Exceptions from Subsection 55(2) - CCH Canadian
Exceptions from Subsection 55(2) - CCH Canadian
Exceptions from Subsection 55(2) - CCH Canadian
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Distribution – <strong>Subsection</strong> <strong>55</strong>(1) Definition• Definition of “distribution” requires:– the Distributing Corporation to make a pro rata distribution of– each “type of property” to– each Transferee Corporation• Pro rata based on % ownership (by value) of Distributing Corporation• Achieving a pro rata distribution is paramount to achieving a successfulbutterfly reorganization• Public company spin-off butterflies are exempt <strong>from</strong> requirement todistribute each type of property© 2010 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is aSwiss entity with which the independent member firms of the KPMG network are affiliated 34
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