The Receiving Trust is settled with nominal funds and issued units. The Transferring Trust and Receiving Trust have the same beneficiaries with the same entitlements and no material discretionary elements. 2. The Transferring Trust transfers the Relevant Asset to the Receiving Trust for the Purchase Price and makes a capital gain. 3. The trustees of the Transferring and Receiving Trusts both choose to obtain Subdivision 126-G rollover. The asserted result is that the Transferring Trust disregards the capital gain it makes from transferring the Relevant Asset to the Receiving Trust. 4. The Receiving Trust's acquisition of the Relevant Asset results in it owing an amount to the Transferring Trust equal to the Purchase Price. This may be in the form of a promissory note. 5. The Purchaser subscribes for a large number of new units in the Receiving Trust equal in value to the Purchase Price and the Receiving Trust uses those subscription funds to repay the amount owing to the Transferring Trust. 6. The Purchaser acquires the original units in the Receiving Trust for typically nominal consideration and replaces the existing trustee with an entity it controls.
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