NASDAQ: SCLXW

4,636

2,685

Derivative liabilities

50,599

18,303

Operating lease liabilities, net of current portion

13,151

1,523

Other long-term liabilities

174

155

Total liabilities

576,733

285,594

Commitments and contingencies (See Note 13)

Stockholders’ deficit:

Preferred stock, $0.0001 par value, 45,000,000 shares authorized

Series A, 29,057,097 shares issued and outstanding as of each of December 31, 2025 and December 31, 2024

—

—

Series 1, 5,000,000 shares declared as a stock dividend, not yet distributed as of December 31, 2025; and December 31, 2024

1

1

Common stock, $0.0001 par value, 740,000,000 shares authorized; 8,491,267 shares issued and 7,033,004 shares outstanding as of December 31, 2025; 6,951,622 shares issued and 5,235,377 shares outstanding as of December 31, 2024

1

1

Additional paid-in capital

796,721

454,614

Accumulated other comprehensive income

(5,803

)

6,317

Accumulated deficit

(921,786

)

(563,052

)

Treasury stock, at cost; 1,458,263 shares as of December 31, 2025 and 1,716,245 as of December 31, 2024

(76,915

)

(90,522

)

Total stockholders’ deficit before noncontrolling interests

(207,781

)

(192,641

)

Noncontrolling interests

(3,971

)

—

Total stockholders’ deficit

(211,752

)

(192,641

)

Total liabilities and stockholders’ deficit

$

364,981

$

92,953

See accompanying notes to audited consolidated financial statements

F-3

SCILEX HOLDING COMPANY

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(In thousands, except for net loss per share amounts)

Year Ended December 31,

2025

2024

Net revenue

$

30,253

$

56,590

Net operating costs and expenses:

Cost of revenue

10,599

16,689

Research and development

20,710

9,641

Selling, general and administrative

266,884

119,016

Goodwill impairment

73,358

—

Intangible amortization

4,364

4,031

Legal settlements

345

(9,391

)

Total net operating costs and expenses

376,260

139,986

Loss from operations

(346,007

)

(83,396

)

Other (income) expense, net:

(Gain) loss on derivative liability

22,693

(17,378

)

Change in fair value of debt and liability instruments

25,351

4,782

Interest expense, net

11,459

1,963

Loss on foreign currency exchange

(86

)

45

Loss on debt extinguishment, net

7,351

—

Unrealized loss on digital assets, net

12,180

—

Realized loss on digital assets, net

30,200

—

Unrealized (gain) on equity investment, net

(2,692

)

—

Realized (gain) on equity investments, net

(19,218

)

—

Unrealized (gain) on equity method investments carried at fair value, net

(54,760

)

—

Realized (gain) on equity method investments carried at fair value, net

(4,657

)

—

Realized (gain) on securities

199

—

Total other (income) expense, net

28,020

(10,588

)

Loss before income taxes

(374,027

)

(72,808

)

Income tax expense (benefit)

26

(1

)

Net loss

(374,053

)

(72,807

)

Net loss attributable to noncontrolling interests

(15,319

)

—

Net loss attributable to common stockholders before deemed dividend

(358,734

)

(72,807

)

Deemed dividend

(43,753

)

—

Net loss attributable to common stockholders

$

(402,487

)

$

(72,807

)

Net loss per share attributable to common stockholders — basic

$

(36.48

)

$

(7.24

)

Net loss per share attributable to common stockholders — diluted

$

(36.48

)

$

(8.05

)

Weighted average number of shares during the period — basic

11,034

10,061

Weighted average number of shares during the period — diluted

11,034

10,145

Comprehensive loss:

Net loss attributable to common stockholders

$

(358,734

)

$

(72,807

)

Other comprehensive income:

Foreign currency translation adjustment

(756

)

—

Changes in fair value attributable to instrument-specific credit risk

(11,364

)

6,317

Total other comprehensive income

(12,120

)

6,317

Comprehensive loss attributable to common stockholders

$

(370,854

)

$

(66,490

)

See accompanying notes to audited consolidated financial statements

F-4

SCILEX HOLDING COMPANY

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY / (DEFICIT)

(In thousands)

