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TITLE 26-INTERNAL REVENUE CODE stock exchanged, and any securities received have substantially the same terms as the se- curities exchanged, then, except as provided in subsection (f), no gain to the shareholder or security holder from the receipt of such stock or such securi- ties or such stock and securities shall be rec- ognized. (3) Pro r-ta and other requirements For pro rata and other requirements, see subsection (a)(3). (4) Exception This subsection shall not apply to any dis- tribution by a corporation if such corpora. tion, a corporation having control of such corporation, or a subsidiary of such corpora. tion has made any distribution pursuant to subsection (a) qr has made an election under section 6158 with respect to prohibited prop- erty. (5) Distributions involving gift or compensation In the case of a distribution to which para- graph (1) or (2) applies but which- (A) results in a git, see section 2501 and following, or (B) has the effect of the payment of com- pensation, see section 61. (c) Property acquired after July 7, 1970 (1) In general Except as provided in paragraphs (2) and (3), subsection (a) or (b) shall not apply to- (A) any property acquired by the distribut- ing corporation after July 7, 1970, unless (i) gain to such corporation with respect to the receipt of such property was not recognized by reason of subsection (a) or (b), or (ii) such property was received by it in ex- change for all of its stock in an exchange to which paragraph (2) or (3) applies, or (iii) such property was acquired by the distribut- ing corporation in a transaction in which gain was not recognized under section 305(a) or section 332, or under section 354 or 356 (but only with respect to property permitted by section 354 or 356 to be re- ceived without the recognition of gain or loss) with respect to a reorganization de- scribed in section 368(a)(1)(A), (B), (E), or (F), or (B) any property which was acquired by the distributing corporation in a distribu- tion with respect to stock acquired by such corporation after July 7, 1970, unless such stock was acquired by such corporation (i) in a distribution (with respect to stock held by it on July 7, 1970, or with respect to stock in respect of which all previous applica- tions of this clause are satisfied) with re- spect to which gain to it was not recognized by reason of subsection (a) or (b), or (ii) in exchange for all of its stock in an exchange to which paragraph (2) or (3) applies, or (iii) in a transaction in which gain was not recognized under section 305(a) or section 332, or under section 354 or 356 (but only with respect to property permitted by sec- tion 354 or 356 to be received without the recognition of gain or loss) with respect to a reorganization described in section 368(a)(1)(A), (B), (E), or (F), or (C) any property acquired by the distrib- uting corporation in a transaction in which gain was not recognized under section 332, unless such property was acquired from a corporation which, if it had been a qualified bank holding corporation, could have dis- tributed such property under subsection (a)(1) or (b)(1), or (D) any property acquired by the distrib- uting corporation in a transaction in which gain was not recognized under section 354 or 356 with respect to a reorganization de- scribed in section 368(a)(1)(A) or (B), unless such property was acquired by the distribut- ing corporation in exchange for property which the distributing corporation could have distributed undier subsection (a)(1) or (b)(1). (2) Exchanges Involving prohibited property If- (A) any qualified bank holding corpora- tion exchanges (i) property, which, under subsection (a)(1), such corporation could distribute directly to its shareholders or se- curity holders without the recognition of gain to such shareholders or security hold- ers, and other property (except property de- scribed in subsection (b)(1)(B)(i)), for (ii) all of the stock of a second corporation cre- ated and availed of solely for the purpose of receiving such property, (B) immediately after the exchange, the qualified bank holding corporation distrib- utes all of such stock in a manner pre- scribed in subsection (a)(2)(A), and (C) before such distribution, the Board has certified (with respect to the property exchanged which consists of property which, under subsection (a)(1), such corporation could distribute directly to its shareholders or security holders without the recognittn of gain) that the exchange and distribution are necessary or appropriate to effectuate section 4 of the Bank Holding Company Act, then paragraph (1) shall not apply with re- spect to such distribution. (3) Exchanges involving interests in banks If- (A) anli qualified bank holding corpora- tion exchanges () property which, under subsection (b)(1), such corporation could distribute directly to its shareholders or se- curity holders without the recognition of gain to such shareholders or security hold- ers, and other property (except prohibited property), for (ii) all of the stock of a second corporation created and availed of solely for the purpose of receiving such property.I (B) immediately after the exchange, the qualified bank holding corporation distrib- utes all of such stock in a manner pre- scribed in subsection (b)(2)(A), and (C) before such distribution, the Board has certified (with respect to the property exchanged which consists of property which, under subsection (b)(1), such corporation could distribute directly to its shareholders or security holders without the recognition of gain) that- 'So in original, the period should rfobably be a comma. Page 668 § 1101