Company: SCLXW
Filing Date: 2025-05-16
Form Type: DEF 14A
Source: 0000950170-25-073612
Chunk: 37

Company: Scilex Holding Co
Filing Date: 2025-05-16
Form: DEF 14A
Chunk 37
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 investigation with respect to certain contracts entered into by us in June 2024 and September 2024, and the corresponding accounting for such contracts, which may impact Ernst & Young’s willingness to rely on management’s representations in connection with its review of the Q3 Financials. The contracts are comprised of the Commitment Side Letter entered into with FSF 33433 LLC (a copy of which was filed with the SEC as an exhibit to our Current Report on Form 8-K filed on June 12, 2024), a distribution agreement entered into with Endeavor Distribution LLC (“Distributor”) in June 2024, and the Satisfaction Agreement entered into with FSF 33433 LLC and Distributor (a copy of which was filed with the SEC as an exhibit to our Current Report on Form 8-K filed on September 18, 2024). As two of the contracts were entered into during our second fiscal quarter of 2024, the investigation of such contracts may have a material impact on our financial statements as of, and for the quarter ended, June 30, 2024, which are included in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2024, filed with the SEC on August 13, 2024 (the “Q2 Form 10-Q”).

In response to Ernst & Young’s request, our Audit Committee commenced an investigation with the assistance of independent counsel with respect to an evaluation of the above referenced contracts, the accounting treatment of such contracts, and related matters. Our Audit Committee was informed by its independent counsel in November 2024 that no conclusive findings have been made yet and its investigation would not be completed for at least several weeks. In

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addition, Ernst & Young informed our Audit Committee that, even after the investigation by independent counsel is complete, Ernst & Young could not provide any assurance as to when or whether it could timely complete its review of the Q3 Financials.

On November 19, 2024, because of Ernst & Young’s inability to provide such assurance regarding the completion of its review of the Q3 Financials, our Audit Committee (as such committee was constituted at the time the investigation commenced) voted to dismiss Ernst & Young, effective immediately. Ernst & Young had initially been engaged by us in 2020 when it was still a private company and was reengaged as our independent registered public accounting firm in 2022 in connection with us becoming a publicly traded company.