Any gain or loss is measured by the difference between the basis of the fractional share interest in Seattle Class A common stock to which you would otherwise be entitled and the amount of cash you received. Lieu of a fractional share, such receipt should be treated as though you received solely Seattle Class A common stock, and then that portion of deemed-received Seattle Class A common stock that corresponds to the fractional share was separately redeemed, for the cash that was actually received. Shares that traded in the "ex-distribution" market traded without an entitlement to shares of Seattle Class A common stock. If you receive cash inġ Shares of HPE common stock that traded in the "regular-way" market on the New York Stock Exchange prior to the Distribution Date traded with an entitlement to shares of Seattle common stock distributed on the Distribution Date. Any cash distributed to you in lieu of fractional shares is meant to avoid the expense and inconvenience to Seattle of issuing and maintaining fractional shares. In addition, if you received cash in lieu of fractional shares, you may recognize taxable gain or loss as described below.įractional Shares. shareholders will be required to recognize gain (but not loss) on the exchange of their Seattle Class A common stock for Micro Focus ADSs. federal income tax purposes on receipt of the Seattle Class A common stock in the Distribution, but U.S. As a result, you generally do not recognize gain or loss for U.S.
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On August 31, 2017, HPE received an opinion of counsel from Skadden, Arps, Slate, Meagher & Flom concluding, based on certain representations of HPE and Seattle with respect to (among other things) the activities of HPE and Seattle following the Distribution, that the Distribution "will" qualify as a reorganization within the meaning of sections 368(a)(1)(D) and 355 of the Internal Revenue Code of 1986, as amended (the "Code"), and that the Merger "will" qualify as a reorganization within the meaning of section 368(a)(1)(D) of the Code, subject to the application of the gain recognition provisions of section 367(a)(1) of the Code. Tax Treatment of the Distribution and Merger.
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federal income tax consequences of the Distribution and the Merger and describes how to allocate your tax basis between your HPE common stock and the Seattle Class A common stock you received in the Distribution, and how to determine your tax basis in the Micro Focus ADSs received in the Merger. The balance of the then-outstanding Micro Focus ordinary shares were held by pre-merger shareholders of Micro Focus. In the Merger, each share of Seattle Class A common stock outstanding immediately prior to the Merger was automatically converted into the right to receive a number of American Depositary Shares ("ADSs") of Micro Focus (each representing a corresponding amount of ordinary shares of Micro Focus) such that immediately following the merger, these newly issued ADSs, in the aggregate, represented 50.1% of the Micro Focus ordinary shares on a fully diluted basis.
Eastern Time on the Distribution Date, a wholly owned subsidiary of Micro Focus International plc ("Micro Focus") merged with and into Seattle, with Seattle continuing as the surviving company and a wholly owned subsidiary of Micro Focus (the "Merger"). Immediately following the spin-off, effective as of 3:00 a.m. Each shareholder who owned a fractional share of HPE common stock received a cash payment in lieu of a fractional share of Seattle common stock.
Eastern Time on the Distribution Date, HPE completed the distribution of 100% of the outstanding shares of Seattle (the "Distribution") and each shareholder who held HPE common stock on the Record Date in the "regular way" 1market received one share of Seattle Class A common stock for each share of HPE common stock owned on the Record Date. ("Seattle") common stock payable on Septem(the "Distribution Date").
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On Augthe Board of Directors of Hewlett Packard Enterprise Company ("HPE") declared a pro rata dividend to HPE common stockholders of record as of the close of business on Aug(the "Record Date") of 100% of the outstanding shares of Seattle SpinCo, Inc. Federal Income Tax Information for Shareholders Concerning the Seattle Spinco, Inc.
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