2015-0564981R3 "cross-statute" amalgamation

Principal Issues: Whether the "cross-statute" amalgamation described below meets legislative requirements?

Position: The amalgamation meets legislative requirements.

Reasons: Consistent with law.

Author: XXXXXXXXXX
Section: subsections 87(1) and XXXXXXXXXX

XXXXXXXXXX
                                                                        2015-056498

XXXXXXXXXX, 2015

Dear XXXXXXXXXX:

Re:   XXXXXXXXXX
Advance Income Tax Ruling Request

This is in reply to your letter of XXXXXXXXXX in which you requested an advance income tax ruling on behalf of the above-noted taxpayer.  We also acknowledge the additional information provided to us in subsequent letters and emails, and during our various telephone conversations.

To the best of your knowledge, and that of the taxpayer involved, none of the issues involved in this ruling request is

(i)   in an earlier return of the taxpayer or a related person;

(ii)  being considered by a tax services office or taxation centre in connection with a previously filed tax return of the taxpayer or a related person;

(iii) under objection by the taxpayer or a related person;

(iv)  before the courts or, if a judgment has been issued, the time limit for appeal to a higher court has expired; or

(v)   the subject of a ruling previously issued by the Income Tax Rulings Directorate.

I.    DEFINITIONS

Unless otherwise expressly stated, every reference herein to the “Act” or to a part, section or subsection, paragraph or subparagraph and clause or subclause is a reference to the relevant provision of the Income Tax Act (Canada), R.S.C. 1985 (5th Supp.) c.1, as amended from time to time and consolidated to the date of this letter.

Unless otherwise noted, all references herein to a currency are a reference to Canadian dollars.

In this letter, the following terms have the meanings specified and, where the circumstances so require, the singular should be read as plural and vice versa:

“Aco” means XXXXXXXXXX, an association incorporated under Act II;

“ACo Certificates of Indebtedness” has the meaning assigned in Paragraph 7(f);

“ACo Class A Shares” means the Class A investment shares of ACo, as described in Paragraph 6, none of which are currently issued and outstanding; 

“ACo Class B Shares” means the Class B investment shares of ACo, as described in Paragraph 6, none of which are currently issued and outstanding;

“ACo Class B Shareholders” means the holders of ACo Class B Shares;

“ACo Class C Shares” means the Class C investment shares of ACo, as described in Paragraph 6;

“ACo Class C Shareholders” means the holders of ACo Class C Shares, as described in Paragraph 6;

“ACo Meeting” means the annual general and special general meeting of ACo Members held on XXXXXXXXXX, to consider the Arrangement and related matters, and any adjournments thereof;

“ACo Member” means a person admitted as a member of ACo under the ACo Rules;

“ACo Membership Shareholders” means the holders of ACo Membership Shares;

“ACo Membership Shares” means the membership shares of ACo, as described in Paragraph 6;

“ACo Obligations” has the meaning assigned in Paragraph 4(a); 

“ACo Rules” means the rules of ACo made pursuant to Act II, as described in Paragraph 7;

“ACo Surplus” for a Taxation Year means the net income of ACo for the year calculated according to Generally Accepted Accounting Principles, but does not include any gain or loss arising on the sale of real property owned by ACo in the year;

“Act I” XXXXXXXXXX

“Act II” XXXXXXXXXX

“ACB” means adjusted cost base, as defined in section 54;

“ACC” means XXXXXXXXXX corporation, XXXXXXXXXX;

“Allowable Disposition” has the meaning assigned by XXXXXXXXXX;

“Amalco” means XXXXXXXXXX, the corporate entity formed on the Amalgamation;

“Amalco Certificates of Indebtedness” means the ACo Certificates of Indebtedness that become the liabilities of Amalco on the Amalgamation, as described in Paragraph 19(b);

“Amalco Class A Shares” means the Class A common shares of Amalco without par value, as described in Paragraph 19;

“Amalco Class A Shareholder” means a holder of an Amalco Class A Share;

“Amalco Class B Shares” means the Class B common shares of Amalco without par value, as described in Paragraph 19;

“Amalco Obligations” means the ACo Obligations that become the liabilities of Amalco on the Amalgamation, as described in Paragraph 19(b);

“Amalgamation” means the amalgamation of ACo and SubCo under the Plan of Arrangement, as described in Paragraph 19;

