Abbastar

Documents
(SEDAR filing: 31 October 2012) Circular of Resources Corp. ("Abbastar") for spin-off of Anacott Resources Corp. ("Anacott"), Brunello Resources Corp. ("Brunello"), Sparx Energy Corp. ("Sparx") and Teldar Resources Corp. ("Teldar") (5563 K).
Summaries
Summary Under
Tax Topics - Public Transactions - Spin-Offs & Distributions - S. 84(2) spin-offs
Abbastar spins-off Anacott, Brunello, Sparz and Teldar
Plan of arrangement

The circular contemplates the spin-off by Abbastar of four newly-formed junior mining companies, via., Anacott, Brunello, Sparz and Teldar. Under a B.C. plan of arrangement, Abbastar transfers the respective assets to Anacott, Brunello, Sparz and Teldar (the "Newcos") in consideration for preferred shares of the Newcos, which then are converted into common shares, with the common shares of the Newcos being distributed to Abbastar's shareholders as a reduction of paid-up capital. Option to acquire Abbastar shares become options to acquire Newco shares.

Canadian tax consequences

It is not anticipated that the distribution will give rise to a deemed dividend. There is no indication as to whether reliance is being placed on s. 84(4.1) or 84(2), nor is there an indication of a ruling having been sought.