Taxation Acts means the collective reference to Act No. 73 of May 28, 2008, Act No. 20 of January 17, 2012, Act No. 22 of January 17, 2012, the Puerto Rico Internal Revenue Code of 2011, and all other statutes and regulations now existing or hereafter enacted by the Commonwealth of Puerto Rico relating to income taxes, capital gains taxes, tax exemptions, or tax credits, as the same may be amended from time to time.
Sections 59, 60, 61, 62 and 63, as in force immediately before the commencement of section 4 of the State Taxation Acts (Further Tax Reform) Act 2002, continue to apply to a transfer that takes place on or after that commencement if the contract of sale giving rise to the transfer was entered into before that commencement.
Notwithstanding any other provision in this Article 6, in accordance with Taxation Acts and the regulations promulgated thereunder, income, gain, loss, and deduction with respect to any property contributed to the capital of the Company shall, solely for tax purposes, be allocated among the Members so as to take account of any variation between the adjusted basis of such property to the Company for income tax purposes and its fair market value on the date of contribution.
If any Membership Interest is Transferred, or is increased or decreased by reason of the admission of a new Member or otherwise, during any Fiscal Year of the Company, each item of income, gain, loss, deduction, or credit of the Company for such Fiscal Year allocable, and cash which is distributable, to the holder of the Membership Interest for the then Fiscal Year shall be allocated and distributed based on a method consistent with the Taxation Acts.
Notwithstanding the foregoing, if, in the determination of the Board, a Transfer in violation of this Article 8 would cause the termination of the Company under the Taxation Acts, in the sole discretion of the Board, the Transfer shall be null and void and the purported transferee shall not become either a Member or an Economic Interest Owner.
The Tax Matters Partner shall have the right to make all elections for the Company provided for in the Taxation Acts.