Element Financial does not intend to withhold on conversion of convertible debentures

Element Financial is issuing convertible debentures as part of an offering to finance its acquisition of PHH for U.S.$1.4B.  The preliminary prospectus states that although there is some uncertainty as to whether the excess of the fair market value of a debenture over its issue price on conversion would be participating interest (see 1 May 2009 IFA Roundtable, Q. 12, 2009-0320231C6, 23 May 2013 IFA Round Table, Q. 9, 2012 Ruling 2011-0418721R3, 2013 CTF Roundtable, Q. 8 and 18 March 2014 T.I. 2013-0515631E5), Element does not currently intend to withhold on conversion by a non-resident.

Neal Armstrong.  Summary of preliminary short form prospectus of Element Financial Corporation under Offerings – Convertible Debentures.