Preferred Stock

Common Stock

Additional

Accumulated Other

Accumulated

Treasury Stock

Noncontrolling

Stockholders’

Shares

Amount

Shares

Amount

Paid-in Capital

Comprehensive Income

Deficit

Shares

Amount

Interest

Equity (Deficit)

Balance, December 31, 2023

29,057

$

—

4,574

$

1

$

407,828

$

—

$

(490,245

)

1,716

$

(90,522

)

$

—

$

(172,938

)

Shares issued under the Standby Equity Purchase Agreements and under the ATM Sales Agreement

—

—

81

—

2,671

—

—

—

—

—

2,671

Shares issued under the February 2024 BDO

—

—

168

—

3,769

—

—

—

—

—

3,769

Shares issued under the April 2024 RDO

—

—

429

—

5,919

—

—

—

—

—

5,919

April 2024 RDO Placement Agent Warrants and February 2024 BDO Representative Warrants

—

—

—

—

956

—

—

—

—

—

956

Retainer shares issued

—

—

286

—

1

—

—

—

—

—

1

Fee Warrant issued in connection with the Commitment Letter

—

—

—

—

310

—

—

—

—

—

310

Repurchase of warrants

—

—

—

—

(298

)

—

—

—

—

—

(298

)

Common stock issuable under the SIPA

—

—

—

—

345

—

—

—

—

—

345

Placement Agent Shares and October 2024 Placement Agent Warrants

—

—

63

—

3,792

—

—

—

—

—

3,792

Conversion of Tranche B Notes into common stock

—

—

263

—

9,256

—

—

—

—

—

9,256

Shares issued under December 2024 RDO

—

—

753

—

328

—

—

—

—

—

328

StockBlock Warrants issued in connection with the December 2024 RDO

—

—

—

—

1,265

—

—

—

—

—

1,265

Stock dividend declared, not yet distributed

5,000

1

—

—

(1

)

—

—

—

—

—

—

Issuance of common stock upon warrants exercise

—

—

321

—

2,311

—

—

—

—

—

2,311

Shares issued under ESPP

—

—

10

—

246

—

—

—

—

—

246

Stock options exercised

—

—

4

—

227

—

—

—

—

—

227

Stock-based compensation

—

—

—

—

15,689

—

—

—

—

—

15,689

Other comprehensive income

—

—

—

—

—

6,317

—

—

—

—

6,317

Net loss

—

—

—

—

—

—

(72,807

)

—

—

—

(72,807

)

Balance, December 31, 2024

34,057

1

6,952

1

454,614

6,317

(563,052

)

1,716

(90,522

)

—

(192,641

)

Treasury Stock transferred to Tranche B Investors for Tranche B Notes deferral

—

—

—

—

(5,353

)

—

—

(143

)

7,535

—

2,182

Treasury Stock paid for Gloperba Ex-US License

—

—

—

—

(808

)

—

—

(22

)

1,174

—

366

Treasury Stock transferred to Oramed for the Oramed Note maturity extension

—

—

—

—

(3,523

)

—

—

(93

)

4,898

—

1,375

F-5

Acquisition of controlling interest in Scilex Bio

—

—

—

—

1,816

—

—

—

—

1,944

3,760

Reverse recapitalization - Semnur Business Combination

—

—

—

—

127,245

—

—

—

—

(1,716

)

125,529

Sale of 12.5 million New Semnur Common

—

—

—

—

200,685

—

—

—

—

(685

)

200,000

Exercise of April 2024 and December 2024 RDO warrants and issuance of November 2025 Warrants

—

—

905

—

19,767

—

—

—

—

—

19,767

Exercise of December 2024 RDO Warrants in exchange for Tranche B Notes deferral

—

—

179

—

3,527

—

—

—

—

—

3,527

Non-Controlling interest in Vivasor net assets at date of acquisition

—

—

—

—

—

—

—

—

—

11,805

11,805

Issuance of common stock upon exercise of December 2024 RDO Warrants

—

—

450

—

10,237

—

—

—

—

—

10,237

Payments in lieu of fractional shares or Reverse Stock Split

—

—

—

—

(1

)

—

—

—

—

—

(1

)

