1041-00005 · Client 1041 · PLR Request Drafting

draft-plr-request-v1.docx DOCUMENT M&A / Corporate

55 / 86 ← → ✕

DRAFT — VERSION 1.0 — PRIVILEGED AND CONFIDENTIAL — ATTORNEY-CLIENT COMMUNICATION

CALDERWOOD & HARKNESS LLP Attorneys at Law

1900 K Street NW, Suite 1100 Washington, DC 20006 Telephone: (202) 555-7400 Facsimile: (202) 555-7401 www.calderwoodharkness.com

July 1, 2025

Prepared by: Robert Jansen, Lead Associate, Tax; Garrett Simmons, Working Associate, Tax Reviewed by: Leonard Cross, Responsible Partner, Tax; Sylvia Hartwell, Billing Partner, Tax Engagement Number: 20250527-SDILP-PLR

Internal Revenue Service

Attn: Office of the Associate Chief Counsel (International)

CC:INTL 1111 Constitution Avenue NW Washington, DC 20224

Secondary Jurisdiction: Office of the Associate Chief Counsel (Passthroughs & Special Industries) CC:PSI 1111 Constitution Avenue NW Washington, DC 20224

Re: Request for Private Letter Ruling on Behalf of Solara Digital Infrastructure LP (EIN 82-4917366) and Related Entities — Cross-Border Fund-Platform Reorganization

Right-click to update Table of Contents

I. Introductory Statement and Request for Ruling

Calderwood & Harkness LLP ("Calderwood & Harkness" or "Counsel"), as authorized counsel to Solara Digital Infrastructure LP ("Solara" or "SDILP"), a Delaware limited partnership (EIN 82-4917366), hereby submits this request for a private letter ruling ("PLR") pursuant to Revenue Procedure 2025-1, 2025-1 I.R.B. 1 ("Rev. Proc. 2025-1"), and the procedures set forth therein. This ruling is requested on behalf of Solara and the following related entities:

1. Solara Digital Infrastructure GP LLC (EIN 82-4917365), a Delaware limited liability company;

2. Solara Digital Partners Fund IV LP (EIN 85-2103748), a Delaware limited partnership;

3. Solara Digital Partners Fund IV-A (Cayman) LP (U.S. EIN 98-6241503), a Cayman Islands exempted limited partnership;

4. Solara Digital Partners Fund IV-B (Luxembourg) SCSp (U.S. EIN 98-6241571), a Luxembourg special limited partnership (société en commandite spéciale);

5. Solara Digital Partners Fund V LP (EIN 88-3467219), a Delaware limited partnership;

6. Solara Digital Partners Fund V-A (Cayman) LP (U.S. EIN 98-7891234), a Cayman Islands exempted limited partnership;

7. Solara Digital Partners Fund V-B (Luxembourg) SCSp (U.S. EIN 98-7891267), a Luxembourg special limited partnership;

8. Solara Consolidated Master Fund LP (to be formed; EIN to be obtained), a Delaware limited partnership;

9. Solara Consolidated Master Fund GP LLC (to be formed; EIN to be obtained), a Delaware limited liability company;

10. Solara International Feeder (Cayman) LP (to be formed; EIN to be obtained), a Cayman Islands exempted limited partnership; and

11. Solara Tax-Exempt Feeder (Cayman) LP (to be formed; EIN to be obtained), a Cayman Islands exempted limited partnership.

Collectively, the entities listed in items 3, 4, 6, and 7 above are referred to herein as the "Legacy Offshore Vehicles." The entities listed in items 8 through 11 above are referred to herein as the "New Entities."

Solara respectfully requests that the Internal Revenue Service (the "Service" or "IRS") issue a favorable private letter ruling addressing the United States federal income tax treatment of a proposed multi-step cross-border reorganization (the "Reorganization") of Solara's fund platform. Specifically, Solara requests rulings on the following eight issues:

Ruling 1 — Whether the contributions of portfolio assets by the Legacy Offshore Vehicles to the Consolidated Master Fund LP constitute tax-free contributions under Section 721(a) of the Internal Revenue Code of 1986, as amended (the "Code" or "IRC");

Ruling 2 — Whether the Consolidated Master Fund LP constitutes an "investment company" within the meaning of IRC § 721(b);

Ruling 3 — Whether IRC § 367 applies to the contributions by foreign partnerships to a domestic partnership;

Ruling 4 — Whether the distributions by the Legacy Offshore Vehicles of their partnership interests in the Consolidated Master Fund LP to their respective limited partners constitute tax-free distributions under IRC § 731(a), and whether IRC § 731(c) applies;

Ruling 5 — Whether the shifts in partner-level shares of liabilities resulting from the Reorganization trigger gain recognition under IRC §§ 752(a), 752(b), and 731;

Ruling 6 — Whether the built-in gain and loss accounts tracked under IRC § 704(c) by the Legacy Offshore Vehicles carry over to the Consolidated Master Fund LP, and whether the Consolidated Master Fund LP may continue to use the remedial allocation method;

Ruling 7 — Whether withholding under IRC § 1446(a) is required on any step of the Reorganization; and

Ruling 8 — Whether the Consolidated Master Fund LP, Solara International Feeder (Cayman) LP, and Solara Tax-Exempt Feeder (Cayman) LP are each properly classified as partnerships for U.S. federal income tax purposes.

Enclosed with this ruling request is the applicable user fee payment of $38,000, as required under the Schedule of User Fees, Appendix A, Rev. Proc. 2025-1, for a ruling request involving multiple entities with combined assets exceeding $50 million.

Also enclosed are IRS Forms 2848, Power of Attorney and Declaration of Representative, designating Leonard Cross (Calderwood & Harkness LLP, 1900 K Street NW, Suite 1100, Washington, DC 20006; telephone (202) 555-7412; CAF No. pending) and Sylvia Hartwell (Calderwood & Harkness LLP, 600 Lexington Avenue, 38th Floor, New York, NY 10022; telephone (212) 555-9803; CAF No. pending) as the authorized representatives of Solara and each of the related entities listed above for purposes of this ruling request. Each Form 2848 has been duly executed by Viktor Raines in his capacity as Managing Partner of Solara Digital Infrastructure GP LLC, the general partner of Solara Digital Infrastructure LP.

Additionally enclosed is the declaration under penalties of perjury required by Rev. Proc. 2025-1, Section 7.01(16), signed by Viktor Raines as Managing Partner of Solara Digital Infrastructure GP LLC, the general partner of Solara Digital Infrastructure LP, stating under penalties of perjury that the facts presented in this ruling request are true, correct, and complete.

By letter dated June 18, 2025 (copy enclosed for reference), Counsel requested a pre-submission conference for July 22, 2025 with the Office of the Associate Chief Counsel (International), CC:INTL, Branch 1, to discuss the proposed rulings and the factual circumstances underlying this request. At the time of filing this ruling request, confirmation of the pre-submission conference date is pending.

II. Statement of Facts

A. Overview of Solara Digital Infrastructure LP

Solara Digital Infrastructure LP is a Delaware limited partnership formed on March 17, 2014, pursuant to the Delaware Revised Uniform Limited Partnership Act, 6 Del. C. §§ 17-101 et seq. Solara's principal office is located at 1200 Market Street, Suite 3400, Wilmington, Delaware 19801. Solara serves as the investment management and advisory platform (the "Platform") through which the Solara group of affiliated investment funds conducts its private equity investment activities.

As of March 31, 2025, Solara manages approximately $14.7 billion in assets under management ("AUM") across its active fund vehicles, including co-investment vehicles and separately managed accounts. Solara's investment strategy is focused exclusively on digital infrastructure — encompassing data centers, fiber-optic networks, edge computing facilities and platforms — and enterprise Software-as-a-Service ("SaaS") businesses. Each of the portfolio companies held across Solara's fund platform is an operating business engaged in the provision of digital infrastructure services or enterprise SaaS solutions to commercial, enterprise, and governmental customers.

Solara was founded by Viktor Raines (age 52), who serves as the firm's Managing Partner. Prior to founding Solara, Mr. Raines served as a managing director in the Technology, Media, and Telecommunications practice at Havensgate Capital Partners, a New York-based private equity firm, where he led investments in data center and telecommunications infrastructure. Mr. Raines has served continuously as Managing Partner since Solara's formation and exercises primary investment decision-making authority over the fund platform.

The other key officers and professionals of Solara include:

• Meredith Tsao, Chief Operating Officer, responsible for day-to-day operations, fund administration oversight, and investor relations;

• Douglas Wexford, Chief Financial Officer, responsible for financial reporting, treasury, and portfolio monitoring;

• Priya Narasimhan, General Counsel, responsible for legal affairs, regulatory compliance, and fund structuring; and

• Stefan Dalmqvist, Head of Tax, responsible for tax planning, compliance, and reporting across all fund vehicles and portfolio companies.

Solara's investment professionals are located primarily in its Wilmington, Delaware headquarters, with additional personnel based in New York, New York; San Francisco, California; London, England; and Luxembourg City, Luxembourg.

B. General Partner

Solara Digital Infrastructure GP LLC ("Solara GP" or the "General Partner"), a Delaware limited liability company (EIN 82-4917365), serves as the general partner of SDILP and, directly or through affiliated entities, serves as the general partner (or equivalent controlling entity) of each of the existing fund vehicles described below. Solara GP was formed on March 15, 2014, under the Delaware Limited Liability Company Act, 6 Del. C. §§ 18-101 et seq.

Solara GP is managed by Viktor Raines in his capacity as Manager. The registered agent for Solara GP is Capitol Registered Agents Inc., located at 850 New Burton Road, Suite 201, Dover, Delaware 19904. Solara GP has no other material business activities apart from serving as general partner to the Solara fund vehicles and performing the investment management and advisory functions of the Platform.

C. Existing Fund Structure

Solara currently operates its investment program through two generations of fund vehicles — Fund IV (vintage 2021) and Fund V (vintage 2023) — each of which is comprised of a domestic Delaware limited partnership and two offshore parallel vehicles organized in the Cayman Islands and Luxembourg, respectively. The parallel vehicle structure was adopted to accommodate the tax, regulatory, and treaty access requirements of Solara's diverse limited partner ("LP") base, which includes U.S. taxable investors, U.S. tax-exempt institutional investors, and non-U.S. sovereign wealth funds, pension plans, insurance companies, and other institutional investors. The existing fund vehicles are described in detail below.

1. Fund IV Vehicles

Solara Digital Partners Fund IV LP ("Fund IV"). Fund IV is a Delaware limited partnership (EIN 85-2103748) formed on January 22, 2021. Fund IV held its final close on June 15, 2021, with total committed capital of $4.2 billion. As of March 31, 2025, Fund IV is approximately 72% deployed, with the remaining committed capital available for follow-on investments and fund expenses. The general partner of Fund IV is Solara GP. Fund IV serves as the primary domestic investment vehicle through which U.S. taxable investors participate in the Fund IV investment program.

Solara Digital Partners Fund IV-A (Cayman) LP ("Fund IV-A Cayman"). Fund IV-A Cayman is a Cayman Islands exempted limited partnership (U.S. EIN 98-6241503; Cayman Islands Monetary Authority ("CIMA") registration number MF-72491) formed on February 10, 2021. Fund IV-A Cayman serves as the parallel fund vehicle through which non-U.S. investors and U.S. tax-exempt investors participate in the Fund IV investment program. Total committed capital in Fund IV-A Cayman is $1.85 billion. The registered office of Fund IV-A Cayman is located at Harborstone Corporate Services Ltd., P.O. Box 2714, 94 Solaris Avenue, George Town, Grand Cayman KY1-1111, Cayman Islands. The general partner of Fund IV-A Cayman is Solara Offshore GP Ltd., a Cayman Islands exempted company. Fund IV-A Cayman invests on a pari passu basis alongside Fund IV in each portfolio company investment, with allocations determined based on relative commitments.

Solara Digital Partners Fund IV-B (Luxembourg) SCSp ("Fund IV-B Lux"). Fund IV-B Lux is a Luxembourg special limited partnership (société en commandite spéciale) (U.S. EIN 98-6241571; Luxembourg Register of Commerce and Companies ("RCS") number B 248193) formed on March 5, 2021. Fund IV-B Lux serves as an additional parallel vehicle for certain non-U.S. investors — principally European institutional investors — that require access to the Luxembourg–U.S. income tax treaty (Convention between the United States and the Grand Duchy of Luxembourg for the Avoidance of Double Taxation, signed April 3, 1996) or that are subject to European regulatory requirements favoring Luxembourg-domiciled fund structures. Total committed capital in Fund IV-B Lux is €1.15 billion (approximately $1.24 billion at the uniform EUR/USD exchange rate of 1.08 applied throughout this ruling request). The registered office of Fund IV-B Lux is located at 14, rue Jean-Pierre Brasseur, L-1258 Luxembourg. The general partner (associé commandité) of Fund IV-B Lux is Solara Luxembourg Management S.à r.l. (RCS number B 248194), a Luxembourg private limited liability company (société à responsabilité limitée).

2. Fund V Vehicles

Solara Digital Partners Fund V LP ("Fund V"). Fund V is a Delaware limited partnership (EIN 88-3467219) formed on April 3, 2023. Fund V held its final close on September 30, 2023, with total committed capital of $5.6 billion. As of March 31, 2025, Fund V is approximately 38% deployed. The general partner of Fund V is Solara GP. Fund V serves as the primary domestic investment vehicle for U.S. taxable investors in the Fund V investment program.

