Company: SCLXW
Filing Date: 2025-12-29
Form Type: 424B3
Source: 0001193125-25-335429
Chunk: 574

Company: Scilex Holding Co
Filing Date: 2025-12-29
Form: 424B3
Chunk 574
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 and Cash Equivalents

The Company considers all highly liquid investments that are readily convertible into cash without penalty and with original maturities of three months or less
at the date of purchase to be cash equivalents. The carrying amounts reported in the unaudited condensed consolidated balance sheets for cash and cash equivalents are valued at cost, which approximate their fair value. Cash equivalents were
immaterial as of September 30, 2025 and December 31, 2024.

Accounts Receivable, Net

Accounts receivable are presented net of allowances for expected credit losses and prompt payment discounts. Accounts receivable consists of trade receivables
from product sales to customers, which are generally

F-67

unsecured. Estimated credit losses related to trade accounts receivable are recorded as selling, general and administrative expenses and as an allowance for expected credit losses within accounts
receivable, net. The Company reviews reserves and makes adjustments based on historical experience, current economic conditions and known collectability issues and disputes. When internal collection efforts on accounts have been exhausted, the
accounts are written off by reducing the allowance for expected credit losses. As of September 30, 2025 and December 31, 2024, allowances for credit losses on accounts receivable were nil and $1.2 million, respectively. As of
September 30, 2025 and December 31, 2024, allowances for prompt payment discounts were $0.3 million and $0.6 million, respectively.

The Oramed Note, FSF Deposit and Tranche B Notes

The Company has elected the fair value option to account for the FSF Deposit and the Tranche B Notes (as defined in Note 2 “Liquidity and Going Concern” below) and the Oramed Note (as defined in Note 4 “Fair Value Measurements” below) that were issued in June 2024, October 2024 and September 2023, respectively, as discussed further in Note 7. The Company
recorded these financial instruments at fair value upon issuance with changes in fair value recorded as change in fair value of debt and liability instruments in the unaudited condensed consolidated statements of operations, with the exception of
changes in fair value due to instrument-specific credit risk, if any, which are recorded as a component of other comprehensive income. Interest expense related to these financial instruments is included in the changes in fair value. As a result of
applying the fair value option, direct costs and fees related to these financial