Partnership Elections. The Code permits partnerships to make elections for the purpose of adjusting the basis of partnership property on the distribution of property by a partnership to a partner and on the transfer of an interest in a partnership by sale or exchange or on the death of a partner. The general effect of such elections is that transferees of Partnership Interests will be treated, for the purposes of depreciation and gain, as though they had a direct interest in the Partnership's assets, and the difference between their adjusted bases for their Partnership Interests and their allocable portion of the Partnership's bases for its assets will be allocated to such assets based upon the fair market value of the assets at the times of transfers of the Partnership Interests. Any such election, once made, cannot be revoked without the consent of the Service. Under the terms of the Partnership Agreement, the General Partner, in its discretion, may make the requisite election necessary to effect such adjustment in basis. Sale of Partnership Units. Gxxx realized on the sale of Units by a Limited Partner who is not a "dealer" in Units or in limited partnership interests will be taxed as capital gain, except that the portion of the sales price attributable to inventory items and unrealized receivables will be taxed as ordinary income. "Unrealized receivables" of the Partnership include the Limited Partner's share of the ordinary income that the Partnership would realize as a result of the recapture of depreciation (as described above) if the Partnership had sold Partnership depreciable property immediately before the Limited Partner sold his Partnership Interest. Investors should note that the IRS Restructuring and Reform Act of 1998 generally imposes a maximum tax rate of 20% on net long-term capital gains. To the extent the Partnership has income attributable to depreciation recapture incurred on the sale of a capital asset, such income will be taxed at a maximum rate of 25%. The Revenue Reconciliation Act of 1993 imposed a maximum potential individual income tax rate of 39.6% on ordinary income.
Partnership Elections. The Company has elected or will elect to be classified and treated as a partnership for U.S. federal income tax purposes. In connection therewith, each Shareholder consents to the making of any election pursuant to Treasury Regulations Section 000-0000-0 consistent with such treatment and agrees to cooperate to effect such election and not to revoke such election or take any action that would cause the Company to be treated as an association taxable as a corporation for U.S. federal income tax purposes.
Partnership Elections. For such time as the Company constitutes a partnership for U.S. federal income tax purposes, the Tax Matters Shareholder shall have the right to make, or cause the Company to make, all Company tax elections which the Tax Matters Shareholder deems appropriate in its reasonable discretion; provided, however, that the Tax Matters Shareholder shall not make any material tax election without the consent of Silver Lake, TPG and August, and provided, further, that the Tax Matters Shareholder shall make the election to adjust the basis of the Company's property pursuant to section 754 of the Code for the year in which the Closing Date occurs.
Partnership Elections. Seller shall cause WCP to make the election contemplated by Section 754 of the Code.
Partnership Elections. Neither the Borrower nor the General Partner will at any time in the future file an election to be treated as a corporation for Federal income tax purposes. 90 84
Partnership Elections. For such time as the Company constitutes a --------------------- partnership for U.S. federal income tax purposes, the Tax Matters Shareholder shall have the right to make, or cause the Company to make, all Company tax elections which the Tax Matters Shareholder deems appropriate in its reasonable discretion; provided, however, that the Tax Matters Shareholder shall not make -------- ------- any material tax election without the consent of Silver Lake, TPG and August, and provided, further, that the Tax Matters Shareholder shall make the election -------- ------- to adjust the basis of the Company's property pursuant to section 754 of the Code for the year in which the Closing Date occurs.
Partnership Elections. The Code permits partnerships to make elections for the purpose of adjusting the basis of partnership property on the distribution of property by a partnership to a partner and on the transfer of an interest in a partnership by sale or exchange or on the death of a partner. The general effect of such elections is that transferees of Partnership interests will be treated, for the purposes of depreciation and gain, as though they had a direct interest in the Partnership's assets, and the difference between their adjusted bases for their interests and their allocable portion of the Partnership's bases for its assets will be allocated to such assets based upon the fair market value of the assets at the times of transfers of the interests. Any such election, once made, cannot be revoked without the consent of the Service. Under the terms of the Partnership Agreement, the General Partner, in its discretion, may make the requisite election necessary to effect such adjustment in basis. The Code requires partnerships having partners who contribute property with a basis different than the property's fair market value on the date of contribution to eliminate that disparity utilizing any one of three methods described in Treasury Regulations promulgated under Code Section 704(c) - the traditional method, the curative method, or the curative method with remedial allocations. In the case of the Partnership, the General Partner has contributed the Contributed Assets which in the aggregate have a tax basis greater than their fair market value. However, certain of the Contributed Assets may have a tax basis less than their fair market value. Code Section 704(c) and the Regulations thereunder provide for methods by which to eliminate, or attempt to eliminate, these disparities. They also govern the allocation of depreciation with respect to contributed property where the tax basis of the property does not equal its fair market value. They will require the Partnership to attempt to eliminate these differences utilizing any one of the above three methods. The General Partner, in its discretion, may elect which of the three methods to utilize to account for the difference in tax basis and fair market value of the Contributed Assets in the aggregate and on an individual basis. Taxable Income The Partnership Agreement provides that in each year of the Partnership, annual Distributions may be made to the Partners. Excluded from the definition of cash available for
