{"component": "clause", "props": {"groups": [{"snippet": "(a) Losses attributable to partner nonrecourse debt (as defined in Treasury Regulation Section 1.704-2(b)(4)) shall be allocated in the manner required by Treasury Regulation Section 1.704-2(i). If there is a net decrease during a Taxable Year in partner nonrecourse debt minimum gain (as defined in Treasury Regulation Section 1.704-2(i)(3)), Profits for such Taxable Year (and, if necessary, for subsequent Taxable Years) shall be allocated to the Members in the amounts and of such character as determined according to Treasury Regulation Section 1.704-2(i)(4).\n(b) Nonrecourse deductions (as determined according to Treasury Regulation Section 1.704-2(b)(1)) for any Taxable Year shall be allocated pro rata among the Members in accordance with their Percentage Interests. Except as otherwise provided in Section 4.03(a), if there is a net decrease in the Minimum Gain during any Taxable Year, each Member shall be allocated Profits for such Taxable Year (and, if necessary, for subsequent Taxable Years) in the amounts and of such character as determined according to Treasury Regulation Section 1.704-2(f). This Section 5.03(b) is intended to be a minimum gain chargeback provision that complies with the requirements of Treasury Regulation Section 1.704-2(f), and shall be interpreted in a manner consistent therewith.\n(c) If any Member that unexpectedly receives an adjustment, allocation or Distribution described in Treasury Regulation Section 1.704-1(b)(2)(ii)(d)(4), (5) and (6) has an Adjusted Capital Account Deficit as of the end of any Taxable Year, computed after the application of Sections 5.03(a) and 5.03(b) but before the application of any other provision of this Article V, then Profits for such Taxable Year shall be allocated to such Member in proportion to, and to the extent of, such Adjusted Capital Account Deficit. This Section 5.03(c) is intended to be a qualified income offset provision as described in Treasury Regulation Section 1.704-1(b)(2)(ii)(d) and shall be interpreted in a manner consistent therewith.\n(d) If the allocation of Net Losses to a Member as provided in Section 5.02 would create or increase an Adjusted Capital Account Deficit, there shall be allocated to such Member only that amount of Losses as will not create or increase an Adjusted Capital Account Deficit. The Net Losses that would, absent the application of the preceding sentence, otherwise be allocated to such Member shall be allocated to the other Members in accordance with their relative Percentage Interests, subject to this Section 5.03(d).\n(e) Profits and Losses described in Section 5.01(b)(v) shall be allocated in a manner consistent with the manner that the adjustments to the Capital Accounts are required to be made pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(j), (k) and (m).\n(f) The allocations set forth in Section 5.03(a) through and including Section 5.03(e) (the \u201cRegulatory Allocations\u201d) are intended to comply with certain requirements of Sections 1.704-1(b) and 1.704-2 of the Treasury Regulations. The Regulatory Allocations may not be consistent with the manner in which the Members intend to allocate Profit and Loss of the Company or make Distributions. Accordingly, notwithstanding the other provisions of this Article V, but subject to the Regulatory Allocations, income, gain, deduction and loss shall be reallocated among the Members so as to eliminate the effect of the Regulatory Allocations and thereby cause the respective Capital Accounts of the Members to be in the amounts (or as close thereto as possible) they would have been if Profit and Loss (and such other items of income, gain, deduction and loss) had been allocated without reference to the Regulatory Allocations. In general, the Members anticipate that this will be accomplished by specially allocating other Profit and Loss (and such other items of income, gain, deduction and loss) among the Members so that the net amount of the Regulatory Allocations and such special allocations to each such Member is zero. In addition, if in any Fiscal Year or Fiscal Period there is a decrease in partnership minimum gain, or in partner nonrecourse debt minimum gain, and application of the minimum gain chargeback requirements set forth in Section 5.03(a) or Section 5.03(b) would cause a distortion in the economic arrangement among the Members, the Members may, if they do not expect