Company: KG
Filing Date: 2025-03-26
Form Type: 424B3
Source: 0001104659-25-028251
Chunk: 280

Company: Kestrel Group Ltd
Filing Date: 2025-03-26
Form: 424B3
Chunk 280
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Co is not eligible to receive a deduction when a SAR is granted. Generally, upon exercising a SAR, a participant will recognize ordinary income in an amount equal to sum of the cash and the fair market value of the shares received and Bermuda NewCo will be eligible to receive a corresponding deduction. Upon sale of any shares received upon exercise of a SAR, the participant will recognize short-term or long-term capital gain or loss, depending

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upon whether the shares have been held for more than one year. The amount of such gain or loss will be equal to the difference between the amount realized in connection with the sale of the shares and the participant’s tax basis in such shares.

Unless a participant makes a “Section 83(b) election” under the Code, there generally will be no U.S. federal income tax consequences to either the participant or Bermuda NewCo upon the grant of restricted shares that are subject to a substantial risk of forfeiture until the restrictions constituting a substantial risk of forfeiture lapse. At the time the substantial risk of forfeiture lapses, the participant generally will recognize taxable income equal to the then fair market value of the shares. Bermuda NewCo will generally be eligible to receive a corresponding tax deduction. If a participant makes a “Section 83(b) election” under the Code, the participant will recognize ordinary income with respect to the shares when the shares are received rather than at the time the forfeiture restrictions lapse. The amount of income recognized will be equal to the fair market value of the restricted shares at such time (valued without taking the restrictions into account) over the price paid for such award, if any, and Bermuda NewCo will be eligible to receive a corresponding deduction. By making a “Section 83(b) election,” the participant will recognize no additional compensation income with respect to the shares when the forfeiture restrictions lapse, and will instead recognize short-term or long-term capital gain or loss with respect to the shares when they are sold. If, however, the shares are subsequently forfeited to us, the participant will not be eligible to claim a loss with respect to the shares to the extent of the income recognized by the participant upon the making of the “Section 83(b) election.” To make a “Section 83(b) election,” a participant must file an appropriate form of election with the Internal Revenue Service and with his or her employer, each within 30 days after the restricted shares are received, and the participant must also attach a copy of his or her