Solara Digital Partners Fund V-A (Cayman) LP ("Fund V-A Cayman"). Fund V-A Cayman is a Cayman Islands exempted limited partnership (U.S. EIN 98-7891234; CIMA registration number MF-89103) formed on May 15, 2023. Fund V-A Cayman serves as the parallel fund vehicle for non-U.S. and U.S. tax-exempt investors in the Fund V investment program, with total committed capital of $2.45 billion. The registered office of Fund V-A Cayman is located at Harborstone Corporate Services Ltd., George Town, Grand Cayman. The general partner of Fund V-A Cayman is Solara Offshore GP Ltd.

Solara Digital Partners Fund V-B (Luxembourg) SCSp ("Fund V-B Lux"). Fund V-B Lux is a Luxembourg SCSp (U.S. EIN 98-7891267; RCS number B 271056) formed on June 1, 2023, to serve as an additional parallel vehicle for European institutional investors in the Fund V investment program. Total committed capital in Fund V-B Lux is €1.38 billion (approximately $1.49 billion at 1.08 EUR/USD). The registered office of Fund V-B Lux is located at 14, rue Jean-Pierre Brasseur, L-1258 Luxembourg. The general partner of Fund V-B Lux is Solara Luxembourg Management S.à r.l.

3. Investor Base and Structure Rationale

The existing parallel vehicle structure was adopted at the inception of Fund IV, and continued for Fund V, to address the distinct tax and regulatory needs of three categories of limited partners:

U.S. Taxable Investors. U.S. taxable investors — including high-net-worth individuals, family offices, taxable trusts, and domestic corporate investors — invest directly through the domestic Delaware fund vehicles (Fund IV and Fund V). These investors benefit from the pass-through treatment of the domestic partnerships, which permits the character of income, gain, loss, deduction, and credit to flow through directly to the partners. Representative U.S. taxable investors include Argyle Family Office Holdings LLC, which has committed capital of $95 million in Fund IV and $130 million in Fund V.

U.S. Tax-Exempt Investors. U.S. tax-exempt institutional investors — including public employee retirement systems, university endowments, and charitable foundations — invest through the Cayman Islands parallel vehicles (Fund IV-A Cayman and Fund V-A Cayman) rather than the domestic vehicles. This structure is designed to mitigate the risk of unrelated business taxable income ("UBTI") under IRC §§ 511–514 that might otherwise arise from debt-financed portfolio company acquisitions and from income derived from operating businesses conducted through pass-through entities. By investing through the Cayman parallel vehicles, which in turn hold portfolio company interests through intermediate offshore corporate subsidiaries classified as corporations for U.S. federal income tax purposes, the tax-exempt investors receive distributions that are generally characterized as dividends or capital gains rather than UBTI. Representative U.S. tax-exempt investors include Pinnacle State Employees' Retirement System, which has committed capital of $275 million in Fund IV and $340 million in Fund V, and Grandview University Endowment, which has committed capital of $120 million in Fund IV and $185 million in Fund V.

Non-U.S. Investors. Non-U.S. investors — including sovereign wealth funds, foreign pension plans, foreign insurance companies, and other foreign institutional investors — invest through the Cayman Islands or Luxembourg parallel vehicles depending on their particular treaty access requirements, regulatory preferences, and tax planning considerations. Representative non-U.S. investors include Nordhaven Sovereign Wealth Fund, a sovereign wealth fund organized under the laws of the Kingdom of Norway, which has committed capital of $380 million in Fund IV-A Cayman and $500 million in Fund V-A Cayman, and Kestrel Pacific Insurance Group, an insurance holding company organized under the laws of Australia, which has committed capital of €200 million in Fund IV-B Lux and €275 million in Fund V-B Lux.

D. Portfolio Company Holdings

The fund vehicles described in Section II.C above collectively hold interests in a total of 23 portfolio companies as of March 31, 2025. Of these, 11 portfolio companies are held by the Fund IV vehicles (Fund IV, Fund IV-A Cayman, and Fund IV-B Lux) and 12 portfolio companies are held by the Fund V vehicles (Fund V, Fund V-A Cayman, and Fund V-B Lux). Each portfolio company is an operating business engaged in digital infrastructure services (data center operation, fiber-optic network operation, edge computing infrastructure) or enterprise SaaS platform operations.

The following are representative portfolio company interests that will be transferred to the Consolidated Master Fund LP as part of the Reorganization, together with their current fair market value ("FMV"), adjusted tax basis, and built-in gain as of the anticipated transaction dates:

1. NovaBright Data Systems Inc. NovaBright Data Systems Inc. ("NovaBright") is a Delaware corporation engaged in the operation of hyperscale and colocation data centers across the eastern United States. NovaBright currently operates seven data center campuses in Virginia, New Jersey, Georgia, and Ohio, with aggregate capacity of approximately 280 megawatts. NovaBright's current FMV is $890 million, with an adjusted tax basis of $520 million, resulting in a built-in gain of $370 million. NovaBright is held 60% by Fund IV-A Cayman and 40% by Fund IV.

2. Crestline Cloud Solutions LLC. Crestline Cloud Solutions LLC ("Crestline") is a Delaware limited liability company classified as a disregarded entity for U.S. federal income tax purposes, owned 100% by Fund IV-B Lux. Crestline operates an enterprise SaaS platform providing cloud-based data management and analytics solutions to mid-market and enterprise customers in the United States and Europe. Crestline's current FMV is €340 million (approximately $367 million at 1.08 EUR/USD), with an adjusted tax basis of €195 million (approximately $211 million), resulting in a built-in gain of €145 million (approximately $156 million).

3. Veridian Edge Computing Corp. Veridian Edge Computing Corp. ("Veridian") is a Delaware corporation engaged in the development and operation of edge computing infrastructure, including micro data centers and edge nodes deployed at cellular tower sites and enterprise locations across North America. Veridian's current FMV is $1.12 billion, with an adjusted tax basis of $780 million, resulting in a built-in gain of $340 million. Veridian is held 55% by Fund V-A Cayman and 45% by Fund V.

4. Thorngate Fiber Networks LP. Thorngate Fiber Networks LP ("Thorngate") is a Delaware limited partnership engaged in the construction, ownership, and operation of fiber-optic network infrastructure, including metropolitan and long-haul fiber routes serving enterprise customers, wireless carriers, and government agencies. Thorngate's current FMV is $670 million, with an adjusted tax basis of $490 million, resulting in a built-in gain of $180 million. Thorngate is held 100% by Fund IV-A Cayman.

5. Helix SaaS Holdings Ltd. Helix SaaS Holdings Ltd. ("Helix") is a Cayman Islands exempted company that serves as a holding company for a group of enterprise SaaS businesses providing cybersecurity, identity management, and compliance automation solutions. Helix's current FMV is $445 million, with an adjusted tax basis of $310 million, resulting in a built-in gain of $135 million. Helix is held 100% by Fund V-A Cayman.

6. Additional Portfolio Companies. The remaining 18 portfolio companies held across the fund vehicles are described in detail in Exhibit D to this ruling request, including each company's jurisdiction of organization, business description, FMV, adjusted tax basis, built-in gain or loss, and ownership by fund vehicle. In the aggregate, the 18 additional portfolio companies have a combined FMV of approximately $3.258 billion, combined adjusted tax basis of approximately $2.719 billion, and combined built-in gain of approximately $539 million.

E. Aggregate Financial Summary of Assets Being Transferred

The following table summarizes the aggregate financial data for all assets being contributed to the Consolidated Master Fund LP in the Reorganization:

The FMV and adjusted tax basis figures set forth above and throughout this ruling request are based on independent appraisals prepared by Redstone Advisory Group LLC ("Redstone") as of March 31, 2025, and on audited financial statements and tax basis records maintained by Caldwell Pierce & Co. LLP ("Caldwell Pierce"), the independent accounting firm retained by Solara for tax compliance and financial reporting purposes. Updated appraisals will be obtained as of the applicable transaction dates for each step of the Reorganization.

F. Business Rationale for the Reorganization

The Reorganization is motivated by several substantial non-tax business purposes, each of which is described below.

Operational Cost Reduction. Under the existing parallel vehicle structure, Solara incurs significant duplicative costs for the maintenance, administration, and regulatory compliance of the four Legacy Offshore Vehicles. These costs include offshore fund administration fees, statutory audit fees (including separate audits for each Cayman and Luxembourg vehicle), Cayman Islands annual registration fees, Luxembourg supervisory fees, registered office and agent fees, and legal and compliance costs associated with maintaining separate entities across three jurisdictions. Based on a comprehensive analysis conducted by Solara's CFO, Douglas Wexford, and confirmed by Caldwell Pierce, Solara currently pays approximately $3.8 million annually in duplicative offshore administration, audit, and regulatory fees that would be substantially eliminated by consolidating the Legacy Offshore Vehicles into the Consolidated Master Fund LP structure. Over the expected remaining life of Fund IV and Fund V (estimated at approximately 5–7 years for Fund IV and 7–10 years for Fund V), the present value of these cost savings is estimated to exceed $20 million.

OECD Pillar Two Global Anti-Base Erosion (GloBE) Rules. The Organization for Economic Co-operation and Development ("OECD") Pillar Two GloBE rules, as implemented by the European Union through Council Directive (EU) 2022/2523 and by Luxembourg through the law of December 22, 2023, impose a minimum effective tax rate of 15% on large multinational enterprises. For Solara's Luxembourg entities, the GloBE rules are expected to become effective beginning in fiscal year 2025. The Luxembourg SCSp structures (Fund IV-B Lux and Fund V-B Lux) were originally adopted in part to achieve tax efficiencies that will be substantially diminished or eliminated under the GloBE regime. The Reorganization will simplify the fund platform in advance of these changes and avoid the compliance costs and operational complexity of maintaining Luxembourg vehicles that no longer offer meaningful structural benefits.

FATCA and CRS Simplification. The current structure requires complex cross-border information reporting under the U.S. Foreign Account Tax Compliance Act ("FATCA") (IRC §§ 1471–1474) and the OECD Common Reporting Standard ("CRS"). Each of the four Legacy Offshore Vehicles must independently comply with FATCA and CRS obligations, including the preparation and filing of FATCA Forms 8966 and CRS reports with the Cayman Islands and Luxembourg tax authorities. Consolidating the offshore assets into a single domestic master fund structure will materially reduce the number of reporting entities and the complexity of cross-border information exchange.

LP-Requested Governance Simplification. Solara's limited partners have repeatedly expressed a preference for a simplified governance structure that reduces the number of separate vehicles, advisory committees, and reporting lines. At a meeting of the Limited Partner Advisory Committee ("LPAC") held on April 22, 2025, LPs representing 78% in interest of the committed capital across all fund vehicles provided preliminary consent to the exploration and implementation of the platform Reorganization. LPs cited administrative burden, duplicative reporting, and the complexity of the multi-vehicle structure as primary concerns. The Reorganization addresses these concerns by consolidating the offshore vehicles into a single master fund with two clean feeder vehicles.

GP Board Approval. The board of managers of Solara GP approved the exploration and implementation of the platform Reorganization at a board meeting held on March 14, 2025. The board determined that the Reorganization is in the best interests of Solara and its limited partners and authorized management to engage advisors and proceed with the structuring and execution of the Reorganization, subject to final LP consent, lender consent, and the receipt of a favorable private letter ruling from the Service.

G. Proposed Reorganization — Multi-Step Transaction

The Reorganization will be implemented through the following five sequential steps:

Step 1 — Formation of New Entities (Target: September 15, 2025)

In Step 1, Solara will cause the formation of the following new entities:

(a) Solara Consolidated Master Fund GP LLC ("Master Fund GP"), a Delaware limited liability company, to be formed under the Delaware Limited Liability Company Act and registered with the Delaware Division of Corporations. The registered agent for Master Fund GP will be Capitol Registered Agents Inc., 850 New Burton Road, Suite 201, Dover, Delaware 19904. Master Fund GP will be managed by Viktor Raines and will serve as the general partner of the Consolidated Master Fund LP.

(b) Solara Consolidated Master Fund LP (the "Consolidated Master Fund" or "Master Fund"), a Delaware limited partnership, to be formed under the Delaware Revised Uniform Limited Partnership Act. The general partner of the Master Fund will be Master Fund GP. The Master Fund will serve as the primary vehicle for consolidating the portfolio company interests currently held by the Legacy Offshore Vehicles.

(c) Solara International Feeder (Cayman) LP (the "International Feeder"), a Cayman Islands exempted limited partnership, to be formed under the Cayman Islands Exempted Limited Partnership Act (as revised). The International Feeder will serve as the feeder vehicle through which non-U.S. investors will invest into the Master Fund following the completion of the Reorganization.

(d) Solara Tax-Exempt Feeder (Cayman) LP (the "Tax-Exempt Feeder"), a Cayman Islands exempted limited partnership, to be formed under the Cayman Islands Exempted Limited Partnership Act (as revised). The Tax-Exempt Feeder will serve as the feeder vehicle through which U.S. tax-exempt investors will invest into the Master Fund following the completion of the Reorganization, in order to continue to mitigate UBTI concerns through the use of intermediate offshore corporate subsidiary holding structures.

Promptly following formation, Solara will file IRS Form 8832 (Entity Classification Election) for each of the four New Entities, electing classification as a partnership for U.S. federal income tax purposes under Treasury Regulations § 301.7701-3. The effective date of each election will be September 15, 2025, or such earlier date as the applicable entity is formed. Each of the four New Entities will have at least two members at all relevant times.

