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Unformatted text preview: osts of the disposition.
Under the Tax Proposals, where a Limited Partner disposes of all of its Units in a fiscal period of the
Partnership, any income or loss allocated to the Limited Partner for such fiscal period will be taken into
account in determining the adjusted cost base of the Limited Partner’s Units.
One-half of a capital gain realized by a Limited Partner must be included in the Limited Partner’s income as a
taxable capital gain. The full amount of a capital gain realized on the transfer of a Unit to a tax-exempt person
may be included in the Limited Partner’s income as a taxable capital gain. One-half of a capital loss may be
deducted by the Limited Partner as an allowable capital loss against taxable capital gains to the extent and
under the circumstances prescribed in the Tax Act.
Dissolution of the Partnership
On dissolution of the Partnership, a Limited Partner will generally be considered to dispose of its Units for
proceeds of disposition equal to the then fair market value of the property received by the Limited Partner on
such dissolution. The Partnership will be deemed to dispose of such property for proceeds equal to its then fair
market value and the Limited Partner will be deemed to acquire such property at a cost equal to the same
amount. On dissolution of the Partnership, gains or losses on the Partnership’s assets will be reflected in the
computation of the Partnership’s income or loss, and in the Limited Partner’s share of such income or loss.
The adjusted cost base of the Limited Partner’s Units will reflect such gains and losses, and will reflect the
distribution of cash or property to the Limited Partner on the dissolution.
Losses of the Partnership deducted by a Limited Partner and capital gains realized by a Limited Partner may
give rise to liability for alternative minimum tax.
Each Limited Partner must file its own tax return reporting the Limited Partner’s share of the Partnership’s
income or loss. The General Partner will file an annual information return on behalf of all Limited Partners
containing required information. The General Partner will provide Limited Partners with information as to the
allocation of the Partnership’s income to each of the provinces in which the Partnership carries on business
and an allocation of any withholding tax in respect of income earned by the Partnership. A Limited Partner
that is a corporation will be required to file an Ontario provincial income tax return as a result of becoming a
Eligibility for Investment
Units of the Partnership are not a qualified investment for trusts governed by registered retirement savings
plans, registered retirement income funds, registered education savings plans, deferred profit sharing plans,
registered disability savings plans, or the proposed tax-free savings accounts.
COUNSEL TO THE PARTNERSHIP - 31 - Stikeman Elliott LLP, Toronto, is Canadian counsel to the Partnership and the General Partner in respect of
this offering of Units of the Partnership. Proskauer Rose LLP, New York, is U.S. counsel to the Partnership
and the General Partner in respect of the offering of Units of the Partnership.
PricewaterhouseCoopers LLP, Toronto, have been appointed the auditors of the Partnership.
LEGAL AND REGULATORY CONSIDERATIONS
The distribution of Units in Canada is being made pursuant to this Memorandum only on a private placement
basis and is exempt from the requirement that the Partnership prepare and file a prospectus with the relevant
Canadian securities regulatory authorities. Accordingly, any resale of the Units which is permitted pursuant to
the Partnership Agreement must be in accordance with applicable securities laws, which will vary depending on
the relevant jurisdiction, and which may require resales to be made in accordance with, or pursuant to exemptions
from, prospectus and dealer registration requirements. Each Purchaser in Canada acknowledges that Units will
contain a legend relating to the abovementioned resale restrictions. Purchasers are advised to seek legal advice
prior to any resale of the Units.
Obligations of Purchasers
Each purchaser who subscribes for Units will be deemed to represent to the Partnership and the General Partner
that: (i) such purchaser is entitled under applicable Canadian provincial securities laws to purchase such Units
without the benefit of a prospectus qualified under, or dealer registration under, such securities laws; (ii) to the
knowledge of such purchaser, the sale of the Units was not accompanied by any advertisement in printed public
media, radio, television or telecommunications (including electronic display such as the Internet); (iii) such
purchaser has reviewed the terms referred to above under “Resale Restrictions”; (iv) such purchaser is purchasing
as principal and is purchasing for investment only and, if applicable, not with a view to resale or distribution; (v)
such purchaser is not a “designated beneficiary” of the Partnership (as defined under the Income Tax Act
(Canada)); (vi) such purchaser is an “accredited investor” within the meaning of Natio...
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- Spring '14