From: Eileen Alexanderson To: "Jeffrey Epstein (jeevacation(a grnail.com)" [email protected]> Subject: FW: Tax considerations Date: Sat, 29 Sep 2012 02:28:43 +0000 From: [email protected] [mailto: Sent: Friday, September 28, 2012 7:51 AM To: Eileen Alexanderson Cc: 'Brad R Okun'• David Lakhdhir; 'Thomas Turrin' Subject: Tax considerations - follow up from last nights call Eileen As promised, please find below our thoughts on the questions raised last night on which I agreed to reply to. Nature of Partnership As we discussed on the call last night, the choice of a Scottish LP is due to the fact that the Scottish LP is a well recognised and established vehicle used for tax planning, particularly with the US, where as a result of its separate legal personality it entity classification as a partnership is clear in overseas jurisdictions. This compares to the English LP's where due to the fact that these do not have separate legal personality this can lead to complications regarding the entity classification and can lead to problems in how they are recognised in tax planning arrangements with foreign partners. As such the SLP is the preferred choice in tax planning arrangements. In terms of the formation of an SLP, Macfarlanes are correct in that Scottish counsel would be needed to form the SLP and that the General Partner would need to have a Scottish registered address, however, this is often solved in practice by the General Partner having its registered address at the offices of the Scottish Counsel. The alternative is the limited liability partnership which Macfarlanes have also mentioned which is a partnership in the UK which like the SLP also has separate legal personality and therefore would be an alternative to use. The one point to note with using an LLP, however, is that the financial statements of the LLP would require to be prepared and audited here in the UK so there would be a cost associated with that. From a tax per