Contract analysis

From: Leonard Cross <lcross@calderwoodharkness.com> To: Jason Tremaine <jtremaine@bramhallschuster.com> Cc: Robert Jansen <rjansen@calderwoodharkness.com> Subject: Coordination on U.S. Withholding Tax and Treaty Analysis — Nordhaven Sovereign Wealth Fund / Solara Digital Infrastructure Platform Reorganization

I hope this message finds you well. I don't believe we've had the occasion to work together previously, but your reputation in the cross-border sovereign investor space certainly precedes you.

I am a partner in the Tax Practice Group at Calderwood & Harkness LLP in our Washington, D.C. office, and I am the responsible partner handling the private letter ruling request on behalf of Solara Digital Infrastructure LP in connection with its cross-border fund-platform reorganization. Stefan Dalmqvist, Solara's Head of Tax, and Priya Narasimhan, Solara's General Counsel, have informed me that your firm, Bramhall

By way of brief background — and I expect you have already been briefed by your client on the general contours — Solara is consolidating its offshore parallel fund vehicles (currently domiciled in the Cayman Islands and Luxembourg) into a newly established Delaware-domiciled master fund structure, the Solara Consolidated Master Fund LP.

Nordhaven's exposure is concentrated in two vehicles: Solara Digital Partners Fund IV-A (Cayman) LP, in which Nordhaven holds commitments of approximately $380 million, and Solara Digital Partners Fund V-A (Cayman) LP, in which Nordhaven holds commitments of approximately $500 million.

Under the reorganization, Fund IV-A Cayman (aggregate fair market value of assets: $2.31 billion; aggregate adjusted tax basis: $1.62 billion) and Fund V-A Cayman (aggregate FMV: $2.89 billion; aggregate adjusted tax basis: $2.34 billion) will contribute their respective portfolio assets to the Consolidated Master Fund LP in exchange for partnership interests. These contributions occur at Steps 2 and 4 of the five-st

I want to flag the principal issues that we see as having direct relevance to your analysis for Nordhaven:

*Section 721(a) — Contribution Nonrecognition.* Our position is that the contributions by Fund IV-A Cayman and Fund V-A Cayman to the Consolidated Master Fund LP qualify as tax-free contributions under IRC § 721(a). We are seeking an IRS ruling to that effect as part of the PLR request.

*Section 731(a) — Distribution Nonrecognition.* The distributions of Master Fund LP interests to Nordhaven and the other limited partners in Step 5 are intended to be tax-free under § 731(a). We are also requesting a ruling under § 731(c) confirming that the distributed Master Fund LP interests do not constitute "marketable securities" within the meaning of that provision.

*Section 1446 — Withholding on Effectively Connected Taxable Income.* This is of direct relevance to Nordhaven as a non-U.S. partner. We are requesting a ruling that no withholding under § 1446(a) is required on the Steps 2–4 contributions or the Step 5 distributions, on the basis that contributions are nonrecognition transactions and distributions are not "amounts subject to withholding" under Treas. Reg. §§ 1.1446-

*Section 897 / FIRPTA.* We are analyzing whether certain portfolio company interests — particularly data center and fiber-optic network assets — constitute U.S. real property interests under § 897. Two holdings are of particular note: NovaBright Data Systems Inc. (FMV approximately $890 million; Fund IV-A Cayman holds a 60% interest) and Thorngate Fiber Networks LP (FMV approximately $670 million; held 100% by Fund I

*Treaty Implications.* Your firm will, of course, be better positioned than we are to analyze any treaty benefits available to Nordhaven under the income tax treaty between the United States and the Kingdom of Nordhaven, including any sovereign immunity provisions or treaty exemptions that may apply to a sovereign wealth fund's effectively connected income or FIRPTA gains. We are not opining on Nordhaven's specific t

*Section 752 — Liability Shifting.* The reorganization involves approximately $1.34 billion in aggregate liabilities being assumed by the Consolidated Master Fund. The resulting shifts in Nordhaven's share of liabilities under § 752 could create deemed contributions or distributions under §§ 752(a) and (b). We are requesting a ruling that the netting under Treas. Reg. § 1.752-1(f) does not result in gain recognition.

