Company: CGCT
Filing Date: 2025-04-14
Form Type: S-1/A
Source: 0001104659-25-034635
Chunk: 146

Company: Cartesian Growth Corp III
Filing Date: 2025-04-14
Form: S-1/A
Chunk 146
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 subject to certain exceptions. If applicable,
the amount of the stock buyback tax is generally 1% of the aggregate fair market value of any stock repurchased by the corporation during
a taxable year, net of the aggregate fair market value of certain new stock issuances by the repurchasing corporation during the same
taxable year. The Biden administration previously proposed increasing the stock buyback tax rate from 1% to 4%; however, it is unclear
whether such a change would be enacted under the Trump administration and, if enacted, how soon it could take effect. In addition, the
U.S. Treasury Department and IRS have released preliminary guidance that would potentially cause a non-U.S. corporation’s
U.S. subsidiaries to be subject to the stock buyback tax with respect to any share repurchases made by the non-U.S. corporation
under certain circumstances.

As an entity incorporated as a Cayman Islands
exempted company, the stock buyback tax is currently not expected to apply to redemptions of our Class A ordinary shares (absent
any regulations or other additional guidance that may be issued in the future). However, in connection with an initial business combination
involving a company organized under the laws of the United States (or any subdivision thereof), it is possible that we domesticate
and continue as a Delaware corporation prior to certain redemptions. Because we expect that, following such a domestication, our securities
would continue to trade on Nasdaq, in such a case we could be subject to the stock buyback tax with respect to any subsequent redemptions
(including redemptions in connection with the initial business combination) that are treated as repurchases for this purpose. In all
cases, whether and to what extent we would be subject to the stock buyback tax will depend on a number of factors, including (i) the
structure of the initial business combination, including the extent to which the initial business combination involves a U.S. corporation
and the extent to which we issue shares in the initial business combination or otherwise during the same taxable year that are eligible
to offset any redemptions or other repurchases, (ii) the fair market value of the shares redeemed and (iii) the extent such
redemptions could be treated as dividends and not as repurchases. The applicability of the stock buyback tax to us could be further affected
by the content of any regulations, clarifications or other additional guidance from the U.S. Treasury Department that