TC Energy spun off South Bow effective October 1, 2024 in a transaction meant to be tax-free to TRP shareholders. South Bow began normal trading in Canada on October 1, 2024 and on U.S. exchanges October 3, 2024 . TRP shareholders received 1 share of SOBO for each 5 shares of TRP owned.

This action is a simple spinoff transaction in the accounting software. It is structured to be a nontaxable event for TRP shareholders according to the shareholder prospectus. The cost basis allocation information is taken from IRS form 8937. This form shows the method used to allocate cost basis among the parent and daughter. A link to IRS Form 8937 is available at the https://www.tcenergy.com/investors/liquids-spinoff/. Click the U.S. Tax Information link on this page.

NOTE:

The cost basis allocation is dependent on the prices used for both South Bow and TC Energy in the cost basis allocation calculations. In our experience brokers tend to use the prices found in the guidance companies post on their websites including IRS form 8937. If available, our instructions will use the guidance in form 8937. If your broker does not use that guidance, or form 8937 is not publicly available, the cost basis of the companies involved as recorded in your accounting records and in your broker’s records may not match. This is not cause for concern. This is just due to the inexact nature of the tax code in this regard. Partnership tax returns have specific areas to reconcile these usually small differences. ICLUBcentral tax printer software automatically fills in these adjustments in the normal operation of the software using the data imported from your accounting records and that you enter from your 1099.

The Spinoff Entry

Go to Accounting > Securities > Record spinoff of securities in myICLUB.com. If you are unfamiliar with spinoff transactions you can get help at this URL:

https://www.myiclub.com/faq/article.aspx?id=54

Here is the information you need to complete the spinoff.

• Date: 10/1/2024
• Select Parent Security (or Parent Company) : TC Energy (TRP)
• Remaining Basis Percentage: 91.0
• Cash received: See your broker statement for cash-in-lieu received
• Spinoff Security (or Symbol of New Company) : South Bow (SOBO)
• Shares received : 0.2 x (# of TRP shares owned) (Include fractional shares.)
  • For example, if you owned 100 TRP shares, you should receive 0.2 x 100 = 20 SOBO shares.
• Price Per Share : 21.58 (Weighted Average SOBO prices on 10/1/2024)

Save the transaction and the spinoff has been entered.