Company: TLGYF
Filing Date: 2025-04-07
Form Type: DEF 14A
Source: 0001104659-25-032443
Chunk: 51

Company: TLGY ACQUISITION CORP
Filing Date: 2025-04-07
Form: DEF 14A
Chunk 51
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 will result in a meaningful reduction in a Redeeming U.S. Holder’s proportionate interest in us will depend on the particular facts and circumstances. However, the IRS has indicated in a published ruling that even a small reduction in the proportionate interest of a small minority shareholder in a publicly held corporation who exercises no control over corporate affairs may constitute such a “meaningful reduction.”

If none of the foregoing tests are satisfied, then the redemption may be treated as a distribution with the tax effects described in the S-1 Registration Statement under “United States Federal Income Tax Considerations — Taxation of Distributions”. After the application of those rules, any remaining tax basis a Redeeming U.S. Holder has in the redeemed Class A ordinary shares will be added to the adjusted tax basis in such holder’s remaining Class A ordinary shares. If there are no remaining Class A ordinary shares, a Redeeming U.S. Holder should consult its own tax advisors as to the allocation of any remaining tax basis.

Redeeming U.S. Holders should consult with their own tax advisors regarding the tax consequences of an exercise of the redemption right, including regarding the reporting requirements applicable to certain Redeeming U.S. Holders.

Passive Foreign Investment Company Rules

A foreign (i.e., non-U.S.) corporation will be classified as a PFIC for U.S. federal income tax purposes if: (i) 75% or more of its gross income consists of passive income; or (ii) 50% or more of the average quarterly market value of its assets in that year are assets (including cash) that produce, or are held for the production of, passive income. For purposes of these calculations, if the corporation directly or indirectly owns at least 25% of the shares by value of another corporation, then it is treated as if it received directly its proportionate share of the income of such other corporation, and held its proportionate share of the assets of such other corporation. Passive income generally includes dividends, interest, rents and royalties (other than rents or royalties derived from the active conduct of a trade or business) and gains from the disposition of passive assets.

Because our assets will consist predominantly of cash prior to our initial business combination, there is a substantial likelihood that we will be a PFIC for such periods, unless we qualify for a start-up exception under which a corporation will not be a PFIC for the first taxable year in which it has gross income (the “start-up year”), if (1) no predecessor of the corporation was a PF