Company: HVIIR
Filing Date: 2025-12-23
Form Type: S-4
Source: 0001493152-25-029121
Chunk: 245

Company: Hennessy Capital Investment Corp. VII
Filing Date: 2025-12-23
Form: S-4
Chunk 245
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 on fair market value of the assets determined at the end of each quarterly period), including its pro rata share of the assets of any corporation in which it is considered to own at least twenty five percent (25%) of the shares by value, are “passive assets”, which generally means that they are held for the production of, or produce, passive income. Passive income generally includes dividends, interest, rents and royalties (other than rents or royalties derived from the active conduct of a trade or business received from unrelated persons) and gains from the disposition of passive assets. For purposes of these rules, which may apply to HVII prior to the Domestication, interest income earned by HVII would be considered passive income and cash held by HVII would generally be considered a passive asset. The determination of whether a non-U.S. corporation is a PFIC is made annually.

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PFIC Status of HVII

Because HVII is a blank check company with no current active business prior to the Business Combination, and based upon the composition of its income and assets, and upon a review of its financial statements, HVII believes that it likely was a PFIC for its most recent taxable year and likely a PFIC for its current taxable year which will end as a result of the Domestication. The determination of whether HVII is a PFIC for the previous taxable year depends (in part) on the application of a start-up exception, the application of which is unclear in certain respects.

Effects of PFIC Rules on the Domestication

Even if the Domestication qualifies as an F Reorganization, Section 1291(f) of the Code requires that, to the extent provided in Treasury Regulations, a U.S. person who disposes of stock of a PFIC recognizes gain notwithstanding any other provision of the Code. No final Treasury Regulations are currently in effect under Section 1291(f) of the Code. However, proposed Treasury Regulations under Section 1291(f) of the Code have been promulgated with a retroactive effective date. If finalized in their current form, those proposed Treasury Regulations would require gain recognition to U.S. Holders of HVII Class A Ordinary Shares as a result of the Domestication if:

| (i)  | HVII                                                                                        
 were classified as a PFIC at any time during such U.S. Holder’s holding period in such      
 HVII Class A Ordinary Shares; and                                                           |
| (ii) | the                                                                                         
 U.S. Holder had not timely made (a) a Q