Step 2 — Contribution of Fund IV-A Cayman Assets (Target: October 1, 2025)

In Step 2, Fund IV-A (Cayman) LP will contribute all of its portfolio company interests — comprising its interests in NovaBright Data Systems Inc. (60% interest), Thorngate Fiber Networks LP (100% interest), and eight additional portfolio companies described in Exhibit D — to the Consolidated Master Fund LP in exchange for a limited partnership interest in the Master Fund. No cash or other consideration will be received by Fund IV-A Cayman in connection with the contribution.

The aggregate financial data for the assets contributed in Step 2 is as follows:

It is intended that the contribution described in Step 2 will qualify as a tax-free contribution under IRC § 721(a), with the result that no gain or loss is recognized by Fund IV-A Cayman, the Consolidated Master Fund LP, or any of their respective partners. The Master Fund will take a carryover basis in each contributed property under IRC § 723, and the holding period of each contributed property will include the period during which the property was held by Fund IV-A Cayman under IRC § 1223(2).

As discussed in Section IV.B below, analysis under IRC § 721(b) is required to confirm that the Consolidated Master Fund LP does not constitute an "investment company" within the meaning of § 721(b).

Step 3 — Contribution of Fund IV-B Luxembourg Assets (Target: October 15, 2025)

In Step 3, Fund IV-B (Luxembourg) SCSp will contribute all of its portfolio company interests — comprising its 100% interest in Crestline Cloud Solutions LLC and its interests in additional portfolio companies described in Exhibit D — to the Consolidated Master Fund LP in exchange for a limited partnership interest in the Master Fund. No cash or other consideration will be received by Fund IV-B Lux in connection with the contribution.

The aggregate financial data for the assets contributed in Step 3 is as follows:

It is intended that the contribution described in Step 3 will qualify as a tax-free contribution under IRC § 721(a). As discussed in Section IV.C below, analysis under IRC § 367 is required to address the transfer of assets by a foreign partnership to a domestic partnership. Solara takes the position that IRC § 367 does not apply because § 367 by its terms applies only to transfers to or from corporations.

With respect to Luxembourg tax consequences, no Luxembourg capital gains tax is expected on the SCSp-level transfer of assets, based on Article 3(2) of the Luxembourg law of July 12, 2013, governing special limited partnerships. Analysis of Luxembourg withholding tax implications has been conducted by Veldhuis & Gérard S.à r.l., Luxembourg counsel.

Additionally, to the extent any deemed disposition could be asserted with respect to Step 3, analysis of Section 1446 withholding obligations is required, as discussed in Section IV.G below.

Step 4 — Contribution of Fund V Offshore Assets (Target: November 1, 2025)

In Step 4, both of the Fund V offshore vehicles will contribute all of their portfolio company interests to the Consolidated Master Fund LP in exchange for limited partnership interests in the Master Fund, as follows:

Fund V-A (Cayman) LP will contribute all of its portfolio company interests — comprising its interests in Veridian Edge Computing Corp. (55% interest), Helix SaaS Holdings Ltd. (100% interest), and additional portfolio companies described in Exhibit D — to the Master Fund. The aggregate financial data for the assets contributed by Fund V-A Cayman is as follows:

Fund V-B (Luxembourg) SCSp will contribute all of its portfolio company interests to the Master Fund. The aggregate financial data for the assets contributed by Fund V-B Lux is as follows:

The same IRC § 721(a) intended treatment described with respect to Steps 2 and 3 applies to the contributions described in Step 4. The same IRC § 367 and § 721(b) analyses are also applicable.

Step 5 — Dissolution of Legacy Offshore Vehicles and LP Migration (Target: December 1, 2025)

In Step 5, following the completion of Steps 2 through 4, each of the four Legacy Offshore Vehicles — Fund IV-A (Cayman) LP, Fund IV-B (Luxembourg) SCSp, Fund V-A (Cayman) LP, and Fund V-B (Luxembourg) SCSp — will dissolve and distribute their respective partnership interests in the Consolidated Master Fund LP to their existing limited partners in complete liquidation.

Following these liquidating distributions, the limited partners of the Legacy Offshore Vehicles will hold direct interests in the Master Fund (through the appropriate feeder vehicle or directly, as applicable). Specifically:

(a) Non-U.S. limited partners will contribute their Master Fund interests to the Solara International Feeder (Cayman) LP in exchange for limited partnership interests in the International Feeder. Thereafter, these non-U.S. limited partners will hold indirect interests in the Master Fund through the International Feeder.

(b) U.S. tax-exempt limited partners will contribute their Master Fund interests to the Solara Tax-Exempt Feeder (Cayman) LP in exchange for limited partnership interests in the Tax-Exempt Feeder. Thereafter, these U.S. tax-exempt limited partners will hold indirect interests in the Master Fund through the Tax-Exempt Feeder.

(c) U.S. taxable limited partners will remain as direct limited partners in Fund IV LP and Fund V LP, which will continue to co-invest alongside the Consolidated Master Fund LP on a pari passu basis with respect to existing and future portfolio company investments.

It is intended that the distributions by the Legacy Offshore Vehicles described in Step 5 will qualify as tax-free distributions under IRC § 731(a), with the result that no gain is recognized by any limited partner, because the distributed Master Fund partnership interests constitute property other than money and the exceptions in § 731(a) are not triggered. As discussed in Section IV.D below, analysis under IRC § 731(c) is required to confirm that the distributed Master Fund partnership interests do not constitute "marketable securities" within the meaning of § 731(c)(2).

The resulting post-Reorganization structure will consist of: (i) the Consolidated Master Fund LP, holding all portfolio company interests previously held by the Legacy Offshore Vehicles; (ii) the International Feeder, through which non-U.S. investors hold indirect interests in the Master Fund; (iii) the Tax-Exempt Feeder, through which U.S. tax-exempt investors hold indirect interests in the Master Fund; and (iv) Fund IV LP and Fund V LP, through which U.S. taxable investors continue to hold direct interests in portfolio companies and co-invest alongside the Master Fund. The post-Reorganization structure is depicted in Exhibit B.

H. Description of Newly Formed Entities

The four New Entities to be formed in Step 1 are described as follows:

Solara Consolidated Master Fund LP. A Delaware limited partnership to serve as the master fund vehicle consolidating all portfolio company interests previously held by the Legacy Offshore Vehicles. The general partner of the Master Fund will be Solara Consolidated Master Fund GP LLC. The Master Fund will file a timely IRS Form 8832 election to be classified as a partnership for U.S. federal income tax purposes under Treas. Reg. § 301.7701-3. The Master Fund will maintain its principal office at 1200 Market Street, Suite 3400, Wilmington, Delaware 19801.

Solara Consolidated Master Fund GP LLC. A Delaware limited liability company to serve as the general partner of the Master Fund. Master Fund GP will be managed by Viktor Raines and will have no material business activities apart from its role as general partner.

Solara International Feeder (Cayman) LP. A Cayman Islands exempted limited partnership to serve as the feeder vehicle for non-U.S. investors investing into the Master Fund. The International Feeder will file a timely IRS Form 8832 election to be classified as a partnership for U.S. federal income tax purposes. The registered office of the International Feeder will be at Harborstone Corporate Services Ltd., George Town, Grand Cayman.

Solara Tax-Exempt Feeder (Cayman) LP. A Cayman Islands exempted limited partnership to serve as the feeder vehicle for U.S. tax-exempt investors investing into the Master Fund. The Tax-Exempt Feeder will file a timely IRS Form 8832 election to be classified as a partnership for U.S. federal income tax purposes. The registered office of the Tax-Exempt Feeder will be at Harborstone Corporate Services Ltd., George Town, Grand Cayman.

I. Related Credit Facilities

The following subscription credit facilities are currently in place and will be affected by the Reorganization:

Fund IV Credit Facility. Fund IV maintains a $1.1 billion revolving subscription credit facility with Ashford National Bank, N.A. (the "Fund IV Credit Facility"), governed by a credit agreement dated June 15, 2021 (as amended). The Fund IV Credit Facility is secured by the uncalled capital commitments of the limited partners of Fund IV and the related parallel vehicles.

Fund V Credit Facility. Fund V maintains a $1.5 billion revolving subscription credit facility with Ashford National Bank, N.A. (as co-lender) and Sentinel Capital Markets LLC (as co-lender and administrative agent) (the "Fund V Credit Facility"), governed by a credit agreement dated September 30, 2023 (as amended). The Fund V Credit Facility is secured by the uncalled capital commitments of the limited partners of Fund V and the related parallel vehicles.

Each of the Fund IV Credit Facility and the Fund V Credit Facility contains covenants and conditions that require lender consent for material changes to the organizational structure of the borrower entities and their parallel vehicles. Lender consent is being sought concurrently with the submission of this ruling request. Solara expects to obtain all required lender consents prior to the implementation of Step 1 of the Reorganization.

J. Advisors and Service Providers

The following advisors and service providers are engaged in connection with the Reorganization and Solara's ongoing fund operations:

III. Rulings Requested

Solara respectfully requests that the Service issue favorable rulings on each of the following eight issues:

Ruling 1 — IRC § 721(a): Tax-Free Contribution

The contributions of portfolio company interests and other assets by the Legacy Offshore Vehicles (Fund IV-A Cayman, Fund IV-B Lux, Fund V-A Cayman, and Fund V-B Lux) to the Consolidated Master Fund LP in exchange for limited partnership interests in the Master Fund, as described in Steps 2, 3, and 4 of the Reorganization, constitute tax-free contributions of property to a partnership in exchange for interests in the partnership within the meaning of IRC § 721(a), and no gain or loss is recognized by the contributing partnerships, the Consolidated Master Fund LP, or any of their respective partners as a result of such contributions.

Ruling 2 — IRC § 721(b): Investment Company Exception

The Consolidated Master Fund LP does not constitute an "investment company" within the meaning of IRC § 721(b) and Treasury Regulations § 1.351-1(c)(1)(ii), because its portfolio consists of interests in operating companies engaged in digital infrastructure and enterprise SaaS businesses, rather than "stocks, securities, or other investment assets" within the meaning of IRC § 351(e)(1), and accordingly, the exception to nonrecognition treatment set forth in IRC § 721(b) does not apply to the contributions described in Steps 2, 3, and 4.

Ruling 3 — IRC § 367: Inapplicability to Partnership-to-Partnership Transfers

IRC § 367 does not apply to the contributions described in Steps 2, 3, and 4 of the Reorganization because IRC § 367(a) and § 367(b) by their terms apply only to transfers to or exchanges involving foreign corporations, and the Consolidated Master Fund LP is classified as a partnership — not a corporation — for U.S. federal income tax purposes. No foreign corporation is a transferor or transferee in any step of the Reorganization.

Ruling 4 — IRC § 731(a): Tax-Free Distribution

The distributions by the Legacy Offshore Vehicles of their respective partnership interests in the Consolidated Master Fund LP to their respective limited partners in complete liquidation, as described in Step 5 of the Reorganization, constitute tax-free distributions under IRC § 731(a)(1), and IRC § 731(c) does not apply to such distributions because the distributed Master Fund partnership interests are not "marketable securities" as defined in IRC § 731(c)(2), inasmuch as such interests are not actively traded on an established securities market and are not readily tradable on a secondary market or the substantial equivalent thereof.

Ruling 5 — IRC § 752: Liability Shifting

The shifts in partner-level shares of liabilities resulting from the Reorganization — including the assumption by the Consolidated Master Fund LP of approximately $1.34 billion in aggregate portfolio-level liabilities of the Legacy Offshore Vehicles — do not result in net deemed contributions or distributions under IRC §§ 752(a) and 752(b) that would trigger gain recognition under IRC § 731, because the netting rule under Treasury Regulations § 1.752-1(f) and the tiered partnership liability allocation rules under Treasury Regulations § 1.752 prevent any partner from experiencing a net deemed distribution under § 752(b) in excess of its adjusted basis in its partnership interest.

Ruling 6 — IRC § 704(c): Built-In Gain Carryover and Remedial Allocation Method

The built-in gain and loss accounts currently tracked by the Legacy Offshore Vehicles under IRC § 704(c)(1)(A) with respect to contributed properties — aggregating approximately $1.72 billion in net built-in gain — carry over in full to the Consolidated Master Fund LP upon the contributions described in Steps 2, 3, and 4, and the Consolidated Master Fund LP may continue to use the remedial allocation method under Treasury Regulations § 1.704-3(d) for each contributed property with respect to which the contributing Legacy Offshore Vehicle used such method.

Ruling 7 — IRC § 1446: No Withholding Required

No withholding under IRC § 1446(a) is required in connection with the contributions described in Steps 2, 3, and 4, or the distributions described in Step 5, of the Reorganization because (a) the contributions are nonrecognition transactions under IRC § 721(a) that do not give rise to effectively connected taxable income ("ECTI") allocable to foreign partners, and (b) the distributions are nonrecognition transactions under IRC § 731(a) that do not generate ECTI and do not constitute "amounts subject to withholding" under Treasury Regulations §§ 1.1446-1 through 1.1446-6.

