Company: PERI
Filing Date: 2025-03-25
Form Type: 20-F
Source: 0001178913-25-001021
Chunk: 37

Company: Perion Network Ltd.
Filing Date: 2025-03-25
Form: 20-F
Item: Item 3
Chunk 37
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 using the market capitalization method. Accordingly, we believe that we were likely not a PFIC for 2024. However, our position is not binding on the U.S. Internal Revenue Service and there can be no assurance that it will agree with our valuation approach.
 
In addition, we may also be a PFIC for any future taxable year if the portion of our financial income out of our gross income were to increase to 75% or more for any taxable year. Our PFIC status for any taxable year is an annual factual determination that can be made only after the end of that taxable year and will depend on the composition of our income and assets and the value of our assets from time to time (including the value of our goodwill and other intangible assets). For the reasons described above, we cannot express any expectation regarding our PFIC status for any future taxable year.
 
If we are a PFIC for any taxable year during which a U.S. investor owns our ordinary shares, we will generally continue to be a PFIC with respect to that investor for all succeeding taxable years, even if we cease to meet the threshold requirements for PFIC status, unless certain elections are timely made by the investor. In addition, a U.S. investor could be subject to adverse U.S. federal income tax consequences and reporting obligations with respect to its ownership of PFIC stock. See “Taxation – U.S. Federal Income Tax Considerations – Passive Foreign Investment Company Rules.”
 
Our business could be negatively affected as a result of actions of activist shareholders, and such activism could impact the trading value of our securities.
 
In recent years, certain issuers listed on U.S. exchanges, including our Company, have faced governance-related and other demands from activist shareholders, as well as unsolicited tender offers and proxy contests. Although as a foreign private issuer we are not subject to U.S. proxy rules, responding to these types of actions by activist shareholders could be costly and time-consuming, disrupting our operations and diverting the attention of management and our employees. Such activities could interfere with our ability to execute our strategic plans. In addition, a proxy contest for the election of directors at our annual meeting would require us to incur significant legal fees and proxy solicitation expenses and require significant time and attention by management and our board of directors. The perceived uncertainties due to these potential actions of activist shareholders also could adversely affect the market price and volatility of our securities.
 
The rights and responsibilities of our shareholders are governed by Israeli law and differ in several key respects from