“Arrangement” means an arrangement under the provisions of Act I, on the terms and conditions set forth in the Plan of Arrangement and the Arrangement Agreement, as amended pursuant to the direction of the Court, including any amendment or supplement thereto as provided for in the Final Order;

“Arrangement Agreement” means the arrangement agreement dated XXXXXXXXXX, among ACo, SubCo and BCo;

“BCo” means XXXXXXXXXX;

“BCo Membership Shares” means the membership shares of BCo, as described in Paragraph 10;

“Business 1” means ACo’s XXXXXXXXXX auction business and related activities business, as described in Paragraph 2; 

“Business 1 Assets” means ACo’s assets that relate to Business 1, as described in Paragraph 3(a);

“Business 1 Sales” means Business 1 sales effected through ACo;

“Business 2” means ACo’s business described in Paragraph 2(b);

“Business 2 Assets” means ACo’s assets that relate to Business 2, as described in Paragraph 3(b);

“Business 2 Sales” means XXXXXXXXXX other than those produced and supplied by the ACo Members, as described in Paragraph 2(b)(i);

“CRA” means the Canada Revenue Agency;

“CCPC” means a “Canadian-controlled private corporation” as defined in subsection 125(7);

“Capital Property” has the meaning assigned by section 54;

“Cost Amount” has the meaning assigned by subsection 248(1);

“Court” means the Supreme Court of XXXXXXXXXX;

“Disposition” has the meaning assigned by subsection 248(1);

“Effective Date” means the effective date of the Plan of Arrangement;

“Effective Time” means XXXXXXXXXX on the Effective Date, which is the time that the Proposed Transactions will be implemented;

“XXXXXXXXXX Member” has the meaning assigned by XXXXXXXXXX;  

“FMV” means fair market value, being the highest price available in an open and unrestricted market between informed prudent parties acting at arm’s length and without compulsion to act, expressed in terms of cash;

“Final Order” means the final order of the Court approving the Arrangement and the fairness of the terms and conditions thereof pursuant to the provisions of Act I, as described in Paragraph 15;

“Guarantee” means the guarantee to be granted by Amalco pursuant to the terms of the Arrangement Agreement whereby Amalco will guarantee the obligations of BCo in respect of the Amalco Certificates of Indebtedness that BCo assumed on the Transfer, as described in Paragraph 20;

“Interim Order” means the order of the Court pursuant to the provisions of Act I, which granted the calling and holding of the ACo Meeting;

“PUC” means paid-up capital, as defined in subsection 89(1);

“Paragraph” means a numbered paragraph in this letter;

“XXXXXXXXXX Dividend” means the distribution made by ACo out of ACo Surplus to the XXXXXXXXXX Dividend Recipients as described in Paragraph 7(e);

“Plan of Arrangement” means the plan of arrangement as amended or supplemented from time to time in accordance with the Arrangement Agreement and the Final Order;

“Proposed Transactions” means the transactions described in Paragraphs 16 to 23;

“Real Estate” means the land owned by ACo (legally described as XXXXXXXXXX), which includes XXXXXXXXXX buildings on the land;

“Related Persons” means, in relation to a particular person, another person who is related to the particular person by virtue of subsection 251(2);

“Stated Capital” in respect of the share capital of a corporation has the meaning assigned by the statute by which the corporation is governed at the relevant time;

“SubCo” means XXXXXXXXXX;

“Subject Transactions” means those completed transactions described in Paragraphs 9 to 15;

XXXXXXXXXX;

“TCC” means taxable Canadian corporation, as defined in subsection 89(1);

“Taxation Year” has the meaning assigned by subsection 249(1); and

“Transfer” means the transfer by Amalco of all of the Business 1 Assets to BCo, as described in Paragraph 20.

Our understanding of the Facts, Subject Transactions, Proposed Transactions and purposes of the Subject Transactions and Proposed Transactions are as follows:

II.   FACTS

1.    ACo is governed by the provisions of Act II.  ACo is a CCPC and a TCC.  ACo’s Taxation Year ends on XXXXXXXXXX.  Its head office is located in XXXXXXXXXX.  ACo files its tax returns at the XXXXXXXXXX Taxation Centre and its tax services office is the XXXXXXXXXX Tax Services Office.