Option fee and repurchase of Penny Warrants

—

—

—

—

(27,000

)

—

—

—

—

—

(27,000

)

Shares issued under ESPP

—

—

5

—

23

—

—

—

—

—

23

Stock-based compensation

—

—

—

—

15,492

—

—

—

—

—

15,492

Other comprehensive income

—

—

—

—

—

(12,120

)

—

—

—

—

(12,120

)

Net loss

—

—

—

—

—

—

(358,734

)

—

—

(15,319

)

(374,053

)

Balance, December 31, 2025

34,057

$

1

8,491

$

1

$

796,721

$

(5,803

)

$

(921,786

)

1,458

$

(76,915

)

$

(3,971

)

$

(211,752

)

See accompanying notes to audited consolidated financial statements

F-6

SCILEX HOLDING COMPANY

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

Year Ended December 31,

2025

2024

Operating activities

Net loss including noncontrolling interest

$

(374,053

)

$

(72,807

)

Adjustments to reconcile net loss to net cash proceeds from operating activities:

Depreciation and amortization

4,623

4,046

Amortization of debt issuance costs and debt discount

409

316

Non-cash operating lease cost

812

718

Stock-based compensation

15,492

15,689

Fair value of Gloperba-Elyxyb RPA liability expensed

500

—

Fair value of treasury Stock expensed - Tranche B and Oramed Note

3,557

—

Fair value of September 2025 warrants expensed - Tranche B modification

3,091

—

(Gain) loss on derivative liability

22,693

(17,378

)

Loss on extinguishment of derivative liability

7,350

—

Goodwill impairment

73,358

—

Financing costs and allocated expense for financial instruments at fair value

—

17,297

In-process research and development expense

5,426

—

Transaction costs expensed related to Semnur Business Combination

140,000

—

Change in fair value of debt and liability instruments

25,351

4,782

Change in fair value of equity investments

(2,692

)

—

Change in fair value of digital assets

12,180

—

Change in fair value of equity method investment, net

(54,759

)

—

Realized (gain) loss on investment, net

(19,218

)

—

Realized (gain) loss on digital assets, net

30,200

—

Realized (gain) loss on equity method investment, net

(4,657

)

—

Realized Gains & Losses on Securities

199

—

Allowances for expected credit losses

—

1,186

Other

(13

)

661

Changes in operating assets and liabilities:

Accounts receivables, net

13,837

(6,267

)

Inventory

1,799

1,462

Prepaid expenses and other

3,300

(479

)

Other long-term assets

(3

)

(30

)

Accounts payable

13,121

7,419

Accrued payroll

(1,095

)

(1,176

)

Accrued expenses

14,601

(8,167

)

Accrued rebates and fees

69,239

72,859

Operating lease liability

(857

)

(758

)

Other long-term liabilities

25

(24

)

Net cash proceeds from operating activities

3,816

19,349

Investing activities

Acquisition consideration paid in cash for Romeg intangible asset acquisition

(600

)

(600

)

Purchase of equity securities

—

(2,000

)

Cash paid for in-process research and development, net

(200

)

(75

)

Cash paid to settle Datavault Obligation

(9,230

)

—

Purchases of Bitcoin with cash

(15,837

)

—

Purchase of property and equipment

(133

)

—

Exercise of prefunded warrant

(27

)

—

Purchase of preferred shares of Vivasor

(9,000

)

—

Sale of Datavault AI Inc. shares for cash, net

39,606

—

Repayments on promissory note

(962

)

—

Payment made for PA OPS investment

(1,000

)

—

Vivasor Cash Acquired

1,517

—

Purchase of convertible promissory note from Denali

(50

)

—

Net cash proceeds from (used for) investing activities

4,084

(2,675

)

Financing activities

Proceeds from issuance of shares under Standby Equity Purchase Agreements and ATM Sales Agreement

—

2,671

Proceeds from issuance of Revolving Facility

—

95,438

Proceeds from issuance of FSF Deposit

—

10,000

Proceeds from issuance of Tranche B Notes and purchased revenue liability

—

25,000

Repayment of Revolving Facility

—

(112,791

)

Repayment of Oramed Note

—

(64,200

)

Cash consideration paid in connection with warrant repurchase

—

(300

)

