b'theInvestorLLCsbankaccountshouldbeusedforoperatingcapital, reserves and capital improvements. You may want to hold the reserves and capital improvement funds in the Investor LLCs savings account.If there are any lender-required reserves, the lender may require that you hold them in a separate escrow account.Disbursing Cash From Operations The property earns money, Either the property manager or the asset manager writes checks for property operating expenses and debt service, as agreed in the property management agreement. Excess cash is swept into to the Investor LLCs operating account. The asset manager writes checks from the Investor LLCs account to itself for any fees that are due at that time. Asset managers fees are described in your operating agreement.The asset manager distributes its earnings to its members as described in its own operating agreement. The asset manager decides how much to retain in the Investor LLCs operating account as working capital or reserves and how much, if any, is distributable cash that can be split among the Investor LLCs members. If there is to be a distribution, the manager follows the waterfall in the Investor LLCs operating agreement, depending on the phase of the company (operations, or a capital transaction). 277'