Company: TVRD
Filing Date: 2025-01-27
Form Type: S-4/A
Source: 0001104659-25-006050
Chunk: 19

Company: Tvardi Therapeutics, Inc.
Filing Date: 2025-01-27
Form: S-4/A
Chunk 19
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.S. Federal Income Tax Consequences of the Reverse Stock Split” beginning on page 217 of this proxy statement/prospectus) should not recognize gain or loss upon the Reverse Stock Split (other than in respect of cash received in lieu of fractional shares). A U.S. holder’s aggregate tax basis in the shares of Cara common stock received pursuant to the Reverse Stock Split should equal the aggregate tax basis of the shares of Cara common stock surrendered (excluding any portion of such basis that is allocated to any fractional share of Cara common stock), and such U.S. holder’s holding period in the shares of Cara common stock received should include the holding period in the shares of Cara common stock surrendered. Treasury Regulations provide detailed rules for allocating the tax basis and holding period of the shares of Cara common stock surrendered to the shares of Cara common stock received in a “recapitalization”. U.S. holders of shares of Cara common stock acquired on different dates and at different prices should consult their tax advisors regarding the allocation of the tax basis and holding period of such shares. |

Please review the information in the section titled “ Matters Being Submitted to a Vote of Cara’s Stockholders — Proposal No. 4: Approval of an Amendment to the Amended and Restated Certificate of Incorporation of Cara Effecting the Reverse Stock Split — Material U.S. Federal Income Tax Consequences of the Reverse Stock Split” beginning on page 217 of this proxy statement/prospectus for a more complete description of the material U.S. Federal Income Tax consequences of the Reverse Stock Split to Cara U.S. holders. Q: What are the Convertible Notes?

| A: | On December 3, 2024, Tvardi entered into a Note Purchase Agreement to issue and sell convertible promissory notes (Convertible Notes) in an aggregate amount of approximately $28.3 million. The Convertible Notes accrue simple interest at 8% per annum and mature on December 31, 2026. Upon the Closing, the outstanding principal balance of such notes and all unpaid accrued interest will be automatically converted into shares of Cara common stock, at a conversion price equal to 80% of the implied valuation of the combined company in the Merger. The Conversion Shares shall be calculated by multiplying the Post-Closing Cara Shares (as defined below) by (a) the quotient obtained by dividing (i)the Implied Note Valuation (as defined below) by (ii) the Aggregate Post-Bridge Valuation (as defined below). The Post-Closing Shares means