions described credits (or item thereof) in the manner provided for in this Section 4.04 would cause allocations of each Member’s distributive share of Profits, gains, Losses, deductions or credits (or items thereof) not to be permitted by Section 704(b) of the Code and Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6), items of Company income and gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c) created by such adjustments, allocations or distributionspromulgated thereunder. Any special allocations of items of income or gain made pursuant to this Section 6.01(d4.04(d) shall be taken into account deemed to be a complete substitute for any allocation otherwise provided for in computing subsequent allocations pursuant to this Section 6.01 so that the net amount this Agreement, and no amendment of this Agreement or approval of any items so allocated and all other items allocated to each Member pursuant to this Section 6.01 shall, to the extent possible, shall be equal to the net amount that would have been allocated to each such Member pursuant to the provisions of this Section 6.01 if such unexpected adjustments, allocations or distributions had not occurredrequired. (e) In the event the Company incurs making any nonrecourse liabilities, income and gain shall be allocated in accordance with allocation (the “minimum gain chargeback” provisions of new allocation”) under Section 1.704-1(b)(4)(iv) and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of the Members shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) to reflect the fair market value (as determined by 4.05(d), the Managing Member in its good faith judgmentMember(s) of Company property whenever Membership Units are relinquished authorized to act only after having been advised by counsel to the Company, whenever an additional Member is admitted Managing Member(s) or counsel to the Company in accordance with Section 4.03that, upon any termination of the Company within the meaning of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) in the case of a distribution of any property (other than cash). (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 704(b) of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units (i) the new allocation is necessary, and (ii) the new allocation is the minimum modification of the Company and with respect to certain distributions of property by the Company).allocations otherwise provided for in this

Allocation of Profits and Losses. (a) Except All Profits as otherwise set forth determined in this accordance with Section 6.01, for Capital Account purposes, Net Income (and items thereof7(d) and Net Loss (and items thereof) for any fiscal period herein shall be allocated among the Members pro rata as follows: (i) First, Profits shall be allocated to all of the Members in accordance with each Member’s the amount of and in proportion to the excess, if any, of (A) the aggregate distributions which have been paid, or are payable, to such Member as of the last day of the current year; less (B) the aggregate amount of Profits previously allocated to such Member pursuant to this Section 7(a)(i) for all prior years; and (ii) Second, all remaining Profits shall be allocated to all of the Members in proportion to their respective Membership UnitsLLC Interests. (b) For federal, state and local income tax purposes, items of income, gain, loss, deduction and expense shall be allocated to the Members in accordance with the allocations of the corresponding amount of Net Income (and items thereof) or amount of Net Loss (and items thereof) of which such items of income, gain, loss, deduction or expense are components for Capital Account purposes under this Section 6.01, except that items with respect to Company property for which there is a difference between tax basis and the Book Value of such property shall be allocated All Losses as determined in accordance with Section 704(c7(d) of hereof shall be allocated among the Code, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i). The Company shall specially allocate long-term capital gains with respect Members in proportion to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership Unitstheir respective Capital Accounts. (c) Notwithstanding any provision Articles 7(a) and (b) hereof: (i) Profits and Losses shall be specifically allocated (the "Regulatory Allocations") if and to the extent necessary to comply with the Regulations under Code Section 704(b) (the "704(b) Regulations"), all as determined by the Tax Matters Partner (as defined in Section 8(e) below). (ii) If Regulatory Allocations have been made, then subsequent allocations of Profits and Losses (the "Curative Allocations") shall be made, so that the net result of all allocations of Profits and Losses pursuant to Sections 7(a) and (b) and this Sections 7(c) in the aggregate shall, as quickly as possible and to the extent possible without violating the constraints prescribed by the 704(b) Regulations, be the same as if no allocations had been made pursuant to this Article 7(c), all as determined by the Tax Matter Partner. (iii) In furtherance of this Section 6.017(c), no item all items of deduction, loss or expense shall be allocated Losses attributable to a Member to the extent the allocation would cause a negative balance in such Member’s Capital Accounts (after taking into account the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) that exceeds the sum of (i) the amount that such Member would be required to reimburse the Company pursuant to this Agreement or under applicable law and (ii) the amount that such Member is deemed obligated to reimburse pursuant to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5). In the event some but not all of the Members would have such excess Capital Account deficits as a consequence of such allocation of loss, deduction or expense, the limitation set forth in this Section 6.01(c) shall be applied on a Member-by-Member basis so as to allocate the maximum permissible deduction, loss or expense to each Member under Section 1.704-1(b)(2)(ii)(d) of the Treasury Regulations. In the event any loss, deduction or expense shall be specially allocated to a Member pursuant to the preceding sentence, an equal amount of income or gain liability of the Company shall be specially specifically allocated to the Member that bears the economic risk of loss for such liability and such Member prior to any allocation pursuant to Section 6.01(a). (d) In the event any Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6), shall be allocated items of Company income and gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c) created by such adjustments, allocations or distributions. Any special allocations of items of income or gain pursuant to this Section 6.01(d) shall be taken into account in computing subsequent allocations pursuant to this Section 6.01 so that the net amount of any items so allocated and all other items allocated to each Member pursuant to this Section 6.01 shall, Profits to the extent possiblethat there is a net decrease in the minimum gain attributable to such portion of such liability, be equal to the net amount that would have been allocated to each such Member pursuant to the provisions of this Section 6.01 if such unexpected adjustments, allocations or distributions had not occurred. (e) In the event the Company incurs any nonrecourse liabilities, income and gain shall be allocated all in accordance with the “minimum gain chargeback” provisions of Section 1.704-1(b)(4)(iv704(b) and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of the Members shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) to reflect the fair market value (as determined by the Managing Member in its good faith judgment) of Company property whenever Membership Units are relinquished to the Company, whenever an additional Member is admitted to the Company in accordance with Section 4.03, upon any termination of the Company within the meaning of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) in the case of a distribution of any property (other than cash)Tax Matters Partner. (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Company).

Allocation of Profits and Losses. (a) For each period for which Profits or Losses are determined, the Manager shall determine the amount of Profits or Losses attributable to each Project. The Manager shall make such determination in the Manager’s reasonable discretion based on such information and factors as the Manager may from time to time determine to be relevant, including the designations by the Subsidiary REIT of its distributions to the Venture, the source and intended use of any reserves maintained by the Venture, and a reasonable apportionment of Venture expenditures for administrative costs. Except as otherwise set forth provided in this Section 6.014.1, for Capital Account purposes, Net Income (Profits and items thereof) and Net Loss (and items thereof) for any fiscal period Losses attributed to each Project shall be allocated among the Members pro rata in accordance with proportion to the Project Net Capital of each Member’s respective Membership UnitsMember for such Project. (b) For federalNotwithstanding anything to the contrary in this Agreement, state Profits and local income tax purposes, items of income, gain, loss, deduction and expense Losses shall be allocated to the Members in accordance as though this Agreement contained (and there is hereby incorporated herein by reference) a qualified income offset provision which complies with Treas. Reg. § 1.704-1(b)(2)(ii)(d) and minimum gain chargeback and partner minimum gain chargeback provisions which comply with the allocations requirements of the corresponding amount of Net Income (and items thereof) or amount of Net Loss (and items thereof) of which such items of income, gain, loss, deduction or expense are components for Capital Account purposes under this Section 6.01, except that items with respect to Company property for which there is a difference between tax basis and the Book Value of such property shall be allocated in accordance with Section 704(c) of the Code, the Treasury Regulations thereunder, and Treasury Regulations Section Treas. Reg. § 1.704-1(b)(4)(i). The Company shall specially allocate long-term capital gains with respect to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership Units2. (c) Notwithstanding In the event that any provision of this Section 6.01, amounts paid or payable to any Member or any Affiliate which the Venture deducted or intended to deduct are disallowed as deductions for U.S. federal income tax purposes (or it is determined that such amounts are no item of deduction, loss or expense shall be allocated to a Member to the extent the allocation would cause a negative balance in such Member’s Capital Accounts (after taking into account the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4longer allowable as deductions), (5) and (6)) that exceeds the sum of (i) the amount that such amounts thus disallowed or no longer allowable will be allocated to the Member would be required to reimburse the Company pursuant to this Agreement which received them (or under applicable law whose Affiliate received them) as income, and (ii) the amount that such Member is deemed obligated to reimburse pursuant notwithstanding any provision herein to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5). In contrary, the event some but not all balance of the Members would have such excess Capital Account deficits as a consequence of such allocation of loss, deduction redetermined income or expense, the limitation set forth in this Section 6.01(c) shall be applied on a Member-by-Member basis so as to allocate the maximum permissible deduction, loss or expense to each Member under Section 1.704-1(b)(2)(ii)(d) of the Treasury Regulations. In Venture for the event any loss, deduction or expense shall be specially allocated to a Member pursuant to the preceding sentence, an equal amount of income or gain of the Company shall be specially allocated to such Member prior to any allocation pursuant to Section 6.01(a). (d) In the event any Member unexpectedly receives any adjustments, allocations, or distributions described taxable year in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6), items of Company income and gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c) created by such adjustments, allocations or distributions. Any special allocations of items of income or gain pursuant to this Section 6.01(d) shall be taken into account in computing subsequent allocations pursuant to this Section 6.01 so that the net amount of any items so allocated and all other items allocated to each Member pursuant to this Section 6.01 question shall, to the extent possiblepermitted by law, be equal allocated among the Members to obtain the same allocation of Venture income or loss (after giving effect to the net amount that income allocated pursuant to clause (i) hereof) as would have been allocated to each obtained for such Member pursuant to taxable year if the provisions of this Section 6.01 if such unexpected adjustments, allocations amounts thus disallowed or distributions no longer allowable had not occurred. (e) In the event the Company incurs any nonrecourse liabilities, income and gain shall be allocated in accordance with the “minimum gain chargeback” provisions of Section 1.704-1(b)(4)(iv) and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of the Members shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) to reflect the fair market value (as determined been proper deductions by the Managing Member in its good faith judgment) of Company property whenever Membership Units are relinquished to the Company, whenever an additional Member is admitted to the Company in accordance with Section 4.03, upon any termination of the Company within the meaning of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) in the case of a distribution of any property (other than cash)Venture. (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Company).