that the Company will have sufficient other income to correct such distortion, request the Internal Revenue Service to waive either or both of such minimum gain chargeback requirements. If such request is granted, this Agreement shall be applied in such instance as if it did not contain such minimum gain chargeback requirement.", "size": 143, "snippet_links": [{"key": "required-by", "type": "definition", "offset": [143, 154]}, {"key": "net-decrease", "type": "definition", "offset": [209, 221]}, {"key": "taxable-year", "type": "clause", "offset": [231, 243]}, {"key": "partner-nonrecourse-debt-minimum-gain", "type": "definition", "offset": [247, 284]}, {"key": "to-the-members", "type": "clause", "offset": [443, 457]}, {"key": "according-to", "type": "definition", "offset": [509, 521]}, {"key": "nonrecourse-deductions", "type": "clause", "offset": [569, 591]}, {"key": "pro-rata", "type": "definition", "offset": [703, 711]}, {"key": "in-accordance-with", "type": "definition", "offset": [730, 748]}, {"key": "percentage-interests", "type": "clause", "offset": [755, 775]}, {"key": "except-as-otherwise-provided", "type": "clause", "offset": [777, 805]}, {"key": "each-member", "type": "definition", "offset": [898, 909]}, {"key": "minimum-gain-chargeback", "type": "definition", "offset": [1154, 1177]}, {"key": "the-requirements", "type": "clause", "offset": [1207, 1223]}, {"key": "adjusted-capital-account-deficit", "type": "definition", "offset": [1498, 1530]}, {"key": "the-application", "type": "clause", "offset": [1581, 1596]}, {"key": "provision-of", "type": "clause", "offset": [1669, 1681]}, {"key": "article-v", "type": "clause", "offset": [1687, 1696]}, {"key": "to-the-extent", "type": "clause", "offset": [1789, 1802]}, {"key": "qualified-income-offset-provision", "type": "clause", "offset": [1887, 1920]}, {"key": "allocation-of-net-losses", "type": "clause", "offset": [2056, 2080]}, {"key": "a-member", "type": "clause", "offset": [2084, 2092]}, {"key": "amount-of-losses", "type": "clause", "offset": [2233, 2249]}, {"key": "the-net", "type": "clause", "offset": [2318, 2325]}, {"key": "application-of-the", "type": "clause", "offset": [2356, 2374]}, {"key": "other-members", "type": "definition", "offset": [2459, 2472]}, {"key": "relative-percentage", "type": "definition", "offset": [2498, 2517]}, {"key": "profits-and-losses", "type": "definition", "offset": [2566, 2584]}, {"key": "consistent-with-the", "type": "clause", "offset": [2648, 2667]}, {"key": "adjustments-to", "type": "clause", "offset": [2684, 2698]}, {"key": "the-capital", "type": "clause", "offset": [2699, 2710]}, {"key": "pursuant-to-treasury", "type": "clause", "offset": [2744, 2764]}, {"key": "comply-with", "type": "definition", "offset": [2953, 2964]}, {"key": "certain-requirements", "type": "clause", "offset": [2965, 2985]}, {"key": "treasury-regulations", "type": "clause", "offset": [3028, 3048]}, {"key": "of-the-company", "type": "clause", "offset": [3171, 3185]}, {"key": "notwithstanding-the", "type": "definition", "offset": [3222, 3241]}, {"key": "provisions-of-this-article", "type": "clause", "offset": [3248, 3274]}, {"key": "subject-to-the", "type": "definition", "offset": [3282, 3296]}, {"key": "effect-of-the", "type": "clause", "offset": [3416, 3429]}, {"key": "capital-accounts-of-the-members", "type": "clause", "offset": [3486, 3517]}, {"key": "other-items", "type": "clause", "offset": [3623, 3634]}, {"key": "reference-to", "type": "definition", "offset": [3699, 3711]}, {"key": "in-general", "type": "definition", "offset": [3740, 3750]}, {"key": "other-profit", "type": "clause", "offset": [3830, 3842]}, {"key": "net-amount", "type": "definition", "offset": [3941, 3951]}, {"key": "special-allocations", "type": "definition", "offset": [3991, 4010]}, {"key": "in-addition", "type": "clause", "offset": [4040, 4051]}, {"key": "fiscal-year", "type": "clause", "offset": [4063, 4074]}, {"key": "fiscal-period", "type": "definition", "offset": [4078, 4091]}, {"key": "decrease-in-partnership-minimum-gain", "type": "clause", "offset": [4103, 4139]}, {"key": "and-application", "type": "clause", "offset": [4186, 4201]}, {"key": "the-company-will", "type": "clause", "offset": [4410, 4426]}, {"key": "other-income", "type": "clause", "offset": [4443, 4455]}, {"key": "the-internal-revenue-service", "type": "definition", "offset": [4492, 4520]}, {"key": "to-waive", "type": "clause", "offset": [4521, 4529]}, {"key": "this-agreement", "type": "clause", "offset": [4619, 