Company: SMNR
Filing Date: 2025-07-02
Form Type: S-4/A
Source: 0001193125-25-154936
Chunk: 832

Company: Semnur Pharmaceuticals, Inc.
Filing Date: 2025-07-02
Form: S-4/A
Chunk 832
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 “Income Taxes” for additional details.

Stock-Based Compensation

The Company accounts for stock-based compensation in accordance with ASC Topic 718, Compensation – Stock Compensation which establishes accounting for equity instruments exchanged for employee and consulting services.

The Company did not have its own equity incentive plans for the years ended December 31, 2024 and 2023, other than the 2024 Stock Option Plan as described below. However, certain shared employees of Scilex, who provide services and support activities related to the Company, also participate in Scilex’s stock-based compensation plans. The stock-based compensation for such employees is allocated and attributed to the Company based on the estimated percentage of their time spent providing services attributable to the Company.

On August 30, 2024, the Company’s board of directors adopted the 2024 Stock Option Plan and approved the grant of Non-statutory Stock Options (“NSOs”) to the members of the Company’s executive team and certain shared employees of Scilex – who provide services and support activities related to the Company – to purchase an aggregate of 40,000,000 shares of the Company’s common stock initially at an exercise price of $1.24 per share, which was then updated to $1.58 per share on December 28, 2024 to reflect the updated per share value of the Company’s common stock as of August 30, 2024.

Stock-based compensation cost is measured at the grant date, based on the fair value of the award determined using the Black-Scholes option pricing model, and is recognized as an expense, under the straight-line method, over the employee’s requisite service period (generally the vesting period of the equity grant) or non-employee’s vesting period. The Company accounts for forfeitures as incurred.

For purposes of determining the inputs used in the calculation of stock-based compensation, the Company determines the expected life assumption for options issued using the simplified method, which is an average of the contractual term of the option and its ordinary vesting period since the Company does not have historic**

<div align='center'>F-74</div>

**exercise behavior. The Company determines an estimate of option volatility based on an assessment of historical volatilities of comparable companies whose share prices are publicly available. The Company uses these estimates, in conjunction with the fair value of Scilex’s common stock, risk-free interest rate, and the expected dividend yield as inputs in the Black-Scholes option pricing model. Depending upon the number of stock options granted