SCHEDULE: Scilex Acquires 8% of Datavault AI, Plans Warrant Exercise

Scilex Holding Company has acquired an initial 8.03% stake in Datavault AI Inc. and plans a significant further investment via a pre-funded warrant, contingent on stockholder approval.

Summary

• Scilex Holding Company (SHC) acquired 15,000,000 shares of Datavault AI Inc. Common Stock on September 26, 2025.
• This initial acquisition represents approximately 8.03% of Datavault AI Inc.'s outstanding Common Stock, based on 171,842,741 shares outstanding prior to the issuance.
• The purchase price for these initial shares was $0.5378 per share, paid in Bitcoin.
• SHC also entered into an agreement to purchase a pre-funded warrant to acquire an additional 263,914,094 shares of Common Stock.
• The aggregate purchase price for both the initial shares and the pre-funded warrant is $150 million.
• The pre-funded warrant has an exercise price of $0.0001 per share and an approximate aggregate purchase price of $141.9 million.
• The issuance of the pre-funded warrant shares is contingent upon Datavault AI Inc. stockholder approval.
• Certain Datavault AI Inc. stockholders, holding at least 40,000,000 shares, have entered into voting agreements to support the necessary proposals for the transaction.
• Funds for the acquisition were sourced from the sale of 12,500,000 shares of Semnur Common Stock by Scilex Sellers to Biconomy PTE.LTD for $16.00 per share, paid in Bitcoin, on September 25, 2025.

Sentiment

Score: 7

Explanation: The filing indicates a substantial strategic investment and capital infusion for Datavault AI Inc., supported by voting agreements, which is generally positive. However, the significant potential dilution and the contingency of stockholder approval introduce some uncertainty and risk.

Positives

• A significant strategic investment by Scilex Holding Company into Datavault AI Inc. indicates confidence in the company's future.
• The transaction provides Datavault AI Inc. with a substantial capital infusion of $150 million.
• Voting agreements from key Datavault AI Inc. stockholders, representing at least 40,000,000 shares, increase the likelihood of obtaining necessary approvals for the full transaction.
• The pre-funded warrant structure allows for future equity issuance at a fixed, low exercise price, potentially providing long-term capital for Datavault AI Inc.

Negatives

• The full investment, specifically the issuance of shares from the pre-funded warrant, is contingent on Datavault AI Inc. stockholder approval, introducing a potential delay or failure point.
• Significant dilution for existing Datavault AI Inc. shareholders is expected if the pre-funded warrant is fully exercised, adding 263,914,094 shares to the initial 15,000,000 shares, compared to 171,842,741 shares outstanding prior to the transaction.
• The requirement to increase authorized shares to up to 1.5 billion suggests a very large potential future share count, which could further dilute existing shareholders.

Risks

• Failure to obtain Datavault AI Inc. stockholder approval for the issuance of pre-funded warrant shares and the increase in authorized common stock could prevent the full transaction from closing.
• Potential for delays in obtaining stockholder approval, requiring multiple meetings over an extended period.
• Market volatility of Bitcoin, as both the funding source for Scilex and the payment for Datavault AI Inc. shares were conducted in Bitcoin, introduces currency risk.
• Significant dilution risk for existing shareholders upon the full exercise of the pre-funded warrant.

Future Outlook

Datavault AI Inc. is required to seek stockholder approval for the issuance of shares underlying the pre-funded warrant and an increase in its authorized common stock to up to 1.5 billion shares. This process involves filing a preliminary proxy statement within 25 days of September 26, 2025, and holding a stockholder meeting within 75 days, with provisions for subsequent meetings if approval is not initially obtained. Alternatively, Datavault may seek written consent from a majority of stockholders.

Management Comments

• The filing includes a certification by Henry Ji, Chief Executive Officer and President of Scilex Holding Company, affirming the truth and completeness of the statement.

Industry Context

This transaction represents a significant investment by a holding company, Scilex Holding Company, into an AI-focused entity, Datavault AI Inc. While the specific strategic rationale for Scilex, which appears to be a pharmaceutical company based on its subsidiary Semnur Pharmaceuticals, is not detailed, it suggests a potential diversification or strategic interest in the AI sector. The use of Bitcoin for payment highlights the increasing acceptance of cryptocurrencies in large-scale corporate transactions, though it also introduces currency volatility considerations.

Corporate Governance

Stakeholder Impact

• Shareholders (Datavault AI Inc.): Potential for significant dilution upon full exercise of the pre-funded warrant. However, the capital infusion could support company growth and strategic initiatives.
• Scilex Holding Company: Gains a significant equity stake and strategic position in Datavault AI Inc., potentially diversifying its portfolio or expanding into the AI sector.

Next Steps

• Datavault AI Inc. to file a preliminary proxy statement with the SEC within 25 days of September 26, 2025.
• Datavault AI Inc. to hold an annual or special stockholder meeting to obtain Stockholder Approval no later than 75 days after September 26, 2025.
• If Stockholder Approval is not obtained, Datavault AI Inc. must hold additional stockholder meetings every 45 days, then every four months, until approval is secured.
• Alternatively, Datavault AI Inc. may obtain written consent from a majority of stockholders and file a Preliminary Information Statement on Schedule 14C within 15 days of September 26, 2025.
• Following Stockholder Approval, Datavault AI Inc. will issue the pre-funded warrant to Scilex Holding Company.

Key Dates

Recommendation

The significant capital infusion from Scilex Holding Company is a positive development for Datavault AI Inc., providing resources for growth. However, the substantial potential dilution from the pre-funded warrant, contingent on stockholder approval, introduces considerable uncertainty and risk for existing shareholders. Investors should hold to monitor the outcome of the stockholder vote and assess the long-term strategic implications of this large equity issuance before making further investment decisions.

Keywords

Scilex Holding Company, Datavault AI Inc., Investment, Equity Stake, Pre-Funded Warrant, Stockholder Approval, Bitcoin Transaction, Corporate Governance, Dilution, SEC Filing, Schedule 13D