Common use of Loss Allocations Clause in Contracts

Loss Allocations. After making any special allocations required under Appendix 1, Losses for each Fiscal Year (including each item of deduction and loss entering into the computation thereof) shall be allocated among the Members (and charged to their respective Capital Accounts) in the following order and priority: (a) First, to the extent that Profits have previously been allocated to the Members for prior periods pursuant to Section 5.1(b) hereof, Losses shall be allocated to the Members to offset such Profits on a last-in, first-out basis with respect to the Profits allocated under Section 5.1(b) in proportion to the Members’ respective shares of the Profits being offset; (b) The balance, if any, to the Members in accordance with their respective Percentage Interests; provided that Losses allocated to any Member’s Capital Account in accordance with this Section 5.2 shall not exceed the maximum amount of Losses that can be so allocated without creating an Adjusted Capital Account Balance deficit with respect to such Capital Account. This limitation shall be applied individually with respect to each Member in order to permit the allocation pursuant to this proviso of the maximum amount of Losses permissible under Regulations Section 1.704-1(b)(2)(ii)(d). All Losses in excess of the limitations set forth in this proviso shall be allocated solely to those Members that bear the economic risk for such additional Losses within the meaning of Code Section 704(b) and the Regulations thereunder. If it is necessary to allocate Losses under the preceding sentence, the Managers shall, in accordance with the Regulations promulgated under Code Section 704(b), determine those Members that bear the economic risk for such additional Losses.

Loss Allocations. After making any special allocations required under Appendix 1, Losses for each Fiscal Year (including and each item of loss and deduction and loss entering into the computation thereof) shall be allocated among the Members (and charged to their respective Capital Accounts) in the following order and priority: (a) First, to the extent that Profits have previously been allocated to the Members for prior periods pursuant to Section 5.1(b) hereof, Losses shall be allocated to the Members to offset such Profits on a last-in, first-out basis with respect to the Profits allocated under Section 5.1(b) in proportion to the Members’ respective shares of the Profits being offset;. (b) The balance, if any, to the Members in accordance with their respective Percentage Interests; provided that . (c) Losses allocated to any Member’s Capital Account in accordance with this Section 5.2 shall not exceed the maximum amount of Losses that can be so allocated without creating an Adjusted Capital Account Balance deficit with respect to such Capital Account. This limitation shall be applied individually with respect to each Member in order to permit the allocation pursuant to this proviso Section 5.2(c) of the maximum amount of Losses permissible under Regulations Section 1.704-1(b)(2)(ii)(d). All Losses in excess of the limitations set forth in this proviso Section 5.2(c) shall be allocated solely to those Members that bear the economic risk for such additional Losses within the meaning of Code Section 704(b) and the Regulations thereunder. If it is necessary to allocate Losses under the preceding sentence, the Managers shall, in accordance with the Regulations promulgated under Code Section 704(b), determine those Members that bear the economic risk for such additional Losses.