Replies to post #30185 on TheGlobe.com Inc (TGLO)

[potatoclump]

except the generalized statute is very specific and is part of a tax act which is still used today.

"Section 382 requires that the buyer meet the continuity of business enterprise requirement; continuing use of the target's historic business or a significant portion of the target's assets in an existing business for 2 years following the transaction. If the continuity of business requirement is not met, the annual NOL limitation is zero. The continuity of business requirement, together with the annual NOL usage limitation, effectively discourage acquisitions of loss companies for their NOL alone."

it works if a biotech buys a biotech with NOLs but not so much if an LNG company buys a shell previously used for tech.

i agree that there could be a loophole but i doubt it. the statute seems pretty explicit about this requirement.