Company: FLYE
Filing Date: 2025-04-22
Form Type: S-1
Source: 0001213900-25-034233
Chunk: 45

Company: Fly-E Group, Inc.
Filing Date: 2025-04-22
Form: S-1
Chunk 45
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 not include the period during which the U.S.
Holder held the Warrant. If a Warrant is allowed to lapse unexercised, a U.S. Holder generally will recognize a capital loss equal to
such holder’s tax basis in the Warrant.

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The tax consequences of a cashless
exercise of a Warrant are not clear under current law. A cashless exercise may not be taxable, either because the exercise is not a realization
event or because the exercise is treated as a “recapitalization” for U.S. federal income tax purposes. In either situation,
a U.S. Holder’s tax basis in our Warrant Shares received generally would equal the U.S. Holder’s tax basis in the Warrants
exercised therefor. If the cashless exercise were not a realization event, it is unclear whether a U.S. Holder’s holding period
for our Warrant Shares will commence on the date of exercise of the Warrant or the day following the date of exercise of the Warrant.
If the cashless exercise were treated as a recapitalization, the holding period of our Warrant Shares would include the holding period
of the Warrants exercised therefor.

It is also possible that a
cashless exercise could be treated in whole or in part as a taxable exchange in which gain or loss would be recognized. In such event,
a U.S. Holder could be deemed to have surrendered a number of Warrants having an aggregate value (as measured by the excess of the fair
market value of our shares of Common Stock over the exercise price of the Warrants) equal to the exercise price for the total number of
Warrants to be exercised (i.e., the Warrants underlying the number of our Warrant Shares actually received by the U.S. Holder pursuant
to the cashless exercise). The U.S. Holder would recognize capital gain or loss in an amount equal to the difference between the value
of the Warrants deemed surrendered and the U.S. Holder’s tax basis in such Warrants. Such gain or loss would be long-term or short-term,
depending on the U.S. Holder’s holding period in the Warrants deemed surrendered. In this case, a U.S. Holder’s tax basis
in our Warrant Shares received would equal the sum of the U.S. Holder’s tax basis in the Warrants exercised and the exercise price
of such Warrants. It is unclear whether a U.S. Holder’s holding period for