Parent owns all the stock of Target and Acquiring. Target merges into Acquiring. Pursuant to the merger, Acquiring issues additional shares to Parent. Pursuant to the merger transaction, Parent distributes the shares of Acquiring that it received in the merger to its shareholders.

A The distribution will not violate continuity of interest (CoI) only if it qualifies as tax-free under section 355.

B The distribution will not violate continuity of interest (CoI).

C The distribution will violate continuity of interest (CoI) if Parent recognizes gain on the distribution under section 311(b).

D The distribution will not violate continuity of interest (CoI) only if Parents shareholder is a domestic corporation.