Company: KOYNU
Filing Date: 2025-05-15
Form Type: DRS
Source: 0001829126-25-003675
Chunk: 335

Company: CSLM Digital Asset Acquisition Corp III, Ltd
Filing Date: 2025-05-15
Form: DRS
Chunk 335
---
 Holder with respect to the tax attributable to each such other taxable year of the 
 U.S. Holder.                                                                                                          |

In general, if we are determined to be a PFIC, a U.S. Holder may be able to avoid the PFIC tax consequences described above in respect of
our Class A ordinary shares by making a timely and valid QEF election (if eligible to do so)
to include in income its pro rata share of our net capital gains (as long-term capital gain) and other earnings and profits (as ordinary income), on a current basis,
in each case whether or not distributed, in the taxable year of the U.S. Holder in which or with which our taxable year ends. A U.S. Holder generally may make a separate election to defer the payment of taxes on undistributed
income inclusions under the QEF rules, 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 Class A ordinary shares in a year after our first taxable year as a PFIC in which the U.S. Holder held (or was deemed to hold) Class A ordinary shares, then notwithstanding such QEF election, the rules relating to “excess
distributions” 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 Class A ordinary shares, unless the U.S. Holder makes a purging election under the PFIC rules. Under the purging election,
the U.S. Holder will be deemed to have sold such 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 the 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 Class A ordinary shares.

It is not entirely clear how various aspects of the PFIC rules apply to the warrants.
However, a U.S. Holder may not make a QEF election with respect to its warrants to acquire our Class A ordinary shares. As a result, if a U.S. Holder sells or otherwise disposes of such warrants (other than upon exercise of such
warrants) and we were a PFIC at any time during the U.S. Holder’s holding period of such warrants,