4633]}], "samples": [{"hash": "cjGOYDvb1nl", "uri": "/contracts/cjGOYDvb1nl#regulatory-allocations", "label": "Operating Agreement (Greenlane Holdings, Inc.)", "score": 33.2436676025, "published": true}, {"hash": "9ux4iylqXur", "uri": "/contracts/9ux4iylqXur#regulatory-allocations", "label": "Operating Agreement (Greenlane Holdings, Inc.)", "score": 30.3114299774, "published": true}, {"hash": "6lpHtfagQMT", "uri": "/contracts/6lpHtfagQMT#regulatory-allocations", "label": "Operating Agreement (Greenlane Holdings, Inc.)", "score": 30.2128677368, "published": true}], "hash": "21c2a0794399e4a39f5865149a9d0cd5", "id": 1}, {"snippet": "The following special allocations shall be made in the following order:", "size": 60, "snippet_links": [{"key": "special-allocations", "type": "definition", "offset": [14, 33]}], "samples": [{"hash": "fyYpsYl4G0O", "uri": "/contracts/fyYpsYl4G0O#regulatory-allocations", "label": "Joint Venture Operating Agreement (Grown Rogue International Inc.)", "score": 36.3264884949, "published": true}, {"hash": "h7LKr3dhDqa", "uri": "/contracts/h7LKr3dhDqa#regulatory-allocations", "label": "Limited Liability Company Agreement (MorningStar Partners, L.P.)", "score": 33.8761138916, "published": true}, {"hash": "hPqnsxIIRNp", "uri": "/contracts/hPqnsxIIRNp#regulatory-allocations", "label": "Equity Purchase Agreement (EG Acquisition Corp.)", "score": 33.7939758301, "published": true}], "hash": "b74ca50dddb38d3882b7358bf97fe59f", "id": 6}, {"snippet": "The allocations set forth in Sections 4.3(a)-(d) (the \u201cRegulatory Allocations\u201d) are intended to comply with certain requirements of Sections 1.704-1(b) and 1.704-2 of the Treasury Regulations. The Regulatory Allocations may not be consistent with the manner in which the Unitholders intend to allocate Profit and Loss of the Company or make the Company distributions. Accordingly, notwithstanding the other provisions of this Article IV, but subject to the Regulatory Allocations, income, gain, deduction, and loss shall be reallocated among the Unitholders so as to eliminate the effect of the Regulatory Allocations and thereby cause the respective Capital Accounts of the Unitholders to be in the amounts (or as close thereto as possible) they would have been if Profit and Loss (and such other items of income, gain, deduction and loss) had been allocated without reference to the Regulatory Allocations. In general, the Unitholders anticipate that this will be accomplished by specially allocating other Profit and Loss (and such other items of income, gain, deduction and loss) among the Unitholders so that the net amount of the Regulatory Allocations and such special allocations to each such Unitholder is zero. In addition, if in any Fiscal Year or Fiscal Period there is a decrease in partnership Minimum Gain, or in partner nonrecourse debt Minimum Gain, and application of the Minimum Gain chargeback requirements set forth in Section 4.3(a) or Section 4.3(b) would cause a distortion in the economic arrangement among the Unitholders, the Unitholders may, if they do not expect that the Company will have sufficient other income to correct such distortion, request the Internal Revenue Service to waive either or both of such Minimum Gain chargeback requirements. If such request is granted, this Agreement shall be applied in such instance as if it did not contain such Minimum Gain chargeback requirement.", "size": 37, "snippet_links": [{"key": "comply-with", "type": "definition", "offset": [96, 107]}, {"key": "certain-requirements", "type": "clause", "offset": [108, 128]}, {"key": "treasury-regulations", "type": "clause", "offset": [171, 191]}, {"key": "consistent-with-the", "type": "clause", "offset": [231, 250]}, {"key": "the-unitholders", "type": "clause", "offset": [267, 282]}, {"key": "of-the-company", "type": "clause", "offset": [318, 332]}, {"key": "company-distributions", "type": "definition", "offset": [345, 366]}, {"key": "notwithstanding-the", "type": "definition", "offset": [381, 400]}, {"key": "article-iv", "type": "clause", "offset": [426, 436]}, {"key": "subject-to-the", "type": "definition", "offset": [442, 456]}, {"key": "effect-of-the", "type": "clause", "offset": [581, 594]}, {"key": "capital-accounts", "type": "definition", "offset": [651, 667]}, {"key": "other-items", "type": "clause", "offset": [792, 803]}, {"key": "reference-to", "type": "definition", "offset": [868, 