2.    ACo is a XXXXXXXXXX of XXXXXXXXXX.  Aco is an ACC.

ACo’s businesses consist of:

(a)   XXXXXXXXXX (“Business 1”) which includes XXXXXXXXXX by the ACo Members, XXXXXXXXXX (“Business 1 Sales”); and

(b)   all business and other activity other than Business 1 (“Business 2”) which includes:

(i)   XXXXXXXXXX by the ACo Members (“Business 2 Sales”); and

(ii)  rental of any portion of the Real Estate to any third party tenants.

3.    ACo’s assets include

(a)   assets that relate to Business 1 (“Business 1 Assets”), which include all XXXXXXXXXX;

(b)   assets that relate to Business 2 (“Business 2 Assets”), which include the XXXXXXXXXX; and

(c)   XXXXXXXXXX share of SubCo.

Subco is a wholly-owned subsidiary of ACo.

4.    ACo’s liabilities include:

(a)   all the liabilities relating to Business 1 (“ACo Obligations”);

(b)   bank indebtedness, none of this relates to Business 1;

(c)   indebtedness in respect of the Real Estate, and

(d)   ACo Certificates of Indebtedness described in Paragraph 7(f).

5.    The Real Estate was originally acquired and used entirely for carrying on Business 1; however, with changing business patterns, some portion of the Real Estate is no longer required for that purpose.

Currently, Business 1 uses approximately XXXXXXXXXX out of the XXXXXXXXXX of the XXXXXXXXXX buildings owned by ACo. Management expects that over the next few years the portion of the Real Estate used in Business 1 will further decline.

The Real Estate not used in Business 1 is either used to conduct Business 2 or rented out to third party tenants.

The estimated FMV of the Real Estate, based on the latest valuation received in XXXXXXXXXX, was approximately $XXXXXXXXXX.  The ACB of the Real Estate to ACo is approximately $XXXXXXXXXX.

6.    The authorized share capital of ACo consists of an unlimited number of:

(a)   voting membership shares with no par value, and redeemable at $XXXXXXXXXX per share (“ACo Membership Shares”); 

(b)   non-voting class A investment shares with no par value, and redeemable at $XXXXXXXXXX per share (“ACo Class A Shares”); 

(c)   non-voting class B investment shares with no par value, and redeemable at $XXXXXXXXXX per share (“ACo Class B Shares”); and 

(d)   non-voting class C investment shares with no par value, and redeemable at $XXXXXXXXXX per share (“ACo Class C Shares”). 

The ACo Membership Shares have XXXXXXXXXX per share.

The issued and outstanding shares of ACo consist of:

(i)   XXXXXXXXXX ACo Membership Shares, all of which are owned by the ACo Members, and

(ii)  XXXXXXXXXX ACo Class C Shares, all of which are owned by the ACo Members or former ACo Members.

All of the ACo Members are XXXXXXXXXX who are corporations, individuals or partnerships.  They are residents of Canada.

Currently, there are no issued and outstanding ACo Class A Shares and ACo Class B Shares.  At the Effective Time, there will be no ACo Class A or Class B Shares issued and outstanding.

7.    According to the articles of incorporation of ACo and the ACo Rules, among other things,

(a)   XXXXXXXXXX who is an individual, corporation or partnership wishing to become an ACo Member is required to apply for a membership, be approved by the board of directors of ACo, pay a one-time membership fee and acquire XXXXXXXXXX ACo Membership Share.

(b)   Each ACo Member can only hold XXXXXXXXXX ACo Membership Share.

(c)   An ACo Member who holds an ACo Membership Share may resign their membership in ACo and can still hold the ACo Membership Share.

(d)   ACo Members will set a minimum XXXXXXXXXX requirement per annum through a vote at a general meeting of ACo.  If an ACo Member is no longer able to meet the minimum XXXXXXXXXX requirement, the board of directors of ACo may vote to terminate the ACo Member’s membership in ACo, and (i) redeem the ACo Member’s ACo Membership Share or (ii) if the ACo Member still has XXXXXXXXXX or intends to have XXXXXXXXXX in the near future, redeem the ACo Member’s ACo Membership Share and issue to the ACo Member an ACo Class B Share.

(e)   The ACo Members and the ACo Class B Shareholders (currently, there are no ACo Class B Shareholders) (collectively referred to as the “XXXXXXXXXX Dividend Recipients”) are entitled to share the distribution (“XXXXXXXXXX Dividend”) made by ACo out of ACo Surplus for a taxation year in proportion to each XXXXXXXXXX Dividend Recipient’s Business 1 Sales for the year over the aggregate XXXXXXXXXX Dividend Recipients’ Business 1 Sales for the year.

