Company: KOYNU
Filing Date: 2025-07-22
Form Type: S-1/A
Source: 0001829126-25-005283
Chunk: 371

Company: CSLM Digital Asset Acquisition Corp III, Ltd
Filing Date: 2025-07-22
Form: S-1/A
Chunk 371
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 but if deferred, any such taxes will be subject to an interest charge.

If a U.S. Holder makes a QEF election with respect to its public shares in a year after our first taxable year as a PFIC in which the U.S. Holder held (or was deemed to hold) public shares, then notwithstanding such QEF election, the excess distribution rules discussed above, adjusted to take into account the current income inclusions resulting from the QEF election, will continue to apply with respect to such U.S. Holder’s public shares, unless the U.S. Holder makes a purging election under the PFIC rules. Under one type of purging election, the U.S. Holder will be deemed to have sold such public shares at their fair market value and any gain recognized on such deemed sale will be treated as an excess distribution, as described above. As a result of such purging election, the U.S. Holder will have additional basis (to the extent of any gain recognized on the deemed sale) and, solely for purposes of the PFIC rules, a new holding period in the public shares.

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It is not entirely clear how various aspects of the PFIC rules apply to the public warrants. However, a U.S. Holder may not make a QEF election with respect to its public warrants to acquire our public shares. As a result, if a U.S. Holder sells or otherwise disposes of such public warrants (other than upon exercise of such public warrants for cash) and we were a PFIC at any time during the U.S. Holder’s holding period of such public warrants, any gain recognized generally will be treated as an excess distribution, taxed as described above. If a U.S. Holder that exercises such public warrants properly makes and maintains a QEF election with respect to the newly acquired public shares (or has previously made a QEF election with respect to our public shares), the QEF election will apply to the newly acquired public shares. Notwithstanding any such QEF election, the adverse tax consequences relating to PFIC shares, adjusted to take into account the current income inclusions resulting from the QEF election, will continue to apply with respect to such newly acquired public shares (which generally will be deemed to have a holding period for purposes of the PFIC rules that includes the period the U.S. Holder held the public warrants), unless the U.S. Holder makes a purging election under the PFIC rules. Under one type of purging election, the U.S