Ruling 8 — Entity Classification Under Treas. Reg. § 301.7701-3

The Consolidated Master Fund LP, Solara International Feeder (Cayman) LP, and Solara Tax-Exempt Feeder (Cayman) LP are each properly classified as partnerships for U.S. federal income tax purposes under Treasury Regulations § 301.7701-3 upon the timely filing of IRS Form 8832 entity classification elections, and such classification will be recognized for all purposes under the Code.

IV. Legal Analysis

A. Ruling 1 Analysis — IRC § 721(a) Contribution

1. General Rule

IRC § 721(a) provides that "[n]o gain or loss shall be recognized to a partnership or to any of its partners in the case of a contribution of property to the partnership in exchange for an interest in the partnership." This provision embodies the fundamental principle that the formation of, or contribution of property to, a partnership is a mere change in the form of the partners' investment and should not be treated as a taxable event. See H.R. Rep. No. 83-1337, at 68 (1954); S. Rep. No. 83-1622, at 94 (1954). The nonrecognition rule of § 721(a) applies regardless of whether the contribution is made at the time of the partnership's formation or at a later date, and regardless of the relative values of the contributed property and the partnership interest received. See Treas. Reg. § 1.721-1(a).

The nonrecognition rule of § 721(a) is complemented by two related provisions. IRC § 723 provides that the basis of property contributed to a partnership by a partner shall be the adjusted basis of such property in the hands of the contributing partner at the time of the contribution — that is, a carryover basis. IRC § 1223(2) provides that the partnership's holding period for the contributed property shall include the period during which it was held by the contributing partner. Together, these provisions ensure that the built-in gain or loss inherent in the contributed property is preserved for future recognition upon a taxable disposition.

2. Application to Steps 2, 3, and 4

In each of Steps 2, 3, and 4 of the Reorganization, one or more of the Legacy Offshore Vehicles will contribute all of its portfolio company interests to the Consolidated Master Fund LP in exchange for a limited partnership interest in the Master Fund. Each of the contributing entities — Fund IV-A Cayman, Fund IV-B Lux, Fund V-A Cayman, and Fund V-B Lux — is a partnership for U.S. federal income tax purposes. The Consolidated Master Fund LP is also classified as a partnership for U.S. federal income tax purposes (as confirmed by Ruling 8). Each contributing partnership is contributing "property" — namely, its portfolio company interests — to the Master Fund in exchange for an "interest in the partnership" — namely, a limited partnership interest in the Master Fund.

The aggregate amounts involved in the contributions are substantial. Across all four Legacy Offshore Vehicles, the total FMV of assets being contributed is $7.75 billion, the total adjusted tax basis is $6.03 billion, and the total aggregate built-in gain is $1.72 billion. Despite the magnitude of these amounts, § 721(a) contains no limitation based on the dollar value of the contributed property or the built-in gain inherent therein. The nonrecognition rule applies in full, provided that the statutory requirements are satisfied.

Each contributing partnership becomes a "partner" of the Consolidated Master Fund LP upon the contribution, and each receives a partnership interest in exchange for its contributed property. There is no disguised sale element to any of the transactions — each contributing entity receives only a partnership interest in the Master Fund and does not receive any cash, other property, or assumption of its liabilities in a manner that could be characterized as a disguised sale under IRC § 707(a)(2)(B). Accordingly, the anti-abuse rules applicable to disguised sales under Treas. Reg. §§ 1.707-3 through 1.707-6 are not implicated.

3. Tiered Partnership Structures

The proposed Reorganization results in a tiered partnership structure in which the Legacy Offshore Vehicles (and, following Step 5, the International Feeder and Tax-Exempt Feeder) are partners of the Consolidated Master Fund LP. Section 721(a) applies to contributions by partnerships to other partnerships, creating tiered partnership structures. See Treas. Reg. § 1.721-1(a) (broadly applying nonrecognition to "a contribution of property to the partnership in exchange for an interest in the partnership," without limiting the rule to contributions by individuals or other non-partnership entities). The Service has consistently applied § 721(a) to tiered partnership contributions. See, e.g., Rev. Rul. 99-5, 1999-1 C.B. 434 (analyzing multi-member LLC transactions under § 721); PLR 200107015 (applying § 721(a) to contribution by partnership to another partnership).

4. Carryover Basis and Holding Period

Under IRC § 723, the Consolidated Master Fund LP will take a carryover basis in each contributed property equal to the adjusted basis of such property in the hands of the contributing Legacy Offshore Vehicle at the time of contribution. Under IRC § 1223(2), the Master Fund's holding period for each contributed property will include the period during which the property was held by the contributing entity. These rules ensure that the $1.72 billion in aggregate built-in gain is fully preserved and will be recognized upon future taxable dispositions of the contributed properties.

5. Conclusion. Based on the foregoing analysis, the contributions described in Steps 2, 3, and 4 of the Reorganization satisfy the requirements of IRC § 721(a). No gain or loss will be recognized by any of the four contributing Legacy Offshore Vehicles, the Consolidated Master Fund LP, or any of their respective partners as a result of such contributions. The Master Fund will take a carryover basis and tacked holding period in each contributed property under IRC §§ 723 and 1223(2).

B. Ruling 2 Analysis — IRC § 721(b) Investment Company Exception

1. Statement of the Exception

IRC § 721(b) provides that "[s]ubsection (a) shall not apply to gain realized on a transfer of property to a partnership which would be treated as an investment company (within the meaning of section 351) if the partnership were incorporated." This provision is intended to prevent taxpayers from using partnership contributions as a mechanism to achieve tax-free diversification of investment portfolios. The investment company test is applied by reference to the rules governing transfers to controlled corporations under IRC § 351, as if the partnership were incorporated.

Treasury Regulations § 1.351-1(c)(1) provides that a transfer results in the creation of an "investment company" if (i) the transfer results, directly or indirectly, in diversification of the transferors' interests and (ii) the transferee is an investment company. An entity is an "investment company" for this purpose if, after the transfer, more than 80% of the value of its assets (excluding cash and nonconvertible debt obligations) consists of stock and securities held for investment. See Treas. Reg. § 1.351-1(c)(1)(ii). A transfer results in "diversification" if two or more persons transfer non-identical assets to a single transferee. See Treas. Reg. § 1.351-1(c)(1)(ii), (c)(5), (c)(6).

2. The Portfolio Consists of Operating Company Interests

The assets being contributed to the Consolidated Master Fund LP consist entirely of interests in 23 operating companies engaged in digital infrastructure and enterprise SaaS businesses. These are not "stocks, securities, or other investment assets" within the meaning of IRC § 351(e)(1). Each portfolio company is an active operating business, not a passive investment vehicle:

(a) NovaBright Data Systems Inc. operates hyperscale and colocation data centers across the eastern United States, employing approximately 1,200 personnel and generating revenue primarily from long-term colocation and interconnection contracts with enterprise and hyperscale customers.

(b) Crestline Cloud Solutions LLC operates an enterprise SaaS platform providing cloud-based data management and analytics solutions, employing approximately 480 personnel and generating revenue from recurring software subscription fees.

(c) Veridian Edge Computing Corp. develops and operates edge computing infrastructure, including micro data centers and edge nodes deployed at cellular tower sites and enterprise locations, employing approximately 750 personnel and generating revenue from infrastructure-as-a-service contracts.

(d) Thorngate Fiber Networks LP constructs, owns, and operates fiber-optic network infrastructure, employing approximately 900 personnel and generating revenue from fiber leasing and enterprise connectivity services.

(e) Helix SaaS Holdings Ltd. serves as a holding company for a group of enterprise SaaS businesses providing cybersecurity, identity management, and compliance automation solutions, with aggregate headcount across its subsidiaries of approximately 1,100 personnel.

(f) The remaining 18 portfolio companies, described in detail in Exhibit D, are similarly engaged in active business operations in the digital infrastructure and enterprise SaaS sectors.

Because the Consolidated Master Fund LP's assets consist of interests in operating businesses rather than stocks, securities, or other investment assets, the Master Fund would not be treated as an "investment company" within the meaning of § 351 if it were incorporated. The 80% threshold for investment company classification under Treas. Reg. § 1.351-1(c)(1)(ii) is not met.

3. No Impermissible Diversification

Even assuming, arguendo, that the investment company test were potentially applicable, the contributions described in Steps 2 through 4 do not result in impermissible diversification. The contributing Legacy Offshore Vehicles hold interests in the same portfolio companies — or in complementary operating businesses within the same industry sector — and the consolidation of these interests in the Master Fund does not create a diversified portfolio of passive investment assets. The purpose of the investment company exception is to prevent taxpayers from exchanging a concentrated portfolio of investment securities for a diversified portfolio on a tax-free basis. See H.R. Rep. No. 105-220, at 502 (1997). That concern is not present here, where the contributed assets are operating company interests in a single industry vertical.

4. Conclusion. The Consolidated Master Fund LP does not constitute an "investment company" within the meaning of IRC § 721(b) and Treas. Reg. § 1.351-1(c)(1)(ii). The portfolio of the Master Fund consists entirely of interests in operating companies engaged in digital infrastructure and enterprise SaaS businesses, not stocks, securities, or other investment assets. Accordingly, the exception to nonrecognition treatment set forth in § 721(b) does not apply.

C. Ruling 3 Analysis — IRC § 367 Inapplicability

1. Statutory Text

IRC § 367(a)(1) provides that "[i]f, in connection with any exchange described in section 332, 351, 354, 356, or 361, a United States person transfers property to a foreign corporation, such foreign corporation shall not, for purposes of determining the extent to which gain shall be recognized on such transfer, be considered to be a corporation." (emphasis added). IRC § 367(b) provides parallel rules applicable to exchanges described in specified Code sections "in connection with which there is no transfer of property described in subsection (a)" but in which a foreign corporation is a party.

By the plain language of the statute, § 367(a) applies only to transfers of property "to a foreign corporation," and § 367(b) applies only to exchanges involving a "foreign corporation." Neither subsection, by its terms, applies to transfers to or from a partnership, or to transactions in which no corporation — domestic or foreign — is a transferor or transferee.

2. The Consolidated Master Fund LP Is a Partnership, Not a Corporation

The Consolidated Master Fund LP is classified as a partnership for U.S. federal income tax purposes under Treas. Reg. § 301.7701-3. As discussed in Section IV.H below (Ruling 8 Analysis), the Master Fund will file a timely Form 8832 election confirming its partnership classification effective September 15, 2025. The Master Fund is not a corporation, a foreign corporation, or an association taxable as a corporation. Accordingly, a transfer of property to the Master Fund is not a transfer "to a foreign corporation" within the meaning of § 367(a)(1).

3. The Contributing Entities Are Foreign Partnerships, Not Foreign Corporations

Each of the four Legacy Offshore Vehicles making contributions in Steps 2 through 4 — Fund IV-A Cayman, Fund IV-B Lux, Fund V-A Cayman, and Fund V-B Lux — is classified as a partnership for U.S. federal income tax purposes. None is classified as a corporation or an association taxable as a corporation. The Legacy Offshore Vehicles are foreign partnerships, not foreign corporations, and accordingly they are not "foreign corporations" within the meaning of § 367.

4. No Foreign Corporation Is a Party to the Transactions

In the transactions described in Steps 2 through 4, foreign partnerships (the Legacy Offshore Vehicles) contribute property to a domestic partnership (the Consolidated Master Fund LP). No foreign corporation — or any corporation — is a transferor, transferee, or party to any of the contributions. The transactions are partnership-to-partnership contributions, not corporate transactions. Section 367, by its express terms, does not apply.

5. Legislative History

The legislative history of § 367 confirms that Congress intended the provision to apply exclusively in the corporate context. Section 367 was enacted as part of the Internal Revenue Code of 1954, and its amendments over the years — including the Tax Reform Act of 1976, the Tax Equity and Fiscal Responsibility Act of 1982, and the Tax Reform Act of 1986 — have consistently focused on preventing the tax-free outbound transfer of appreciated property to foreign corporations and the tax-free repatriation of earnings from foreign corporations. See H.R. Rep. No. 94-658, at 232–37 (1975); S. Rep. No. 94-938, at 272–78 (1976); H.R. Rep. No. 99-841, at II-638–42 (1986) (Conf. Rep.). At no point has Congress extended § 367 to partnership-to-partnership transfers.

6. Potential Concern — Partner-Level Analysis

The Service might conceivably inquire whether the transaction should be analyzed at the partner level — that is, whether the partners of the Legacy Offshore Vehicles (some of which may be foreign corporations, such as intermediate offshore blocker entities) should be treated as transferring property to the Master Fund. However, the contributions in Steps 2 through 4 are made at the partnership level by the Legacy Offshore Vehicles, and the aggregate theory of partnerships does not override the entity-level characterization of the transaction for purposes of § 367. The Treasury Regulations under § 367 do not extend the provision's reach to partnership contributions. See Treas. Reg. §§ 1.367(a)-1T through 1.367(a)-8; Treas. Reg. §§ 1.367(b)-1 through 1.367(b)-13 (all addressing corporate-level transactions). The Service has not issued guidance suggesting that § 367 applies to partnership-to-partnership transfers, and the plain statutory language precludes such an interpretation.

7. Conclusion. Based on the foregoing, IRC § 367 does not apply to the contributions described in Steps 2, 3, and 4 of the Reorganization. There is no foreign corporation — or any corporation — that is a transferor or transferee in any step of the Reorganization. The contributions are partnership-to-partnership transfers that fall outside the scope of § 367.

