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We believe that we were likely classified as a PFIC for the period ended December 31, 2015, and may be a
PFIC in subsequent years. The tests for determining PFIC status depend upon a number of factors, some of which
are beyond our control and can be subject to uncertainties. Accordingly, we cannot provide certainty to U.S.
Holders that we were or were not a PFIC for the period ended December 31, 2015, or any future year. We will use
commercially reasonable efforts to provide information as to our status as a PFIC and the PFIC status of any
subsidiary in which the Company owns more than 50% of such subsidiary’s total aggregate voting power to U.S.
Holders who make a written request for such information.
If we are classified as a PFIC for any taxable year, the so-called “excess distribution” regime will apply to
any U.S. Holder of common shares that does not make a QEF election or mark-to-market election, as described
below. Under the excess distribution regime, (i) any gain the U.S. Holder realizes on the sale or other disposition of
the common shares (possibly including a gift, exchange in a corporate reorganization, or grant as security for a loan)
and any “excess distribution” that we make to such U.S. Holder (generally, any distributions to such holder in
respect of the common shares during a single taxable year that are greater than 125% of the average annual
distributions received by such U.S. Holder in the three preceding years or, if shorter, such holder’s holding period
for the common shares), will be treated as ordinary income that was earned ratably over each day in such U.S.
Holder’s holding period for the common shares; (ii) the portion of any excess distributions allocated to the current
year or prior years before the first day of the first taxable year beginning after December 31, 1986, in which we
became a PFIC would be includible by the U.S. Holder as ordinary income in the current year; (iii) the portion of
such gain or distribution that is allocable to prior taxable years during which we were a PFIC will be subject to tax at
the highest rate applicable to ordinary income for the relevant taxable years, regardless of the tax rate otherwise
applicable to such U.S. Holder and without reduction for deductions or loss carryforwards; and (iv) the interest
charge generally applicable to underpayments of tax will be imposed with respect of the tax attributable to each such
year. The interest charge discussed above generally will be non-deductible interest expense for individual U.S.
Holders.
Certain elections may be available with respect to our common shares (the so-called “QEF,” “mark-to-
market,” and “deemed sale” elections) if we are a PFIC, but these elections may accelerate the recognition of taxable
income and may result in the recognition of ordinary income.
If a U.S. Holder makes for any tax year a timely election to treat the Company as a “qualifying electing
fund” or “QEF” (a “QEF election”) with respect to such U.S. Holder’s interest therein, the above-described rules
regarding excess distributions generally will not apply. Instead, the electing U.S. Holder would include annually in
its gross income its pro rata share of our ordinary earnings and any net capital gain regardless of whether such
income or gain was actually distributed. Special rules apply to U.S. Holders who own their interests in a PFIC
through intermediate entities or persons.
A U.S. Holder may make a QEF election only if the U.S. Holder receives certain information (known as a
“PFIC annual information statement”) from us annually. We will use commercially reasonable efforts to make
available to U.S. Holders, upon written request, an accurate PFIC annual information statement for each year in
which the Company is a PFIC. A QEF election is generally timely filed only if it is made on a timely filed federal
income tax return for the first year in the U.S. Holder’s holding period for our common shares in which we were a
PFIC. A U.S. Holder for whom a QEF election would otherwise be untimely may be able to make a special
“deemed sale” election pursuant to which the U.S. Holder recognizes any gain inherent in the U.S. Holder’s
common shares and restarts the U.S. Holder’s holding period in our common shares for purposes of making a QEF
election. A deemed sale election generally can be made only if the U.S. Holder owns common shares on the first
day of our taxable year in which the election is to be effective.
Alternatively, a U.S. Holder of common shares may elect to recognize any gain or loss on its common
shares on a mark-to-market basis at the end of each taxable year, so long as the common shares are regularly traded
on a qualifying exchange. We cannot provide assurance that our common shares will be regularly traded on a
qualifying exchange for years in which we may be a PFIC.