Allocation of Profits and Losses. (a) Except as otherwise set forth in this Section 6.01, 5.02 for Capital Account purposes, Net Income (all items of income, gain, loss and items thereof) and Net Loss (and items thereof) for any fiscal period deduction shall be allocated among the Members pro rata in accordance with each Member’s their respective Membership UnitsInterests. (b) For federal, state and local income tax purposes, items of income, gain, loss, deduction and expense credit shall be allocated to the Members in accordance with the allocations of the corresponding amount of Net Income (and items thereof) or amount of Net Loss (and items thereof) of which such items of income, gain, loss, deduction or expense are components for Capital Account purposes under this Section 6.015.02, except that items with respect to Company property for which there is a difference between tax and book basis and the Book Value of such property shall will be allocated in accordance with Section 704(c) of the Code, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i). The Company shall specially allocate long-term capital gains with respect to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership Units. (c) Notwithstanding any provision of set forth in this Section 6.01Section, no item of deduction, deduction or loss or expense shall be allocated to a Member to the extent the allocation would cause a negative balance in such Member’s 's Capital Accounts Account (after taking into account the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) that exceeds the sum of (i) the amount that such Member would be required to reimburse the Company pursuant to this Agreement or under applicable law and (ii) the amount that such Member is deemed obligated to reimburse pursuant to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5). In the event some but not all of the Members would have such excess Capital Account deficits as a consequence of such allocation of loss, deduction or expense, the limitation set forth in this Section 6.01(c) shall be applied on a Member-by-Member basis so as to allocate the maximum permissible deduction, loss or expense to each Member under Section 1.704-1(b)(2)(ii)(d) of the Treasury Regulations. In the event any loss, deduction or expense shall be specially allocated to a Member pursuant to the preceding sentence, an equal amount of income or gain of the Company shall be specially allocated to such Member prior to any allocation pursuant to Section 6.01(a)law. (d) In the event any Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6), items of Company the Company's income and gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c5.02(c) created by such adjustments, allocations or distributions. Any special allocations of items of income or gain pursuant to this Section 6.01(d5.02(d) shall be taken into account in computing subsequent allocations pursuant to this this Section 6.01 5.02 so that the net amount of any items so allocated and all other items allocated to each Member pursuant to this Section 6.01 5.02 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 this Section 6.01 5.02 if such unexpected adjustments, special allocations or distributions had not occurred. (e) In the event the Company incurs any nonrecourse liabilities, income and gain shall be allocated Nonrecourse deductions as defined in accordance with the “minimum gain chargeback” provisions of Section 1.704-1(b)(4)(iv) and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of the Members shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f2(b) to reflect shall be allocated among the fair market value (as determined by the Managing Member in its good faith judgment) of Company property whenever Membership Units are relinquished to the Company, whenever an additional Member is admitted to the Company Members in accordance with Section 4.03, upon any termination of the Company within the meaning of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) in the case of a distribution of any property (other than cash)their respective Membership Interests. (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Company).

Allocation of Profits and Losses. (a) Except as otherwise set forth in this Section 6.01, for Capital Account For income tax purposes, Net Income allocations of net profits, other than net profits being allocated at the time of dissolution and liquidation of River Edge, shall be made to the extent possible to the Equity Members in the same amounts as (and items thereofin proportion to if less than) and Net Loss the distributions that would be made to the Equity Members under Section 5.2 for the same period. All other allocations for income tax purposes shall be made as follows: (and items thereofi) for any fiscal period net profits shall be allocated among the Equity Members pro rata in the manner necessary to increase each Equity Member Household’s Capital Account (after increasing the Capital Account balances by the amounts of “partnership minimum gain” and “partner minimum gain” that would be allocated to the Equity Members if all River Edge assets were sold for an amount equal to the indebtedness encumbering such assets) to an amount equal to the amount of cash such Equity Member would be entitled to receive pursuant to Section 5.2 if an amount of cash equal to the net positive Capital Account balances (after such allocation and after increasing the Capital Account balances by the amounts of “partnership minimum gain” and “partner minimum gain” as described above) were distributed to the Members pursuant to Section 5.2, and (ii) net losses shall be allocated among the Equity Members in the manner necessary to reduce each Equity Member Household’s Capital Account (after increasing the Capital Account balances by the amounts of “partnership minimum gain” and “partner minimum gain” as described above) to an amount equal to the amount of cash such Equity Member would be entitled to receive pursuant to Section 5.2 if an amount of cash equal to the net positive Capital Account balances (after such allocation and after increasing the Capital Account balances by the amounts of “partnership minimum gain” and “partner minimum gain” as described above) were distributed to the Equity Members pursuant to Section 5.2. Notwithstanding the foregoing, all allocations of “partnership nonrecourse deductions” and “partnership minimum gain” and other items that cannot have economic effect (except “partner nonrecourse deductions” and “partner minimum gain”) shall be allocated to the Equity Members in accordance with each Member’s respective Membership Unitsthe Equity Members’ interests in River Edge, which, unless otherwise required by Code Section 704(b) and the regulations promulgated thereunder, shall be in proportion to the Percentage Interests of the Equity Member Households, and all “partner nonrecourse deductions” and “partner minimum gain” shall be allocated in accordance with the provisions of Regulations Section 1.704-2. This Section 5.4(a) is intended to comply in full with the Regulations under Section 704(b) of the Code, including the “qualified income offset” and “minimum gain chargeback” provisions thereof, and shall be interpreted consistently therewith. (b) For federal, state Net profits and local net losses shall be as determined for reporting on River Edge’s Federal income tax purposes, return. All items of income, gain, loss, deduction and expense shall be allocated to the Members in accordance with the allocations of the corresponding amount of Net Income (and items thereof) or amount of Net Loss (and items thereof) of which such items of incomedepreciation, gain, loss, deduction or expense are components for Capital Account purposes under this Section 6.01, except that items with respect to Company property for which there is a difference between tax basis and the Book Value of such property credit shall be allocated in accordance with Section 704(c) of the Code, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i). The Company shall specially allocate long-term capital gains with respect to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership Units. (c) Notwithstanding any provision of this Section 6.01, no item of deduction, loss or expense shall be allocated to a Member to the extent the allocation would cause a negative balance in such Member’s Capital Accounts (after taking into account the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) that exceeds the sum of (i) the amount that such Member would be required to reimburse the Company pursuant to this Agreement or under applicable law and (ii) the amount that such Member is deemed obligated to reimburse pursuant to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5). In the event some but not all of the Members would have such excess Capital Account deficits as a consequence of such allocation of loss, deduction or expense, the limitation set forth in this Section 6.01(c) shall be applied on a Member-by-Member basis so as to allocate the maximum permissible deduction, loss or expense to each Member under Section 1.704-1(b)(2)(ii)(d) of the Treasury Regulations. In the event any loss, deduction or expense shall be specially allocated to a Member pursuant to the preceding sentence, an equal amount of income or gain of the Company shall be specially allocated to such Member prior to any allocation pursuant to Section 6.01(a). (d) In the event any Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6), items of Company income and gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c) created by such adjustments, allocations or distributions. Any special allocations of items of income or gain pursuant to this Section 6.01(d) shall be taken into account in computing subsequent allocations pursuant to this Section 6.01 so that the net amount of any items so allocated and all other items allocated to each Member pursuant to this Section 6.01 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 this Section 6.01 if such unexpected adjustments, allocations or distributions had not occurred. (e) In the event the Company incurs any nonrecourse liabilities, income and gain shall be allocated determined in accordance with the “minimum gain chargeback” provisions Code and, except to the extent otherwise required by the Code, allocated to and among the Equity Members in the same percentages in which the Equity Members share in net profits and net losses. Notwithstanding the foregoing, if the book value of property (as such term is used in Regulation Section 1.704-1(b)(4)(iv1(b)(2)(iv)(g)) differs from its tax basis, then for the purposes of this Agreement, all determinations of income, gain, loss and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of the Members deduction shall be adjusted determined with respect to such book value in accordance with Treasury Regulations the rules of Regulation Section 1.704-1(b)(2)(iv)(f1(b)(2). In accordance with Code Section 704(c) and the Regulations thereunder, depreciation, amortization, gain, loss, and deduction with respect to reflect any property contributed to the fair market value (capital of River Edge shall, solely for tax purposes, be allocated among the Equity Members so as determined to take account of any variation between the adjusted basis of such property to River Edge for Federal income tax purposes and its initial book value, such allocation to be made by the Managing Member in its good faith judgment) of Company property whenever Membership Units are relinquished to the Company, whenever an additional Member is admitted to the Company Administrative Committee in accordance with Section 4.03, upon any termination of the Company within the meaning of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance so-called “traditional method with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) curative allocations solely in the case of a distribution sale of any property (other than cashproperty” under Regulation Section 1.704-3(c)(iii)(B). (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Company).

