2015 Ruling 2014-0558831R3 - No-type of property spin-off butterfly -- summary under Subsection 86(1)

DC is a public corporation with two classes of common shares (namely, multiple and subordinate voting shares). Preliminarily to a butterfly spin-off by DC to Spinco, there is a s. 86 exchange respecting both the multiple voting and subordinate voting shares, in each case, for shares of two "new" classes, ie., "new" common shares and redeemable special shares. Immediately before the exchange, both Class will be redesignated pursuant to Articles of Amendment and have their number of votes per share increased (presumably , proportionately). Then, on each of the two s. 86 exchanges, the stated capital of each old common share is to be allocated to that of the two new replacement shares based on their relative FMV. The new common shares issued on each of the two exchanges have identical attributes to the old ones (before their votes per share were momentarily increased), except for their share provisions referring to the prior rights of the special shares (mainly, to receipt of any redemption amount).