880]}, {"key": "in-general", "type": "definition", "offset": [909, 919]}, {"key": "other-profit", "type": "clause", "offset": [1003, 1015]}, {"key": "net-amount", "type": "definition", "offset": [1118, 1128]}, {"key": "special-allocations", "type": "definition", "offset": [1168, 1187]}, {"key": "in-addition", "type": "clause", "offset": [1221, 1232]}, {"key": "fiscal-year", "type": "clause", "offset": [1244, 1255]}, {"key": "fiscal-period", "type": "definition", "offset": [1259, 1272]}, {"key": "decrease-in-partnership-minimum-gain", "type": "clause", "offset": [1284, 1320]}, {"key": "partner-nonrecourse-debt-minimum-gain", "type": "definition", "offset": [1328, 1365]}, {"key": "application-of-the", "type": "clause", "offset": [1371, 1389]}, {"key": "minimum-gain-chargeback", "type": "definition", "offset": [1390, 1413]}, {"key": "the-company-will", "type": "clause", "offset": [1597, 1613]}, {"key": "other-income", "type": "clause", "offset": [1630, 1642]}, {"key": "the-internal-revenue-service", "type": "definition", "offset": [1679, 1707]}, {"key": "to-waive", "type": "clause", "offset": [1708, 1716]}, {"key": "this-agreement", "type": "clause", "offset": [1806, 1820]}], "samples": [{"hash": "3bXchM9fUIy", "uri": "/contracts/3bXchM9fUIy#regulatory-allocations", "label": "Limited Liability Company Agreement (Real Good Food Company, Inc.)", "score": 35.7351112366, "published": true}, {"hash": "jKUMQZeU8Du", "uri": "/contracts/jKUMQZeU8Du#regulatory-allocations", "label": "Limited Liability Company Agreement (Real Good Food Company, Inc.)", "score": 32.8220405579, "published": true}, {"hash": "31jW3lZFsWB", "uri": "/contracts/31jW3lZFsWB#regulatory-allocations", "label": "Limited Liability Company Agreement (Real Good Food Company, Inc.)", "score": 32.7782325745, "published": true}], "hash": "cb9e54484a40544f54b5db4d8b7a79e4", "id": 8}, {"snippet": "The allocations set forth in Sections 3.3(a), 3.3(b), 3.3(c), 3.3(d), 3.3(e), 3.3(f), 3.3(g) and 3.5 (the \u201cRegulatory Allocations\u201d) are intended to comply with certain requirements of the Regulations. It is the intent of the Unit Holders that, to the extent possible, all Regulatory Allocations shall be offset either with other Regulatory Allocations or with special allocations of other items of Company income, gain, loss or deduction pursuant to this Section 3.4. Therefore, notwithstanding any other provision of this Article III (other than the Regulatory Allocations), the Directors shall make such offsetting special allocations of Company income, gain, loss or deduction in whatever manner they determine appropriate so that, after such offsetting allocations are made, each Unit Holder\u2019s Capital Account balance is, to the extent possible, equal to the Capital Account balance such Unit Holder would have had if the Regulatory Allocations were not part of the Agreement and all Company items were allocated pursuant to Sections 3.1, 3.2, and 3.3(h).", "size": 43, "snippet_links": [{"key": "comply-with", "type": "definition", "offset": [148, 159]}, {"key": "the-regulations", "type": "clause", "offset": [184, 199]}, {"key": "unit-holders", "type": "definition", "offset": [225, 237]}, {"key": "to-the-extent", "type": "clause", "offset": [244, 257]}, {"key": "special-allocations", "type": "definition", "offset": [360, 379]}, {"key": "other-items", "type": "clause", "offset": [383, 394]}, {"key": "section-34", "type": "clause", "offset": [455, 466]}, {"key": "provision-of", "type": "clause", "offset": [505, 517]}, {"key": "article-iii", "type": "clause", "offset": [523, 534]}, {"key": "the-directors", "type": "clause", "offset": [576, 589]}, {"key": "allocations-of-company-income", "type": "clause", "offset": [625, 654]}, {"key": "offsetting-allocations", "type": "definition", "offset": [746, 768]}, {"key": "capital-account-balance", "type": "definition", "offset": [798, 821]}, {"key": "equal-to", "type": "definition", "offset": [850, 858]}, {"key": "the-capital", "type": "clause", "offset": [859, 870]}, {"key": "such-unit", "type": "definition", "offset": [887, 896]}, {"key": "part-of-the-agreement", "type": "clause", "offset": [958, 979]}, {"key": "company-items", "type": "definition", "offset": [988, 1001]}, {"key": "pursuant-to-sections", "type": "clause", "offset": [1017, 1037]}], "samples": [{"hash": "9QrHi49VPdZ", "uri": "/contracts/9QrHi49VPdZ#regulatory-allocations", "label": "Operating Agreement (Homeland Energy Solutions LLC)", "score": 