(f)   The XXXXXXXXXX Dividend may be paid by ACo to the XXXXXXXXXX Dividend Recipients:

(i)   in cash, or

(ii)  by issuing ACo Class C Shares or certificates of indebtedness of ACo (“ACo Certificates of Indebtedness”).

(g)   The ACo Class C Shares and the ACo Certificates of Indebtedness issued to the XXXXXXXXXX Dividend Recipients must be redeemed or repaid by ACo no later than XXXXXXXXXX or XXXXXXXXXX years after their issuance, as the case may be.

However, except pursuant to an Allowable Disposition, ACo cannot redeem any ACo Class C Shares on any date prior to the date which is XXXXXXXXXX years from the date on which such ACo Class C Shares were issued.

8.    ACo has not issued any ACo Class C Shares at any time after its XXXXXXXXXX Taxation Year.

On the Effective Date, approximately XXXXXXXXXX ACo Class C Shares will be outstanding less than XXXXXXXXXX years from the date which they were issued.
As at XXXXXXXXXX, the total ACo Certificates of Indebtedness issued and outstanding was $XXXXXXXXXX.

III.  SUBJECT TRANSACTIONS

9.    ACo incorporated SubCo under Act I on XXXXXXXXXX and acquired XXXXXXXXXX share of SubCo without par value for $XXXXXXXXXX. There are no other issued SubCo shares.

10.   ACo incorporated BCo under Act II on XXXXXXXXXX. 

BCo’s capital consists of an unlimited number of:

(a)   membership shares (“BCo Membership Shares”);

(b)   Class A Investment Shares (“BCo Class A Shares”);

(c)   Class B Investment Shares (“BCo Class B Shares”), and

(d)   Class C Investment Shares (“BCo Class C Shares”).   

The share attributes of the BCo Membership Shares, the BCo Class A Shares, the BCo Class B Shares and the BCo Class C Shares are similar to the ACo Membership Shares, the ACo Class A Shares, the ACo Class B Shares and the ACo Class C Shares, respectively.

BCo also has made rules pursuant to Act II, which are similar to the ACo Rules. 

At the time of the incorporation of BCo, each of XXXXXXXXXX individuals (XXXXXXXXXX, who are ACo Members) subscribed for XXXXXXXXXX BCo Membership Share for $XXXXXXXXXX. 

11.   On XXXXXXXXXX, ACo, Subco and BCo entered into an Arrangement Agreement which set out the terms and conditions of a Plan of Arrangement.

12.   On XXXXXXXXXX, ACo, Subco and BCo applied to the Court to seek an Interim Order for directions for calling an ACo Meeting to consider and vote on the Plan of Arrangement to be effected under Act I. 

On XXXXXXXXXX, an Interim Order was obtained.  

13.   On XXXXXXXXXX, ACo mailed to its shareholders an information circular which described the Plan of Arrangement and the shareholders’ meeting to vote on the Plan of Arrangement. 

14.   On XXXXXXXXXX, at the ACo Meeting, XXXXXXXXXX% of the ACo Membership Shareholders voted in favor of the Plan of Arrangement. 

15.   On XXXXXXXXXX, the Court approved the Plan of Arrangement (“Final Order”) but subject to certain amendments to the Arrangement described in the Plan of Arrangement. 

IV.   PROPOSED TRANSACTIONS

Pre-Plan of Arrangement

16.   Immediately prior to the Effective Time, ACo will resolve to pay a XXXXXXXXXX Dividend to the ACo Members, in accordance with the articles of incorporation of ACo and the ACo Rules, which will be equal to the entire amount of the ACo Surplus for the Taxation Year ending immediately before the Amalgamation. 

Plan of Arrangement

Pursuant to the Final Order granted by the Court, commencing at the Effective Time, the following transactions shall be completed in the following order.

17.   The ACo Members will cease to be members of ACo.

18.   ACo will redeem with cash all of the issued and outstanding ACo Class C Shares for a redemption price equal to $XXXXXXXXXX per share.

19.   ACo and SubCo will amalgamate to form Amalco.

Amalco will be governed by Act I.  The certificate of amalgamation resulting from the Amalgamation will be deemed to be the certificate of incorporation of Amalco.

