Company: GIGGU
Filing Date: 2025-11-12
Form Type: S-4
Source: 0001193125-25-277896
Chunk: 383

Company: GigCapital7 Corp.
Filing Date: 2025-11-12
Form: S-4
Chunk 383
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, under a proposed Treasury Regulation that generally treats an “option” (which would include a Public Warrant) to acquire the stock of a PFIC as stock of the PFIC, exchanging warrants of a PFIC for newly issued warrants in connection with a domestication transaction) 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 GigCapital7 Class A Ordinary Shares and Public Warrants as a result of the Domestication if:

| (i) | GigCapital7 were classified as a PFIC at any time during such U.S. Holder’s holding period in such GigCapital7 Class A Ordinary Shares or Public Warrants; and |

| (ii) | the U.S. Holder had not timely made (a) a QEF Election (as defined below) for the first taxable year in which the U.S. Holder owned such GigCapital7 Class A Ordinary Shares or in which GigCapital7 was a PFIC, whichever is later (or a QEF Election along with a purging election), or (b) an MTM Election (as defined below) with respect to such GigCapital7 Class A Ordinary Shares. Under current law, neither a QEF Election nor an MTM Election can be made with respect to warrants. |

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The tax on any such recognized gain would be imposed based on a complex set of computational rules designed to offset the tax deferral with respect to the undistributed earnings of GigCapital7. Under these rules (the “ excess distributions regime”):

| • |     | the U.S. Holder’s gain will be allocated ratably over the U.S. Holder’s holding period for such U.S. Holder’s GigCapital7 Class A Ordinary Shares or Public Warrants; |

| • |     | the amount of gain allocated to the U.S. Holder’s taxable year in which the U.S. Holder recognized the gain, or to the period in the U.S. Holder’s holding period before the first day of the first taxable year in which GigCapital7 was a PFIC, will be taxed as ordinary income; |

| • |     | the amount of gain allocated to each other taxable year (or portion thereof) of the U.S. Holder and included