Allocation of Profits and Losses. (a) Except as otherwise After giving effect to the allocations set forth in this Section 6.016.02 below, for Capital Account purposeseach fiscal year of the Company, Net Income (any remaining Profits and items thereof) and Net Loss (and items thereof) for any fiscal period Losses of the Company attributable to the Category A Property shall be allocated among as necessary to cause the Members pro rata Capital Account of each Category A Member (increased by the amount of gain that would be allocated to such Category A Member under Section 6.02 below if Category A Property subject to any nonrecourse liability were transferred in accordance satisfaction of such liability and for no other consideration) to equal (as nearly as possible) the Category A Net Cash Flow distributions that would be made to such Category A Member under Sections 6.03 and 6.05, as applicable, if the Category A Property of the Company at the end of such year were sold for their then adjusted book basis for purposes of Treas. Reg. Section 1.7040a(b)(2), all Company liabilities attributable to the Category A Property were satisfied (limited with respect to each Member’s respective Membership Unitsnonrecourse liability to the adjusted book basis of the Category A Property subject to the liability) and the proceeds were distributed under Section 6.03 (without regard to the Capital Accounts of the Category A Members). (b) For federalAfter giving effect to the allocations set forth in Section 6.02 below, state for each fiscal year of the Company, any remaining Profits and local income tax purposes, items Losses of income, gain, loss, deduction and expense the Company attributable to the Category B Property shall be allocated as necessary to cause the Capital Account of each Category B Member (increased by the amount of gain that would be allocated to such Category B Member under Section 6.02 below if Category B Property subject to any nonrecourse liability were transferred in satisfaction of such liability and for no other consideration) to equal (as nearly as possible) the Category B Net Cash Flow distributions that would be made to such Category B Member under Sections 6.04 and 6.06, as applicable, if the Category B Property of the Company at the end of such year were sold for their then adjusted book basis for purposes of Treas. Reg. Section 1.7040a(b)(2), all Company liabilities attributable to the Members in accordance with the allocations of the corresponding amount of Net Income Category B Property were satisfied (and items thereof) or amount of Net Loss (and items thereof) of which such items of income, gain, loss, deduction or expense are components for Capital Account purposes under this Section 6.01, except that items limited with respect to Company property for which there is a difference between tax each nonrecourse liability to the adjusted book basis of the Category B Property subject to the liability) and the Book Value of such property shall be allocated in accordance with proceeds were distributed under Section 704(c) 6.04 (without regard to the Capital Accounts of the Code, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(iCategory B Members). The Company shall specially allocate long-term capital gains with respect to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership Units. (c) Notwithstanding any provision In making the allocations of this Section 6.01, no item of deduction, loss or expense shall be allocated Profits and Losses attributable to a Member to the extent the allocation would cause a negative balance in such Member’s Capital Accounts (after taking into account the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) that exceeds the sum of (i) the amount that such Member would be required to reimburse the Company pursuant to this Agreement or under applicable law and (ii) the amount that such Member is deemed obligated to reimburse pursuant to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5). In the event some but not all of the Members would have such excess Capital Account deficits as a consequence of such allocation of loss, deduction or expense, the limitation set forth in this Section 6.01(c) shall be applied on a Member-by-Member basis so as to allocate the maximum permissible deduction, loss or expense to each Member under Section 1.704-1(b)(2)(ii)(d) of the Treasury Regulations. In the event any loss, deduction or expense shall be specially allocated to a Member pursuant to the preceding sentence, an equal amount of income or gain of the Company shall be specially allocated to such Member prior to any allocation Category A Property pursuant to Section 6.01(a). (d) , that portion of each Member’s Capital Account attributable to Category B Property shall be ignored. In making the event any Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4allocations of Profits and Losses attributable to Category B Property pursuant to Section 6.02(a), (5) and (6), items that portion of Company income and gain each Member’s Capital Account attributable to Category A Property shall be specially allocated to such Member in an amount and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c) created by such adjustments, allocations or distributions. Any special allocations of items of income or gain pursuant to this Section 6.01(d) shall be taken into account in computing subsequent allocations pursuant to this Section 6.01 so that the net amount of any items so allocated and all other items allocated to each Member pursuant to this Section 6.01 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 this Section 6.01 if such unexpected adjustments, allocations or distributions had not occurredignored. (e) In the event the Company incurs any nonrecourse liabilities, income and gain shall be allocated in accordance with the “minimum gain chargeback” provisions of Section 1.704-1(b)(4)(iv) and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of the Members shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) to reflect the fair market value (as determined by the Managing Member in its good faith judgment) of Company property whenever Membership Units are relinquished to the Company, whenever an additional Member is admitted to the Company in accordance with Section 4.03, upon any termination of the Company within the meaning of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) in the case of a distribution of any property (other than cash). (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Company).

Allocation of Profits and Losses. (a) 7.1.1 Except as otherwise set forth provided in this Section 6.01Article VII, for Capital Account purposes, Net Income (Profits and items thereof) and Net Loss (and items thereof) Losses for any fiscal period shall be allocated among the Members pro rata in accordance with each Member’s respective Membership Units. (b) For federal, state and local income tax purposes, items of income, gain, loss, deduction and expense Fiscal Year shall be allocated to the Members as follows: (a) First, to the Preferred Members in accordance with proportion to their respective Preferred Member Percentage Interests, until the allocations of the corresponding amount of Net Income (and items thereof) or amount of Net Loss (and items thereof) of which such items of income, gain, loss, deduction or expense are components for Capital Account purposes under this Section 6.01, except that items aggregate Profits allocated with respect to Company property for which there is a difference between tax basis and the Book Value Preferred Members (taking into account allocations of Profits to all previous holders of such property shall be allocated Preferred Membership Interests) pursuant to this Section 7.1.1 (a) for the period commencing with the effective date of this Agreement and ending on the last day of such Fiscal Year equal the cumulative Preferred Distribution paid to such Preferred Members (taking into account Preferred Distributions paid to all previous holders of such Preferred Membership Interests) for the period commencing with the effective date of this Agreement and ending on the last day of such Fiscal Year and (b) Thereafter, to the Common Members, in accordance with Section 704(c) proportion to their respective Common Member Percentage Interests as of the Code, end of the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i). The Company shall specially allocate long-term capital gains with respect to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership UnitsFiscal Year. (c) Notwithstanding 7.1.2 Except as otherwise provided in this Article VII, Losses for any provision of this Section 6.01, no item of deduction, loss or expense Fiscal Year shall be allocated to a the Common Members in proportion to their respective Common Member Percentage Interests as of the end of such Fiscal Year. 7.1.3 The Losses allocated pursuant to Section 7.1.2 shall not exceed the maximum amount of Losses that can be so allocated without causing any Member to have an Adjusted Capital Account Deficit at the extent the allocation would cause a negative balance in such Member’s Capital Accounts (after taking into account the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) that exceeds the sum end of (i) the amount that such Member would be required to reimburse the Company pursuant to this Agreement or under applicable law and (ii) the amount that such Member is deemed obligated to reimburse pursuant to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5)any fiscal period. In the event that some but not all of the Members would have such excess Adjusted Capital Account deficits Deficits as a consequence of such an allocation of loss, deduction or expenseLosses pursuant to this Section 7.1, the limitation set forth in this Section 6.01(c) 7.1.3 shall be applied on a Member-by-Member by Member basis so as to allocate the maximum permissible deduction, loss or expense Losses to each Member under Treas. Reg. Section 1.704-1(b)(2)(ii)(d) ). All Losses in excess of the Treasury Regulations. In the event any loss, deduction or expense limitation set forth in this Section 7.1.3 shall be specially allocated to a Member pursuant to proportionately among the preceding sentenceCommon Members. Notwithstanding the provisions of Section 7.1.1, an equal amount of income or gain 100% of the Company Profits shall be specially allocated to such Member allocated, prior to any allocation pursuant to Section 6.01(a). (d) In the event any Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6), items of Company income and gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c) created by such adjustments, allocations or distributions. Any special other allocations of items of income or gain pursuant Profits, to this Section 6.01(d) shall be taken into account the Members up to the aggregate of, and in computing subsequent allocations pursuant to this Section 6.01 so that the net amount of proportion to, any items so allocated and all other items Losses previously allocated to each Member pursuant to this Section 6.01 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 this Section 6.01 if such unexpected adjustments, allocations or distributions had not occurred. (e) In the event the Company incurs any nonrecourse liabilities, income and gain shall be allocated in accordance with the “minimum gain chargeback” provisions of this Section 1.704-1(b)(4)(iv) and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of the Members shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) to reflect the fair market value (as determined by the Managing Member in its good faith judgment) of Company property whenever Membership Units are relinquished to the Company, whenever an additional Member is admitted to the Company in accordance with Section 4.03, upon any termination of the Company within the meaning of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) 7.1.3 in the case of a distribution of any property (other than cash)reverse order in which such Losses were allocated. (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Company).

Allocation of Profits and Losses. (a) Except as otherwise set forth in this Subject to provisions of Section 6.016.2, for Capital Account purposes, Net Income Profits (and items thereof) and Net Loss (and items thereofincluding Profits from Non-Recurring Transactions) for any fiscal period shall be allocated among the Members pro rata in accordance with each Member’s respective Membership Units. (b) For federal, state and local income tax purposes, items of income, gain, loss, deduction and expense Fiscal Year shall be allocated to the Members in accordance with the following order of priority: (i) First, if any Losses have been allocated to Members in the current year or any prior years under Section 6.1(b) and such Losses have not previously been offset by Profit allocations of the corresponding amount of Net Income (and items thereof) or amount of Net Loss (and items thereof) of which such items of income, gain, loss, deduction or expense are components for Capital Account purposes under this Section 6.016.1(a)(i) (“Unrecovered Losses”), except that items then Profits shall be allocated to the Members to whom such Unrecovered Losses were allocated in the same amounts so allocated, in reverse order Fiscal Year by Fiscal Year, until the cumulative Profits so allocated for the current and all prior Fiscal Years equal the cumulative Unrecovered Losses so allocated to the Members have been offset by cumulative Profit allocations hereunder, without duplication; and, thereafter, no allocations shall be made under this Section 6.1(a)(i) unless and until further Losses are experienced by the Company and allocated to Members. (ii) Second, any additional Profits in any Fiscal Year shall be allocated entirely to the Non-Initial Members, and among them in proportion to their respective Units, up to the point at which the Non-Initial Members have received aggregate cash distributions to achieve a fifteen percent (15%) return in the Fiscal year with respect to Company property their Capital Accounts (the “Milestone Return”). (iii) Third, any additional Profits in each Fiscal Year in which the Milestone Return is achieved shall be allocated fifty percent (50%) to the Non-Initial Members, and among them in proportion to their respective Units, and fifty percent (50%) to the Initial Member. (In other words, such Profits shall be allocated among all of the Members in proportion to their respective Units.) (iv) Upon a sale of the Real Estate, net proceeds from the sale shall be allocated entirely to the Non-Initial Members, and among them in proportion to their respective Units, up to the point at which the Non-Initial Members have received one hundred fifteen percent (115%) of the Non-Initial Members’ Capital Accounts at the time of the sale. Any additional proceeds from the sale shall be allocated among all of the Members in proportion to their respective Units. (b) Losses for which there is a difference between tax basis and the Book Value of such property each Fiscal Year shall be allocated in accordance with Section 704(cthe following order of priority: (i) First, Losses shall be allocated among the Members in proportion to the positive balances in their respective Capital Accounts until the Capital Accounts of the Code, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i). The Company shall specially allocate long-term capital gains with respect those Members have been reduced to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership Unitszero. (cii) Notwithstanding All additional Losses in any provision of this Section 6.01, no item of deduction, loss or expense Fiscal Year shall be allocated to a Member to the extent the allocation would cause a negative balance in such Member’s Capital Accounts (after taking into account the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) that exceeds the sum of (i) the amount that such Member would be required to reimburse the Company pursuant to this Agreement or under applicable law and (ii) the amount that such Member is deemed obligated to reimburse pursuant to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5). In the event some but not all of among the Members would have in the same proportion as Profits for such excess Capital Account deficits as a consequence of such allocation of loss, deduction or expense, the limitation set forth in this Section 6.01(cyear (had Profits been earned) shall be applied on a Member-by-Member basis so as to allocate the maximum permissible deduction, loss or expense to each Member under Section 1.704-1(b)(2)(ii)(d) of the Treasury Regulations. In the event any loss, deduction or expense shall be specially allocated to a Member pursuant to the preceding sentence, an equal amount of income or gain of the Company shall be specially allocated to such Member prior to any allocation pursuant to Section 6.01(a). (d) In the event any Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6), items of Company income and gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c) created by such adjustments, allocations or distributions. Any special allocations of items of income or gain pursuant to this Section 6.01(d) shall be taken into account in computing subsequent allocations pursuant to this Section 6.01 so that the net amount of any items so allocated and all other items allocated to each Member pursuant to this Section 6.01 shall, to the extent possible, be equal to the net amount that would have been allocated between them under clause (ii), (iii), or (iv) of Section 6.1(a) (whichever would have been applicable to each such Member pursuant to the provisions of this Section 6.01 if such unexpected adjustmentsany Profits), allocations or distributions had not occurred. (e) In the event the Company incurs any nonrecourse liabilities, income and gain shall be allocated in accordance with the “minimum gain chargeback” provisions of Section 1.704-1(b)(4)(iv) and 1.704-2 of the Treasury RegulationsMembers’ portion thereof being allocated among them in proportion to their respective Units. (f) The Capital Accounts of the Members shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) to reflect the fair market value (as determined by the Managing Member in its good faith judgment) of Company property whenever Membership Units are relinquished to the Company, whenever an additional Member is admitted to the Company in accordance with Section 4.03, upon any termination of the Company within the meaning of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) in the case of a distribution of any property (other than cash). (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Company).

