Company: GCL
Filing Date: 2025-07-31
Form Type: 20-F
Source: 0001213900-25-069672
Chunk: 149

Company: GCL Global Holdings Ltd
Filing Date: 2025-07-31
Form: 20-F
Item: Item 10
Chunk 149
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 characterization
of a cashless exercise of a Warrant is not clear under current U. S. federal tax law. A cashless exercise could potentially be characterized
as any of the following for U. S. federal income tax purposes: (i) not a realization event and thus tax-deferred, (ii) a realization event
that qualifies as a tax-deferred “recapitalization,” or (iii) a taxable realization event. The tax consequences of all three
characterizations are generally described below. U. S. Holders should consult with their own tax advisors regarding the tax consequences
of a cashless exercise.

If a cashless exercise were
characterized as either not a realization event or as a realization event that qualifies as a recapitalization, a U. S. Holder would not
recognize any gain or loss on the exchange of Warrants for our Ordinary Shares. A U. S. Holder’s basis in our Ordinary Shares received
would generally equal the U. S. Holder’s aggregate basis in the exchanged Warrants.

If the cashless exercise
were not a realization event, it is unclear whether a U. S. Holder’s holding period in our Ordinary Shares would be treated as commencing
on the date of exchange of the Warrants or on the immediately following date, but the holding period would not include the period during
which the U. S. Holder held the Warrants. On the other hand, if the cashless exercise were characterized as a realization event that qualifies
as a recapitalization, the holding period of our Ordinary Shares would include the holding period of the warrants exercised therefor.

If the cashless exercise
were treated as a realization event that does not qualify as a recapitalization, the cashless exercise could be treated in whole or in
part as a taxable exchange in which gain or loss would be recognized by the U. S. Holder. Under this characterization, a portion of the
Warrants to be exercised on a cashless basis would be deemed to have been surrendered in payment of the exercise price of the remaining
portion of such warrants, which would be deemed to be exercised. In such a case, a U. S. Holder would effectively be deemed to have sold
a number of Warrants having an aggregate value equal to the exercise price of the remaining Warrants deemed exercised. The U. S. Holder
would recognize capital gain or loss in an amount generally equal to the difference between the value of the portion of the warrants deemed