eTrade 2000 Annual Report Download - page 239

arbitration in San Francisco, California, in accordance with the rules, then obtaining, of the American Arbitration Association. Any
award shall be final, binding and conclusive upon the parties. A judgment upon the award rendered may be entered in any court having
jurisdiction thereof.
13.16. Tax Matters Partner. Thomas A. Bevilacqua shall be the Company’ s Tax Matters Partner under the Code (“TMP”). The
TMP shall have the right to resign by giving thirty(30) days’ written notice to the Members. Upon the resignation, dissolution or
Bankruptcy of the TMP, a successor TMP shall be elected by a majority in interest of the other Members. The TMP shall employ
experienced tax counsel to represent the Company in connection with any audit or investigation of the Company by the Internal
Revenue Service (“IRS”) and in connection with all subsequent administrative and judicial proceedings arising out of such audit. The
fees and expenses of such, and all expenses incurred by the TMP in serving as the TMP, shall be Company expenses and shall be paid
by the Company. Notwithstanding the foregoing, it shall be the responsibility of the Members, at their expense, to employ tax counsel
to represent their respective separate interests. If the TMP is required by law or regulation to incur fees and expenses in connection
with tax matters not affecting each of the Members, then the TMP may, in his sole discretion, seek reimbursement from or charge such
fees and expenses to the Members on whose behalf such fees and expenses were incurred. The TMP shall keep the Members informed
of all administrative and judicial proceedings, as required by Section6223(g) of the Code, and shall furnish a copy of each notice or
other communication received by the TMP from the IRS to each Member, except such notices or communications as are sent directly
to such Member by the IRS. The relationship of the TMP to the Members is that of a fiduciary, and the TMP has a fiduciary obligation
to perform his duties as TMP in such manner as will serve the best interests of the Company and all of the Company’ s Members. To
the fullest extent permitted by law, the Company agrees to indemnify the TMP and his agents and save and hold them harmless from
and in respect to all (i)reasonable fees, costs and expenses in connection with or resulting from any claim, action or demand against the
TMP, the Managing Members or the Company that arise out of or in any way relate to the TMP’ s status as TMP for
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the Company, and (ii)all such claims, actions and demands and any losses or damages therefrom, including amounts paid in settlement
or compromise of any such claim, action or demand; provided that this indemnity shall not extend to conduct by the TMP adjudged
(i)not to have been undertaken in good faith to promote the best interests of the Company or (ii)to have constituted recklessness or
intentional wrongdoing by the TMP.
13.17. Taxation as Company. The Managing Members, while serving as such, agree to use their best efforts to avoid taking any
action that would cause the Company to be classified as other than a partnership for federal income tax purposes.
ARTICLE XIV
MISCELLANEOUS TAX COMPLIANCE PROVISIONS
14.1. Substantial Economic Effect. The provisions of this Agreement are intended to comply generally with the provisions of
Treasury Regulation Section1.704-1, and shall be interpreted and applied in a manner consistent with such Regulations; and, to the
extent the subject matter thereof is otherwise not addressed by this Agreement, the provisions of Treasury Regulations Section1.704-1
are hereby incorporated by reference unless the Managing Members shall determine that such incorporation will result in economic
consequences inconsistent with the economic arrangement among the Members as expressed in this Agreement. In the event the
Managing Members shall determine that it is prudent to modify the manner in which the Capital Accounts, or any debits or credits
thereto, are computed or allocated or the manner in which distributions and contributions upon liquidation (or otherwise) of the
Company (or any Member’ s interest therein) are effected in order to comply with such Regulations and other applicable tax laws, or to
assure that the Company is treated as a partnership for tax purposes, or to achieve the economic arrangement of the Members as
expressed in this Agreement, then, notwithstanding anything in this Agreement to the contrary, the Managing Members may make such
modification, provided that it is not likely to have a material detrimental effect on the tax consequences and total amounts distributable
to any Non-Managing Member pursuant to ArticlesVIII and XI as applied without giving effect to such modification. The Managing
Members shall also (i)make any adjustments that are necessary or appropriate to maintain equality between the Capital Accounts of the
Members and the amount of Company capital reflected on the Company’ s balance sheet, as computed for book purposes pursuant to
this Agreement, in accordance with Regulations Section 1.704-1(b)(2)(iv)(g), and (ii)make any appropriate m odifications in the event
unanticipated events (such as the incurrence of nonrecourse indebtedness) might otherwise cause the allocations under this Agreement
not to comply with Treasury Regulations Section1.704, provided in each case that the Managing Members determine that such
adjustments or modifications shall not result in economic consequences inconsistent with the economic arrangement among the
Members as expressed in this Agreement.
14.2. Income Tax Allocations.
(a)Except as otherwise provided in this paragraph or as otherwise required by the Code and the rules and Treasury Regulations
promulgated thereunder, income, gain, loss, deduction, or credit of the Company for income tax purposes shall be allocated in the
2002. EDGAR Online, Inc.