The authorized capital of Amalco will consist of an unlimited number of Amalco Class A Shares and an unlimited number of Amalco Class B Shares. 

The Amalco Class A Shares will be voting (XXXXXXXXXX per share) and non-participating.  The Amalco Class B Shares will be non-voting but participating.

On the Amalgamation,

(a)   all of the property, rights and interests of each of ACo and SubCo (except the XXXXXXXXXX SubCo XXXXXXXXXX share owned by ACo) immediately before the Amalgamation will continue to be the property, rights and interests of Amalco;

(b)   all of the liabilities and obligations of ACo and SubCo immediately before the Amalgamation will become the liabilities and obligations of Amalco. In particular, the ACo Certificates of Indebtedness will become the Amalco Certificates of Indebtedness, and the ACo Obligations will become the Amalco Obligations.  For greater certainty, 

(i)   any existing cause of action, claim or liability to prosecution of ACo or SubCo will be unaffected by the Amalgamation;

(ii)  any civil, criminal or administrative action or proceeding pending by or against ACo or SubCo may be continued to be prosecuted by or against Amalco; and

(iii) any conviction against, or ruling, order or judgment in favor of or against, ACo or SubCo may be enforced by or against Amalco, and

(c)   Each ACo Membership Shareholder will receive XXXXXXXXXX Amalco Class A Share and a number of Amalco Class B Shares having an aggregate FMV equal to the particular ACo Membership Shareholder’s ACo Membership Share and their related membership in ACo, determined:

(i)   immediately before the Amalgamation and

(ii)  using the principles set out in the articles of incorporation of ACo and the ACo Rules (including such member’s entitlement to the XXXXXXXXXX Dividend described in Paragraph 7(e)) and, for greater certainty, applying these principles on the assumption that, at that time:

(I)   all such ACo Membership Shareholders remained members of ACo;

(II)  all of the assets of ACo were disposed of at FMV;

(III) all outstanding liabilities of ACo were satisfied; and

(IV)  all of the remaining proceeds of disposition of ACo’s assets were distributed to the ACo Membership Shareholders and the ACo Members.

An amount of $XXXXXXXXXX will be added to the Stated Capital of the Amalco Class A Shares issued to the ACo Membership Shareholders.  No amount will be added to the Stated Capital of the Amalco Class B Shares issued to the ACo Membership Shareholders.  

All of the ACo Membership Shares and the XXXXXXXXXX SubCo XXXXXXXXXX share will be cancelled without any repayment of capital in respect of those shares.

20.   Amalco will transfer (“Transfer”) all of the Business 1 Assets to BCo.  As consideration for the Transfer, BCo will:

(a)   assume Amalco Obligations and a portion of the Amalco Certificates of Indebtedness; and

(b)   issue to Amalco XXXXXXXXXX BCo Membership Shares having an aggregate FMV equal to the aggregate FMV of the Business 1 Assets so transferred to BCo less the aggregate FMV of the liabilities and obligations assumed by BCo as described in Paragraph 20(a).

No subsection 85(1) election will be filed by Amalco or BCo with respect to the Transfer.

BCo will add an amount of $XXXXXXXXXX to the Stated Capital of the BCo Membership Shares issued to Amalco, as described in Paragraph 20.

Amalco will grant the Guarantee to the holders of the Amalco Certificates of Indebtedness that BCo assumed, as described in Paragraph 20. 

21.   Amalco will distribute to each Amalco Class A Shareholder XXXXXXXXXX BCo Membership Share as a capital distribution.

22.   BCo will redeem the XXXXXXXXXX BCo Membership Shares that were issued to the initial subscribers, as described in Paragraph 10, for $XXXXXXXXXX per share.

Post-Plan of Arrangement

23.   Immediately following the Proposed Transaction described in Paragraph 22, BCo will enter into a lease agreement (“Lease Agreement”) and a master agreement (“Master Agreement”) with Amalco.  The Lease Agreement will provide for the continued use of the Real Estate needed by BCo for Business 1 and the Master Agreement will provide for the sharing of certain space and personnel between BCo and Amalco in order that the benefits from the synergies enjoyed by sharing various resources continues.

V.    ADDITIONAL INFORMATION

24.   The ACo Class C Shares are XXXXXXXXXX.

25.   At the Effective Time, ACo will not have any ACo Surplus earned in any Taxation Years since its incorporation, which remains unallocated or undistributed to the ACo Members.