Allocation of Profits and Losses. (a) Except as otherwise set forth in this Section 6.01, for Capital Account purposes, Net Income (and items thereof) and Net Loss (and items thereof) for any fiscal period 4.1.1 Profits shall be allocated among the Members pro rata in accordance with each Member’s respective Membership Units. (b) For federal, state and local income tax purposes, items of income, gain, loss, deduction and expense shall be allocated credited to the Members in accordance with the allocations of the corresponding amount of Net Income (and items thereof) or amount of Net Loss (and items thereof) of which such items of income, gain, loss, deduction or expense are components for Capital Account purposes under this Section 6.01, except that items with respect to Company property for which there is a difference between tax basis and the Book Value of such property shall be allocated in accordance with Section 704(c) of the Code, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i). The Company shall specially allocate long-term capital gains with respect to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership Units. (c) Notwithstanding any provision of this Section 6.01, no item of deduction, loss or expense shall be allocated to a Member to the extent the allocation would cause a negative balance in such Member’s Capital Accounts (after taking into account the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) that exceeds the sum of (i) the amount that such Member would be required to reimburse the Company pursuant to this Agreement or under applicable law and (ii) the amount that such Member is deemed obligated to reimburse pursuant to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5). In the event some but not all of the Members would have such excess Capital Account deficits as a consequence of such allocation of loss, deduction or expense, the limitation set forth in this Section 6.01(c) shall be applied on a Member-by-Member basis so as to allocate the maximum permissible deduction, loss or expense to each Member under Section 1.704-1(b)(2)(ii)(d) of the Treasury Regulations. In the event any loss, deduction or expense shall be specially allocated to a Member pursuant to the preceding sentence, an equal amount of income or gain of the Company shall be specially allocated to such Member prior to any allocation pursuant to Section 6.01(a). (d) In the event any Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6), items of Company income and gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c) created by such adjustments, allocations or distributions. Any special allocations of items of income or gain pursuant to this Section 6.01(d) shall be taken into account in computing subsequent allocations pursuant to this Section 6.01 so that the net amount of any items so allocated and all other items allocated to each Member pursuant to this Section 6.01 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 this Section 6.01 if such unexpected adjustments, allocations or distributions had not occurred. (e) In the event the Company incurs any nonrecourse liabilities, income and gain shall be allocated in accordance with the “minimum gain chargeback” provisions of Section 1.704-1(b)(4)(iv) and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of the Members as follows and in the following order of priority: “First, among the Members in an amount equal to the Losses, if any, allocated to their Membership Interests pursuant to Section 4.1.2 and not previously offset by Profits allocated to their Membership Interests pursuant to this Section 4.1.1. The Profits allocated pursuant to this Section 4.1.1 shall be adjusted allocated among such Members to offset Losses on a year-by-year basis, with the Profits first offsetting the Losses allocated in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) to reflect the fair market value (as determined by the Managing Member in its good faith judgment) of Company property whenever Membership Units are relinquished year most recent to the Company, whenever an additional Member is admitted year of such Profits allocation and then to offset Losses in the preceding years with the most recent Losses being offset first in the proportion that each such Member’s allocable share of the Losses for each such years bears to the Company total Net Loss allocated for such year; and “Second, to such Members, in accordance with Section 4.03, upon any termination proportion to their Profits Interest set forth on Exhibit A. 4.1.2 Losses for each year shall be allocated and charged to the Capital Accounts of the Company within Members as follows and in the meaning following order of priority: “First, among the Members in an amount equal to the Profits previously allocated to the Members and not previously offset by losses allocated pursuant to this Section 708 4.1.2. The Losses allocated pursuant to this Section shall be allocated between the Members to offset Profits on a year-by-year basis, with the Losses first offsetting the Profits allocated in the year most recent to the year of such Profit allocation and then to offset Profits in the preceding years, with the most recent Profit being offset first in the proportion that each Members’ allocable share of the CodeProfits for such year bears to the total Profits allocated for such year; “Second, among such Members in an amount up to but not exceeding such Member’s positive Capital Account in the proportion that each such Member’s Capital Account bears to the aggregate Capital Accounts of all such Members; “Third, among such Members in an amount up to be not exceeding their at-risk basis in their Membership Interest under Code Sections 704(d) and 465 (which would permit the Members with at-risk basis to incur negative capital accounts); “Fourth, any suspended Losses which have been allocated to a Member for which a Member has no at-risk basis and for which the suspended Losses have been carried over to another year in which the Member has no at-risk basis, and when the Company is liquidated pursuant to Article XIif such other Member has at-risk basis, and such gross income shall be adjusted reallocated from the Member which has no at-risk basis to the Member which has the at-risk basis in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) in an amount equal to the case of a distribution of any property (other than cash). (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIIISuspended Losses, at the request of the Member transferring earliest time practicable; and “Thereafter, to such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company proportion to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Company).their Profits Interest set forth on Exhibit A.”

Allocation of Profits and Losses. (a) Except The profits or losses for tax purposes of the Partnership, other than any profits or losses attributable to the sale or other disposition of all or any substantial portion of the Partnership Property or the Joint Venture Property, shall be allocated as otherwise set forth in this follows: subject to the provisions of Section 6.019(e) below, for Capital Account purposes, Net Income (and items thereof) and Net Loss (and items thereof) for any fiscal period 96% of such profits or losses shall be allocated among the Members pro rata Limited Partners in accordance with each Member’s proportion to their respective Membership Units. (b) For federalPercent Interests, state and local income tax purposes, items 4% of income, gain, loss, deduction and expense such profits or losses shall be allocated to the Members in accordance with General Partners; provided, however, that the allocations books of the corresponding amount Partnership shall be closed immediately prior to the first Periodic Admission Date and any such profits or losses attributable to the portion of Net Income (and items thereof) or amount of Net Loss (and items thereof) of which such items of income, gain, loss, deduction or expense are components for Capital Account purposes under this Section 6.01, except that items with respect the fiscal year occurring prior to Company property for which there is a difference between tax basis and the Book Value of such property first Periodic Admission Date shall be allocated 99.99% to the General Partners and 0.01% to the Initial Limited Partner; 12 (b) The profits of the Partnership from any sale or other disposition of all or any substantial portion of the Partnership Property or the Joint Venture Property, after deducting any expenses relating to such sale or other disposition, shall be allocated as follows: (i) first, there shall be allocated to the General Partners an amount equal to the greater of (A) 1% of such profits or (B) the amount distributable (in excess of the General Partners' aggregate net positive Capital Account balances) to the General Partners as Sale Proceeds or Financing Proceeds from such sale or other disposition in accordance with Section 704(c11(b) hereof to be allocated among the General Partners in proportion to the amount of such proceeds distributed to each General Partner; (ii) second, if the Code, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i). The Company shall specially allocate long-term capital gains Capital Accounts with respect to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership Units. (c) Notwithstanding any provision each Limited Partnership Interest of this Section 6.01the Limited Partners are not then equal, no item of deduction, loss or expense profits shall be allocated to the holder of a Member Limited Partnership Interest with a Capital Account which is smaller in amount (or greater in deficit) than the Capital Account for any other Limited Partnership Interest until the balance in such Capital Account equals the balance in the Capital Account of the Limited Partnership Interest which was next smallest in amount (or next greatest in deficit) before such allocation, and thereafter such profits shall continue to be allocated to each successive holder or group of holders of Limited Partnership Interests with Capital Accounts which are smallest in amount (or greatest in deficit), until either the balances of all Capital Accounts with respect to the Limited Partnership Interests are equal or all such profits have been allocated; and (iii) third, any remaining profits shall be allocated among the Limited Partners in proportion to their respective Percent Interests. Notwithstanding the allocation in the first sentence of this Section 9(b), if, after such allocation, the aggregate deficit balances, if any, in the Capital Accounts of the General Partners would be greater in absolute amount than the Potential Unrealized Gain (as hereinafter defined) of the Partnership on the date of such allocation (for such purposes such Potential Unrealized Gain is to be allocated pro rata among the General Partners in proportion to the negative balances in their respective Capital Accounts), then the allocation of profits to the Limited Partners under clause (iii) of the first sentence of this Section 9(b) shall be reduced and the allocation of profits to the General Partners under clause (i) of the first sentence of this Section 9( b) shall be increased (to be shared by them in proportion to the deficit balances in their respective Capital Accounts) to the extent necessary to cause the aggregate deficit balances in the Capital Accounts of the General Partners after such allocation to be equal in absolute amount to the Potential Unrealized Gain (but the allocation of profits under clause (ii) of the first sentence of this Section 9(b) shall not be affected by this sentence). Notwithstanding the allocation in the first sentence of this Section 9(b), if, at any time profits are realized by the Partnership on the sale or other disposition of all or any substantial portion of the Partnership Property or the Joint Venture Property, any current or anticipated reduction of the Partnership's indebtedness (including the Partnership's share of the indebtedness of the Joint Venture or the Building Joint Ventures) or any future distribution of cash to the General Partners, as calculated by the Corporate General Partner, would cause a negative balance the deficit balances in such Member’s the Capital Accounts of any or all of the General Partners to be greater than its or their share of the Partnership's indebtedness (including the Partnership's share of the indebtedness of the Joint Venture and the Building Joint Ventures) after taking into account such reduction or distribution, then the adjustments, allocations allocation of profits to the Limited Partners under clause (iii) of the first sentence of this Section 9(b) shall be reduced and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) that exceeds the sum allocation of profits to the General Partners under clause (i) of the amount that first sentence of this Section 9(b) shall be increased (to be shared by them in proportion to the deficit balances in their respective Capital Accounts) to the extent necessary to cause the deficit balance in each General Partner's Capital Account to be equal to such Member would be required to reimburse General Partner's share of the Company pursuant to this Agreement Partnership's indebtedness (including the Partnership's share of the indebtedness of the Joint Venture or the Building Joint Ventures) after such reduction or distribution (but the allocation of profits under applicable law and clause (ii) of the first sentence of this Section 9( b) shall not be affected by this sentence). "Potential Unrealized Gain" shall equal the amount that such Member is deemed obligated of profits which would be realized by the Partnership for Federal income tax purposes (to reimburse pursuant be shared pro rata in proportion to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5). In the event some but not all respective deficit balances of the Members would have such excess Capital Account deficits General Partners) if all Partnership Property and Joint Venture Property (including the Joint Venture's interests in the Building Joint Ventures) were sold for their fair market value as a consequence determined by the Corporate General Partner (and all installment receivables of the Partnership, the Joint Venture and the Building Joint Ventures were collected) on the date of such allocation of loss, deduction or expense, allocation. Notwithstanding anything to the limitation set forth contrary in this Section 6.01(c) shall be applied on a Member-by-Member basis so as to allocate Agreement, upon the maximum permissible deduction, loss or expense to each Member under Section 1.704-1(b)(2)(ii)(d) ultimate liquidation of the Treasury Regulations. In the event any lossPartnership, deduction or expense shall be specially allocated to if a Member pursuant to the preceding sentence, an equal amount of income or gain of the Company shall be specially allocated to such Member prior to any allocation pursuant to Section 6.01(a). (d) In the event any Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6), items of Company income and gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate as quickly as possible any General Partner has a deficit balance in its Capital Account (after giving effect to the allocations set forth in excess of that permitted under this Agreement, including without limitation the allocations set forth in this Section 6.01(c) created 9(b)), such General Partner will make a capital contribution which, when added to the amount contributed by such adjustmentsGeneral Partner pursuant to Sections 11(b) and 13(e) hereof, allocations is equal to such deficit balance. Notwithstanding any adjustment of the allocation of profits or distributions. Any special losses provided in this Agreement by any judicial body or governmental agency, the allocations of items profits or losses provided in this Agreement shall control for all other purposes of income this Agreement (or gain any amendment hereto, including any amendment pursuant to this Section 6.01(d) shall be taken into account in computing subsequent allocations pursuant to this Section 6.01 so that 19(d)), including without limitation, the net amount determination of any items so allocated and the Partners' Capital Accounts for all other items allocated to each Member pursuant to this Section 6.01 shall, to the extent possible, be equal to the net amount that would have been allocated to each such Member pursuant to the provisions purposes of this Section 6.01 if such unexpected adjustments, allocations or distributions had not occurredAgreement. (ec) In The losses from any sale or other disposition of all or any substantial portion of the event Partnership Property or the Company incurs any nonrecourse liabilities, income and gain Joint Venture Property shall be allocated 99% among the Limited Partners in accordance with the “minimum gain chargeback” provisions of Section 1.704-1(b)(4)(iv) proportion to their respective Percent Interests, and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of the Members shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) to reflect the fair market value (as determined by the Managing Member in its good faith judgment) of Company property whenever Membership Units are relinquished 1% to the Company, whenever an additional Member is admitted to the Company in accordance with Section 4.03, upon any termination of the Company within the meaning of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) in the case of a distribution of any property (other than cash)General Partners. (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Company).

