EFTA01583900.pdf

SECTION III CAPITAL ACCOUNT A. Capital Account. A capital account ("Capital Accoutre') shall be maintained for the Sate Member, and each additional Member, if any, in accordance with the pros ision of this Article I. Increases in Cattal Account. The Capital Account of each Member shall be increased }., • (a) The fair markm sable of the Member's inttia; capital contribution and any additional capital contributions by the Member to the Company If any property. other than cash, is contributed to or it:shit:wed by the Company, the adjustments to Capital Accounts required by Treasury Regulation Section 1.704 -1(bX2Kls.Rd), (e). (t) and (g) and Section 1.704-1(bX4 XI) shall be made. (b) The Member's share of the increase in the tax basis of Company property. if any, arising out of thc recapture of any lax credit. (e) Allocations to the Member of Profit. (d) Company income or gain (including income v4 gain exempt from income taxation) as provided wider this Agreement, or othassise by ReguLation Section 1.704-l(b)(2giv) (e) The amount of Company liabilities that are assumed his the Member. 2. Dearases in Capital .Account. The Capital Accramt of each Member sh.al ts: decreased by: (a) The amount of money distributed to the Member by the Compare.) pursuant to any provision of this Agreement (b) The fair market value of property distributed to the Member by the Company (net of liabilities secured by such distnbuted property that Markt is considered to assume or taise subject to under Code Section 752) (c) Allocutions to the Member of Losses. (d) Allocations to the Member of deducticrs, expenses, Nonrecourse Deductions and net toms allocated to him pursuant to this Agreement. awl the Member's share of Company expenditures which are neither deductible nut properly chargeable to Carina, Accounts under Code Section 705(a)(2XII) or EC treated as such expenditures under Treasury Regulation Section 1.704- I (bX2 "Nonrecourse Deductions' shall have the meaning set forth in Treasury Regulation Section 1.704-2 Confidential Treatment Requested by JPMorgan Chase JPM-SDNY-00063629 EFTA01583900