D. Ruling 4 Analysis — IRC § 731(a) and § 731(c)

1. IRC § 731(a) Tax-Fre

DRAFT — VERSION 1.0 — PRIVILEGED AND CONFIDENTIAL — ATTORNEY-CLIENT COMMUNICATION
CALDERWOOD & HARKNESS LLP Attorneys at Law
1900 K Street NW, Suite 1100 Washington, DC 20006 Telephone: (202) 555-7400 Facsimile: (202) 555-7401 www.calderwoodharkness.com
July 1, 2025
Prepared by: Robert Jansen, Lead Associate, Tax; Garrett Simmons, Working Associate, Tax Reviewed by: Leonard Cross, Responsible Partner, Tax; Sylvia Hartwell, Billing Partner, Tax Engagement Number: 20250527-SDILP-PLR
Internal Revenue Service
Attn: Office of the Associate Chief Counsel (International)
CC:INTL 1111 Constitution Avenue NW Washington, DC 20224
Secondary Jurisdiction: Office of the Associate Chief Counsel (Passthroughs & Special Industries) CC:PSI 1111 Constitution Avenue NW Washington, DC 20224
Re: Request for Private Letter Ruling on Behalf of Solara Digital Infrastructure LP (EIN 82-4917366) and Related Entities — Cross-Border Fund-Platform Reorganization
Right-click to update Table of Contents
I. Introductory Statement and Request for Ruling
Calderwood & Harkness LLP ("Calderwood & Harkness" or "Counsel"), as authorized counsel to Solara Digital Infrastructure LP ("Solara" or "SDILP"), a Delaware limited partnership (EIN 82-4917366), hereby submits this request for a private letter ruling ("PLR") pursuant to Revenue Procedure 2025-1, 2025-1 I.R.B. 1 ("Rev. Proc. 2025-1"), and the procedures set forth therein. This ruling is requested on behalf of Solara and the following related entities:
1. Solara Digital Infrastructure GP LLC (EIN 82-4917365), a Delaware limited liability company;
2. Solara Digital Partners Fund IV LP (EIN 85-2103748), a Delaware limited partnership;
3. Solara Digital Partners Fund IV-A (Cayman) LP (U.S. EIN 98-6241503), a Cayman Islands exempted limited partnership;
4. Solara Digital Partners Fund IV-B (Luxembourg) SCSp (U.S. EIN 98-6241571), a Luxembourg special limited partnership (société en commandite spéciale);
5. Solara Digital Partners Fund V LP (EIN 88-3467219), a Delaware limited partnership;
6. Solara Digital Partners Fund V-A (Cayman) LP (U.S. EIN 98-7891234), a Cayman Islands exempted limited partnership;
7. Solara Digital Partners Fund V-B (Luxembourg) SCSp (U.S. EIN 98-7891267), a Luxembourg special limited partnership;
8. Solara Consolidated Master Fund LP (to be formed; EIN to be obtained), a Delaware limited partnership;
9. Solara Consolidated Master Fund GP LLC (to be formed; EIN to be obtained), a Delaware limited liability company;
10. Solara International Feeder (Cayman) LP (to be formed; EIN to be obtained), a Cayman Islands exempted limited partnership; and
11. Solara Tax-Exempt Feeder (Cayman) LP (to be formed; EIN to be obtained), a Cayman Islands exempted limited partnership.
Collectively, the entities listed in items 3, 4, 6, and 7 above are referred to herein as the "Legacy Offshore Vehicles." The entities listed in items 8 through 11 above are referred to herein as the "New Entities."
Solara respectfully requests that the Internal Revenue Service (the "Service" or "IRS") issue a favorable private letter ruling addressing the United States federal income tax treatment of a proposed multi-step cross-border reorganization (the "Reorganization") of Solara's fund platform. Specifically, Solara requests rulings on the following eight issues:
Ruling 1 — Whether the contributions of portfolio assets by the Legacy Offshore Vehicles to the Consolidated Master Fund LP constitute tax-free contributions under Section 721(a) of the Internal Revenue Code of 1986, as amended (the "Code" or "IRC");
Ruling 2 — Whether the Consolidated Master Fund LP constitutes an "investment company" within the meaning of IRC § 721(b);
Ruling 3 — Whether IRC § 367 applies to the contributions by foreign partnerships to a domestic partnership;
Ruling 4 — Whether the distributions by the Legacy Offshore Vehicles of their partnership interests in the Consolidated Master Fund LP to their respective limited partners constitute tax-free distributions under IRC § 731(a), and whether IRC § 731(c) applies;
Ruling 5 — Whether the shifts in partner-level shares of liabilities resulting from the Reorganization trigger gain recognition under IRC §§ 752(a), 752(b), and 731;
Ruling 6 — Whether the built-in gain and loss accounts tracked under IRC § 704(c) by the Legacy Offshore Vehicles carry over to the Consolidated Master Fund LP, and whether the Consolidated Master Fund LP may continue to use the remedial allocation method;
Ruling 7 — Whether withholding under IRC § 1446(a) is required on any step of the Reorganization; and
Ruling 8 — Whether the Consolidated Master Fund LP, Solara International Feeder (Cayman) LP, and Solara Tax-Exempt Feeder (Cayman) LP are each properly classified as partnerships for U.S. federal income tax purposes.
Enclosed with this ruling request is the applicable user fee payment of $38,000, as required under the Schedule of User Fees, Appendix A, Rev. Proc. 2025-1, for a ruling request involving multiple entities with combined assets exceeding $50 million.
Also enclosed are IRS Forms 2848, Power of Attorney and Declaration of Representative, designating Leonard Cross (Calderwood & Harkness LLP, 1900 K Street NW, Suite 1100, Washington, DC 20006; telephone (202) 555-7412; CAF No. pending) and Sylvia Hartwell (Calderwood & Harkness LLP, 600 Lexington Avenue, 38th Floor, New York, NY 10022; telephone (212) 555-9803; CAF No. pending) as the authorized representatives of Solara and each of the related entities listed above for purposes of this ruling request. Each Form 2848 has been duly executed by Viktor Raines in his capacity as Managing Partner of Solara Digital Infrastructure GP LLC, the general partner of Solara Digital Infrastructure LP.
Additionally enclosed is the declaration under penalties of perjury required by Rev. Proc. 2025-1, Section 7.01(16), signed by Viktor Raines as Managing Partner of Solara Digital Infrastructure GP LLC, the general partner of Solara Digital Infrastructure LP, stating under penalties of perjury that the facts presented in this ruling request are true, correct, and complete.
By letter dated June 18, 2025 (copy enclosed for reference), Counsel requested a pre-submission conference for July 22, 2025 with the Office of the Associate Chief Counsel (International), CC:INTL, Branch 1, to discuss the proposed rulings and the factual circumstances underlying this request. At the time of filing this ruling request, confirmation of the pre-submission conference date is pending.
II. Statement of Facts
A. Overview of Solara Digital Infrastructure LP
Solara Digital Infrastructure LP is a Delaware limited partnership formed on March 17, 2014, pursuant to the Delaware Revised Uniform Limited Partnership Act, 6 Del. C. §§ 17-101 et seq. Solara's principal office is located at 1200 Market Street, Suite 3400, Wilmington, Delaware 19801. Solara serves as the investment management and advisory platform (the "Platform") through which the Solara group of affiliated investment funds conducts its private equity investment activities.
As of March 31, 2025, Solara manages approximately $14.7 billion in assets under management ("AUM") across its active fund vehicles, including co-investment vehicles and separately managed accounts. Solara's investment strategy is focused exclusively on digital infrastructure — encompassing data centers, fiber-optic networks, edge computing facilities and platforms — and enterprise Software-as-a-Service ("SaaS") businesses. Each of the portfolio companies held across Solara's fund platform is an operating business engaged in the provision of digital infrastructure services or enterprise SaaS solutions to commercial, enterprise, and governmental customers.
Solara was founded by Viktor Raines (age 52), who serves as the firm's Managing Partner. Prior to founding Solara, Mr. Raines served as a managing director in the Technology, Media, and Telecommunications practice at Havensgate Capital Partners, a New York-based private equity firm, where he led investments in data center and telecommunications infrastructure. Mr. Raines has served continuously as Managing Partner since Solara's formation and exercises primary investment decision-making authority over the fund platform.
The other key officers and professionals of Solara include:
• Meredith Tsao, Chief Operating Officer, responsible for day-to-day operations, fund administration oversight, and investor relations;
• Douglas Wexford, Chief Financial Officer, responsible for financial reporting, treasury, and portfolio monitoring;
• Priya Narasimhan, General Counsel, responsible for legal affairs, regulatory compliance, and fund structuring; and
• Stefan Dalmqvist, Head of Tax, responsible for tax planning, compliance, and reporting across all fund vehicles and portfolio companies.
Solara's investment professionals are located primarily in its Wilmington, Delaware headquarters, with additional personnel based in New York, New York; San Francisco, California; London, England; and Luxembourg City, Luxembourg.
B. General Partner
Solara Digital Infrastructure GP LLC ("Solara GP" or the "General Partner"), a Delaware limited liability company (EIN 82-4917365), serves as the general partner of SDILP and, directly or through affiliated entities, serves as the general partner (or equivalent controlling entity) of each of the existing fund vehicles described below. Solara GP was formed on March 15, 2014, under the Delaware Limited Liability Company Act, 6 Del. C. §§ 18-101 et seq.
Solara GP is managed by Viktor Raines in his capacity as Manager. The registered agent for Solara GP is Capitol Registered Agents Inc., located at 850 New Burton Road, Suite 201, Dover, Delaware 19904. Solara GP has no other material business activities apart from serving as general partner to the Solara fund vehicles and performing the investment management and advisory functions of the Platform.
C. Existing Fund Structure
Solara currently operates its investment program through two generations of fund vehicles — Fund IV (vintage 2021) and Fund V (vintage 2023) — each of which is comprised of a domestic Delaware limited partnership and two offshore parallel vehicles organized in the Cayman Islands and Luxembourg, respectively. The parallel vehicle structure was adopted to accommodate the tax, regulatory, and treaty access requirements of Solara's diverse limited partner ("LP") base, which includes U.S. taxable investors, U.S. tax-exempt institutional investors, and non-U.S. sovereign wealth funds, pension plans, insurance companies, and other institutional investors. The existing fund vehicles are described in detail below.
1. Fund IV Vehicles
Solara Digital Partners Fund IV LP ("Fund IV"). Fund IV is a Delaware limited partnership (EIN 85-2103748) formed on January 22, 2021. Fund IV held its final close on June 15, 2021, with total committed capital of $4.2 billion. As of March 31, 2025, Fund IV is approximately 72% deployed, with the remaining committed capital available for follow-on investments and fund expenses. The general partner of Fund IV is Solara GP. Fund IV serves as the primary domestic investment vehicle through which U.S. taxable investors participate in the Fund IV investment program.
Solara Digital Partners Fund IV-A (Cayman) LP ("Fund IV-A Cayman"). Fund IV-A Cayman is a Cayman Islands exempted limited partnership (U.S. EIN 98-6241503; Cayman Islands Monetary Authority ("CIMA") registration number MF-72491) formed on February 10, 2021. Fund IV-A Cayman serves as the parallel fund vehicle through which non-U.S. investors and U.S. tax-exempt investors participate in the Fund IV investment program. Total committed capital in Fund IV-A Cayman is $1.85 billion. The registered office of Fund IV-A Cayman is located at Harborstone Corporate Services Ltd., P.O. Box 2714, 94 Solaris Avenue, George Town, Grand Cayman KY1-1111, Cayman Islands. The general partner of Fund IV-A Cayman is Solara Offshore GP Ltd., a Cayman Islands exempted company. Fund IV-A Cayman invests on a pari passu basis alongside Fund IV in each portfolio company investment, with allocations determined based on relative commitments.
Solara Digital Partners Fund IV-B (Luxembourg) SCSp ("Fund IV-B Lux"). Fund IV-B Lux is a Luxembourg special limited partnership (société en commandite spéciale) (U.S. EIN 98-6241571; Luxembourg Register of Commerce and Companies ("RCS") number B 248193) formed on March 5, 2021. Fund IV-B Lux serves as an additional parallel vehicle for certain non-U.S. investors — principally European institutional investors — that require access to the Luxembourg–U.S. income tax treaty (Convention between the United States and the Grand Duchy of Luxembourg for the Avoidance of Double Taxation, signed April 3, 1996) or that are subject to European regulatory requirements favoring Luxembourg-domiciled fund structures. Total committed capital in Fund IV-B Lux is €1.15 billion (approximately $1.24 billion at the uniform EUR/USD exchange rate of 1.08 applied throughout this ruling request). The registered office of Fund IV-B Lux is located at 14, rue Jean-Pierre Brasseur, L-1258 Luxembourg. The general partner (associé commandité) of Fund IV-B Lux is Solara Luxembourg Management S.à r.l. (RCS number B 248194), a Luxembourg private limited liability company (société à responsabilité limitée).
2. Fund V Vehicles
Solara Digital Partners Fund V LP ("Fund V"). Fund V is a Delaware limited partnership (EIN 88-3467219) formed on April 3, 2023. Fund V held its final close on September 30, 2023, with total committed capital of $5.6 billion. As of March 31, 2025, Fund V is approximately 38% deployed. The general partner of Fund V is Solara GP. Fund V serves as the primary domestic investment vehicle for U.S. taxable investors in the Fund V investment program.
Solara Digital Partners Fund V-A (Cayman) LP ("Fund V-A Cayman"). Fund V-A Cayman is a Cayman Islands exempted limited partnership (U.S. EIN 98-7891234; CIMA registration number MF-89103) formed on May 15, 2023. Fund V-A Cayman serves as the parallel fund vehicle for non-U.S. and U.S. tax-exempt investors in the Fund V investment program, with total committed capital of $2.45 billion. The registered office of Fund V-A Cayman is located at Harborstone Corporate Services Ltd., George Town, Grand Cayman. The general partner of Fund V-A Cayman is Solara Offshore GP Ltd.
Solara Digital Partners Fund V-B (Luxembourg) SCSp ("Fund V-B Lux"). Fund V-B Lux is a Luxembourg SCSp (U.S. EIN 98-7891267; RCS number B 271056) formed on June 1, 2023, to serve as an additional parallel vehicle for European institutional investors in the Fund V investment program. Total committed capital in Fund V-B Lux is €1.38 billion (approximately $1.49 billion at 1.08 EUR/USD). The registered office of Fund V-B Lux is located at 14, rue Jean-Pierre Brasseur, L-1258 Luxembourg. The general partner of Fund V-B Lux is Solara Luxembourg Management S.à r.l.
