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No consideration is payable by such third parties under the confidentiality agreements. ... DC does not own the shares of any other corporation. g) Paragraph 15 will be amended by replacing the term "intellectual property" with the defined term "the Intellectual Property". h) The second paragraph of Paragraph 17 will be amended to read as follows: Each TechCo Reorganization Share will be redeemable at any time at the option of the issuer and retractable at any time at the option of the holder for an aggregate amount equal to the fair market value of the property received for the issuance of the shares, net of any liabilities assumed by the issuer at the time of issuance and the value of any other non-share consideration provided by the issuer by virtue of entering into the Facility (as described in Paragraph 44A), divided by the number of TechCo Reorganization Shares issued as consideration for such property. i) The second paragraph of Paragraph 18 will be amended to read as follows: Each PlantCo Reorganization Share will be redeemable at any time at the option of the issuer and retractable at any time at the option of the holder for an aggregate amount equal to the fair market value of the property received for the issuance of the shares, net of any liabilities assumed by the issuer at the time of issuance and the value of any other non-share consideration provided by the issuer by virtue of entering into the Facility (as described in Paragraph 44A), divided by the number of PlantCo Reorganization Shares issued as consideration for such property. j) The fourth sentence in Paragraph 19 will be amended by replacing the words "without nominal or par value" with the words "with nominal par value". k) The following new Paragraph 29A will be added after Paragraph 29: DC will transfer its legal title to (but not beneficial ownership of) PlantC to Aco as bare trustee for no consideration. ... On the subsequent transfer of the beneficial ownership of PlantC by DC to PlantCo as contemplated, a similar bare trust agreement between Aco and PlantCo will be executed. l) The first sentence of Paragraph 33 will use the defined term "the Intellectual Property" rather than "intellectual property". m) The last sentence of the first paragraph of Paragraph 33 will be amended by the following: In consideration for the transfer, TechCo may assume liabilities of DC and may provide non-share consideration to TechCo by virtue of its becoming a party to the Facility (as described in Paragraph 44A) and will issue TechCo Reorganiztion Shares, with an aggregate fair market value and redemption amount equal to the fair market value of the property transferred to TechCo, as described herein, net of any liabilities assumed by TechCo in respect thereof and the value of any non-share consideration provided by TechCo by virtue of TechCo becoming a party to the Facility (the "TechCo Redemption Amount"). n) The first sentence of Paragraph 34 will be amended to refer to beneficial ownership of PlantC and the Fixed Assets, such that the sentence reads: Immediately after the transfer of the DC PlantCo Reorganization Shares to PlantCo, DC will transfer to PlantCo, certain business assets including beneficial ownership of PlantC and related equipment, the Fixed Assets and cash or near-cash property (collectively the "PlantCo Butterflied Assets") such that the net fair market value of each type of property so transferred to PlantCo (after allocating and deducting, in the manner described in Paragraph 16 above, the liabilities of DC that are to be assumed by PlantCo) will approximate the PlantCo Butterfly Proportion of the net fair market value of all of the property of that type owned by DC immediately before the transfer. o) The last sentence of the first paragraph of Paragraph 34 should be amended to read as follows: In consideration for the transfer, PlantCo may assume liabilities of DC and may provide non-share consideration to PlantCo by virtue of its becoming a party to the Facility (as described in Paragraph 44A) and will issue PlantCo Reorganization Shares, with an aggregate fair market value and redemption amount equal to the fair market value of the property transferred to PlantCo, as described herein, net of any liabilities assumed by PlantCo in respect thereof and the value of any non-share consideration provided by PlantCo by virtue of PlantCo becoming a party to the Facility (the "PlantCo Redemption Amount"). p) The first sentence of Paragraph 44 will be amended as follows: Parent will transfer its DC New Common Shares to Blocker for shares of Blocker having a fair market value not exceeding the value of the DC New Common Shares so transferred. q) The following two Paragraphs will be added after Paragraph 44. 44A. ...

S. residents in consideration of the sale of a capital asset are to be exempt from tax pursuant to Article VIII of the Canada-U. ... The consideration for the assignment was that the respondent was to be paid monthly "by way of royalty" a percentage of the gross sales of gas. ... It is doubtful that royalties paid in consideration of the sale of capital property are "from an interest" in any such property. ...