Allocation of Profits and Losses. (a) Except as otherwise After giving effect to the special allocations set forth in Section 6.04, and except as otherwise provided in this Section 6.01ARTICLE VI, for Capital Account purposes, Net Income (the Profits and items thereof) and Net Loss (and items thereof) Losses of the Company for any fiscal Fiscal Year or other period shall be allocated among the Members pro rata Unitholders in accordance with such manner that, as of the end of such Fiscal Year or other period and after taking into account (x) the opening Capital Account balances of the Unitholders at the start of such Fiscal Year or other period and (y) any appropriate adjustments to each Member’s respective Membership Units. (b) For federalopening Capital Account balance to reflect Capital Contributions, state Distributions and local income tax purposes, allocations of items of income, gain, loss, loss or deduction and expense shall be allocated pursuant to the Members in accordance with the allocations of the corresponding amount of Net Income (and items thereof) Section 6.04 made during or amount of Net Loss (and items thereof) of which such items of income, gain, loss, deduction or expense are components for Capital Account purposes under this Section 6.01, except that items with respect to Company property for which there is a difference between tax basis and such Fiscal Year or other period, the Book Value respective Capital Accounts of such property the Unitholders shall be allocated in accordance with Section 704(c) equal, to the greatest extent possible, to the respective net amounts that would be distributed to them under this Agreement, determined as if the Company were, as of the Codeend of the Fiscal Year or other period (for this purpose, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i). The Company each Unitholder’s Capital Account shall specially allocate long-term capital gains with respect to Membership Units for which a Member’s holding period would entitle such Membership Units be deemed to be taxable as long-term capital gains if such Member sold such Membership Units. (c) Notwithstanding any provision of this Section 6.01, no item of deduction, loss or expense shall be allocated to a Member to the extent the allocation would cause a negative balance in such Member’s Capital Accounts (after taking into account the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) that exceeds increased by the sum of the amounts described in clauses (i) the amount that such Member would be required to reimburse the Company pursuant to this Agreement or under applicable law and (ii) of Section 6.04(b) with respect to such Unitholder as of the end of such Fiscal Year or other period), to (i) liquidate the assets of the Company for an amount that such Member is deemed obligated to reimburse pursuant equal to the penultimate sentences sum of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5). In the event some but not Gross Asset Values of all of the Members would have such excess Capital Account deficits as a consequence assets (net of such allocation any Depreciation with respect to each asset’s Gross Asset Value, but without any adjustment being deemed to be made to the Gross Asset Value of lossthe Company’s assets in respect of the presumed liquidation thereof under this clause (i)), deduction or expenseand (ii) distribute the proceeds of liquidation (net of any Company liabilities, which, in the limitation set forth in this Section 6.01(c) case of each Nonrecourse Debt and Unitholder Nonrecourse Debt, shall be applied on a Member-by-Member basis so as limited for these purposes to allocate the maximum permissible deduction, loss or expense to each Member under Section 1.704-1(b)(2)(ii)(d) an amount not in excess of the Treasury Regulations. In the event any loss, deduction or expense shall be specially allocated to a Member pursuant to the preceding sentence, an equal amount of income or gain Gross Asset Value of the Company shall be specially allocated to such Member prior to any allocation assets securing the liability) pursuant to Section 6.01(a9.02(c). (d) In . Accordingly, any difference between the event any Member unexpectedly receives any adjustments, allocations, or distributions amounts described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), clauses (5x) and (6), items of Company income y) and gain shall be specially allocated to such Member the amount described in an amount clauses (i) and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c) created by such adjustments, allocations or distributions. Any special allocations of items of income or gain pursuant to this Section 6.01(d(ii) shall be taken into account in computing subsequent allocations pursuant to this Section 6.01 so that the net amount of any items so allocated allocating Profits and all other items allocated to each Member pursuant to this Section 6.01 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 this Section 6.01 if such unexpected adjustments, allocations or distributions had not occurred. (e) In the event the Company incurs any nonrecourse liabilities, income and gain shall be allocated in accordance with the “minimum gain chargeback” provisions of Section 1.704-1(b)(4)(iv) and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of the Members shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) to reflect the fair market value (as determined by the Managing Member in its good faith judgment) of Company property whenever Membership Units are relinquished to the Company, whenever an additional Member is admitted to the Company in accordance with Section 4.03, upon any termination of the Company within the meaning of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) in the case of a distribution of any property (other than cash). (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the CodeLosses, if such election would not materially adversely affect the interests of the Membersany, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Company)for any Fiscal Year or other period.

