Company: BTBT
Filing Date: 2025-09-29
Form Type: 424B5
Source: 0001213900-25-093122
Chunk: 103

Company: Bit Digital, Inc
Filing Date: 2025-09-29
Form: 424B5
Chunk 103
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 Adjustments to the conversion rate made pursuant to a bona fide reasonable adjustment formula that has the effect of preventing the dilution of the interest of the holders of the notes, however, generally will not be considered to result in a deemed distribution to a U.S. Holder. Certain of the possible conversion rate adjustments provided in the notes (including, without limitation, adjustments with respect to taxable dividends to holders of our ordinary shares) will not qualify as being pursuant to a bona fide reasonable adjustment formula. If such a non-qualifying adjustment is made, a U.S. Holder may be deemed to have received a distribution even though the U.S. Holder has not received any cash or property as a result of such adjustment. In addition, an adjustment to the conversion rate of a note converted in connection with a make-whole fundamental change or during a redemption period or for which the interest make-whole provision applies, each as described under “Description of the Notes—Conversion Rights,” may also be treated as a deemed distribution to a U.S. Holder under certain circumstances.

Any such deemed distribution will generally be taxable to U.S. Holders as a dividend, return of capital, or capital gain, as described in “—Dividends” below. However, it is not entirely clear whether a deemed dividend deemed paid to a non-corporate U.S. Holder would be “qualified dividend income” eligible for preferential tax treatment. It is also not entirely clear whether corporate U.S. Holders would be entitled to claim the dividends-received deduction with respect to any such constructive dividends. Because a constructive dividend deemed received by a U.S. Holder would not give rise to any cash from which any applicable withholding could be satisfied, if backup withholding is paid on behalf of a U.S. Holder (because such U.S. Holder failed to establish an exemption from backup withholding), such backup withholding may be withheld from or set off against payments of cash and ordinary shares payable on the notes (or, in certain circumstances, against any payments on the ordinary shares) or sales proceeds payable to or other funds or assets of the U.S. Holder. Generally, a U.S. Holder’s adjusted tax basis in a note will be increased to the extent any such constructive distribution is treated as a dividend. U.S. Holders should consult their tax advisors regarding the U.S. federal income tax consequences of a constructive distribution on the notes.

We are required under current law to report the amount of any deemed distributions on our website or to the IRS and to holders of notes