33.2409324646, "published": true}, {"hash": "2jJDUYmk21R", "uri": "/contracts/2jJDUYmk21R#regulatory-allocations", "label": "Operating Agreement (Southwest Iowa Renewable Energy, LLC)", "score": 31.4750175476, "published": true}, {"hash": "jVGiL6B5OPO", "uri": "/contracts/jVGiL6B5OPO#regulatory-allocations", "label": "Operating Agreement", "score": 25.6179389954, "published": true}], "hash": "61ac69a3643b1c0272d39f1c99426839", "id": 7}, {"snippet": "Although the Members do not anticipate that events will arise that will require application of this Section 5.1, provisions are included in this Agreement governing the allocation of income, gain, loss, deduction and credit (and items thereof) as may be necessary to provide that the Company\u2019s allocation provisions contain a so-called \u201cqualified income offset\u201d and comply with all provisions relating to the allocation of so-called \u201cnon-recourse deductions\u201d and \u201cpartner non-recourse deductions\u201d and the chargeback thereof as set forth in the Treasury Regulations under Section 704(b) of the Code (such regulatory allocations, \u201cRegulatory Allocations\u201d); provided, however, that the Members intend that all Regulatory Allocations that may be required shall be offset by other Regulatory Allocations or special allocations of items so that the share of the Net Income and Net Loss of the Company of each Member will be the same as it would have been had the events requiring the Regulatory Allocations not occurred. For this purpose the Managing Member, based on the advice of the Company\u2019s auditors or tax counsel, is hereby authorized to make such special curative allocations as may be appropriate.", "size": 35, "snippet_links": [{"key": "the-members", "type": "clause", "offset": [9, 20]}, {"key": "section-51", "type": "clause", "offset": [100, 111]}, {"key": "in-this-agreement", "type": "definition", "offset": [137, 154]}, {"key": "allocation-of-income", "type": "clause", "offset": [169, 189]}, {"key": "to-provide", "type": "definition", "offset": [264, 274]}, {"key": "allocation-provisions", "type": "definition", "offset": [294, 315]}, {"key": "qualified-income-offset", "type": "clause", "offset": [337, 360]}, {"key": "comply-with", "type": "definition", "offset": [366, 377]}, {"key": "provisions-relating-to-the", "type": "clause", "offset": [382, 408]}, {"key": "treasury-regulations", "type": "clause", "offset": [544, 564]}, {"key": "the-code", "type": "clause", "offset": [589, 597]}, {"key": "allocations-of-items", "type": "clause", "offset": [810, 830]}, {"key": "the-share", "type": "clause", "offset": [839, 848]}, {"key": "loss-of", "type": "definition", "offset": [875, 882]}, {"key": "each-member", "type": "definition", "offset": [898, 909]}, {"key": "the-events", "type": "clause", "offset": [953, 963]}, {"key": "the-managing-member", "type": "clause", "offset": [1032, 1051]}, {"key": "based-on", "type": "definition", "offset": [1053, 1061]}, {"key": "advice-of-the-company", "type": "clause", "offset": [1066, 1087]}, {"key": "tax-counsel", "type": "clause", "offset": [1102, 1113]}, {"key": "curative-allocations", "type": "clause", "offset": [1157, 1177]}], "samples": [{"hash": "lTrTXjo2ZM4", "uri": "/contracts/lTrTXjo2ZM4#regulatory-allocations", "label": "Limited Liability Company Agreement (PetIQ, Inc.)", "score": 28.5099239349, "published": true}, {"hash": "54uBTdBn4vV", "uri": "/contracts/54uBTdBn4vV#regulatory-allocations", "label": "Limited Liability Company Agreement (Planet Fitness, Inc.)", "score": 26.5331954956, "published": true}, {"hash": "480vFaA6rhu", "uri": "/contracts/480vFaA6rhu#regulatory-allocations", "label": "Limited Liability Company Agreement (Habit Restaurants, Inc.)", "score": 26.2621498108, "published": true}], "hash": "c8d9c08e6409cd47f9c7fa3573437488", "id": 9}, {"snippet": "Notwithstanding any other provision of this Agreement:", "size": 84, "snippet_links": [{"key": "other-provision-of-this-agreement", "type": "clause", "offset": [20, 53]}], "samples": [{"hash": "gmFwluHNvzR", "uri": "/contracts/gmFwluHNvzR#regulatory-allocations", "label": "Limited Partnership Agreement (HPS Net Lease Income REIT)", "score": 37.566734314, "published": true}, {"hash": "aLWl0AMJvOp", "uri": "/contracts/aLWl0AMJvOp#regulatory-allocations", "label": "Limited Partnership Agreement (Core University Living Real Estate Income Trust)", "score": 37.5338821411, "published": true}, {"hash": "if2I0Vzjd5n", "uri": "/contracts/if2I0Vzjd5n#regulatory-allocations", "label": "Limited Partnership Agreement (North Haven Net REIT)", "score": 37.4243659973, "published": true}], "hash": "453708dd60bdb760876290561eb43a75", "id": 4}, {"snippet": "The following allocations shall be made in the following order:\n(a) Nonrecourse Deductions shall be allocated to the Members in accordance with their respective Percentage Interests.