Company: TGE
Filing Date: 2025-06-24
Form Type: F-1
Source: 0001213900-25-057225
Chunk: 191

Company: Generation Essentials Group
Filing Date: 2025-06-24
Form: F-1
Chunk 191
---
 to become a PFIC because the value of its assets, including goodwill and other unbooked
intangibles, for purposes of the asset test may be determined by reference to the market price of the Class A Ordinary Shares, which
may be volatile. Additionally, under circumstances where TGE’s income from activities that produce passive income significantly
increases relative to income from activities that produce non-passive income, or where TGE determines not to deploy significant amounts
of cash for active purposes, TGE’s risk of becoming a PFIC may substantially increase.

Application of PFIC
Rules

If TGE is a PFIC for any taxable
year (or portion thereof) that is included in the holding period of a U.S. Holder’s Class A Ordinary Shares, respectively,
then such holder will generally be subject to special rules (the “Default PFIC Regime”) with respect to such Shares unless
the U.S. Holder makes a “mark-to-market” election as described below.

It is not entirely clear how
various aspects of the PFIC rules apply to the Warrants. Section 1298(a)(4) of the Code provides that, to the extent provided
in Treasury regulations, any person who has an option to acquire stock in a PFIC shall be considered to own such stock in the PFIC for
purposes of the PFIC rules. No final Treasury regulations are currently in effect under Section 1298(a)(4) of the Code. However,
proposed Treasury regulations under Section 1298(a)(4) of the Code have been promulgated with a retroactive effective date (the
“Proposed PFIC Option Regulations”). U.S. Holders should consult their tax advisors regarding the possible application
of the Proposed PFIC Option Regulations to the Warrants. The following discussion assumes that the Proposed PFIC Option Regulations will
apply to the Warrants.

The Default PFIC Regime applies
with respect to:

| ● | Any gain recognized by the U.S. Holder on the sale or 
 other disposition of such Securities; and             |

| ● | any “excess distribution” made to the U.S. Holder                                                                                
 with respect to such Securities (generally, any distributions to such U.S. Holder during a taxable year of the U.S. Holder       
 that are greater than 125% of the average annual distributions received by such U.S. Holder in respect of such Securities during 
 the three preceding taxable years of such U.S. Holder or, if shorter,