Corporate Taxation
Scope and Purpose
This new course of study, comprising more than 13 hours of instruction, explores the full array of issues that arise when structuring corporate transactions. Each session permits registrants to learn practical strategies, as well as to hear about the latest techniques.
The program starts with basic merger and acquisition structures and their consequences, including:
• taxable structures involving section 338(h)(10) elections
• tax-free corporate reorganizations
• section 351 acquisition structures
• taxable and tax-free acquisitions involving disregarded entities
• the treatment of contingent liabilities.
The course also emphasizes complex issues and cutting-edge acquisition structures. Among them are:
• the use of corporate joint ventures, spin-offs, and other divestiture techniques
• transactions involving contingent consideration
• structures to accommodate private equity investors
• acquisitions and restructurings of troubled companies
• special issues involving executive compensation and compensatory interests
• post-acquisition restructurings
• cross-border mergers and acquisitions.
Beyond structures, the program also examines hot topics and current transactions. A Treasury Department official discusses policy issues, and a special 90-minute session views the evolving ethical landscape, especially as it involves the role of corporate transparency.
Planning Chairs
(also on faculty)
Julie A. Divola, Pillsbury Winthrop Shaw Pittman LLP, San Francisco
Rose L. Williams, National M&A Transaction Advisory Services, Ernst & Young LLP, New York
Philip B. Wright, Bryan Cave LLP, St. Louis
LUNCHEON SPEAKER
Eric Solomon, Assistant Secretary for Tax Policy, U.S. Department of the Treasury, Washington, D.C.
Faculty
William D. Alexander, Associate Chief Counsel (Corporate), Internal Revenue Service, Washington, D.C.
Neil Barr, Davis Polk & Wardwell, New York
John J. Clair, Jr., Latham & Watkins LLP, Los Angeles
Reginald J. Clark, Sutherland Asbill & Brennan LLP, Atlanta
Kenneth E. Cohen, Senior Technician Reviewer, Branch 3, Office of Associate Chief Counsel (Corporate), Internal Revenue Service, Washington, D.C.
Marc Countryman, Attorney-Advisor, U.S. Department of the Treasury, Washington, D.C.
Jasper L. (Jack) Cummings, Jr., Alston & Bird LLP, Raleigh, North Carolina
William S. Dixon, Managing Director, Mergers & Acquisitions, Citigroup Global Markets, Inc., New York
Danni Dunn, Ernst & Young LLP, San Jose, California
Stephen P. Fattman, Special Counsel to the Associate Chief Counsel (Corporate), Office of Chief Counsel, Internal Revenue Service, Washington, D.C.
Lawrence Garrett, National Tax M&A Group, Ernst & Young LLP, Washington, D.C.
John N. Geracimos, Director, Washington National Tax, KPMG LLP, Washington, D.C.
Karen Gilbreath-Sowell, Deputy Assistant Secretary for Tax Policy, U.S. Department of the Treasury, Washington, D.C.
John Harrell, U.S. Department of the Treasury, Washington, D.C.
Hal J. Hicks, Skadden, Arps, Slate, Meagher & Flom LLP, Washington, D.C.
Carl M. Jenks, Jones Day, New York and Cleveland
Mark S. Jennings, Branch Chief, Branch 1, Office of Associate Chief Counsel (Corporate), Internal Revenue Service, Washington, D.C.
Donald L. Korb, Chief Counsel, Internal Revenue Service, Washington, D.C.
John J. Merrick, Special Counsel to the Associate Chief Counsel (International), Office of Chief Counsel, Internal Revenue Service, Washington, D.C.
Helen H. Morrison, Acting Deputy Benefits Tax Counsel, U.S. Department of the Treasury, Washington, D.C.
José Murillo, Taxation Specialist, Office of the International Tax Counsel, U.S. Department of the Treasury, Washington, D.C.
Audrey Nacamuli, Senior Tax Counsel, General Electric Company, Stamford, Connecticut
Joseph M. Pari, Dewey & LeBoeuf LLP, Washington, D.C.
Michael L. Schler, Cravath, Swaine & Moore LLP, New York
Mark J. Silverman, Steptoe & Johnson LLP, Washington, D.C.
Lewis R. Steinberg, Managing Director, UBS Securities LLC, New York
Dana L. Trier, Davis Polk & Wardwell, New York
Robert H. Wellen, Ivins, Phillips & Barker, Chartered, Washington, D.C.
Philip R. West, Steptoe & Johnson LLP, Washington, D.C.