3. Investor Base and Structure Rationale
The existing parallel vehicle structure was adopted at the inception of Fund IV, and continued for Fund V, to address the distinct tax and regulatory needs of three categories of limited partners:
U.S. Taxable Investors. U.S. taxable investors — including high-net-worth individuals, family offices, taxable trusts, and domestic corporate investors — invest directly through the domestic Delaware fund vehicles (Fund IV and Fund V). These investors benefit from the pass-through treatment of the domestic partnerships, which permits the character of income, gain, loss, deduction, and credit to flow through directly to the partners. Representative U.S. taxable investors include Argyle Family Office Holdings LLC, which has committed capital of $95 million in Fund IV and $130 million in Fund V.
U.S. Tax-Exempt Investors. U.S. tax-exempt institutional investors — including public employee retirement systems, university endowments, and charitable foundations — invest through the Cayman Islands parallel vehicles (Fund IV-A Cayman and Fund V-A Cayman) rather than the domestic vehicles. This structure is designed to mitigate the risk of unrelated business taxable income ("UBTI") under IRC §§ 511–514 that might otherwise arise from debt-financed portfolio company acquisitions and from income derived from operating businesses conducted through pass-through entities. By investing through the Cayman parallel vehicles, which in turn hold portfolio company interests through intermediate offshore corporate subsidiaries classified as corporations for U.S. federal income tax purposes, the tax-exempt investors receive distributions that are generally characterized as dividends or capital gains rather than UBTI. Representative U.S. tax-exempt investors include Pinnacle State Employees' Retirement System, which has committed capital of $275 million in Fund IV and $340 million in Fund V, and Grandview University Endowment, which has committed capital of $120 million in Fund IV and $185 million in Fund V.
Non-U.S. Investors. Non-U.S. investors — including sovereign wealth funds, foreign pension plans, foreign insurance companies, and other foreign institutional investors — invest through the Cayman Islands or Luxembourg parallel vehicles depending on their particular treaty access requirements, regulatory preferences, and tax planning considerations. Representative non-U.S. investors include Nordhaven Sovereign Wealth Fund, a sovereign wealth fund organized under the laws of the Kingdom of Norway, which has committed capital of $380 million in Fund IV-A Cayman and $500 million in Fund V-A Cayman, and Kestrel Pacific Insurance Group, an insurance holding company organized under the laws of Australia, which has committed capital of €200 million in Fund IV-B Lux and €275 million in Fund V-B Lux.
D. Portfolio Company Holdings
The fund vehicles described in Section II.C above collectively hold interests in a total of 23 portfolio companies as of March 31, 2025. Of these, 11 portfolio companies are held by the Fund IV vehicles (Fund IV, Fund IV-A Cayman, and Fund IV-B Lux) and 12 portfolio companies are held by the Fund V vehicles (Fund V, Fund V-A Cayman, and Fund V-B Lux). Each portfolio company is an operating business engaged in digital infrastructure services (data center operation, fiber-optic network operation, edge computing infrastructure) or enterprise SaaS platform operations.
The following are representative portfolio company interests that will be transferred to the Consolidated Master Fund LP as part of the Reorganization, together with their current fair market value ("FMV"), adjusted tax basis, and built-in gain as of the anticipated transaction dates:
1. NovaBright Data Systems Inc. NovaBright Data Systems Inc. ("NovaBright") is a Delaware corporation engaged in the operation of hyperscale and colocation data centers across the eastern United States. NovaBright currently operates seven data center campuses in Virginia, New Jersey, Georgia, and Ohio, with aggregate capacity of approximately 280 megawatts. NovaBright's current FMV is $890 million, with an adjusted tax basis of $520 million, resulting in a built-in gain of $370 million. NovaBright is held 60% by Fund IV-A Cayman and 40% by Fund IV.
2. Crestline Cloud Solutions LLC. Crestline Cloud Solutions LLC ("Crestline") is a Delaware limited liability company classified as a disregarded entity for U.S. federal income tax purposes, owned 100% by Fund IV-B Lux. Crestline operates an enterprise SaaS platform providing cloud-based data management and analytics solutions to mid-market and enterprise customers in the United States and Europe. Crestline's current FMV is €340 million (approximately $367 million at 1.08 EUR/USD), with an adjusted tax basis of €195 million (approximately $211 million), resulting in a built-in gain of €145 million (approximately $156 million).
3. Veridian Edge Computing Corp. Veridian Edge Computing Corp. ("Veridian") is a Delaware corporation engaged in the development and operation of edge computing infrastructure, including micro data centers and edge nodes deployed at cellular tower sites and enterprise locations across North America. Veridian's current FMV is $1.12 billion, with an adjusted tax basis of $780 million, resulting in a built-in gain of $340 million. Veridian is held 55% by Fund V-A Cayman and 45% by Fund V.
4. Thorngate Fiber Networks LP. Thorngate Fiber Networks LP ("Thorngate") is a Delaware limited partnership engaged in the construction, ownership, and operation of fiber-optic network infrastructure, including metropolitan and long-haul fiber routes serving enterprise customers, wireless carriers, and government agencies. Thorngate's current FMV is $670 million, with an adjusted tax basis of $490 million, resulting in a built-in gain of $180 million. Thorngate is held 100% by Fund IV-A Cayman.
5. Helix SaaS Holdings Ltd. Helix SaaS Holdings Ltd. ("Helix") is a Cayman Islands exempted company that serves as a holding company for a group of enterprise SaaS businesses providing cybersecurity, identity management, and compliance automation solutions. Helix's current FMV is $445 million, with an adjusted tax basis of $310 million, resulting in a built-in gain of $135 million. Helix is held 100% by Fund V-A Cayman.
6. Additional Portfolio Companies. The remaining 18 portfolio companies held across the fund vehicles are described in detail in Exhibit D to this ruling request, including each company's jurisdiction of organization, business description, FMV, adjusted tax basis, built-in gain or loss, and ownership by fund vehicle. In the aggregate, the 18 additional portfolio companies have a combined FMV of approximately $3.258 billion, combined adjusted tax basis of approximately $2.719 billion, and combined built-in gain of approximately $539 million.
E. Aggregate Financial Summary of Assets Being Transferred
The following table summarizes the aggregate financial data for all assets being contributed to the Consolidated Master Fund LP in the Reorganization:
The FMV and adjusted tax basis figures set forth above and throughout this ruling request are based on independent appraisals prepared by Redstone Advisory Group LLC ("Redstone") as of March 31, 2025, and on audited financial statements and tax basis records maintained by Caldwell Pierce & Co. LLP ("Caldwell Pierce"), the independent accounting firm retained by Solara for tax compliance and financial reporting purposes. Updated appraisals will be obtained as of the applicable transaction dates for each step of the Reorganization.
F. Business Rationale for the Reorganization
The Reorganization is motivated by several substantial non-tax business purposes, each of which is described below.
Operational Cost Reduction. Under the existing parallel vehicle structure, Solara incurs significant duplicative costs for the maintenance, administration, and regulatory compliance of the four Legacy Offshore Vehicles. These costs include offshore fund administration fees, statutory audit fees (including separate audits for each Cayman and Luxembourg vehicle), Cayman Islands annual registration fees, Luxembourg supervisory fees, registered office and agent fees, and legal and compliance costs associated with maintaining separate entities across three jurisdictions. Based on a comprehensive analysis conducted by Solara's CFO, Douglas Wexford, and confirmed by Caldwell Pierce, Solara currently pays approximately $3.8 million annually in duplicative offshore administration, audit, and regulatory fees that would be substantially eliminated by consolidating the Legacy Offshore Vehicles into the Consolidated Master Fund LP structure. Over the expected remaining life of Fund IV and Fund V (estimated at approximately 5–7 years for Fund IV and 7–10 years for Fund V), the present value of these cost savings is estimated to exceed $20 million.
OECD Pillar Two Global Anti-Base Erosion (GloBE) Rules. The Organization for Economic Co-operation and Development ("OECD") Pillar Two GloBE rules, as implemented by the European Union through Council Directive (EU) 2022/2523 and by Luxembourg through the law of December 22, 2023, impose a minimum effective tax rate of 15% on large multinational enterprises. For Solara's Luxembourg entities, the GloBE rules are expected to become effective beginning in fiscal year 2025. The Luxembourg SCSp structures (Fund IV-B Lux and Fund V-B Lux) were originally adopted in part to achieve tax efficiencies that will be substantially diminished or eliminated under the GloBE regime. The Reorganization will simplify the fund platform in advance of these changes and avoid the compliance costs and operational complexity of maintaining Luxembourg vehicles that no longer offer meaningful structural benefits.
FATCA and CRS Simplification. The current structure requires complex cross-border information reporting under the U.S. Foreign Account Tax Compliance Act ("FATCA") (IRC §§ 1471–1474) and the OECD Common Reporting Standard ("CRS"). Each of the four Legacy Offshore Vehicles must independently comply with FATCA and CRS obligations, including the preparation and filing of FATCA Forms 8966 and CRS reports with the Cayman Islands and Luxembourg tax authorities. Consolidating the offshore assets into a single domestic master fund structure will materially reduce the number of reporting entities and the complexity of cross-border information exchange.
LP-Requested Governance Simplification. Solara's limited partners have repeatedly expressed a preference for a simplified governance structure that reduces the number of separate vehicles, advisory committees, and reporting lines. At a meeting of the Limited Partner Advisory Committee ("LPAC") held on April 22, 2025, LPs representing 78% in interest of the committed capital across all fund vehicles provided preliminary consent to the exploration and implementation of the platform Reorganization. LPs cited administrative burden, duplicative reporting, and the complexity of the multi-vehicle structure as primary concerns. The Reorganization addresses these concerns by consolidating the offshore vehicles into a single master fund with two clean feeder vehicles.
GP Board Approval. The board of managers of Solara GP approved the exploration and implementation of the platform Reorganization at a board meeting held on March 14, 2025. The board determined that the Reorganization is in the best interests of Solara and its limited partners and authorized management to engage advisors and proceed with the structuring and execution of the Reorganization, subject to final LP consent, lender consent, and the receipt of a favorable private letter ruling from the Service.
G. Proposed Reorganization — Multi-Step Transaction
The Reorganization will be implemented through the following five sequential steps:
Step 1 — Formation of New Entities (Target: September 15, 2025)
In Step 1, Solara will cause the formation of the following new entities:
(a) Solara Consolidated Master Fund GP LLC ("Master Fund GP"), a Delaware limited liability company, to be formed under the Delaware Limited Liability Company Act and registered with the Delaware Division of Corporations. The registered agent for Master Fund GP will be Capitol Registered Agents Inc., 850 New Burton Road, Suite 201, Dover, Delaware 19904. Master Fund GP will be managed by Viktor Raines and will serve as the general partner of the Consolidated Master Fund LP.
(b) Solara Consolidated Master Fund LP (the "Consolidated Master Fund" or "Master Fund"), a Delaware limited partnership, to be formed under the Delaware Revised Uniform Limited Partnership Act. The general partner of the Master Fund will be Master Fund GP. The Master Fund will serve as the primary vehicle for consolidating the portfolio company interests currently held by the Legacy Offshore Vehicles.
(c) Solara International Feeder (Cayman) LP (the "International Feeder"), a Cayman Islands exempted limited partnership, to be formed under the Cayman Islands Exempted Limited Partnership Act (as revised). The International Feeder will serve as the feeder vehicle through which non-U.S. investors will invest into the Master Fund following the completion of the Reorganization.
(d) Solara Tax-Exempt Feeder (Cayman) LP (the "Tax-Exempt Feeder"), a Cayman Islands exempted limited partnership, to be formed under the Cayman Islands Exempted Limited Partnership Act (as revised). The Tax-Exempt Feeder will serve as the feeder vehicle through which U.S. tax-exempt investors will invest into the Master Fund following the completion of the Reorganization, in order to continue to mitigate UBTI concerns through the use of intermediate offshore corporate subsidiary holding structures.
Promptly following formation, Solara will file IRS Form 8832 (Entity Classification Election) for each of the four New Entities, electing classification as a partnership for U.S. federal income tax purposes under Treasury Regulations § 301.7701-3. The effective date of each election will be September 15, 2025, or such earlier date as the applicable entity is formed. Each of the four New Entities will have at least two members at all relevant times.
Step 2 — Contribution of Fund IV-A Cayman Assets (Target: October 1, 2025)
In Step 2, Fund IV-A (Cayman) LP will contribute all of its portfolio company interests — comprising its interests in NovaBright Data Systems Inc. (60% interest), Thorngate Fiber Networks LP (100% interest), and eight additional portfolio companies described in Exhibit D — to the Consolidated Master Fund LP in exchange for a limited partnership interest in the Master Fund. No cash or other consideration will be received by Fund IV-A Cayman in connection with the contribution.
The aggregate financial data for the assets contributed in Step 2 is as follows:
