Company: MDCXW
Filing Date: 2025-04-04
Form Type: POS AM
Source: 0001062993-25-007073
Chunk: 179

Company: Medicus Pharma Ltd.
Filing Date: 2025-04-04
Form: POS AM
Chunk 179
---
 after we provide notice of our intent to redeem Warrants for cash) to be treated as a recapitalization, a cashless exercise could alternatively be treated as a taxable exchange in which gain or loss would be recognized.

It is also possible that a cashless exercise could be treated in part as a taxable exchange in which gain or loss is recognized. In such event, a portion of the Warrants to be exercised on a cashless basis could, for U.S. federal income tax purposes, be deemed to have been surrendered in consideration for the exercise price of the remaining Warrants, which would be deemed to be exercised. For this purpose, a U.S. Holder would be deemed to have surrendered a number of Warrants having an aggregate value equal to the exercise price for the total number of Warrants deemed exercised. The U.S. Holder would recognize capital gain or loss in an amount equal to the difference between exercise price for the total number of Warrants deemed exercised and the U.S. Holder's tax basis in the Warrants deemed surrendered. Such gain or loss would be long-term or short-term depending on the U.S. Holder's holding period in the Warrants deemed surrendered. In this case, a U.S. Holder's initial tax basis in the common shares received would equal the sum of the U.S. Holder's adjusted tax basis in the Warrants deemed exercised and the exercise price of such Warrants. It is unclear whether a U.S. Holder's holding period for the common shares would commence 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 would not include the period during which the U.S. Holder held the Warrant.

Distributions on Common Shares

If we pay distributions or make constructive distributions (other than certain distributions of our stock or rights to acquire our stock) to U.S. Holders, such distributions generally will constitute dividends for U.S. federal income tax purposes to the extent paid or deemed paid from our current or accumulated earnings and profits, as determined under U.S. federal income tax principles. Distributions in excess of our current and accumulated earnings and profits will constitute a return of capital that will be applied against and reduce (but not below zero) the U.S. Holder's adjusted tax basis in our common shares. Any remaining excess will be treated as gain realized on the sale or other disposition of the common shares and will be treated as described under "-Dispositions" below.

<div align='center'>-126-</div