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DC will transfer a proportionate share (based on the relative fair market value of the shares in its capital held by the particular TC): of its common shares and Class B shares of Aco, as well as its "Fund Units" to each of the five TCs in consideration for Class X preferred shares of that TC; of its Series A and B preferred shares of ACo to each TC in consideration for a non-interest-bearing Note1 of the respective TC; and of cash to each TC in consideration for a non-interest-bearing Note2 of the respective TC. ...

2013 Ruling 2013-0490341R3- No-type of property spin-off butterfly-- summary under Distribution Summary Under Tax Topics- Income Tax Act- Section 55- Subsection 55(1)- Distribution s. 55(3.02) public spin-off of CFAs to new sister TC with post butterfly FX loan by TC to DC; new public corp inserted above DC before b/f Preliminary As a preliminary step under a plan of arrangement, the shareholders of Old Pubco (a Canadian public corporation dealing at arm's length with each shareholder) will transfer (in a s. 85.1 exchange) all their Old Pubco common shares to a newly-incorporated Canadian subsidiary of Old Pubco (New Pubco) in consideration for New Pubco common shares, and New Pubco will reduce the stated capital of its shares (in order to satisfy the solvency test for any future dividends). ... Old Pubco will transfer to Newco the Spin-off Properties (being shares of various non-resident subsidiaries) in consideration for the issuance of the Newco Preferred Shares, electing under s. 85(1). ... " Newco will redeem "from Old Pubco" all of the issued and outstanding Newco Preferred Shares, and Old Pubco will redeem "from Newco" all of the outstanding Old Pubco New Preferred Shares, in each case in consideration for issuance of a non-interest-bearing demand promissory note. ...

Pubco will acquire an undivided percentage interest in the Royalty from Partnership D in consideration for the issuance of a demand promissory note (the "Royalty Purchase Note"), with the proceeds being allocated by Partnership D to its partners (Subco and Pubco.) Subco will transfer its interest in Partnership D and other "Distributed Assets" to a newly-incorporated subsidiary of Pubco (Newco 1) in consideration for redeemable preferred shares of Newco 1 with a price adjustment clause and with a s. 85(1) election made. ... Subco will redeem the preferred share issued to Pubco in 1 in consideration for transferring the Newco 1 Note and for issuing a further Note, with a contemporaneous eligible dividend notice. ...

Application of life insurance proceeds Within a year of the death, PCo purchased for cancellation a portion of its common shares held by the Estate (which had been stepped up under s. 70(5)(b)) in consideration for a note, elected under s. 83(2) on the resulting deemed dividend and used the insurance proceeds and other cash to repay the note. ... The Estate will transfer its remaining PCo Shares (electing under s. 85(1)) to Newco in consideration mostly for a note (the “Newco Note”) with a principal amount and FMV equal to the lesser of such shares’ current FMV and their FMV on A’s death, minus $100. As additional consideration, it also will receive 100 Class A Newco Preferred Shares with a stated capital of $100, and a redemption value and FMV of $100 plus any appreciation in the remaining PCo Shares from A’s death to such transfer date. ...

X also held by Class E preferred shares of Corporations D (a holding company), whose participating shares were held by Trust 1 Proposed transactions Corporations A and B will purchase for cancellation a portion of its voting participating shares in consideration for notes, thereby generating a deemed dividend and a dividend refund of their respective RDTOH balances. Corporation A will also purchase for cancellation, in consideration for a note, a further portion of its voting participating shares so as to give rise to a deemed dividend that is elected to come out of its capital dividend account. ... X The estate will transfer its remaining shares of Corporations A and B to a newly-incorporated corporation (“Newco”) in consideration for notes and shares of Newco, electing under s. 85(1). ...

Child 1, Newtrust 1 and Trust 1 will transfer a portion of their common shares of Amalco to TC 1 under s. 85(1) in consideration for common shares of TC 1. Amalco will transfer a pro rata portion (determined on a net rather than gross FMV basis) of each of its two types of property (cash and near cash, and investment assets) on an s. 85(1) basis to TC 1 in consideration for assumption of liabilities and non-voting retractable preferred shares of TC 1. Such preferred shares will then be redeemed in consideration for a TC 1 note. ...

To assist the Estate with funding the Deceased’s terminal T1 income tax liability, the Estate transferred land and buildings owned by it to Opco on a s. 85(1) rollover basis in consideration for a demand, non-interest bearing promissory note (“Note 1”) of Opco and Class C preferred shares of Opco, with Opco then borrowing under a mortgage and repaying Note 1. ... The Estate will transfer its Class A common shares of Opco to a corporation newly incorporated by it (Newco) in consideration for a demand non-interest bearing promissory note (“Note 2”) and non-voting, redeemable and retractable Class C preferred shares of Newco, jointly electing under s. 85(1). The Estate will transfer its Class C preferred shares of Opco to Newco under s. 85(1) in consideration for non-voting, redeemable and retractable Class D preferred shares of Newco. ...

(f) applicable to transfer of shares for no consideration to new trust for same incapacitated minor beneficiary Background A special-needs minor child (CC4) of Mr. ... F2co will redeem Class E shares held by Fco for those shares’ PUC and ACB in consideration for the issuance of a non-interest bearing demand note in a principal amount equal to the estimated tax liability of TebC4 from the taxable dividend in 3 above. ... CC will settle a new trust for the exclusive benefit of CC4 (“NTebC4”) with a silver bar, and TebC4 will transfer its Class Z shares of Fco to NTebC4 for no consideration. ...

Proposed transactions One of the sisters will transfer, on a s. 85(1) rollover basis, her common and Class C shares, and her three brothers will transfer their Class C shares, of DC to TC1 in consideration for Class A voting participating shares, and non-voting preferred shares, respectively, of TC1. The other sister will transfer, on a s. 85(1) rollover basis, her common and Class C shares of DC to TC2 in consideration for Class A voting participating shares of TC1. The cash and near cash assets of DC (described as including “cash (including cash, if any, in investment accounts managed by investment advisors), accounts receivable (including income taxes receivable), certificates of deposit and similar short-term investments, marketable securities (other than those held as portfolio investments)”) and DC’s investment property (i.e., its portfolio of listed shares) will be transferred under s. 85(1) on a pro rata (and net FMV) basis to TC1 and TC2 in consideration for the assumption of liabilities (including the CDA note owing to the respective sister) and for non-voting preferred shares. ...

In particular: After the settling of MFT, which has redeemable retractable units, by a Canadian-resident third party, the Fund subscribes for MFT units for nominal cash consideration and the unit of the settlor is redeemed. Sub-Trust will transfer all its assets including the Class A LP Units and the GP I shares of Partnership, to MFT for no consideration, with no s. 107.4(3)(a)(i) election being made and with MFT electing under (f)(v) of “disposition” in s. 248(1) that para. ... Pursuant to a transfer agreement between the Fund, MFT and an agent for the MFT Unitholders, MFT will transfer its assets to the Fund at the “MFT Transfer Time” in consideration for Fund Units being issued to the MFT Unitholders in payment of the redemption proceeds for their Units; and immediately after the MFT Transfer Time, MFT will redeem all of the MFT Units held by the Fund and the MFT Unitholders except for one MFT Unit which the Fund will continue to hold until the winding-up of MFT in 7 below. ...