S. residents in consideration of the sale of a capital asset are to be exempt from tax pursuant to Article VIII of the Canada-U. ... The consideration for the assignment was that the respondent was to be paid monthly "by way of royalty" a percentage of the gross sales of gas. ... It is doubtful that royalties paid in consideration of the sale of capital property are "from an interest" in any such property. ...

Accordingly, does section 84 apply where non-share consideration is received by a shareholder of the amalgamated corporation as part of the exchange of his shares of the predecessor corporation for the new shares of the amalgamated corporation? ... As a result, an amalgamation can be an amalgamation to which section 87 applies even where a shareholder of a predecessor corporation receives both shares of the amalgamated corporation and non-share consideration in exchange for shares of the predecessor corporation.  On this basis, the position in paragraph 52 of IT-474R would apply to a section 87 amalgamation where the shareholder of a predecessor corporation receives both shares in the amalgamated corporation and non-share consideration in exchange for shares in the predecessor corporation. ...

1 November 1985 Income Tax Severed Letter RCT 5-8000 F Unedited CRA Tags 85(1)(e.2) Dear Sirs: RE:     Transfer of Property to a Sister Corporation This is in response to your letter of September 6, 1985 wherein you requested clarification of our position with respect to the application of paragraph 85(1)(e.2) of the Act where a property is transferred between corporations owned by the same shareholder for consideration less than the fair market value of the property transferred. Transfers for consideration less than fair value can, inadvertantly or intentionally, create opportunities for the inappropriate reduction of capital gains in the event of a future disposition of shares of the corporations involved. Despite the fact that the provisions of paragraph 85(1)(e.2) of the Act are applicable in such situations we have adopted an administrative position not to apply them to transfers between sister corporations where, in our view, the consideration taken back ensures that the accrued gain in the shares of the transferor is not reduced, as a result of the transfer, by more than the accrued gain in the property transferred. ...

Accordingly, does section 84 apply where non-share consideration is received by a shareholder of the amalgamated corporation as part of the exchange of his shares of the predecessor corporation for the new shares of the amalgamated corporation? ... As a result, an amalgamation can be an amalgamation to which section 87 applies even where a shareholder of a predecessor corporation receives both shares of the amalgamated corporation and non-share consideration in exchange for shares of the predecessor corporation. On this basis, the position in paragraph 52 of IT-474R would apply to a section 87 amalgamation where the shareholder of a predecessor corporation receives both shares in the amalgamated corporation and non-share consideration in exchange for shares in the predecessor corporation. ...

1 November 1990 Income Tax Severed Letter QUESTION I-78 Loan Guarantee from Non-resident for no Consideration A Canadian corporation ("Canco") borrows funds from an arm's length lender (the "lender"). Canco's non-resident parent corporation (the "parent") guarantees the loan for no consideration. ... Since the parent did not receive consideration for its guarantee of the loan, the parent will not be deemed by paragraph 214(15)(a) of the Act to have been paid interest on the loan. ...

Accordingly, does section 84 apply where non-share consideration is received by a shareholder of the amalgamated corporation as part of the exchange of his shares of the predecessor corporation for the new shares of the amalgamated corporation? ... As a result, an amalgamation can be an amalgamation to which section 87 applies even where a shareholder of a predecessor corporation receives both shares of the amalgamated corporation and non-share consideration in exchange for shares of the predecessor corporation. On this basis, the position in paragraph 52 of IT-474R would apply to a section 87 amalgamation where the shareholder of a predecessor corporation receives both shares in the amalgamated corporation and non-share consideration in exchange for shares in the predecessor corporation. ...

Holdco will not receive any non-share consideration on the transfer of the DC shares. 50. ... DC will not receive any non-share consideration on the transfer of the Landco1 shares. 53. ... DC will not receive any non-share consideration on the transfer of the Landco3 shares. ...

There is no basis, in my view, for confining the word "consideration" to executed consideration. ... There is no basis, in my view, for confining the word "consideration" to executed consideration. Consideration is of two kinds-executed and executory-and it would be an unwarranted restriction on that term to limit it to only one of the two types. ...