Company: TACOW
Filing Date: 2025-04-09
Form Type: S-1/A
Source: 0001829126-25-002484
Chunk: 284

Company: Berto Acquisition Corp.
Filing Date: 2025-04-09
Form: S-1/A
Chunk 284
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 a recapitalization for United States federal income tax purposes. In either situation, a U.S. Holder’s tax basis
in a ordinary share received upon the cashless exercise of a warrant generally should equal the U.S. Holder’s tax basis in the
warrant. If a cashless exercise of a warrant is not a realization event, it is unclear whether a U.S. Holder’s holding period for
the ordinary share received upon the cashless exercise of the warrant would be treated as commencing on the date of exercise of the warrant
or the day following the date of exercise of the warrant; in either case, the holding period will not include the period during which
the U.S. Holder held the warrant. If the cashless exercise of a warrant is treated as a recapitalization, the holding period of the ordinary
shares received upon the cashless exercise of the warrant would include the holding period of the warrant.

It is also possible that a cashless
exercise of a warrant could be treated in part as a taxable exchange in which gain or loss is recognized. In such event, a U.S. Holder
could be deemed to have surrendered a number of warrants equal to the number of ordinary shares having a value equal to the exercise
price for the total number of warrants exercised on a cashless basis. In such case, subject to the PFIC rules discussed below, the U.S.
Holder would recognize capital gain or loss with respect to the warrants deemed surrendered in an amount equal to the difference between
the fair market value of the ordinary shares that would have been received in a regular exercise of the warrants deemed surrendered and
the U.S. Holder’s tax basis in the warrants deemed surrendered. In this case, a U.S. Holder’s aggregate tax basis in the
ordinary shares received would equal the sum of the U.S. Holder’s initial investment in the warrants deemed exercised (that is,
the portion of the U.S. Holder’s purchase price for the units that is allocated to the warrants, as described above under “—
Allocation of Purchase Price and Characterization of a Unit”) and the aggregate exercise price of such warrants. It is unclear
whether a U.S. Holder’s holding period for the ordinary shares would commence on the date of exercise of the warrants or the day
following the date of exercise of the warrants; in either case, the holding period will not include the period during which the U.S.
Holder held the warrants.

Due to the absence of authority
on the United States federal income tax treatment