Allocation of Profits and Losses. (a) Except as otherwise set forth provided in this Agreement, (i) Profits for any Fiscal Year shall be allocated, first, to the Members holding Class A Interests in accordance with their Class A Ownership Percentages, until the aggregate amount of Profits and Losses allocated to each Member holding Class A Interests under this Section 6.014.01(a) is at least equal to the aggregate Percentage Preferred Return through the end of such Fiscal Year, and then, second, to all Members in accordance with their Ownership Percentages; and (ii) Losses for any Fiscal Year shall be allocated, first, to the Members holding Class B Vested Interests in accordance with their Class B Ownership Percentages, until each of their Capital Accounts has been reduced to zero, second, to the Members holding Class A Interests in accordance with their Class A Ownership Percentages, until each of their Capital Accounts has been reduced to zero, and then, third, to all Members in accordance with their Ownership Percentages. In the event of a Transfer of all or a portion of a Member’s Class A Interests or Class B Vested Interests during any Fiscal Year, Profits or Losses, as the case may be, shall be allocated, for Capital Account both accounting and Tax purposes, Net Income (between the transferor and items thereof) and Net Loss (and items thereof) for any fiscal period shall be allocated among the Members pro rata transferee Member in accordance with each Member’s respective Membership Unitsweighted Class A Ownership Percentages or Class B Ownership Percentages for such Fiscal Year. (b) For federal, state and local income tax purposes, items of income, gain, loss, deduction and expense shall be allocated to the Members in accordance with the allocations of the corresponding amount of Net Income (and items thereof) or amount of Net Loss (and items thereof) of which such items of income, gain, loss, deduction or expense are components for Capital Account purposes under this Section 6.01, except that items with respect to Company property for which there is a difference between tax basis and the Book Value of such property shall be allocated in accordance with Section 704(c) of the Code, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i). The Company shall specially allocate long-term capital gains with respect to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership Units. (c) Notwithstanding any provision of set forth in this Section 6.014.01, no item of deduction, deduction or loss or expense shall be allocated to a Member to the extent the such allocation would cause a negative balance in such Member’s Capital Accounts Account (after taking into account the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) of the Regulations) that exceeds the sum of (i) the amount that such Member would be required obligated to reimburse restore to the Company pursuant to this Agreement or under applicable law and (ii) the amount that such Member or is deemed to be obligated to reimburse pursuant to the penultimate sentences of Treasury Regulations Sections restore under Section 1.704-2(g)(1) and or Section 1.704-2(i)(5)) of the Regulations. In the event that some but not all of the Members would have such excess Capital Account deficits as a consequence of such an allocation of loss, deduction loss or expensededuction, the limitation set forth in this Section 6.01(c4.01(b) shall be applied on a Member-by-Member by Member basis so as to allocate the maximum permissible deduction, deduction or loss or expense to each Member holding Interests without such excess deficits under Section 1.704-1(b)(2)(ii)(d) of the Treasury Regulations. In the event any loss, loss or deduction or expense shall be specially allocated to a any Member pursuant to the preceding sentence, an equal amount of subsequent income or gain of the Company shall be specially allocated to such Member prior to any allocation pursuant to Section 6.01(a4.01(a). (dc) In the event any Member unexpectedly receives any adjustments, allocations, allocations or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) of the Regulations, items of Company income and gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate eliminate, as quickly as possible possible, any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c4.01(b) created by such adjustments, allocations or distributions. Any special allocations of items of income or gain pursuant to this Section 6.01(d4.01(c) shall be taken into account in computing subsequent allocations pursuant to this Section 6.01 this Article IV, so that the net amount of any items so allocated and all other items allocated to each Member pursuant to this Section 6.01 Article IV 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 this Section 6.01 Article IV if such unexpected adjustments, allocations or distributions had not occurred. (ed) In the event that the Company incurs any nonrecourse liabilitiesliabilities (within the meaning of Section 1.752-1(a)(2) of the Regulations), such liabilities and the nonrecourse deductions (within the meaning of Section 1.704-2(b)(1) of the Regulations) attributable to such liabilities shall be allocated among the Members holding Class A Interests in accordance with their Class A Ownership Percentages, and income and gain shall be allocated in accordance with the “minimum gain chargeback” provisions of Section Sections 1.704-1(b)(4)(iv) and 1.704-2 2(f) of the Treasury Regulations. (f) . The Capital Accounts of items so allocated pursuant to the Members previous sentence shall be adjusted determined in accordance with Treasury Regulations Section Sections 1.704-1(b)(2)(iv)(f2(f)(6) to reflect the fair market value (as determined by the Managing Member in its good faith judgmentand 1.704-2(j)(2) of Company property whenever Membership Units are relinquished to the Company, whenever an additional Member is admitted to Regulations. Solely for purposes of determining the Company in accordance with Section 4.03, upon any termination proportionate share of the “excess nonrecourse liabilities” of the Company (within the meaning of Section 708 1.752-3(a)(3) of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(eRegulations) in the case respect of a distribution of any property (other than cash)Member holding Class A Interests, such Member’s interest in the Profits will be in proportion to its Class A Ownership Percentage. (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (he) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 incurs any Member Nonrecourse Debt, any Member Nonrecourse Deductions attributable to such Member Nonrecourse Debt shall be specially allocated to the Member who bears the economic risk of the Code, if loss with respect to such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, Nonrecourse Debt in accordance with Section 754 1.704-2(i)(1) of the Code Regulations, and income and gain shall be allocated in accordance with the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers “partner minimum gain chargeback” provisions of Membership Units Sections 1.704-1(b)(4)(iv) and 1.704-2(i) of the Company Regulations. The items so allocated pursuant to the previous sentence shall be determined in accordance with Sections 1.704-2(i)(4) and with respect to certain distributions 1.704-2(j)(2) of property by the Company)Regulations.

Allocation of Profits and Losses. (a) Except as otherwise set forth in this Section 6.01, for Capital Account purposesprovided herein, Net Income (and items thereof) Profits and Net Loss Losses of the Company (including profits and items thereoflosses attributable to the sale or other disposition of all or any portion of the Company’s property) for shall be allocated among or borne by the Members in accordance with their Capital Accounts, as those may change as provided herein. (b) Notwithstanding any fiscal period provision of this Agreement to the contrary, to the extent required by law, income, gain, loss and deduction attributable to property contributed to the Company by a Member shall be allocated among the Members pro rata so as to take into account any variation between the tax basis of the property and the fair market value thereof at the time of contribution, in accordance with each Member’s respective Membership Unitsthe requirements of Section 704(c) of the Code, or its counterpart in any subsequently-enacted Internal Revenue Code, and the applicable Regulations promulgated thereunder. (bc) For federalCompany profits, state losses and local income tax purposes, items of income, gain, loss, deduction and expense gains shall be allocated to the Members in accordance with the allocations portion of the corresponding amount of Net Income (and items thereof) or amount of Net Loss (and items thereof) of year during which such the Members have held their respective interests. All items of income, gain, loss, deduction or expense are components for Capital Account purposes under this Section 6.01income and loss shall be considered to have been earned ratably over the fiscal year of the Company, except that items with respect to Company property for which there is a difference between tax basis gains and losses arising from the Book Value disposition of such property assets shall be allocated in accordance with Section 704(c) taken into account as of the Code, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i). The Company shall specially allocate long-term capital gains with respect to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership Unitsdate thereof. (cd) Notwithstanding any provision of this Section 6.01Agreement to the contrary, no item in the event the Company is entitled to a deduction for imputed interest under any provision of deductionthe Code on any loan or advance from a Member, loss or expense such deduction shall be allocated solely to a Member such Member. (e) Notwithstanding any provision of this Agreement to the contrary, to the extent the allocation would cause a negative balance in such Member’s Capital Accounts (after taking into account the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) that exceeds the sum payment of (i) the amount that such Member would be required to reimburse any expenditure by the Company pursuant to this Agreement or under applicable law and (ii) the amount that such Member is deemed obligated to reimburse pursuant to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5). In the event some but not all of the Members would have such excess Capital Account deficits treated as a consequence of such allocation of loss, deduction or expense, the limitation set forth in this Section 6.01(c) shall be applied on a Member-by-Member basis so as to allocate the maximum permissible deduction, loss or expense to each Member under Section 1.704-1(b)(2)(ii)(d) of the Treasury Regulations. In the event any loss, deduction or expense shall be specially allocated distribution to a Member pursuant to the preceding sentencefor federal income tax purposes, an equal amount of income or gain of the Company there shall be specially allocated to such Member prior to any a gross income allocation pursuant to Section 6.01(a). (d) In the event any Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6), items of Company income and gain shall be specially allocated to such Member in an the amount and manner sufficient of such distribution. (f) Notwithstanding any provision of this Agreement to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c) created by such adjustmentsthe contrary, allocations or distributions. Any special allocations of if items of income or gain pursuant to this be allocated include income or gain treated as ordinary income for federal income tax purposes because they are attributable to the recapture of depreciation under Section 6.01(d) shall be taken into account in computing subsequent allocations pursuant to this Section 6.01 so that 1245 or 1250 of the net amount of any items so allocated and all other items allocated to each Member pursuant to this Section 6.01 shallCode, then such income or gain, to the extent possibletreated as ordinary income, be equal to the net amount that would have been allocated to each such Member pursuant to the provisions of this Section 6.01 if such unexpected adjustments, allocations or distributions had not occurred. (e) In the event the Company incurs any nonrecourse liabilities, income and gain shall be allocated in accordance with the “minimum gain chargeback” provisions of Section 1.704-1(b)(4)(iv) to, and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of reported by, the Members shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) proportion to reflect the fair market value (as determined by the Managing Member in its good faith judgment) their then respective cumulative allocations of Company property whenever Membership Units are relinquished to the Company, whenever an additional Member is admitted to the Company in accordance with Section 4.03, upon any termination of the Company within the meaning of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) in the case of a distribution of any property (other than cash)depreciation. (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Company).

Allocation of Profits and Losses. (a) The Company's Profits -------------------------------- and Losses shall be determined on an annual basis and shall be allocated to the Members in accordance with this Section 5.02. (b) Except as otherwise set forth provided in this Section 6.01, for Capital Account purposes, Net Income (and items thereof5.02(c) and Net Loss (and items thereof) d), Profits or Losses for any each fiscal period year shall be allocated among the Members pro rata (and credited or debited to their Capital Accounts) in such manner that if the Company were to liquidate completely immediately after the end of such fiscal year and in connection with such liquidation sell all of its assets and settle all of its liabilities at their then Adjusted Book Values (i.e., without any Profits or Losses resulting therefrom); (i) the distribution by the Company of any remaining cash to the Members in accordance with each Member’s their respective Membership Units. positive Capital Account balances (bafter crediting or debiting Capital Accounts for Profits or Losses for such fiscal year) would correspond as closely as possible to the distributions that would result if the liquidating distributions has instead been made in accordance with the provisions of Section 5.01(b), and (ii) any resulting deficit Capital Account balances (after crediting or debiting Capital Accounts for Profits and Losses for such fiscal year) would correspond as closely as possible to the manner in which economic responsibility for Company deficit balances (as determined in accordance with the principles of Treasury Regulations under Section 704 of the Code) would be borne by the Members under the terms of this Agreement and any collateral agreements. For federal, state and local income tax purposespurposes of maintaining the Capital Accounts, items of income, gain, loss, deduction deduction, expense and expense credit shall be allocated to the Members in accordance with the allocations same manner as are Profits and Losses, except where otherwise necessary to more closely achieve the result contemplated by the first sentence of the corresponding amount of Net Income (and items thereof) or amount of Net Loss (and items thereof) of which such items of income, gain, loss, deduction or expense are components for Capital Account purposes under this Section 6.01, except that items with respect to Company property for which there is a difference between tax basis and the Book Value of such property shall be allocated in accordance with Section 704(c) of the Code, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i5.02(b). The Company shall specially allocate long-term capital gains with respect to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership Units. (c) Notwithstanding any provision Allocations necessary to fulfill the requirements of this Section 6.01, no item of deduction, loss or expense shall be allocated to a Member to the extent the allocation would cause a negative balance in such Member’s Capital Accounts (after taking into account the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) that exceeds the sum of (i) the amount that such Member would be required to reimburse the Company pursuant to this Agreement or "qualified income offset" under applicable law and (ii) the amount that such Member is deemed obligated to reimburse pursuant to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5)Treas. In the event some but not all of the Members would have such excess Capital Account deficits as a consequence of such allocation of loss, deduction or expense, the limitation set forth in this Section 6.01(c) shall be applied on a Member-by-Member basis so as to allocate the maximum permissible deduction, loss or expense to each Member under Section Reg. ss. 1.704-1(b)(2)(ii)(d) and a "minimum gain chargeback" under Treas. Reg. ss. 1.704-2(f) shall be made, but shall be neutralized to the extent feasible by offsetting allocations made for subsequent periods. (d) To the extent practicable, distributions to PHC in respect of the Treasury Regulations. In the event any loss, deduction or expense shall be specially allocated to a Member PHC Priority pursuant to the preceding sentencefirst sentence of Section 5.01(b) shall not be considered made out of Profits, an equal amount of and taxable income or and gain of the Company shall not be specially allocated to PHC on account of such Member prior to any allocation pursuant to Section 6.01(a). distributions (d) In the event any Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6), items of Company income and gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c) created by such adjustments, allocations or distributions. Any special allocations of items of income or gain pursuant to this Section 6.01(d) shall be taken into account in computing subsequent allocations pursuant to this Section 6.01 so that the net amount of any items so allocated and all other items allocated to each Member pursuant to this Section 6.01 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 this Section 6.01 if such unexpected adjustments, allocations or distributions had not occurred. (e) In the event the Company incurs any nonrecourse liabilities, income and gain shall be allocated in accordance with the “minimum gain chargeback” provisions of Section 1.704-1(b)(4)(iv) and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of the Members shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) to reflect the fair market value (as determined by the Managing Member in its good faith judgment) of Company property whenever Membership Units are relinquished to the Company, whenever an additional Member is admitted to the Company in accordance with Section 4.03, upon any termination of the Company within the meaning of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) in the case of a distribution of any property (other than cash). (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding except with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Companyamounts representing notional interest).

