Company: KII
Filing Date: 2025-09-18
Form Type: S-1
Source: 0001213900-25-088883
Chunk: 276

Company: K2 Capital Acquisition Corp
Filing Date: 2025-09-18
Form: S-1
Chunk 276
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 of passive income (which generally includes dividends, interest, rents and royalties (other than rents or royalties derived from the active conduct of a trade or business) and gains from the disposition of passive assets); or (ii)at least 50% of our assets in a taxable year (ordinarily determined based on fair market value and averaged quarterly over the year), including our pro rata share of the assets of any corporation in which we are considered to own at least 25% of the shares by value, produce or are held for the production of passive income. Because we are a blank check company with no current income from an active business (as defined for these purposes), we believe that it is likely that we will meet one or both of the PFIC tests during the taxable years prior to our acquisition of a company or assets in a business combination (including any short taxable year that might result from a business combination), which would generally result in our being treated as a PFIC in those taxable years. In certain circumstances, a foreign corporation may qualify for a “start -upexception,” pursuant to which it would not be treated as a PFIC for the first taxable year it has gross income (the “start -upyear”), if (1) no predecessor of the corporation was a PFIC, (2) the corporation satisfies the IRS that it will not be a PFIC for either of the first two taxable years following the start -upyear, and (3) the corporation is not in fact a PFIC for either of those years. If the start -upexception were to apply to us, we would not be a PFIC during our start -upyear. However, the start -upexception may not be applicable to us. Our PFIC status for our current and subsequent taxable years may depend on, among other things, the timing of our business combination, the amount of our passive income and assets in the year of the business combination, whether we combine with a U.S. or non -U.S. target company, and the amount of passive income and assets of the acquired business. If the company that we acquire in a business combination is a PFIC, then we will likely not qualify for the start -upexception and will be a PFIC for our current taxable year. Our actual PFIC status for our current taxable year or any subsequent taxable year will not be determinable until after the end of such taxable year. However, if the start -upexception is not applicable to us, we are likely to be treated as