\n(b) Member Nonrecourse Deductions attributable to Member Nonrecourse Debt shall be allocated to the Members bearing the Economic Risk of Loss for such Member Nonrecourse Debt as determined under Treasury Regulation Section 1.704-2(b)(4). If more than one Member bears the Economic Risk of Loss for such Member Nonrecourse Debt, the Member Nonrecourse Deductions attributable to such Member Nonrecourse Debt shall be allocated among the Members according to the ratio in which they bear the Economic Risk of Loss. This Section 6.4(b) is intended to comply with the provisions of Treasury Regulation Section 1.704-2(i) and shall be interpreted consistently therewith.\n(c) Notwithstanding any other provision hereof to the contrary, if there is a net decrease in Minimum Gain for a Fiscal Year (or if there was a net decrease in Minimum Gain for a prior Fiscal Year and the Company did not have sufficient amounts of income and gain during prior years to allocate among the Members under this Section 6.4(c)), items of income and gain shall be allocated to each Member in an amount equal to such Member\u2019s share of the net decrease in such Minimum Gain (as determined pursuant to Treasury Regulation Section 1.704-2(g)(2)). This Section 6.4(c) is intended to constitute a minimum gain chargeback under Treasury Regulation Section 1.704-2(f) and shall be interpreted consistently therewith.\n(d) Notwithstanding any provision hereof to the contrary except Section 6.4(c) (dealing with Minimum Gain), if there is a net decrease in Member Nonrecourse Debt Minimum Gain for a Fiscal Year (or if there was a net decrease in Member Nonrecourse Debt Minimum Gain for a prior Fiscal Year and the Company did not have sufficient amounts of income and gain during prior years to allocate among the Members under this Section 6.4(d), items of income and gain shall be allocated to each Member in an amount equal to such Member\u2019s share of the net decrease in Member Nonrecourse Debt Minimum Gain (as determined pursuant to Treasury Regulation Section 1.704-2(i)(4)). This Section 6.4(d) is intended to constitute a partner nonrecourse debt minimum gain chargeback under Treasury Regulation Section 1.704-2(i)(4) and shall be interpreted consistently therewith.\n(e) Notwithstanding any provision hereof to the contrary except Section 6.4(c) and Section 6.4(d) (dealing with Minimum Gain and Member Nonrecourse Debt Minimum Gain), a Member who unexpectedly receives an adjustment, allocation or distribution described in Treasury Regulation Section 1.704-1(b)(2)(ii)(d)(4), (5) or (6) shall be allocated items of income and gain (consisting of a pro rata portion of each item of income, including gross income, and gain for the Fiscal Year or other period) in an amount and manner sufficient to eliminate any deficit balance in such Member\u2019s Adjusted Capital Account as quickly as possible. This Section 6.4(e) is intended to constitute a qualified income offset under Treasury Regulation Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.\n(f) In the event that any Member has a negative Adjusted Capital Account at the end of any Fiscal Year, such Member shall be allocated items of Company income and gain LIMITED LIABILITY COMPANY AGREEMENT IRON \u2587\u2587\u2587\u2587 \u2587\u2587\u2587\u2587\u2587\u2587 LLC in the amount of such deficit as quickly as possible; provided that an allocation pursuant to this Section 6.4(f) shall be made only if and to the extent that such Member would have a negative Adjusted Capital Account after all other allocations provided for in this Section 6.4(f) have been tentatively made as if Section 6.4(e) and this Section 6.4(f) were not in this Agreement.