Allocation of Profits and Losses. (a) Except as otherwise After giving effect to the special allocations set forth in this Section 6.01Sections 6.2 and 6.3, Profits and Losses for Capital Account purposes, Net Income (and items thereof) and Net Loss (and items thereof) for any fiscal period each Fiscal Period shall be preliminarily allocated among as of the end of such Fiscal Period to the Capital Accounts of all the Members pro rata in accordance with the proportions that each Member’s respective Membership UnitsCapital Account as of the beginning of such Fiscal Period bore to the aggregate of the Capital Accounts of all the Members as of the beginning of such Fiscal Period. (b) For federalWith respect to each Member, state and local income tax purposesat the end of each Allocation Period, items of income, gain, loss, deduction and expense the Advisor shall be allocated from each Member’s Capital Account the following amounts: if the “Positive Allocation Change” for such Allocation Period for such Member exceeds the “10% Hurdle” for a Member and the amount of any positive balance in such Member’s “High Watermark Account”, then the performance allocation (the “Performance Allocation”) shall be equal to the Members in accordance with the allocations sum of (x) 100% of the corresponding amount of Net Income such Member’s Positive Allocation Change for such Allocation Period until the Advisor receives an amount equal to the 10% Catch-Up Amount and (and items thereofy) or 20% of the amount by which such Member’s Positive Allocation Change for such Allocation Period, if any, exceeds the sum of the amount of Net Loss the Positive Allocation Change allocated to such Member to satisfy such Member’s 10% Hurdle (the “10% Priority Amount”) and items thereof) of which such items of incomethe 10% Catch-Up Amount; provided, gainhowever, loss, deduction or expense are components for Capital Account purposes under this Section 6.01, except that items no Performance Allocation with respect to Company property for which there is a difference between tax basis and the Book Value of such property shall be allocated in accordance with Section 704(c) of the Code, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i). The Company shall specially allocate long-term capital gains with respect to Membership Units for which a particular Member’s holding period would entitle Capital Account will be made until such Membership Units Member’s High Watermark Account has a zero balance (after taking into account any allocation of Profits pursuant to be taxable as long-term capital gains if such Member sold such Membership UnitsSection 6.1(a). (c) Notwithstanding No transferee of any provision of this Section 6.01, no item of deduction, loss Units shall succeed to any High Watermark Account balance or expense shall be allocated to a Member portion thereof attributable to the extent transferor unless the allocation would cause transfer by which such transferee received such Units did not involve a negative balance in such Member’s Capital Accounts (after taking into account change of beneficial ownership or as otherwise agree to by the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) that exceeds the sum of (i) the amount that such Member would be required to reimburse the Company pursuant to this Agreement or under applicable law and (ii) the amount that such Member is deemed obligated to reimburse pursuant to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5). In the event some but not all of the Members would have such excess Capital Account deficits as a consequence of such allocation of loss, deduction or expense, the limitation set forth in this Section 6.01(c) shall be applied on a Member-by-Member basis so as to allocate the maximum permissible deduction, loss or expense to each Member under Section 1.704-1(b)(2)(ii)(d) of the Treasury Regulations. In the event any loss, deduction or expense shall be specially allocated to a Member pursuant to the preceding sentence, an equal amount of income or gain of the Company shall be specially allocated to such Member prior to any allocation pursuant to Section 6.01(a)Board. (d) In For Units redeemed other than on the event any Member unexpectedly receives any adjustmentslast day of a Fiscal Year, allocationsthe Performance Allocation, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4)if any, (5) and (6), items of Company income and gain shall be specially allocated to such Member in an amount calculated and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c) created by such adjustments, allocations or distributions. Any special allocations of items of income or gain pursuant to this Section 6.01(d) shall be taken into account in computing subsequent allocations pursuant to this Section 6.01 so that the net amount of any items so allocated and all other items allocated to each Member pursuant to this Section 6.01 shall, charged with respect to the extent possible, be equal redeemed Units as if the redemption date was the last day of the Fiscal Year and the 10% Hurdle applicable to the net amount that would have been allocated to each such Member pursuant to the provisions of this Section 6.01 if such unexpected adjustments, allocations or distributions had not occurred. (e) In the event the Company incurs any nonrecourse liabilities, income and gain shall be allocated in accordance with the “minimum gain chargeback” provisions of Section 1.704-1(b)(4)(iv) and 1.704-2 calculation of the Treasury Regulations. (f) The Capital Accounts of the Members Performance Allocation shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) to reflect take into account the fair market value (as determined by number of days that the Managing Member in its good faith judgment) of Company property whenever Membership Units are relinquished to the Company, whenever an additional Member is admitted to the Company in accordance with Section 4.03, upon any termination of the Company within the meaning of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) tendering Member’s Capital Account was invested in the case of a distribution of any property (other than cash)Fund for such Fiscal Year. (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Company).

Allocation of Profits and Losses. (a) Except as otherwise set forth provided in this Section 6.01, for Capital Account purposes, Net Income 3.3: (and items thereofi) Subject to the allocations specified in Sections 3.3(a)(ii) and Net Loss (3.3(a)(iii) below, all Profits and items thereof) for any fiscal period Losses of the Company shall be allocated among the Members pro rata in accordance with each Member’s respective Membership Units. (b) For federal, state and local income tax purposes, items of income, gain, loss, deduction and expense shall be allocated charged to the Members in accordance with the allocations of the corresponding amount of Net Income (and items thereof) or amount of Net Loss (and items thereof) of which such items of income, gain, loss, deduction or expense are components for Capital Account purposes under this Section 6.01, except that items with respect to Company property for which there is a difference between tax basis and the Book Value of such property shall be allocated in accordance with Section 704(c) of the Code, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i). The Company shall specially allocate long-term capital gains with respect to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership Unitstheir respective Unit Percentages. (cii) Notwithstanding any provision of this Section 6.013.3(a)(i) above, in no item of deduction, loss or expense event shall Losses be allocated to a Member to the extent the such allocation would cause result in any limitation on the use of such Losses under Section 704(d) of the Internal Revenue Code of 1986, as amended from time to time (the “Code”). All the Losses subject to the foregoing limitation shall be reallocated to the Members having a negative balance positive tax basis in such Member’s Capital Accounts their Units (after taking into account all components thereof, including, without limitation, the adjustments, allocations and distributions described share of Members in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) that exceeds the sum liabilities of (i) the amount that such Member would be required to reimburse the Company pursuant to this Agreement or under applicable law and (ii) the amount that such Member is deemed obligated to reimburse pursuant to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5). In the event some but not all Section 752 of the Members would have such excess Capital Account deficits as a consequence of such allocation of loss, deduction or expense, the limitation set forth in this Section 6.01(c) shall be applied on a Member-by-Member basis so as to allocate the maximum permissible deduction, loss or expense to each Member under Section 1.704-1(b)(2)(ii)(d) of the Treasury Regulations. In the event any loss, deduction or expense shall be specially allocated to a Member pursuant to the preceding sentence, an equal amount of income or gain of the Company shall be specially allocated to such Member prior to any allocation pursuant to Section 6.01(aCode). (diii) Notwithstanding Section 3.3(a)(i) above, Profits equal to the excess (if any) of Losses reallocated under Section 3.3(a)(ii) at any time since the Formation Date over Profits previously allocated under this Section 3.3(a)(iii) since the Formation Date, shall be allocated 100% to Members in the proportion and amounts in which such excess was allocated. (b) In the event case of any property contributed to the Company by any Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)which at the time of contribution has an adjusted tax basis which differs from its fair market value, items of Company Profits, Losses, income, gain and deduction for income and gain tax purposes shall be specially allocated to such Member in an amount and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted required under Section 6.01(c704(c) created by of the Code to take into account such adjustmentsdifference. (c) Any item of taxable income, allocations gain, loss or distributionsdeduction of the Company (as well as any credits or the basis of property to which such credits apply) as determined for federal income tax purposes shall be allocated in the same manner as the corresponding income, gain, loss, or deduction is allocated under Section 3.3(a). Any special allocations of items of income or gain Allocations pursuant to this Section 6.01(d3.3(c) are solely for purposes of federal, state, and local taxes and shall not affect, or in any way be taken into account in computing subsequent allocations computing, any Member’s Capital Account or share of Profits, Losses, other items, or distributions pursuant to this Section 6.01 so that the net amount of any items so allocated and all other items allocated to each Member pursuant to this Section 6.01 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 this Section 6.01 if such unexpected adjustments, allocations or distributions had not occurred. (e) In the event the Company incurs any nonrecourse liabilities, income and gain shall be allocated in accordance with the “minimum gain chargeback” provisions of Section 1.704-1(b)(4)(iv) and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of the Members shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) to reflect the fair market value (as determined by the Managing Member in its good faith judgment) of Company property whenever Membership Units are relinquished to the Company, whenever an additional Member is admitted to the Company in accordance with Section 4.03, upon any termination of the Company within the meaning of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) in the case of a distribution of any property (other than cash). (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms provision of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Company).

