Company: APM
Filing Date: 2025-10-06
Form Type: S-4
Source: 0001213900-25-096656
Chunk: 422

Company: Aptorum Group Ltd
Filing Date: 2025-10-06
Form: S-4
Chunk 422
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 profits is complex and may be impacted by numerous factors, and it is possible that one or more of such factors may cause Company to have positive earnings and profits through the date of the Domestication. As a result, depending upon the period in which such a U.S. Shareholder held his Company shares, he could be required to include his share of Company’s all earnings and profits amount in income as a deemed dividend under Treasury Regulation Section 1.367(b) -3(b)(3) as a result of the Domestication. See below, under “Effect of PFIC Rules on the Domestication” for a discussion of whether amounts included in income under Code Section 367(b) should be reduced by amounts required to be taken into account by a U.S. Holder under the proposed Treasury Regulations under Code Section 1291(f). B. U.S. Holders Who Own Less Than 10 Percent of Company A U.S. Holder who on the day of the Domestication beneficially owns (directly, indirectly, or constructively) Company shares with a fair market value of $50,000 or more but less than (i) ten percent (10%) of the total combined voting power of all classes of Company shares entitled to vote and (ii) ten percent (10%) of the total value of shares of all classes of Company shares must either recognize gain with respect to the Domestication or, in the alternative, elect to recognize his share of the “all earnings and profits” amount as described below. Unless a U.S. Holder makes the “all earnings and profits election” as described below, he generally must recognize gain (but not loss) with respect to Aptorum common stock received in exchange for his DiamiR shares pursuant to the Domestication. Any such gain would be equal to the excess of the fair market value of the Company stock received over the U.S. Holder’s adjusted tax basis in the Company shares surrendered in exchange. Subject to the PFIC rules discussed below, such gain would be capital gain, and would be long -termcapital gain if the U.S. Holder had held the Company shares for longer than one year. In lieu of recognizing any gain as described in the preceding paragraph, a U.S. Holder may elect to include in income the all earnings and profits amount attributable to his Company shares under Section 367(b). However, there are strict conditions for making this election. This election must comply with applicable Treasury regulations 251 and generally must include, among other things: (i) a statement that the