26.   With respect to the Guarantee described in Paragraph 20, Amalco is the principal debtor of the Amalco Certificates of Indebtedness that BCo assumed on the Transfer, as described in Paragraph 20.  

27.   The ACo Membership Shareholders hold their ACo Membership Shares as Capital Property.

28.   None of the ACo Members are related to each other.

29.   Since its incorporation, ACo has not realized any capital gain from the disposition of any real property.

30.   Each of the ACo Members is XXXXXXXXXX Member of ACo.

31.   ACo has deducted the XXXXXXXXXX Dividends that it distributed to the ACo Members in a Taxation Year in computing its income for that Taxation Year pursuant to XXXXXXXXXX.

VI.   PURPOSES OF THE SUBJECT TRANSACTIONS AND THE PROPOSED TRANSACTIONS

32.   The purpose of SubCo is to:

(a)   serve with ACo and BCo as an applicant to the Court to seek the Court’s approval of the Plan of Arrangement under Act I, as described in Paragraph 12, and

(b)   amalgamate with ACo to form Amalco, as described in Paragraph 19.  

33.   The purpose for separating Business 1 from Business 2 and operating Business 1 continuously through a XXXXXXXXXX structure (i.e. BCo) and Business 2 through a conventional corporation (i.e., Amalco), as described in Paragraphs 17 to 22, is twofold:

First, ACo has determined that it is not commercially appropriate for any business other than Business 1 to be carried on in XXXXXXXXXX.  This is primarily because Business 2 has no direct connection to the XXXXXXXXXX activities of the ACo Members (i.e., XXXXXXXXXX by the ACo Members).

Second, under the current XXXXXXXXXX structure of ACo, ACo Members who retire before the Real Estate is sold will not benefit from the appreciation in the value of the Real Estate; however, new ACo Members who make little or no contribution to the appreciation in the value of the Real Estate would receive substantial benefit from the disposition of the Real Estate in the future.

34.   The purpose of having the ACo Members who own the ACo Class C Shares cease their memberships in ACo immediately before the redemption of their ACo Class C Shares, as described in Paragraph 17, is to ensure that the redemption of any of their ACo Class C Shares that had been issued for less than XXXXXXXXXX years at the time of the redemption, would be an Allowable Disposition, such that the aggregate redemption amount of those ACo Class C Shares received by the ACo Class C Shareholders will be included in computing their income for the Taxation Year in which those redemption amounts are received.

VII.  RULINGS

Provided that the preceding statements constitute a complete and accurate disclosure of all of the relevant facts, transactions and the purposes of the Subject Transactions and the Proposed Transactions, and provided that the Proposed Transactions are completed in the manner described above, our rulings are set forth below:

A. The redemption of any ACo Class C Share at a time that is less than XXXXXXXXXX years after the date of its issuance, as described in Paragraph 18, would occur as a consequence of an Allowable Disposition.  

B.    The Amalgamation will be considered an amalgamation within the meaning of that term in subsection 87(1). 

These rulings are given subject to the limitations and qualifications set out in Information Circular 70-6R6 issued by the CRA on August 29, 2014 and are binding on the CRA provided that the Proposed Transactions are completed on or before XXXXXXXXXX.

The above rulings are based on the Act in its present form and do not take into account any proposed amendments to the Act which, if enacted, could have an effect on the rulings provided herein.

VIII. COMMENTS

Nothing in this letter should be construed as implying that the CRA has confirmed, reviewed, made any determination, or accepted any method for the determination in respect of:

(a)   the PUC of any share or the ACB or FMV of any property referred to herein;

(b)   any other tax account of any corporation referred to herein;

(c)   the characterization of any property described herein to the holder thereof, or

(d)   any other tax consequence relating to the facts, Subject Transactions, Proposed Transactions or any transaction or event taking place either prior to the Proposed Transactions or subsequent to the Proposed Transactions, whether described in this letter or not, other than those specifically described in the rulings given above, including whether any of the Proposed Transactions would also be included in a series of transactions or events that includes other transactions or events that are not described in this letter. 

Yours truly,

XXXXXXXXXX
Section Manager
for Division Director
Reorganizations Division
Income Tax Rulings Directorate
Legislative Policy and Regulatory Affairs Branch

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