\n(g) To the extent an adjustment to the adjusted tax basis of any Company properties pursuant to Code Section 734(b) or Code Section 743(b) is required pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(m)(2) or 1.704-1(b)(2)(iv)(m)(4) to be taken into account in determining Capital Accounts as the result of a distribution to any Member in complete liquidation of such Member\u2019s Membership Interest, the amount of such adjustment to 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 allocated to the Members in accordance with Treasury Regulation Section 1.704-1(b)(2)(iv)(m)(2) if such Section applies, or to the Member to whom such distribution was made if Treasury Regulation Section 1.704-1(b)(2)(iv)(m)(4) applies.", "size": 32, "snippet_links": [{"key": "to-the-members", "type": "clause", "offset": [110, 124]}, {"key": "in-accordance-with", "type": "definition", "offset": [125, 143]}, {"key": "percentage-interests", "type": "clause", "offset": [161, 181]}, {"key": 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"clause", "offset": [20, 33]}, {"key": "paragraph-1", "type": "definition", "offset": [34, 45]}, {"key": "exhibit-b", "type": "definition", "offset": [54, 63]}, {"key": "special-allocations", "type": "definition", "offset": [79, 98]}], "samples": [{"hash": "4BH5pzmRx2R", "uri": "/contracts/4BH5pzmRx2R#regulatory-allocations", "label": "Limited Partnership Agreement (HappyNest REIT, Inc.)", "score": 34.9329223633, "published": true}, {"hash": "21SBtF2kwnd", "uri": "/contracts/21SBtF2kwnd#regulatory-allocations", "label": "Limited Partnership Agreement (HappyNest REIT, Inc.)", "score": 29.9856262207, "published": true}, {"hash": "frT1u17BFTw", "uri": "/contracts/frT1u17BFTw#regulatory-allocations", "label": "Limited Partnership Agreement (Sila Realty Trust, Inc.)", "score": 29.7460651398, "published": true}], "hash": "8f8163d3b4ee741a1c9455ab9c3c7af9", "id": 2}, {"snippet": "The following allocations shall be made in the following order:\n(a) Nonrecourse Deductions shall be allocated to the Members in accordance with their respective Sharing Percentages.\n(b) Member Nonrecourse Deductions attributable to Member Nonrecourse Debt shall be allocated to the Members bearing the Economic Risk of Loss for such Member Nonrecourse Debt as determined under Treasury Regulation Section 1.704-2(b)(4). If more than one Member bears the Economic Risk of Loss for such Member Nonrecourse Debt, the Member Nonrecourse Deductions attributable to such Member Nonrecourse Debt shall be allocated among the Members according to the ratio in which they bear the Economic Risk of Loss. This Section 5.04(b) is intended to comply with the provisions of Treasury Regulation Section 1.704-2(i) and shall be interpreted consistently therewith.\n(c) Notwithstanding any other provision hereof to the contrary, if there is a net decrease in Minimum Gain for a Fiscal Year (or if there was a net decrease in Minimum Gain for a prior Fiscal Year and the Company did not have sufficient amounts of income and gain during prior years to allocate among the Members under this Section 5.04(c), items of income and gain shall be allocated to each Member in an amount equal to such Member\u2019s share of the net decrease in such Minimum Gain (as determined pursuant to Treasury Regulation Section 1.704-2(g)(2)). This Section 5.04(c) is intended to constitute a minimum gain chargeback under Treasury Regulation Section 1.704-2(f) and shall be interpreted consistently therewith.\n(d) Notwithstanding any provision hereof to the contrary except Section 5.04(c) (dealing with Minimum Gain), if there is a net decrease in Member Nonrecourse Debt Minimum Gain for a Fiscal Year (or if there was a net decrease in Member Nonrecourse Debt Minimum Gain for a prior Fiscal Year and the Company did not have sufficient amounts of income and gain during prior years to allocate among the Members under this Section 5.04(d), items of income and gain shall be allocated to each Member in an amount equal to such Member\u2019s share of the net decrease in Member Nonrecourse Debt Minimum Gain (as determined pursuant to Treasury Regulation Section 1.704-2(i)(4)). This Section 5.04(d) is intended to constitute a partner nonrecourse debt minimum gain chargeback under Treasury Regulation Section 1.704-2(i)(4) and shall be interpreted consistently therewith.\n(e) Notwithstanding any provision hereof to the contrary except Sections 5.04(c) and Section 5.04(d) (dealing with Minimum Gain and Member Nonrecourse Debt Minimum Gain), a Member who unexpectedly receives an adjustment, allocation or distribution described in Treasury Regulation Section 1.704-1(b)(2)(ii)(d)(4), (5) or (6) shall be allocated items of income and gain (consisting of a pro rata portion of each item of income, including gross income, and gain for the Fiscal Year) in an amount and manner sufficient to eliminate any deficit balance in such Member\u2019s Adjusted Capital Account as quickly as possible. This Section 5.04(e) is intended to constitute a qualified income offset under Treasury Regulation Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.