It is intended that the contribution described in Step 2 will qualify as a tax-free contribution under IRC § 721(a), with the result that no gain or loss is recognized by Fund IV-A Cayman, the Consolidated Master Fund LP, or any of their respective partners. The Master Fund will take a carryover basis in each contributed property under IRC § 723, and the holding period of each contributed property will include the period during which the property was held by Fund IV-A Cayman under IRC § 1223(2).
As discussed in Section IV.B below, analysis under IRC § 721(b) is required to confirm that the Consolidated Master Fund LP does not constitute an "investment company" within the meaning of § 721(b).
Step 3 — Contribution of Fund IV-B Luxembourg Assets (Target: October 15, 2025)
In Step 3, Fund IV-B (Luxembourg) SCSp will contribute all of its portfolio company interests — comprising its 100% interest in Crestline Cloud Solutions LLC and its interests in additional portfolio companies described in Exhibit D — to the Consolidated Master Fund LP in exchange for a limited partnership interest in the Master Fund. No cash or other consideration will be received by Fund IV-B Lux in connection with the contribution.
The aggregate financial data for the assets contributed in Step 3 is as follows:
It is intended that the contribution described in Step 3 will qualify as a tax-free contribution under IRC § 721(a). As discussed in Section IV.C below, analysis under IRC § 367 is required to address the transfer of assets by a foreign partnership to a domestic partnership. Solara takes the position that IRC § 367 does not apply because § 367 by its terms applies only to transfers to or from corporations.
With respect to Luxembourg tax consequences, no Luxembourg capital gains tax is expected on the SCSp-level transfer of assets, based on Article 3(2) of the Luxembourg law of July 12, 2013, governing special limited partnerships. Analysis of Luxembourg withholding tax implications has been conducted by Veldhuis & Gérard S.à r.l., Luxembourg counsel.
Additionally, to the extent any deemed disposition could be asserted with respect to Step 3, analysis of Section 1446 withholding obligations is required, as discussed in Section IV.G below.
Step 4 — Contribution of Fund V Offshore Assets (Target: November 1, 2025)
In Step 4, both of the Fund V offshore vehicles will contribute all of their portfolio company interests to the Consolidated Master Fund LP in exchange for limited partnership interests in the Master Fund, as follows:
Fund V-A (Cayman) LP will contribute all of its portfolio company interests — comprising its interests in Veridian Edge Computing Corp. (55% interest), Helix SaaS Holdings Ltd. (100% interest), and additional portfolio companies described in Exhibit D — to the Master Fund. The aggregate financial data for the assets contributed by Fund V-A Cayman is as follows:
Fund V-B (Luxembourg) SCSp will contribute all of its portfolio company interests to the Master Fund. The aggregate financial data for the assets contributed by Fund V-B Lux is as follows:
The same IRC § 721(a) intended treatment described with respect to Steps 2 and 3 applies to the contributions described in Step 4. The same IRC § 367 and § 721(b) analyses are also applicable.
Step 5 — Dissolution of Legacy Offshore Vehicles and LP Migration (Target: December 1, 2025)
In Step 5, following the completion of Steps 2 through 4, each of the four Legacy Offshore Vehicles — Fund IV-A (Cayman) LP, Fund IV-B (Luxembourg) SCSp, Fund V-A (Cayman) LP, and Fund V-B (Luxembourg) SCSp — will dissolve and distribute their respective partnership interests in the Consolidated Master Fund LP to their existing limited partners in complete liquidation.
Following these liquidating distributions, the limited partners of the Legacy Offshore Vehicles will hold direct interests in the Master Fund (through the appropriate feeder vehicle or directly, as applicable). Specifically:
(a) Non-U.S. limited partners will contribute their Master Fund interests to the Solara International Feeder (Cayman) LP in exchange for limited partnership interests in the International Feeder. Thereafter, these non-U.S. limited partners will hold indirect interests in the Master Fund through the International Feeder.
(b) U.S. tax-exempt limited partners will contribute their Master Fund interests to the Solara Tax-Exempt Feeder (Cayman) LP in exchange for limited partnership interests in the Tax-Exempt Feeder. Thereafter, these U.S. tax-exempt limited partners will hold indirect interests in the Master Fund through the Tax-Exempt Feeder.
(c) U.S. taxable limited partners will remain as direct limited partners in Fund IV LP and Fund V LP, which will continue to co-invest alongside the Consolidated Master Fund LP on a pari passu basis with respect to existing and future portfolio company investments.
It is intended that the distributions by the Legacy Offshore Vehicles described in Step 5 will qualify as tax-free distributions under IRC § 731(a), with the result that no gain is recognized by any limited partner, because the distributed Master Fund partnership interests constitute property other than money and the exceptions in § 731(a) are not triggered. As discussed in Section IV.D below, analysis under IRC § 731(c) is required to confirm that the distributed Master Fund partnership interests do not constitute "marketable securities" within the meaning of § 731(c)(2).
The resulting post-Reorganization structure will consist of: (i) the Consolidated Master Fund LP, holding all portfolio company interests previously held by the Legacy Offshore Vehicles; (ii) the International Feeder, through which non-U.S. investors hold indirect interests in the Master Fund; (iii) the Tax-Exempt Feeder, through which U.S. tax-exempt investors hold indirect interests in the Master Fund; and (iv) Fund IV LP and Fund V LP, through which U.S. taxable investors continue to hold direct interests in portfolio companies and co-invest alongside the Master Fund. The post-Reorganization structure is depicted in Exhibit B.
H. Description of Newly Formed Entities
The four New Entities to be formed in Step 1 are described as follows:
Solara Consolidated Master Fund LP. A Delaware limited partnership to serve as the master fund vehicle consolidating all portfolio company interests previously held by the Legacy Offshore Vehicles. The general partner of the Master Fund will be Solara Consolidated Master Fund GP LLC. The Master Fund will file a timely IRS Form 8832 election to be classified as a partnership for U.S. federal income tax purposes under Treas. Reg. § 301.7701-3. The Master Fund will maintain its principal office at 1200 Market Street, Suite 3400, Wilmington, Delaware 19801.
Solara Consolidated Master Fund GP LLC. A Delaware limited liability company to serve as the general partner of the Master Fund. Master Fund GP will be managed by Viktor Raines and will have no material business activities apart from its role as general partner.
Solara International Feeder (Cayman) LP. A Cayman Islands exempted limited partnership to serve as the feeder vehicle for non-U.S. investors investing into the Master Fund. The International Feeder will file a timely IRS Form 8832 election to be classified as a partnership for U.S. federal income tax purposes. The registered office of the International Feeder will be at Harborstone Corporate Services Ltd., George Town, Grand Cayman.
Solara Tax-Exempt Feeder (Cayman) LP. A Cayman Islands exempted limited partnership to serve as the feeder vehicle for U.S. tax-exempt investors investing into the Master Fund. The Tax-Exempt Feeder will file a timely IRS Form 8832 election to be classified as a partnership for U.S. federal income tax purposes. The registered office of the Tax-Exempt Feeder will be at Harborstone Corporate Services Ltd., George Town, Grand Cayman.
I. Related Credit Facilities
The following subscription credit facilities are currently in place and will be affected by the Reorganization:
Fund IV Credit Facility. Fund IV maintains a $1.1 billion revolving subscription credit facility with Ashford National Bank, N.A. (the "Fund IV Credit Facility"), governed by a credit agreement dated June 15, 2021 (as amended). The Fund IV Credit Facility is secured by the uncalled capital commitments of the limited partners of Fund IV and the related parallel vehicles.
Fund V Credit Facility. Fund V maintains a $1.5 billion revolving subscription credit facility with Ashford National Bank, N.A. (as co-lender) and Sentinel Capital Markets LLC (as co-lender and administrative agent) (the "Fund V Credit Facility"), governed by a credit agreement dated September 30, 2023 (as amended). The Fund V Credit Facility is secured by the uncalled capital commitments of the limited partners of Fund V and the related parallel vehicles.
Each of the Fund IV Credit Facility and the Fund V Credit Facility contains covenants and conditions that require lender consent for material changes to the organizational structure of the borrower entities and their parallel vehicles. Lender consent is being sought concurrently with the submission of this ruling request. Solara expects to obtain all required lender consents prior to the implementation of Step 1 of the Reorganization.
J. Advisors and Service Providers
The following advisors and service providers are engaged in connection with the Reorganization and Solara's ongoing fund operations:
III. Rulings Requested
Solara respectfully requests that the Service issue favorable rulings on each of the following eight issues:
Ruling 1 — IRC § 721(a): Tax-Free Contribution
The contributions of portfolio company interests and other assets by the Legacy Offshore Vehicles (Fund IV-A Cayman, Fund IV-B Lux, Fund V-A Cayman, and Fund V-B Lux) to the Consolidated Master Fund LP in exchange for limited partnership interests in the Master Fund, as described in Steps 2, 3, and 4 of the Reorganization, constitute tax-free contributions of property to a partnership in exchange for interests in the partnership within the meaning of IRC § 721(a), and no gain or loss is recognized by the contributing partnerships, the Consolidated Master Fund LP, or any of their respective partners as a result of such contributions.
Ruling 2 — IRC § 721(b): Investment Company Exception
The Consolidated Master Fund LP does not constitute an "investment company" within the meaning of IRC § 721(b) and Treasury Regulations § 1.351-1(c)(1)(ii), because its portfolio consists of interests in operating companies engaged in digital infrastructure and enterprise SaaS businesses, rather than "stocks, securities, or other investment assets" within the meaning of IRC § 351(e)(1), and accordingly, the exception to nonrecognition treatment set forth in IRC § 721(b) does not apply to the contributions described in Steps 2, 3, and 4.
Ruling 3 — IRC § 367: Inapplicability to Partnership-to-Partnership Transfers
IRC § 367 does not apply to the contributions described in Steps 2, 3, and 4 of the Reorganization because IRC § 367(a) and § 367(b) by their terms apply only to transfers to or exchanges involving foreign corporations, and the Consolidated Master Fund LP is classified as a partnership — not a corporation — for U.S. federal income tax purposes. No foreign corporation is a transferor or transferee in any step of the Reorganization.
Ruling 4 — IRC § 731(a): Tax-Free Distribution
The distributions by the Legacy Offshore Vehicles of their respective partnership interests in the Consolidated Master Fund LP to their respective limited partners in complete liquidation, as described in Step 5 of the Reorganization, constitute tax-free distributions under IRC § 731(a)(1), and IRC § 731(c) does not apply to such distributions because the distributed Master Fund partnership interests are not "marketable securities" as defined in IRC § 731(c)(2), inasmuch as such interests are not actively traded on an established securities market and are not readily tradable on a secondary market or the substantial equivalent thereof.
Ruling 5 — IRC § 752: Liability Shifting
The shifts in partner-level shares of liabilities resulting from the Reorganization — including the assumption by the Consolidated Master Fund LP of approximately $1.34 billion in aggregate portfolio-level liabilities of the Legacy Offshore Vehicles — do not result in net deemed contributions or distributions under IRC §§ 752(a) and 752(b) that would trigger gain recognition under IRC § 731, because the netting rule under Treasury Regulations § 1.752-1(f) and the tiered partnership liability allocation rules under Treasury Regulations § 1.752 prevent any partner from experiencing a net deemed distribution under § 752(b) in excess of its adjusted basis in its partnership interest.
Ruling 6 — IRC § 704(c): Built-In Gain Carryover and Remedial Allocation Method
The built-in gain and loss accounts currently tracked by the Legacy Offshore Vehicles under IRC § 704(c)(1)(A) with respect to contributed properties — aggregating approximately $1.72 billion in net built-in gain — carry over in full to the Consolidated Master Fund LP upon the contributions described in Steps 2, 3, and 4, and the Consolidated Master Fund LP may continue to use the remedial allocation method under Treasury Regulations § 1.704-3(d) for each contributed property with respect to which the contributing Legacy Offshore Vehicle used such method.
Ruling 7 — IRC § 1446: No Withholding Required
No withholding under IRC § 1446(a) is required in connection with the contributions described in Steps 2, 3, and 4, or the distributions described in Step 5, of the Reorganization because (a) the contributions are nonrecognition transactions under IRC § 721(a) that do not give rise to effectively connected taxable income ("ECTI") allocable to foreign partners, and (b) the distributions are nonrecognition transactions under IRC § 731(a) that do not generate ECTI and do not constitute "amounts subject to withholding" under Treasury Regulations §§ 1.1446-1 through 1.1446-6.
Ruling 8 — Entity Classification Under Treas. Reg. § 301.7701-3
The Consolidated Master Fund LP, Solara International Feeder (Cayman) LP, and Solara Tax-Exempt Feeder (Cayman) LP are each properly classified as partnerships for U.S. federal income tax purposes under Treasury Regulations § 301.7701-3 upon the timely filing of IRS Form 8832 entity classification elections, and such classification will be recognized for all purposes under the Code.
IV. Legal Analysis
A. Ruling 1 Analysis — IRC § 721(a) Contribution
1. General Rule
IRC § 721(a) provides that "[n]o gain or loss shall be recognized to a partnership or to any of its partners in the case of a contribution of property to the partnership in exchange for an interest in the partnership." This provision embodies the fundamental principle that the formation of, or contribution of property to, a partnership is a mere change in the form of the partners' investment and should not be treated as a taxable event. See H.R. Rep. No. 83-1337, at 68 (1954); S. Rep. No. 83-1622, at 94 (1954). The nonrecognition rule of § 721(a) applies regardless of whether the contribution is made at the time of the partnership's formation or at a later date, and regardless of the relative values of the contributed property and the partnership interest received. See Treas. Reg. § 1.721-1(a).
