Company: LIMN
Filing Date: 2025-02-07
Form Type: 424B3
Source: 0001104659-25-010605
Chunk: 288

Company: Liminatus Pharma, Inc.
Filing Date: 2025-02-07
Form: 424B3
Chunk 288
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 exercise of the ParentCo warrant will begin on the day following the date of exercise (or possibly the date of exercise) of the ParentCo warrant and will not include the period during which the U.S. holder held the ParentCo warrant. Subject to certain exceptions, if a ParentCo warrant is allowed to lapse unexercised, a U.S. holder will realize a capital loss equal to such U.S. holder’s tax basis in the ParentCo warrant. Such loss will be long-term if the U.S. holder’s holding period for the ParentCo warrant exceeds one year.

The tax consequences of a cashless exercise of a ParentCo warrant are not clear under current tax law. A cashless exercise may be tax-deferred, either because the exercise is not a gain realization event or because the exercise is treated as a recapitalization for U.S. federal income tax purposes. In either tax-deferred situation, a U.S. holder’s tax basis in the ParentCo Common Stock received would equal the U.S. holder’s tax basis in the ParentCo warrant. If the cashless exercise were treated as not being a gain realization event, a U.S. holder’s holding period in the ParentCo Common Stock would be treated as commencing on the day following the date of exercise (or possibly the date of exercise) of the ParentCo warrant. If the cashless exercise were treated as a recapitalization, the holding period of the ParentCo Common Stock would include the holder’s holding period for the ParentCo warrant.

It is also possible that a cashless exercise could be treated in part as a taxable exchange in which gain or loss would be recognized. In such event, a U.S. holder could be deemed to have surrendered warrants having a value equal to the exercise price for the total number of ParentCo warrants to be exercised. The U.S. holder would recognize capital gain or loss in an amount equal to the difference between the fair market value of the shares of ParentCo Common Stock represented by the ParentCo warrants deemed surrendered and the U.S. Holder’s tax basis in the ParentCo warrants deemed surrendered. In this case, a U.S. Holder’s tax basis in the ParentCo Common Stock received would equal the fair market value of the shares of ParentCo Common Stock represented by the ParentCo warrants deemed surrendered. A U.S. Holder’s holding period for the ParentCo Common Stock would commence on the day following the date of exercise (or possibly the date of exercise) of the ParentCo warrant.

Due to the