Delivering U.S. International Tax Advice Relating

to Multinational Mergers & Acquisitions

O G L E I N T E R N A T I O N A L T A X A D V I S O R S

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O U R I N T E R N A T I O N A L T A X

P R A C T I C E I N C L U D E S B O T H C P A S

A N D A T T O R N E Y S W I T H B I G 4 A N D

F O R T U N E 5 0 0 E X P E R I E N C E . O U R

P R O F E S S I O N A L S A R E D E D I C A T E D

T O T H E H I G H E S T S T A N D A R D S O F

S E R V I C E A N D C O M M I T T E D T O

E X C E L L E N C E . W E H A V E C R E A T E D

A C U L T U R E T H A T I S B A S E D O N

T E A M B U I L D I N G , I N D I V I D U A L

E M P O W E R M E N T , A N D L E A D E R S H I P .

Delivering U.S. International Tax Services to G

lobal Clientele M & A T A X A D V I C E

Ogle International Tax Advisors specialize in advising multinational companies on international tax matters. Our clients include both public and privately held businesses. We also assist other regional CPA and Law firms who do not have expertise in international tax. Our multinational M&A tax planning and compliance services include but are not limited to the following areas:

Performing M&A tax due diligence, Reviewing tax provisions in acquisition agreements, Providing tax planning solutions in both the pre and

post merger periods, Advising on tax free and partially tax free acquisitive

reorganizations, and Advising on tax divisive strategies including spin-offs,

split-offs and split-ups.

By offering both international tax planning and compliance services, we simplify the technical complexities our clients face in the area of multinational M&A.

Taxpayers can acquire or combine businesses organized in corporate form in a number of ways. For an acquisition or business combination to be wholly or partially tax free, the transaction usually must qualify as a reorganization under Internal Revenue Code Section 368(a)(1). Sections 368(a)(1)(A) through 368(a)(1)(G) and the underlying Treasury Regulations define the different types of tax-free reorganizations and specify the different requirements that must be satisfied for a particular transaction to qualify as a tax-free reorganization.

M & A T A X C O N S I D E R A T I O N S

Corporate Office: 8130 Lakewood Main Street, Suite 208, Bradenton FL 34202 (T) 941.361.1147 (F) 941.827.9929 Miami Office: Waterford Business Park, 5201 Blue Lagoon Drive, Miami FL, 33126 (T) 305.671.3179 (F) 305.402.0552

OGLE INTERNATIONAL TAX ADVISORS DELIVERING U.S. INTERNATIONAL TAX SERVICES TO GLOBAL CLIENTELE 4 |

M & A T A X A D V I C E

The different types of reorganizations in Sections 368(a)(1)(A) through 368(a)(1)(G) can very generally be differentiated as follows:

Type A - “Acquisitive” - statutory mergers or consolidations including “Triangular Type A” and “Reverse Type A Triangular” mergers

Type B - “Acquisitive” - acquisitions of stock of target for voting stock of the acquiring corporation

Type C - “Acquisitive” - acquisitions of assets of target for voting stock of the acquiring corporation

Type D - “Divisive” - results in the division of a single corporation into two or more separate entities

Type D – “Nondivisive” - results in certain transfers of substantially all assets from one corporation to another, followed by liquidation of the first corporation

Type E - “Nonacquisitive / Nondivisive” – recapitalization

Type F - “Nonacquisitive / Nondivisive” – change in identity, form, or place of incorporation

Type G - “Nonacquisitive / Nondivisive” - transfers of a corporation’s assets to another pursuant to a bankruptcy reorganization plan

In general, it is only after all of the requirements of a particular reorganization are satisfied that an M&A transaction may qualify as wholly or partially tax free. In addition for most reorganizations, there are four nonstatutory requirements that generally must be satisfied: continuity of interest, continuity of business enterprise, business purpose and plan of reorganization.

The basic statutory requirements for qualifications as a tax-free acquisitive reorganization generally differ, depending on the particular type of reorganization at issue, and relate to, for example, the quantum of stock or assets that must be acquired, the consideration that the acquiring corporation must use, or the post-acquisition actions that must be taken by the target.

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M & A T A X A D V I C E

The complex and technical tax planning issues and considerations addressed during the M&A period extend to the post M&A period after the acquisition is complete. At Ogle International Tax Advisors, we have the experience to advise and assist clients during the post M&A period.

For example, it has generally been our experience that when one U.S.-based multinational group acquires another U.S.-based multinational group, they frequently have overlapping foreign operations, conflicting transfer pricing methodologies, and inconsistent repatriation practices. In addition, each group may have various beneficial U.S. and foreign tax attributes such as U.S. or foreign net operating losses, research and experimentation credits, foreign tax credits, and earnings and profits deficits.

After the acquisition closes, it will be necessary or at least desirable to consolidate or restructure the two groups' formerly separate operations to achieve tax and operational efficiencies. The first step in any such post acquisition foreign consolidation or restructuring is to consider how the business objectives of the original acquisition impact post acquisition planning and then focus on the operational needs and objectives of the consolidated businesses.

P O S T M & A T A X C O N S I D E R A T I O N S

In the cross-border context (inbound, outbound and foreign to foreign reorganizations), Sections 367(a) and 367(b) can apply to require gain recognition or to impose tax in connection with transactions that otherwise are tax free. As a practical matter, Sections 367(a) and (b) can both apply in the context of any otherwise tax-free reorganization where either the acquiring corporation, the acquiring corporation’s immediate parent, and/or the target corporation are foreign.

M & A T A X A D V I C E

In general, the U.S. Treasury Regulations require that certain detailed information statements be attached to U.S. tax returns when a multi-national M&A transaction occurs. Also, certain U.S. tax forms may also be required: Form 926, “Return by U.S. Transferor of Property to a

Foreign Corporation” Form 966, “Corporate Dissolution or Liquidation” Form 8023, “Elections Under Section 338 for

Corporations Making Qualified Stock Purchases” Form 8806, “Information Return for Acquisition of

Control or Substantial Change in Capital Structure” Form 8838, “Consent to Extend the Time To Assess Tax

Under Section 367 – Gain Recognition Agreement”

T A X F O R M S

We are experienced in preparing these and other IRS forms that permit a seamless approach in combining the international tax planning and compliance functions with one advisory group.

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