Company: CSLMF
Filing Date: 2025-07-03
Form Type: DEFM14A
Source: 0001193125-25-155514
Chunk: 300

Company: CSLM ACQUISITION CORP.
Filing Date: 2025-07-03
Form: DEFM14A
Chunk 300
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, the gain
realized on the transfer is taxable as an excess distribution under Section 1291 of the Code, and the excess, if any, of the amount to be included in income under Section 367(b) over the gain realized under Section 1291 is taxable as
provided under Section 367(b). See “— U.S. Federal Income Tax Consequences of the

175

Domestication to U.S. Holders of CSLM Securities — Effect of Section367 of the Code to U.S. Holders of Public Shares.” The Proposed Regulations should not
apply to an Electing Shareholder with respect to its Public Shares for which a timely QEF election, a QEF election along with a purging election, or mark-to-market
election is made.

An Electing Shareholder may, however, be subject to the rules discussed below under the section entitled “—
U.S. Federal Income Tax Consequences of the Domestication to U.S. Holders of CSLM Securities — Effect of Section367 of the Code to U.S. Holders of Public Shares.” In addition, as discussed above, since a QEF
election cannot be made with respect to Public Warrants, the Proposed Regulations may apply to cause gain recognition under the PFIC rules on the exchange of Public Warrants for Pubco Warrants pursuant to the Domestication. It is not possible to
determine at this time whether, in what form, and with what effective date, final Treasury Regulations under Section 1291(f) of the Code will be adopted.

The rules dealing with PFICs and with the QEF election and purging election (or a mark-to-market election) are very complex and are affected by various factors in addition to those described above. Accordingly, a U.S. Holder of CSLM securities should consult its own tax advisor concerning
the application of the PFIC rules to such securities under such holder’s particular circumstances.

Certain U.S. Federal Income Tax Consequences to U.S. Holders of Exercising Redemption Rights

In the event that a U.S. Holder elects to redeem its Public Shares
(which will be exchanged for shares of Pubco Common Stock in the Domestication) for cash, the treatment of the transaction for U.S. federal income tax purposes will depend on whether the redemption qualifies as sale or exchange of the Pubco Common
Stock under Section 302 of the Code or is treated as a distribution under Section 301 of the Code with respect to the U.S. Holder.