Company: KAVL
Filing Date: 2025-02-21
Form Type: PRE 14C
Source: 0001731122-25-000278
Chunk: 14

Company: Kaival Brands Innovations Group, Inc.
Filing Date: 2025-02-21
Form: PRE 14C
Chunk 14
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 stock surrendered in the Reverse Split in exchange therefor, and the holding period of the U.S. holder’s
common stock received pursuant to the Reverse Split will include the holding period of the common stock surrendered in the Reverse Split
in exchange therefor.

In general, a U.S. holder
who receives a cash payment in lieu of a fractional share will recognize capital gain or loss equal to the difference between the amount
of cash received in lieu of the fractional share and the portion of the U.S. holder’s tax basis of the common stock surrendered
in the Reverse Split that is allocable to the fractional share. Such gain or loss generally will be long-term capital gain or loss if
the U.S. holder’s holding period in its common stock surrendered in the Reverse Split is more than one year as of the date of the
Reverse Split. The deductibility of net capital losses by individuals and corporations is subject to limitations. Depending on a stockholder’s
individual facts and circumstances, it is possible that cash received in lieu of a fractional share could be treated as a distribution
under Section 301 of the Code, so stockholders should consult their own tax advisors as to that possibility and the resulting tax consequences
to them in that event.

U.S. holders that have acquired
different blocks of our common stock at different times or at different prices are urged to consult their own tax advisors regarding the
allocation of their aggregated adjusted basis among, and the holding period of, our common stock.

Information returns generally
will be required to be filed with the IRS with respect to the payment of cash in lieu of a fractional share made pursuant to the Reverse
Split unless such U.S. holder is an exempt recipient and timely and properly establishes with the applicable withholding agent the exemption.
In addition, payments of cash in lieu of a fractional share made pursuant to the Reverse Split may, under certain circumstances, be subject
to backup withholding, unless a U.S. holder timely provides to the applicable withholding agent proof of an applicable exemption or a
correct taxpayer identification number, and otherwise complies with the applicable requirements of the backup withholding rules. Any amounts
withheld under the backup withholding rules are not additional tax and may be refunded or credited against the U.S. holder’s U.S.
federal income tax liability, provided that the U.S. holder timely furnishes the required information to the IRS. U.S. holders should
consult their tax advisors regarding their qualification for an exemption from backup withholding and the procedures for obtaining such
an exemption.

Account