Company: ATMCW
Filing Date: 2025-11-17
Form Type: DEFM14A
Source: 0001493152-25-023842
Chunk: 210

Company: ALPHATIME ACQUISITION CORP
Filing Date: 2025-11-17
Form: DEFM14A
Chunk 210
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 Combination occurs, the income and assets, and the value of the assets, of its predecessor AlphaTime. In addition, the risk of PubCo being a PFIC for any taxable year will increase if its market capitalization declines substantially during that year. Furthermore, whether and to which extent PubCo’s income and assets, including goodwill, will be characterized as active or passive will depend on various factors that are subject to uncertainty, including PubCo’s future business plan and the application of laws that are subject to varying interpretation. For example, there is no authority that directly addresses the proper treatment of certain items of PubCo’s income, such as income from proprietary hash rate sharing, or hosting for purposes of the PFIC rules and, although PubCo currently treats these items of income as active, such treatment is uncertain. Moreover, certain of PubCo’s business activities generate passive income and, although the amount of such income is currently small, PubCo’s risk of being a PFIC will increase if the proportion of PubCo’s revenue earned from such business activities increases in future taxable years. Accordingly, there can be no assurances that PubCo will not be a PFIC for its current or any future taxable year.

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Even if PubCo is not a PFIC for its taxable year ending December 31, 2024, or any subsequent taxable year, if AlphaTime is or was a PFIC (as AlphaTime believes to be the case for its 2021, 2022 and 2023 taxable years, and which may be the case for its 2024 taxable year) for any taxable year during the holding period of a U.S. Holder in its ATMC Ordinary Shares, and such U.S. Holder did not (or could not) make any of the PFIC Elections (as defined below), although not free from doubt, PubCo would be treated as a PFIC as to a U.S. Holder who exchanges ATMC Ordinary Shares for PubCo Ordinary Shares in connection with the Initial Mergers with respect to such PubCo Ordinary Shares, unless such U.S. Holder makes a purging election with respect to its shares. Under one type of purging election, the U.S. Holder will be deemed to have sold such shares at their fair market value and any gain recognized on such deemed sale will be treated as an “excess distribution,” as described below. As a result of this election, the U.S. Holder will have additional basis (to the extent of any gain recognized in the deemed sale)