Company: KII
Filing Date: 2025-09-18
Form Type: S-1
Source: 0001213900-25-088883
Chunk: 275

Company: K2 Capital Acquisition Corp
Filing Date: 2025-09-18
Form: S-1
Chunk 275
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.” If none of the redemption sale tests is satisfied, the redemption will be treated as a distribution from us and the tax considerations will be as described under “— Considerations for U.S. Holders — Tax Characterization of Distributions with Respect to Class A Ordinary Shares” above. After the application of those rules, any remaining tax basis of the U.S. Holder in the redeemed Class A ordinary shares will be added to the U.S. Holder’s adjusted tax basis in its remaining shares or, if it has none, possibly to the U.S. Holder’s adjusted tax basis in shares in us constructively owned by it. U.S. Holders are urged to consult with and rely solely upon their own tax advisers as to the allocation of any remaining basis if there are no remaining Class A ordinary shares. Conversion or Lapse of Rights The treatment of the rights upon consummation of an initial business combination is uncertain. The right may be viewed as a forward contract, derivative security or similar interest in us (analogous to a warrant or option with no exercise price), and under that view, the U.S. Holder of the right would not be treated as owning the Class A ordinary shares issuable pursuant to the rights until such Class A ordinary shares are actually issued. There are other alternative characterizations of the rights that the IRS may successfully assert, including that the rights are treated as equity in us at the time the rights are issued. If a right is allowed to lapse unexercised, a U.S. Holder generally will recognize a capital loss equal to such holder’s tax basis in the right. The U.S. federal income tax consequences of a conversion of rights is uncertain. Accordingly, a U.S. Holder should consult with its own tax advisor regarding the tax consequences of an acquisition of Class A ordinary shares pursuant to rights or of a lapse of rights. Passive Foreign Investment Company Rules Adverse U.S. federal income tax rules apply to U.S. Holders that hold shares in a foreign (i.e., non -U.S.) corporation classified as a PFIC for U.S. federal income tax purposes. In general, we will be treated as a PFIC with respect to a U.S. Holder in any taxable year in which, after applying certain look -throughrules, either: (i)at least 75% of our gross income for such taxable year, including our pro rata share of the gross income of any corporation in which we are considered to own at least 25% of the shares by value, consists