Company: GAUZ
Filing Date: 2025-03-11
Form Type: 20-F
Source: 0001213900-25-022437
Chunk: 124

Company: Gauzy Ltd.
Filing Date: 2025-03-11
Form: 20-F
Item: Item 10
Chunk 124
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 earnings and profits under U. S. federal
income tax principles and, therefore, U. S. Holders should expect that the entire amount of any distribution generally will be
reported as dividend income.

In general, preferential tax
rates for “qualified dividend income” and long-term capital gains are applicable for U. S. Holders that are individuals, estates
or trusts. For this purpose, “qualified dividend income” means, inter alia, dividends received from a “qualified foreign
corporation.” A “qualified foreign corporation” is a corporation that is entitled to the benefits of a comprehensive
tax treaty with the United States that includes an exchange of information program. The IRS has stated that the U. S.-Israel Tax Treaty
satisfies this requirement and we believe we are eligible for the benefits of that treaty.

In addition, our dividends
will be qualified dividend income if our ordinary shares are readily tradable on the Nasdaq or another established securities market in
the United States. Dividends will not qualify for the preferential rate if we are treated, in the year the dividend is paid or in the
prior year, as a passive foreign investment company, or PFIC, as described below under “ Passive Foreign Investment Companies.”
A U. S. Holder will not be entitled to the preferential rate: (1) if the U. S. Holder has not held our ordinary shares for at least 61 days
of the 121 day period beginning on the date which is 60 days before the ex-dividend date, or (2) to the extent the U. S. Holder is under
an obligation to make related payments with respect to positions in substantially similar or related property. Any days during which the
U. S. Holder has diminished its risk of loss on our ordinary shares are not counted towards meeting the 61-day holding period. Finally,
U. S. Holders who elect to treat the dividend income as “investment income” pursuant to Section 163(d)(4) of the Code will
not be eligible for the preferential rate of taxation.

The amount of a distribution
with respect to our ordinary shares will be measured by the amount of the fair market value of any property distributed, and for U. S.
federal income tax purposes, the amount of any Israeli taxes withheld therefrom. Cash distributions paid by us in NIS will be included
in the income of U. S. Holders at a U. S. dollar amount based upon the spot rate