\n(f) In the event that any Member has a negative Adjusted Capital Account at the end of any Fiscal Year, such Member shall be allocated items of Company income and gain in the amount of such deficit as quickly as possible; provided that an allocation pursuant to this Section 5.04(f) shall be made only if and to the extent that such Member would have a negative Adjusted Capital Account after all other allocations provided for in this Section 5.04 have been tentatively made as if this Section 5.04(f) were not in this Agreement.\n(g) To the extent an adjustment to the adjusted tax basis of any Company properties pursuant to Code Section 734(b) or Code Section 743(b) is required pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(m)(2) or 1.704-1(b)(2)(iv)(m)(4) to be taken into account in determining Capital Accounts as the result of a distribution to any Member in complete liquidation of such Member\u2019s Membership Interest, the amount of such adjustment to 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 allocated to the Members in accordance with Treasury Regulation Section 1.704-1(b)(2)(iv)(m)(2) if such Section applies, or to the Member to whom such distribution was made if Treasury Regulation Section 1.704-1(b)(2)(iv)(m)(4) applies.", "size": 96, "snippet_links": [{"key": "to-the-members", "type": "clause", "offset": [110, 124]}, {"key": "in-accordance-with", "type": "definition", "offset": [125, 143]}, {"key": "sharing-percentages", "type": "definition", "offset": [161, 180]}, {"key": "deductions-attributable-to-member-nonrecourse-debt", "type": "clause", "offset": [205, 255]}, {"key": "economic-risk-of-loss", "type": "definition", "offset": 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["minimum-gain-chargeback", "Minimum Gain Chargeback"], ["gross-income-allocation", "Gross Income Allocation"], ["section-754-adjustment", "Section 754 Adjustment"], ["nonrecourse-deductions", "Nonrecourse Deductions"]], "title": "Regulatory Allocations", "parents": [["allocations", "Allocations"], ["additional-allocation-provisions", "Additional Allocation Provisions"], ["profits-and-losses-distributions", "Profits and Losses Distributions"], ["allocation-of-profit-and-loss", "Allocation of Profit and Loss"], ["distributions-and-allocations", "Distributions and Allocations"]], "id": "regulatory-allocations", "related": [["priority-allocations", "Priority Allocations", "Priority Allocations"], ["injury-allowance", "INJURY ALLOWANCE", "INJURY ALLOWANCE"], ["by-allottee", "BY ALLOTTEE", "BY ALLOTTEE"], ["allocations", "Allocations", "Allocations"], ["section-704c-allocations", "Section 704(c) Allocations", "Section 704(c) Allocations"]], "related_snippets": [], "updated": "2026-08-08T05:41:37+00:00", "also_ask": ["What are the essential elements to include in a regulatory allocation clause to ensure compliance and minimize disputes?", "How can parties strategically negotiate regulatory allocations to shift or limit liability exposure?", "What are the most common pitfalls or fatal flaws in drafting regulatory allocation provisions?", "How do regulatory allocation clauses differ across key jurisdictions or under different regulatory regimes?", "What standards do courts use to assess the enforceability of regulatory allocation clauses in litigation?"], "drafting_tip": "Specify allocation methods, reference applicable regulations, and clarify adjustment procedures to ensure compliance, prevent disputes, and maintain tax integrity.", "explanation": "The Regulatory Allocations clause defines how tax items such as income, gain, loss, and deductions are allocated among parties in accordance with applicable tax regulations. In practice, this clause ensures that allocations comply with IRS rules, such as those under Section 704(b) of the Internal Revenue Code, and may include provisions for special allocations required by law, like minimum gain chargebacks or qualified income offsets. Its core function is to ensure that the partnership\u2019s tax reporting aligns with regulatory requirements, thereby preventing adverse tax consequences and maintaining compliance with tax authorities."}, "json": true, "cursor": ""}}