The nonrecognition rule of § 721(a) is complemented by two related provisions. IRC § 723 provides that the basis of property contributed to a partnership by a partner shall be the adjusted basis of such property in the hands of the contributing partner at the time of the contribution — that is, a carryover basis. IRC § 1223(2) provides that the partnership's holding period for the contributed property shall include the period during which it was held by the contributing partner. Together, these provisions ensure that the built-in gain or loss inherent in the contributed property is preserved for future recognition upon a taxable disposition.
2. Application to Steps 2, 3, and 4
In each of Steps 2, 3, and 4 of the Reorganization, one or more of the Legacy Offshore Vehicles will contribute all of its portfolio company interests to the Consolidated Master Fund LP in exchange for a limited partnership interest in the Master Fund. Each of the contributing entities — Fund IV-A Cayman, Fund IV-B Lux, Fund V-A Cayman, and Fund V-B Lux — is a partnership for U.S. federal income tax purposes. The Consolidated Master Fund LP is also classified as a partnership for U.S. federal income tax purposes (as confirmed by Ruling 8). Each contributing partnership is contributing "property" — namely, its portfolio company interests — to the Master Fund in exchange for an "interest in the partnership" — namely, a limited partnership interest in the Master Fund.
The aggregate amounts involved in the contributions are substantial. Across all four Legacy Offshore Vehicles, the total FMV of assets being contributed is $7.75 billion, the total adjusted tax basis is $6.03 billion, and the total aggregate built-in gain is $1.72 billion. Despite the magnitude of these amounts, § 721(a) contains no limitation based on the dollar value of the contributed property or the built-in gain inherent therein. The nonrecognition rule applies in full, provided that the statutory requirements are satisfied.
Each contributing partnership becomes a "partner" of the Consolidated Master Fund LP upon the contribution, and each receives a partnership interest in exchange for its contributed property. There is no disguised sale element to any of the transactions — each contributing entity receives only a partnership interest in the Master Fund and does not receive any cash, other property, or assumption of its liabilities in a manner that could be characterized as a disguised sale under IRC § 707(a)(2)(B). Accordingly, the anti-abuse rules applicable to disguised sales under Treas. Reg. §§ 1.707-3 through 1.707-6 are not implicated.
3. Tiered Partnership Structures
The proposed Reorganization results in a tiered partnership structure in which the Legacy Offshore Vehicles (and, following Step 5, the International Feeder and Tax-Exempt Feeder) are partners of the Consolidated Master Fund LP. Section 721(a) applies to contributions by partnerships to other partnerships, creating tiered partnership structures. See Treas. Reg. § 1.721-1(a) (broadly applying nonrecognition to "a contribution of property to the partnership in exchange for an interest in the partnership," without limiting the rule to contributions by individuals or other non-partnership entities). The Service has consistently applied § 721(a) to tiered partnership contributions. See, e.g., Rev. Rul. 99-5, 1999-1 C.B. 434 (analyzing multi-member LLC transactions under § 721); PLR 200107015 (applying § 721(a) to contribution by partnership to another partnership).
4. Carryover Basis and Holding Period
Under IRC § 723, the Consolidated Master Fund LP will take a carryover basis in each contributed property equal to the adjusted basis of such property in the hands of the contributing Legacy Offshore Vehicle at the time of contribution. Under IRC § 1223(2), the Master Fund's holding period for each contributed property will include the period during which the property was held by the contributing entity. These rules ensure that the $1.72 billion in aggregate built-in gain is fully preserved and will be recognized upon future taxable dispositions of the contributed properties.
5. Conclusion. Based on the foregoing analysis, the contributions described in Steps 2, 3, and 4 of the Reorganization satisfy the requirements of IRC § 721(a). No gain or loss will be recognized by any of the four contributing Legacy Offshore Vehicles, the Consolidated Master Fund LP, or any of their respective partners as a result of such contributions. The Master Fund will take a carryover basis and tacked holding period in each contributed property under IRC §§ 723 and 1223(2).
B. Ruling 2 Analysis — IRC § 721(b) Investment Company Exception
1. Statement of the Exception
IRC § 721(b) provides that "[s]ubsection (a) shall not apply to gain realized on a transfer of property to a partnership which would be treated as an investment company (within the meaning of section 351) if the partnership were incorporated." This provision is intended to prevent taxpayers from using partnership contributions as a mechanism to achieve tax-free diversification of investment portfolios. The investment company test is applied by reference to the rules governing transfers to controlled corporations under IRC § 351, as if the partnership were incorporated.
Treasury Regulations § 1.351-1(c)(1) provides that a transfer results in the creation of an "investment company" if (i) the transfer results, directly or indirectly, in diversification of the transferors' interests and (ii) the transferee is an investment company. An entity is an "investment company" for this purpose if, after the transfer, more than 80% of the value of its assets (excluding cash and nonconvertible debt obligations) consists of stock and securities held for investment. See Treas. Reg. § 1.351-1(c)(1)(ii). A transfer results in "diversification" if two or more persons transfer non-identical assets to a single transferee. See Treas. Reg. § 1.351-1(c)(1)(ii), (c)(5), (c)(6).
2. The Portfolio Consists of Operating Company Interests
The assets being contributed to the Consolidated Master Fund LP consist entirely of interests in 23 operating companies engaged in digital infrastructure and enterprise SaaS businesses. These are not "stocks, securities, or other investment assets" within the meaning of IRC § 351(e)(1). Each portfolio company is an active operating business, not a passive investment vehicle:
(a) NovaBright Data Systems Inc. operates hyperscale and colocation data centers across the eastern United States, employing approximately 1,200 personnel and generating revenue primarily from long-term colocation and interconnection contracts with enterprise and hyperscale customers.
(b) Crestline Cloud Solutions LLC operates an enterprise SaaS platform providing cloud-based data management and analytics solutions, employing approximately 480 personnel and generating revenue from recurring software subscription fees.
(c) Veridian Edge Computing Corp. develops and operates edge computing infrastructure, including micro data centers and edge nodes deployed at cellular tower sites and enterprise locations, employing approximately 750 personnel and generating revenue from infrastructure-as-a-service contracts.
(d) Thorngate Fiber Networks LP constructs, owns, and operates fiber-optic network infrastructure, employing approximately 900 personnel and generating revenue from fiber leasing and enterprise connectivity services.
(e) Helix SaaS Holdings Ltd. serves as a holding company for a group of enterprise SaaS businesses providing cybersecurity, identity management, and compliance automation solutions, with aggregate headcount across its subsidiaries of approximately 1,100 personnel.
(f) The remaining 18 portfolio companies, described in detail in Exhibit D, are similarly engaged in active business operations in the digital infrastructure and enterprise SaaS sectors.
Because the Consolidated Master Fund LP's assets consist of interests in operating businesses rather than stocks, securities, or other investment assets, the Master Fund would not be treated as an "investment company" within the meaning of § 351 if it were incorporated. The 80% threshold for investment company classification under Treas. Reg. § 1.351-1(c)(1)(ii) is not met.
3. No Impermissible Diversification
Even assuming, arguendo, that the investment company test were potentially applicable, the contributions described in Steps 2 through 4 do not result in impermissible diversification. The contributing Legacy Offshore Vehicles hold interests in the same portfolio companies — or in complementary operating businesses within the same industry sector — and the consolidation of these interests in the Master Fund does not create a diversified portfolio of passive investment assets. The purpose of the investment company exception is to prevent taxpayers from exchanging a concentrated portfolio of investment securities for a diversified portfolio on a tax-free basis. See H.R. Rep. No. 105-220, at 502 (1997). That concern is not present here, where the contributed assets are operating company interests in a single industry vertical.
4. Conclusion. The Consolidated Master Fund LP does not constitute an "investment company" within the meaning of IRC § 721(b) and Treas. Reg. § 1.351-1(c)(1)(ii). The portfolio of the Master Fund consists entirely of interests in operating companies engaged in digital infrastructure and enterprise SaaS businesses, not stocks, securities, or other investment assets. Accordingly, the exception to nonrecognition treatment set forth in § 721(b) does not apply.
C. Ruling 3 Analysis — IRC § 367 Inapplicability
1. Statutory Text
IRC § 367(a)(1) provides that "[i]f, in connection with any exchange described in section 332, 351, 354, 356, or 361, a United States person transfers property to a foreign corporation, such foreign corporation shall not, for purposes of determining the extent to which gain shall be recognized on such transfer, be considered to be a corporation." (emphasis added). IRC § 367(b) provides parallel rules applicable to exchanges described in specified Code sections "in connection with which there is no transfer of property described in subsection (a)" but in which a foreign corporation is a party.
By the plain language of the statute, § 367(a) applies only to transfers of property "to a foreign corporation," and § 367(b) applies only to exchanges involving a "foreign corporation." Neither subsection, by its terms, applies to transfers to or from a partnership, or to transactions in which no corporation — domestic or foreign — is a transferor or transferee.
2. The Consolidated Master Fund LP Is a Partnership, Not a Corporation
The Consolidated Master Fund LP is classified as a partnership for U.S. federal income tax purposes under Treas. Reg. § 301.7701-3. As discussed in Section IV.H below (Ruling 8 Analysis), the Master Fund will file a timely Form 8832 election confirming its partnership classification effective September 15, 2025. The Master Fund is not a corporation, a foreign corporation, or an association taxable as a corporation. Accordingly, a transfer of property to the Master Fund is not a transfer "to a foreign corporation" within the meaning of § 367(a)(1).
3. The Contributing Entities Are Foreign Partnerships, Not Foreign Corporations
Each of the four Legacy Offshore Vehicles making contributions in Steps 2 through 4 — Fund IV-A Cayman, Fund IV-B Lux, Fund V-A Cayman, and Fund V-B Lux — is classified as a partnership for U.S. federal income tax purposes. None is classified as a corporation or an association taxable as a corporation. The Legacy Offshore Vehicles are foreign partnerships, not foreign corporations, and accordingly they are not "foreign corporations" within the meaning of § 367.
4. No Foreign Corporation Is a Party to the Transactions
In the transactions described in Steps 2 through 4, foreign partnerships (the Legacy Offshore Vehicles) contribute property to a domestic partnership (the Consolidated Master Fund LP). No foreign corporation — or any corporation — is a transferor, transferee, or party to any of the contributions. The transactions are partnership-to-partnership contributions, not corporate transactions. Section 367, by its express terms, does not apply.
5. Legislative History
The legislative history of § 367 confirms that Congress intended the provision to apply exclusively in the corporate context. Section 367 was enacted as part of the Internal Revenue Code of 1954, and its amendments over the years — including the Tax Reform Act of 1976, the Tax Equity and Fiscal Responsibility Act of 1982, and the Tax Reform Act of 1986 — have consistently focused on preventing the tax-free outbound transfer of appreciated property to foreign corporations and the tax-free repatriation of earnings from foreign corporations. See H.R. Rep. No. 94-658, at 232–37 (1975); S. Rep. No. 94-938, at 272–78 (1976); H.R. Rep. No. 99-841, at II-638–42 (1986) (Conf. Rep.). At no point has Congress extended § 367 to partnership-to-partnership transfers.
6. Potential Concern — Partner-Level Analysis
The Service might conceivably inquire whether the transaction should be analyzed at the partner level — that is, whether the partners of the Legacy Offshore Vehicles (some of which may be foreign corporations, such as intermediate offshore blocker entities) should be treated as transferring property to the Master Fund. However, the contributions in Steps 2 through 4 are made at the partnership level by the Legacy Offshore Vehicles, and the aggregate theory of partnerships does not override the entity-level characterization of the transaction for purposes of § 367. The Treasury Regulations under § 367 do not extend the provision's reach to partnership contributions. See Treas. Reg. §§ 1.367(a)-1T through 1.367(a)-8; Treas. Reg. §§ 1.367(b)-1 through 1.367(b)-13 (all addressing corporate-level transactions). The Service has not issued guidance suggesting that § 367 applies to partnership-to-partnership transfers, and the plain statutory language precludes such an interpretation.
7. Conclusion. Based on the foregoing, IRC § 367 does not apply to the contributions described in Steps 2, 3, and 4 of the Reorganization. There is no foreign corporation — or any corporation — that is a transferor or transferee in any step of the Reorganization. The contributions are partnership-to-partnership transfers that fall outside the scope of § 367.
D. Ruling 4 Analysis — IRC § 731(a) and § 731(c)
1. IRC § 731(a) Tax-Fre

DRAFT — VERSION 1.0 — PRIVILEGED AND CONFIDENTIAL — ATTORNEY-CLIENT COMMUNICATION

Record

Parties

Dates

Amounts