Company: VSA
Filing Date: 2025-11-13
Form Type: 424B5
Source: 0001213900-25-109735
Chunk: 93

Company: VisionSys AI Inc
Filing Date: 2025-11-13
Form: 424B5
Chunk 93
---
 or (2) 50% or more of its average quarterly assets during such year is attributable to assets that produce
or are held for the production of passive income. For this purpose, cash is categorized as a passive asset and the company’s unbooked
intangibles associated with active business activities may generally be classified as active assets. Passive income generally includes,
among other things, dividends, interest, rents, royalties, and gains from the disposition of passive assets. We will be treated as owning
our proportionate share of the assets and earning our proportionate share of the income of any other non-United States corporation in
which we own, directly or indirectly, more than 25% (by value) of the stock.

The determination of whether we will be or become
a PFIC will depend upon the composition of our income (which may differ from our historical results and current projections) and assets
and the value of our assets from time to time, including, in particular the value of our goodwill and other unbooked intangibles (which
may depend upon the market value of the ADSs or ordinary shares from time-to-time and may be volatile). In addition, although the law
in this regard is unclear, we treat the consolidated affiliated entities as being owned by us for United States federal income tax purposes,
not only because we exercise effective control over the operation of such entities but also because we are entitled to substantially all
of their economic benefits, and, as a result, we combine and consolidate their operating results in our consolidated financial statements.
Assuming that we are the owner of the consolidated affiliated entities for United States federal income tax purposes, based upon the historical
and current value of our assets, composition of our income and assets and value of the ADSs and ordinary shares, we do not believe we
were classified as a PFIC for the fiscal year ended December 31, 2023 and we do not expect to be classified as a PFIC for the current
fiscal year. Among other matters, if our market capitalization declines, we may be classified as a PFIC for the current fiscal year or
future fiscal years. It is also possible that the IRS, may challenge our classification or valuation of our goodwill and other unbooked
intangibles, which may result in our company being, or becoming classified as, a PFIC for the current fiscal year or one or more future
fiscal years.

The determination of whether we will be or become
a PFIC may also