Company: SCLXW
Filing Date: 2025-05-07
Form Type: POS AM
Source: 0001193125-25-115095
Chunk: 432

Company: Scilex Holding Co
Filing Date: 2025-05-07
Form: POS AM
Chunk 432
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 for U.S. federal income tax purposes. Accordingly, a U.S. Holder should not recognize any gain or loss on the redemption of SPAC Warrants for shares of our Common Stock. A U.S. Holder’s aggregate initial tax basis in the shares of Common Stock received in the redemption should equal such U.S. Holder’s aggregate adjusted tax basis in the SPAC Warrants redeemed and the holding period for the shares of Common Stock received in redemption of the SPAC Warrants should include the holding period for the surrendered SPAC Warrants. However, there is some uncertainty regarding this tax treatment and, accordingly, U.S. Holders should consult their tax advisors regarding the tax consequences of a redemption of SPAC Warrants for Common Stock.

Possible Constructive Distributions

The terms of each SPAC Warrant provide for an adjustment to the number of shares of Common Stock for which the SPAC Warrant may be exercised or to the exercise price of the SPAC Warrant in certain events, as discussed in the section of this prospectus titled “Description of Our Securities — SPAC Warrants”. An adjustment which has the effect of preventing dilution generally should not be a taxable event. Nevertheless, a U.S. Holder of SPAC Warrants would be treated as receiving a constructive distribution from us if, for example, the adjustment increases the holder’s proportionate interest in our assets or earnings and profits (e.g., through an increase in the number of shares of Common Stock that would be obtained upon exercise) as a result of a distribution of cash to the holders of shares of our Common Stock which is taxable to such holders as a distribution. Such constructive distribution would be subject to tax as described above under “U.S.Holders — Taxation of Distributions” in the same manner as if such U.S. Holder received a cash distribution from us on Common Stock equal to the fair market value of such increased interest.

Non-U.S. Holders

Taxation of Distributions

In general, any distributions (including constructive distributions) we make to a Non-U.S. Holder of shares of our Common Stock, to the extent paid out of our current or accumulated earnings and profits (as determined under U.S. federal income tax principles), will constitute dividends for U.S. federal income tax purposes under the same rules as described above under “U.S. Holders — Taxation of Distributions” and “U.S. Holders — Gain or Loss on Sale, Taxable Exchange or Other Taxable Disposition of Common Stock” and, provided