Allocation of Profits and Losses. (a) Except as otherwise set forth in this Section 6.014.02, for Capital Account purposes, Net Income (all items of income, gain, loss and items thereof) and Net Loss (and items thereof) for any fiscal period deduction shall be allocated among to the Members pro rata Member in a manner such that if the Company were dissolved, its affairs wound up and its assets distributed to the Member in accordance with each Member’s its respective Membership UnitsCapital Account balances immediately after making such allocation, such distributions would, as nearly as possible, be equal to the distributions that would be made pursuant to Section 5.03. (b) For federal, state and local income tax purposes, items of income, gain, loss, deduction and expense credit shall be allocated to the Members Member in accordance with the allocations of the corresponding amount of Net Income (and items thereof) or amount of Net Loss (and items thereof) of which such items of income, gain, loss, deduction or expense are components for Capital Account purposes under this Section 6.014.02, except that items with respect to Company property for which there is a difference between tax and book basis and the Book Value of such property shall will be allocated in accordance with Section 704(c) of the Code, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i). The Company shall specially allocate long-term capital gains with respect to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership Units. (c) Notwithstanding any provision of set forth in this Section 6.01Section, no item of deduction, deduction or loss or expense shall be allocated to a the Member to the extent the allocation would cause a negative balance in such Member’s Capital Accounts Account (after taking into account the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) that exceeds the sum of (i) the amount that such Member would be required to reimburse the Company pursuant to this Agreement or under applicable law and (ii) the amount that such Member is deemed obligated to reimburse pursuant to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5). In the event some but not all of the Members would have such excess Capital Account deficits as a consequence of such allocation of loss, deduction or expense, the limitation set forth in this Section 6.01(c) shall be applied on a Member-by-Member basis so as to allocate the maximum permissible deduction, loss or expense to each Member under Section 1.704-1(b)(2)(ii)(d) of the Treasury Regulations. In the event any loss, deduction or expense shall be specially allocated to a Member pursuant to the preceding sentence, an equal amount of income or gain of the Company shall be specially allocated to such Member prior to any allocation pursuant to Section 6.01(a)law. (d) In the event any the Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6), items of Company the Company’s income and gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c4.02(c) created by such adjustments, allocations or distributions. Any special allocations of items of income or gain pursuant to this Section 6.01(d4.02(d) shall be taken into account in computing subsequent allocations pursuant to this this Section 6.01 4.02 so that the net amount of any items so allocated and all other items allocated to each the Member pursuant to this Section 6.01 4.02 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 this Section 6.01 4.02 if such unexpected adjustments, allocations or distributions had not occurred. (e) In the event the Company incurs any nonrecourse liabilities, income and gain shall be allocated in accordance with the “minimum gain chargeback” provisions of Section 1.704-1(b)(4)(iv) and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of the Members shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) to reflect the fair market value (as determined by the Managing Member in its good faith judgment) of Company property whenever Membership Units are relinquished to the Company, whenever an additional Member is admitted to the Company in accordance with Section 4.03, upon any termination of the Company within the meaning of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) in the case of a distribution of any property (other than cash). (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Company).

Allocation of Profits and Losses. (a) Except as otherwise After giving effect to the special allocations set forth in this Section 6.016.1(b) below, the Net Profits and Net Losses (or the respective items thereof) of the Company for Capital Account purposeseach Fiscal Year or other relevant period of calculation, as determined by the Managing Member in accordance with the provisions hereof, shall be allocated among the Members in a manner such that, as of the end of such Fiscal Year or other relevant period and taking into account all prior allocations of Net Income Profits and Net Losses (and any items thereof) and all distributions made to the Members through such date, the Adjusted Capital Account Balance of each Member, immediately after making such allocation, is, as nearly as possible, equal (proportionately) to the distributions that would be made to such Member pursuant to Section 7.1 if the Company were dissolved, its affairs wound up and its assets sold for cash equal to their Gross Asset Values, all Company liabilities were satisfied (limited with respect to each nonrecourse liability to the Gross Asset Values of the assets securing such liability), and the net assets of the Company were distributed in accordance with Section 7.1 to the Members immediately after making such allocation; provided, that the Net Loss Losses (and or items thereof) for allocated to a Member shall not exceed the maximum amount of losses that can be so allocated without causing such Member to have a negative Adjusted Capital Account Balance at the end of any fiscal Fiscal Year or other relevant period. (i) Notwithstanding any other provision of this Agreement, (i) “partner nonrecourse deductions” (as defined in Treasury Regulations Section 1.704-2(i)), if any, of the Company shall be allocated to the Member that bears the economic risk of loss within the meaning of Treasury Regulations Section 1.704-2(i), and (ii) “nonrecourse deductions” (as defined in Treasury Regulations Section 1.704-2(b)) and “excess nonrecourse liabilities” (as defined in Treasury Regulations Section 1.752-3(a)(3)), if any, of the Company with respect to each period shall be allocated among the Members pro rata in accordance with each Member’s respective Membership Unitstheir applicable Carried Interest Percentages. (i) This Agreement shall be deemed to include “qualified income offset,” “minimum gain chargeback” and “partner nonrecourse debt minimum gain chargeback” provisions within the meaning of the Treasury Regulations under Code Section 704(b). Accordingly, notwithstanding any other provision of this Agreement, items of gross income shall be allocated to the Members on a priority basis to the extent and in the manner required by such provisions. (ii) Notwithstanding any other provisions of this Agreement, no allocation of Net Losses or items of deduction or expense shall be made to any Member to the extent that the effect of such allocation would be to cause the Member to have a negative Adjusted Capital Account Balance. (iii) To the extent that an adjustment to the adjusted tax basis of any Company asset pursuant to Code Section 734(b) or 743(b) is required, pursuant to Treasury Regulations Section 1.704-1(b)(2)(iv)(m), to be taken into account in determining Capital Accounts, the amount of such adjustment to the Capital Accounts shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases such basis) and such gain or loss shall be specially allocated to the Members in a manner consistent with the manner in which their Capital Accounts are required to be adjusted pursuant to such section of the Treasury Regulations. (c) In the event that any Member forfeits an Interest in the Company pursuant to the application of the principles referred to in Section 5.2, any balance in the Capital Account of such Member relating to such forfeited Interest (after accounting for any distributions to such Member) shall be reallocated to the Managing Member, unless otherwise determined by the Managing Member. (d) Notwithstanding the foregoing, but after taking account of any items of income, gain, loss or deduction mandated under subsection (b) For federalabove, state during the Fiscal Year in which an event occurs resulting in the liquidation of assets and local income tax purposeseventual dissolution of the Company, items of income, gain, loss, loss or deduction for such Fiscal Year and expense for each Fiscal Year thereafter shall be allocated to among the Members in accordance with such a manner as will (i) eliminate any deficit balances in their Capital Accounts (allocated in proportion to, and to the allocations extent of, such deficit balances), and (ii) then to cause each Member’s Capital Account balance to have a zero balance immediately upon the Members’ receipt of the corresponding amount of Net Income last liquidating distribution from the Company. (and items thereofe) or amount of Net Loss (and items thereof) of which such Notwithstanding anything to the contrary in this Section 6.1, the Managing Member may allocate items of income, gain, loss, loss and deduction or expense are components for Capital Account purposes under this Section 6.01, except that items with respect to Company property for which there is a difference between tax basis and the Book Value of such property shall be allocated in accordance with Section 704(c) of the Code, the Treasury Regulations thereunder, and Treasury Regulations Section 1.704-1(b)(4)(i). The Company shall specially allocate long-term capital gains with respect to Membership Units for which a Member’s holding period would entitle such Membership Units to be taxable as long-term capital gains if such Member sold such Membership Units. (c) Notwithstanding any provision of this Section 6.01, no item of deduction, loss or expense shall be allocated to a Member to the extent the allocation would cause a negative balance in such Member’s Capital Accounts (after taking into account the adjustments, allocations and distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6)) that exceeds the sum of (i) the amount that such Member would be required to reimburse the Company pursuant to this Agreement or under applicable law and (ii) the amount that such Member is deemed obligated to reimburse pursuant to the penultimate sentences of Treasury Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5). In the event some but not all of the Members would have such excess Capital Account deficits other manner as a consequence of such allocation of loss, deduction or expense, the limitation set forth in this Section 6.01(c) shall be applied on a Member-by-Member basis so as to allocate the maximum permissible deduction, loss or expense to each Member under Section 1.704-1(b)(2)(ii)(d) of the Treasury Regulations. In the event any loss, deduction or expense shall be specially allocated to a Member pursuant to the preceding sentence, an equal amount of income or gain of the Company shall be specially allocated to such Member prior to any allocation pursuant to Section 6.01(a). (d) In the event any Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6), items of Company income and gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate as quickly as possible any deficit balance in its Capital Account in excess of that permitted under Section 6.01(c) created by such adjustments, allocations or distributions. Any special allocations of items of income or gain pursuant to this Section 6.01(d) shall be taken into account in computing subsequent allocations pursuant to this Section 6.01 so that the net amount of any items so allocated and all other items allocated to each Member pursuant to this Section 6.01 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 this Section 6.01 if such unexpected adjustments, allocations or distributions had not occurred. (e) In the event the Company incurs any nonrecourse liabilities, income and gain shall be allocated in accordance with the “minimum gain chargeback” provisions of Section 1.704-1(b)(4)(iv) and 1.704-2 of the Treasury Regulations. (f) The Capital Accounts of the Members shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f) to reflect the fair market value (as determined by the Managing Member reasonably determines more appropriately reflects the Members’ interests in its good faith judgment) of Company property whenever Membership Units are relinquished to the Company, whenever an additional Member is admitted to the Company in accordance with Section 4.03, upon any termination of the Company within the meaning of Section 708 of the Code, and when the Company is liquidated pursuant to Article XI, and shall be adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(e) in the case of a distribution of any property (other than cash). (g) All elections, decisions and other matters concerning the allocation of income, gains, losses, deductions and expenses among the Members, and accounting procedures, not specifically and expressly provided for by the terms of this Agreement, shall be determined by the Managing Member in good faith. Such determination made in good faith by the Managing Member shall, absent manifest error, be final and conclusive as to all Members. (h) In the event of a Transfer of a Member’s Membership Units pursuant to Article VIII, at the request of the Member transferring such Membership Units or its successor in interest that the Company make an election under Section 754 of the Code, if such election would not materially adversely affect the interests of the Members, the Managing Member may, in its reasonable judgment, cause the Company to make such election (which election, unless properly revoked, will, in accordance with Section 754 of the Code and the Treasury Regulations thereunder, be binding with respect to all subsequent Transfers of Membership Units of the Company and with respect to certain distributions of property by the Company).