Company: CGCT
Filing Date: 2025-03-05
Form Type: S-1/A
Source: 0001104659-25-020969
Chunk: 143

Company: Cartesian Growth Corp III
Filing Date: 2025-03-05
Form: S-1/A
Chunk 143
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 U.S. Holder such information as the IRS
may require, including a PFIC annual information statement, in order to enable the U.S. Holder to make and maintain a “qualified
electing fund” election, but there can be no assurance that we will timely provide such required information, and such election
would be unavailable with respect to our warrants in all cases. We urge U.S. investors to consult their own tax advisors regarding
the possible application of the PFIC rules. For a more detailed explanation of the tax consequences of PFIC classification to U.S. Holders,
see the section of this prospectus captioned “Taxation — United States Federal Income Tax Considerations — U.S. Holders — Passive Foreign Investment Company Rules.”

If our initial business combination involves a company organized under the laws of the United States (or any subdivision thereof), a U.S. federal excise tax could be imposed on us in connection with any redemptions of our Class A ordinary shares after or in connection with such initial business combination.

The Inflation Reduction Act of 2022
provides for, among other things, a new 1% U.S. federal excise tax on certain repurchases (including redemptions) of stock by publicly
traded U.S. corporations after December 31, 2022 (the “stock buyback tax”), subject to certain exceptions. If applicable,
the amount of the stock buyback tax is generally 1% of the aggregate fair market value of any stock repurchased by the corporation during
a taxable year, net of the aggregate fair market value of certain new stock issuances by the repurchasing corporation during the same
taxable year. The Biden administration previously proposed increasing the stock buyback tax rate from 1% to 4%; however, it is unclear
whether such a change would be enacted under the Trump administration and, if enacted, how soon it could take effect. In addition, the
U.S. Treasury Department and IRS have released preliminary guidance that would potentially cause a non-U.S. corporation’s
U.S. subsidiaries to be subject to the stock buyback tax with respect to any share repurchases made by the non-U.S. corporation
under certain circumstances.

As an entity incorporated as a Cayman Islands
exempted company, the stock buyback tax is currently not expected to apply to redemptions of our Class A ordinary shares (absent
any regulations or other additional guidance that may be issued in the future). However, in connection