Company: SCAG
Filing Date: 2025-01-06
Form Type: 424B3
Source: 0001213900-25-001215
Chunk: 38

Company: Scage Future
Filing Date: 2025-01-06
Form: 424B3
Chunk 38
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 ordinary share of Merger Sub II, par value US$0.0001 per share, shall be converted into and exchanged for one ordinary share of the Surviving Entity. Q.What are the U.S. federal income tax consequences of the Business Combination to me? A.Subject to the discussion below of Finnovate Warrants, it is intended that the Business Combination qualifies as an exchange described in Section 351(a) of the Code, and it is the opinion of Finnovate’s counsel, Ellenoff Grossman & Schole LLP, that the Business Combination will qualify as an exchange described in Section 351(a) of the Code. However, there can be no assurance that the U.S. Internal Revenue Service will not successfully challenge this position, and if so then the exchange of Finnovate Ordinary Shares or Company Ordinary Shares (including those converted from Company Preferred Shares in the Conversion) for PubCo ADSs will be a taxable exchange, and the tax consequences described herein will be materially different from those described below. The remainder of this discussion assumes that the transactions described above qualify as an exchange described in Section 351(a) of the Code. Assuming such qualification, a U.S. holder that receives PubCo ADSs in exchange for Finnovate Ordinary Shares or Company Ordinary Shares in the Business Combination will not recognize any gain or loss on such exchange. In such case, the aggregate adjusted tax basis of the PubCo ADSs received in the Business Combination by a U.S. holder should be equal to the adjusted tax basis of the Finnovate Ordinary Shares or Company Ordinary Shares exchanged therefor. The holding period of the PubCo ADSs should include the holding period during which the Finnovate Ordinary Shares or Company Ordinary Shares exchanged therefor were held by such U.S. holder. xv If the Business Combination qualifies only as an exchange governed by Section 351(a) of the Code (and not by Section 368 of the Code), a U.S. holder that receives PubCo ADSs in exchange for Finnovate Ordinary Shares and that holds Finnovate Warrants that automatically convert into Assumed Warrants should recognize gain (but not loss) in an amount equal to the lesser of (i) the amount of gain realized by such holder (generally, the excess (if any) of (x) the sum of the fair market values of the PubCo ADSs and the Assumed Warrants received by such holder over (y) such holder’s aggregate adjusted tax basis in the Finnovate Ordinary Shares and Finnovate