10 March 2003 Internal T.I. 2002-0172187 F - DEDUCTIBILITE DES INTERET -- summary under Paragraph 20(1)(c)

A debenture issued by a corporation provided for the payment of base interest plus the payment of an “additional interest” on maturity that was the greater of a fixed amount and a formula amount based inter alia on the imputed value of the corporation’s equity. The Directorate indicated that insufficient information was available to determine whether the “additional interest” amount qualified for deduction as participating interest in accordance with CRA’s policies, as modified following Sherway (e.g., 9823880).