Robert Willens, Managing Director, Lehman Brothers, Inc., New York
B. John Williams, Jr., Skadden, Arps, Slate, Meagher & Flom LLP, Washington, D.C.
ALI-ABA Staff Attorney: William S. Stevens, Assistant Director, Office of Courses of Study (wstevens@ali-aba.org)
Program Schedule
THURSDAY, APRIL 10, 2008
7:45 a.m. Registration and Continental Breakfast
Webcast Segment A
8:45 a.m. Introductory Remarks - Mss. Divola and Williams and Mr. Wright
9:00 a.m. Common Merger & Acquisition Structures - Messrs. Clark, Cohen, and Wellen
Common forms of taxable asset and stock acquisitions, including section 338(h)(10); tax-free reorganizations and section 351 exchanges; traps for the unwary; recent developments and trends, including the role of disregarded entities and measurement of continuity-of-interest in reorganizations; indemnities; consolidated return aspects
10:30 a.m. Networking Break
10:45 a.m. Advanced Merger & Acquisition Structures - Ms. Gilbreath-Sowell and Messrs. Clair, Harrell, and Steinberg
Advanced techniques to optimize mergers, acquisitions, and divestitures and complex problems that arise in connection with an M&A practice, including the treatment of contingent consideration and structuring M&A transactions for private equity investors
12:30 p.m. Luncheon and Address (not webcast) - Eric Solomon, Assistant Secretary for Tax Policy, U.S. Department of the Treasury
Luncheon Sponsored by Bryan Cave LLP and Ernst & Young LLP
Webcast Segment B
2:00 p.m. The Due Diligence Process and Tax Separation Agreements - Mr. Dixon and Ms. Dunn
• Due Diligence: exposure for contingent tax liabilities, state and local nexus issues, tax attributes and limitations (NOLs), invalid elections (e.g. consolidated return election), Section 1.1502-6 liability exposure, inadequate or incomplete information
• Tax Separation Agreements: payment for NOLs, restrictions on issuing stock in certain transactions, involvement in IRS audit, the three-page vs. the 30-page agreement
2:45 p.m. Post-Acquisition Restructurings - Messrs. Alexander, Countryman, Pari, and Silverman
Common issues that arise in connection with restructurings undertaken to integrate an acquired company, including:
• The limitations on restructurings imposed by the form of the original acquisition (e.g., whether it was a qualified stock purchase, an "A" reorganization, a subsidiary "A" reorganization with a "substantially all" limitation, or something else)
• The consequences of an initial post-acquisition combination transaction on future integration activities (such as the inbound or outbound transfer of intellectual property) and the application of the liquidation-reincorporation doctrine and Rev. Rul. 69-617 to upstream reorganization transactions
• The application of consolidated return rules
3:45 p.m. Networking Break
4:00 p.m. Acquisitions and Restructurings Involving Troubled Companies - Messrs. Cummings, Garrett, Jenks, and Jennings
• Special rules and considerations involved in structuring acquisitions, dispositions, and reorganizations involving troubled companies, including the application of the "no net value" regulations and other limitations that may apply to insolvent companies
• Special rules that may benefit bankrupt and insolvent companies
• Issues that may arise in connection with the liquidation of insolvent subsidiaries, including special considerations under the consolidated return regulations
5:00 p.m. Adjournment for the Day; Networking Reception for Registrants and Faculty
FRIDAY, APRIL 11, 2008
8:00 a.m. Continental Breakfast
Webcast Segment C
8:30 a.m. Special Breakfast Session: Hot Topics and Cutting-Edge Structures - Messrs. Steinberg and Willens
9:30 a.m. Selected Compensation Issues Related to Acquisitions - Ms. Morrison and Messrs. Barr and Trier
• Qualified and nonqualified deferred compensation schemes likely to be encountered in a target corporation
• Tax issues associated with assuming or eliminating deferred compensation obligations, including the tax treatment of the cancellation/acceleration of the obligation; allocation of the deduction between the buyer and the seller; withholding tax obligations; whether payments must be capitalized or can be currently deducted; the application of section 409A and traps associated with it; the possible effect on the tax-free status of a merger; the effect of the "Golden Parachute Rules" of §280G and §162(m)
• Tax considerations relating to carried interest and deferred compensation in connection with acquisition of a private equity or hedge fund management company
10:30 a.m. Networking Break
10:45 a.m. Divisive Structures - Ms. Nacamuli and Messrs. Countryman, Fattman, Geracimos, and Schler
Acquisitions involving partial divestitures, spin-offs, and alternative divestiture structures
• Taxable Stock Dispositions - Pre-sale distribution of assets to sellers: Step-transaction; capital gain or dividend treatment of shareholders; applicability of section 1059; issues under section 338(h)(10)
• Tax-Free Asset Reorganizations - Pre-reorganization distribution of assets to shareholders: Treatment of corporation and shareholders; effects on the "substantially all," "solely for voting stock," "continuity of interest," and "continuity of business enterprise" tests for a reorganization
• Section 355 Distributions: Overview of the basic section 355 structures and requirements; monetization and value extraction without gain recognition; structuring to isolate contingent liabilities, including "F" reorganizations involving disregarded entities; recent and pending legislation, regulations, and rulings
• Alternative divestiture structures, including partnership and joint venture transactions
12:30 p.m. Lunch Break
Webcast Segment D
2:00 p.m. Cross-Border Considerations: U.S. Tax Issues in Acquisitions of Non-U.S. Operations - Messrs. Hicks, Merrick, Murillo, and West
Financing the acquisition; international considerations in a section 338 election; the effect of section 1248 on buyers, sellers, and acquisition structures, including due diligence considerations; minimizing adverse tax consequences associated with post-acquisition restructuring, including subsequent qualification avoidance of section 304 and "D" reorganizations
3:15 p.m. Networking Break
3:30 p.m. Ethics and Professional Responsibility - Messrs. Korb and Williams
The ethical duties of lawyers (and other professionals) in identifying and disclosing the economic substance of transactions
5:00 p.m. Adjournment
Total 60-minute hours of instruction: 13.25, including 1.5 hours of ethics
Suggested Prerequisite: Limited experience in legal practice in subject matter
Educational Objective: Maintenance of professional competence as a practitioner; provision of information on recent legal developments; development of proficiency in performance of intricate and complex legal tasks within a narrow area
Level of Instruction: Advanced
