Company: TGE
Filing Date: 2025-02-19
Form Type: DRS
Source: 0001213900-25-015012
Chunk: 184

Company: Generation Essentials Group
Filing Date: 2025-02-19
Form: DRS
Chunk 184
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ulgated under Section 1291(f) of the Code (which have a retroactive effective date) generally require that, unless certain elections have been made by a U.S. Holder, a U.S. Holder who transfers stock of a PFIC must recognize gain (if any) equal to the excess of the fair market value of such PFIC stock over its adjusted tax basis, notwithstanding any other provision of the Code. Black Spade II anticipates that it will be treated as a PFIC for its current taxable year. As a result, if these proposed Treasury Regulations are finalized in their current form, a U.S. Holder of BSII Class A Ordinary Shares may be required to recognize additional gain under the PFIC rules on the exchange of BSII Class A Ordinary Shares for aWME Ordinary Shares pursuant to the merger unless such U.S. Holder makes (or has made) certain elections discussed further below under “Tax Considerations — U.S. Federal Income Tax Considerations — Effects of the Business Combination to U.S. Holders of BSII Securities — Consequences to BSII Shareholders if the Merger is Treated as a reorganization.” The tax on any such gain would be imposed at the rate applicable to ordinary income and an interest charge would apply based on a complex set of rules. It is difficult to predict whether such proposed Treasury regulations will be finalized and whether, in what form, and with what effective date, the final Treasury Regulations under Section 1291(f) of the Code may be adopted. Further, it is not clear whether any such regulations would apply to the Black Spade II Warrants. If Section 1291(f) were to apply to the Black Spade II Warrants, even if the merger were to qualify as a reorganization, then a U.S. Holder may recognize gain that is subject to the PFIC rules described above upon an exchange of Black Spade II Warrants for aWME Warrants. For a more complete discussion of the potential application of the PFIC rules to U.S. Holders as a result of the merger, see the section titled “Tax Considerations — U.S. Federal Income Tax Considerations — Effects of the Business Combination to U.S. Holders of BSII Securities — Consequences if the Business Combination is Treated as a Reorganization.” U.S. Holders of Black Spade II Securities are urged to consult their own tax advisors to determine the tax consequences of the Business Combination. We may redeem your unexpired warrants prior to their exercise at a