I want to be clear about how we see the respective roles here, as I know this is important for both privilege management and client expectations:

Calderwood & Harkness serves as tax counsel to Solara. We are preparing and submitting the PLR request to IRS Chief Counsel (CC:INTL, with secondary jurisdiction in CC:PSI) and are responsible for the overall tax analysis of the reorganization as it applies to all fund entities and all investor categories. We are not providing individualized tax advice to any limited partner, including Nordhaven.

Bramhall & Quelwick serves as independent tax counsel to Nordhaven SWF, evaluating the reorganization's U.S. withholding tax and treaty implications from Nordhaven's perspective. We understand that you will provide your own independent advice to Nordhaven.

I should note that the PLR request, once submitted, will be a taxpayer-specific ruling for Solara and its fund entities — Nordhaven is not a requesting taxpayer. That said, the rulings we obtain, particularly on § 1446 withholding and § 731 distribution treatment, will bear directly on Nordhaven's tax position, which is why coordination between our firms is important.

As you would expect, Calderwood & Harkness's work product is privileged and prepared at the direction of our client. However, with Solara's express authorization — confirmed through Stefan Dalmqvist — we are prepared to share certain categories of information with Bramhall & Quelwick on a common-interest basis. If you believe a formal common interest agreement is warranted, we are happy to put one in place and can ci

The categories of information we can share include:

- Factual descriptions of the reorganization steps and structure, including pre- and post-reorganization organizational charts; - The schedule of contributing entities, portfolio assets, fair market values, adjusted tax bases, and built-in gains relevant to Fund IV-A Cayman and Fund V-A Cayman; - Our positions on the § 721, § 731, § 1446, and § 752 rulings being requested (though not our full internal memoranda); - T

We are not in a position to share internal attorney-client communications with Solara, internal work-product memoranda, or any analysis specific to other limited partners' individual tax positions.

On a reciprocal basis, it would be helpful if Bramhall & Quelwick could share with us any specific concerns or positions Nordhaven intends to take regarding the reorganization's tax treatment. This will allow us to ensure the PLR request adequately addresses — or, at a minimum, does not conflict with — Nordhaven's position.

To give you a sense of where we are in the process:

- We are targeting completion of our initial comprehensive tax analysis memorandum by **June 16, 2025**. - The first draft of the PLR request (v1.0) is targeted for internal circulation by **July 1, 2025**. A client-reviewed version (v3.0) is expected to be available for LPAC and investor counsel review by mid-July, with a target of **July 15, 2025** for LPAC distribution. - We have requested a pre-submission confere

I would welcome the opportunity to speak with you in the coming week to discuss our coordination in more detail. If you could identify any additional data points or analyses your team needs from us to complete Bramhall & Quelwick's review for Nordhaven, we will do our best to provide them promptly. I should note that the organizational charts (pre- and post-reorganization), the asset schedule for Fund IV-A Cayman and

Please feel free to reach out to me directly at any time. My direct line is (202) 555-8140 and my cell is (202) 555-3027. For day-to-day data requests and analytical coordination, Robert Jansen, the lead associate on our team (copied here), will serve as the primary point of contact. Rob can be reached at rjansen@calderwoodharkness.com or (202) 555-8163.

I look forward to working with you on this, Jason. Please let me know what times work for a call next week.

Leonard Cross Partner, Tax Practice Group Calderwood & Harkness LLP 1900 K Street NW, Suite 1100 Washington, DC 20006 T: (202) 555-8140 C: (202) 555-3027 lcross@calderwoodharkness.com

*CONFIDENTIALITY NOTICE: This email message, including any attachments, is sent by Calderwood & Harkness LLP and is intended only for the use of the individual or entity to which it is addressed. This communication may contain information that is privileged, confidential, and exempt from disclosure under applicable law, including attorney-client privileged communications and attorney work product. If you are not the