SCHEDULE: Scilex Holding Co. Solidifies Semnur Control Post-Merger

Scilex Holding Company and its subsidiaries report beneficial ownership of 79.89% of Semnur Pharmaceuticals, Inc. common stock following a business combination and strategic share transactions.

Summary

• Scilex Holding Company (SHC) and its subsidiaries (Scilex, Inc. and Scilex Bio) are the beneficial owners of 188,554,849 shares of Semnur Pharmaceuticals, Inc. Common Stock, representing 79.89% of the class.
• The ownership stems from a business combination on September 22, 2025, where Old Semnur merged with a SPAC, which then became Semnur Pharmaceuticals, Inc.
• Key transactions included the conversion of 155,000,000 Old Semnur shares held by Scilex, Inc. into 193,750,000 Issuer Common Stock shares (1.25:1 exchange ratio).
• 5,000,000 Old Semnur shares held by Scilex Bio converted into 6,250,000 Issuer Common Stock shares (1.25:1 exchange ratio).
• SHC converted $54,236,058.00 of outstanding debt owed by Old Semnur into 5,423,606 shares of Series A Preferred Stock of Old Semnur, which were then exchanged for 5,423,606 shares of Series A Preferred Stock of the Issuer and 542,361 shares of Issuer Common Stock.
• A convertible promissory note of $124,883.82 from SPAC to SHC was converted into 12,488 shares of Issuer Common Stock.
• SHC purchased 500,000 SPAC Class B Ordinary Shares for $2,000,000 cash and 300,000 Scilex Shares (later adjusted to $213,932.16 cash in lieu of Scilex Shares), which converted into 500,000 shares of Issuer Common Stock.
• On September 23, 2025, SHC and Scilex, Inc. sold an aggregate of 12,500,000 shares of Issuer Common Stock to Biconomy PTE.LTD for $16.00 per share, payable in Bitcoin.

Sentiment

Score: 7

Explanation: The sentiment is moderately positive. The successful completion of a complex business combination and the consolidation of a majority stake by Scilex Holding Company provide stability and clear strategic direction for Semnur. The $16.00 per share valuation from the Biconomy sale is a positive indicator. However, the significant debt conversion and the restrictive nature of the Stockholder Agreement temper the overall sentiment slightly.

Positives

• Successful consummation of the business combination, integrating Semnur Pharmaceuticals into the Scilex ecosystem.
• Scilex Holding Company and its subsidiaries now hold a significant majority stake (79.89% common stock, 80.34% total voting power) in Semnur, providing strong control over its strategic direction.
• The sale of 12,500,000 shares to Biconomy PTE.LTD at $16.00 per share provides a recent valuation benchmark for Semnur's common stock.

Negatives

• The conversion of significant debt ($54,236,058.00) into preferred and common stock indicates prior financial support was necessary for Old Semnur.
• The sale of 12,500,000 shares to a third party, while providing cash, represents a partial divestment by the Reporting Persons.

Risks

• SHC's significant control over Semnur, as outlined in the Stockholder Agreement, could limit the independence and flexibility of Semnur's management and board, potentially impacting minority shareholders.
• Restrictions on Semnur's ability to incur indebtedness exceeding $10,000,000 without SHC's consent could hinder future growth or operational needs requiring substantial capital.
• The payment for shares in Bitcoin introduces cryptocurrency volatility risk for the seller (Scilex Sellers).

Future Outlook

The filing primarily details historical transactions related to the business combination and beneficial ownership changes. It does not provide explicit forward-looking statements or guidance regarding Semnur's future operational performance or financial projections, beyond the ongoing governance structure established by the Stockholder Agreement.

Industry Context

The consummation of a business combination via a SPAC (Special Purpose Acquisition Company) is a common strategy for private companies to go public. Scilex Holding Company's move to consolidate a majority stake in Semnur Pharmaceuticals, Inc. positions Semnur as a key asset within Scilex's portfolio, typical of strategic acquisitions in the pharmaceutical and biotechnology sectors. The use of Bitcoin as payment for a significant share sale is an emerging trend, reflecting increasing acceptance of digital assets in financial transactions, though still uncommon in traditional SEC filings.

Comparison to Industry Standards

• The 1.25 to 1 exchange ratio for Old Semnur common stock into Issuer common stock is a specific term of the merger agreement, not directly comparable to industry-wide standards without more context on valuation.
• The $16.00 per share price for the Biconomy resale provides a recent market-based valuation for Semnur's common stock, which can be benchmarked against comparable public pharmaceutical or biotech companies of similar stage and market capitalization.
• The significant control provisions granted to Scilex Holding Company through the Stockholder Agreement, including board designation rights and veto power over key corporate actions (e.g., debt, M&A, dividends), are typical for a majority shareholder in a subsidiary, ensuring alignment with the parent company's strategic objectives.

Corporate Governance

Related Party Transactions

• Business Combination between Denali Capital Acquisition Corp. (SPAC) and Old Semnur, where Old Semnur was a wholly-owned indirect subsidiary of SHC.
• Contribution and Satisfaction of Indebtedness Agreement where SHC contributed $54,236,058.00 of debt to Old Semnur in exchange for Series A Preferred Stock.
• Convertible Promissory Note issued by SPAC to SHC for up to $180,000, with $124,883.82 outstanding at conversion.
• Sponsor Interest Purchase Agreement where SHC purchased 500,000 SPAC Class B Ordinary Shares from the SPAC sponsor.
• Amended and Restated Registration Rights Agreement involving SHC and other security holders.
• Stockholder Agreement between SHC and SPAC (now Semnur Pharmaceuticals, Inc.) granting SHC significant governance rights.
• Securities Purchase Agreement where SHC and Scilex, Inc. (Scilex Sellers) sold 12,500,000 shares of Issuer Common Stock to Biconomy PTE.LTD.

Stakeholder Impact

• Shareholders (SHC): Gains significant control and beneficial ownership, solidifying its strategic investment in Semnur.
• Minority Shareholders (Semnur): Their voting power is diluted, and their influence over corporate decisions is significantly curtailed due to SHC's majority control and the terms of the Stockholder Agreement. The Biconomy sale provides a recent valuation point.
• Management (Semnur): Operates under the significant influence and oversight of SHC, with restrictions on certain strategic and financial decisions.
• Creditors (Semnur): The $10,000,000 indebtedness limit without SHC's consent could affect Semnur's ability to raise debt independently.

Next Steps

• Registration of certain shares of Issuer Common Stock for resale, as per the Amended and Restated Registration Rights Agreement.
• Ongoing governance and strategic direction of Semnur Pharmaceuticals, Inc. under the terms of the Stockholder Agreement, with significant influence from Scilex Holding Company.

Key Dates

Recommendation

The filing details the consummation of a business combination and the establishment of Scilex Holding Company's majority ownership and control over Semnur Pharmaceuticals, Inc. This provides structural clarity and strategic alignment. The sale of a block of shares at $16.00 per share offers a recent valuation benchmark. While the consolidation of control is a positive for long-term strategic direction, the filing does not provide new operational or financial performance data to warrant a 'buy' or 'sell' recommendation. Investors should 'hold' to observe how Scilex leverages its control to drive Semnur's future performance and integrate it within its broader portfolio.

Keywords

Semnur Pharmaceuticals, Scilex Holding Company, Business Combination, Merger, Beneficial Ownership, Schedule 13D, SPAC, Biotechnology, Pharmaceuticals, Corporate Governance, Stockholder Agreement, Bitcoin Transaction