Company: SMNR
Filing Date: 2025-04-21
Form Type: S-4/A
Source: 0001193125-25-087342
Chunk: 429

Company: Semnur Pharmaceuticals, Inc.
Filing Date: 2025-04-21
Form: S-4/A
Chunk 429
---
 this purpose. Long term capital gain realized by a non–corporate U.S. Holder is currently taxed at a reduced rate. The deductibility of capital losses is subject to limitations.

If the redemption does not qualify as a sale or exchange of New Semnur Common Stock, the U.S. Holder generally will be treated as receiving a corporate distribution. Such distributions generally will constitute dividends for U.S. federal income tax purposes to the extent paid from Denali’s current or accumulated earnings and profits, as determined under U.S. federal income tax principles. Distributions in excess of current and accumulated earnings and profits generally 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 the New Semnur Common Stock. Any remaining excess generally will be treated as gain realized on the sale or other disposition of the New Semnur Common Stock. Dividends paid to a U.S. Holder that is a taxable corporation generally will not be eligible for the dividends–received deduction generally allowed to domestic corporations in respect of dividends received from other domestic corporations. With certain exceptions (including, but not limited to, dividends treated as investment income for purposes of investment interest deduction limitations) and provided certain holding period requirements are met, dividends paid to a non–corporate U.S. Holder generally will constitute “qualified dividends” that will be subject to tax at the preferential tax rate accorded to long–term capital gains if the New Semnur Common Stock are readily tradable on an established securities market in the United States and we are not a PFIC for the taxable year in which the dividend was paid or in the previous year. However, it is unclear whether the redemption rights with respect to the New Semnur Common Stock may prevent a U.S. Holder from satisfying the applicable holding period requirements with respect to the preferential tax rate on qualified dividend income.

Whether a redemption qualifies for sale or exchange treatment will depend largely on the total number of New Semnur Common Stock treated as held by the U.S. Holder (including any New Semnur Common Stock constructively owned by the U.S. Holder, as discussed below) relative to all of the shares of New Semnur Common Stock outstanding both before and after the redemption. The redemption of New Semnur Common Stock generally will be treated as a sale or exchange of the New Semnur Common Stock (rather than as a corporate distribution) if the redemption (i) is “substantially disproportionate” with