Cash assumed in Semnur Business Combination

35

—

Repayment of Convertible Debentures

—

(4,375

)

Repayment of Tranche B Notes

(20,532

)

(3,283

)

Payments of debt issuance costs

(71

)

(4,172

)

Cash consideration paid in connection with the repurchase of Penny Warrants

(27,000

)

—

F-7

Payments on purchased revenue liability

(3,179

)

—

Transaction costs paid in connection with share repurchase

(996

)

—

Proceeds from exercise of April 2024 RDO Warrants and December 2024 RDO Warrants

20,358

—

Transaction costs paid in connection with issuance of common stock and exchange of April 2024 RDO Warrants and December 2024 RDO Warrants for November 2025 Warrants

(1,745

)

—

Payments for the termination of Tumim Purchase Agreement

(2,700

)

—

Proceeds from issuance of Scilex-St. James Loans

21,528

—

Excise tax paid in connection with share repurchase

(860

)

(450

)

Proceeds from issuance of shares under direct offerings

—

41,967

Payments of direct offering issuance costs

—

(4,370

)

Payments of deferred transaction costs related to Semnur Business Combination

—

(1,379

)

Proceeds from exercise of December 2024 RDO Warrants for Common Stock

10,237

—

Proceeds from stock options and warrants exercised and ESPP

23

2,113

Payments for Vivasor debt

(558

)

—

Payments in lieu of fractional shares for Reverse Stock Split

(1

)

—

Net cash (used for) financing activities

(5,461

)

(18,131

)

Effect of exchange rate changes on cash

(756

)

—

Net change in cash and cash equivalents

1,683

(1,457

)

Cash, cash equivalents and restricted cash at beginning of period

3,272

4,729

Cash, cash equivalents and restricted cash at end of period

$

4,955

$

3,272

Supplemental disclosure:

Cash paid for interest

$

935

$

1,561

Non-cash investing and financing activities

Issuance costs related to direct offerings included in accrued expenses and account payables

$

—

$

1,845

Net liabilities assumed in Semnur Business Combination

$

12,822

$

—

Derecognition of Scilex's equity investment in Denali in connection with Semnur Business Combination

$

2,470

$

—

Exercise of December 2024 RDO Warrants in exchange for settlement of Tranche B Notes principal and interest

$

2,689

$

—

Purchase of equity investment in Datavault AI Inc in exchange for Bitcoin

$

8,069

$

—

Bitcoin acquired in exchange for shares of Semnur Stock

$

200,000

$

—

Additions to intangible assets included in accrued expenses

$

1,000

$

—

Fee Warrants issued and exercised in connection with the Commitment Letter

$

—

$

610

Settlement of FSF Deposit

$

—

$

13,000

Deferred transaction costs related to Semnur Business Combination included in accrued expenses and account payable

$

—

$

4,602

Conversion of Oramed Note into Tranche B Notes

$

—

$

25,000

Conversion of Tranche B Notes into common stock

$

—

$

9,256

Debt issuance costs included in accrued expenses

$

—

$

3,063

Placement Agent Shares and October 2024 Placement Agent Warrants

$

—

$

3,792

StockBlock Warrants issued in connection with the December 2024 RDO

$

—

$

1,265

Datavault Licenses acquired but not yet paid

$

30,000

$

—

Purchase of Bitcoin in exchange for Scilex-St. James Loans

$

9,395

$

—

Excise tax in connection with share repurchase included in accrued expenses

$

—

$

860

Purchase and exercise of prefunded warrant for Datavault shares in exchange for Bitcoin

$

110,043

$

—

Issuance of warrants as financing costs in connection with issuance of common stock and exchange of liability classified instruments

$

862

$

—

Vivasor debt forgiveness

$

(2,469

)

$

—

Vivasor net assets consolidated

$

—

$

—

Net impact of the issuance of November 2025 Warrants and exchange of liability classified instruments

$

6,248

$

—

See accompanying notes to audited consolidated financial statements

F-8

SCILEX HOLDING COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Nature of Operations and Basis of Presentation

Organization and Principal Activities

Scilex Holding Company (“Scilex” and together with its consolidated subsidiaries, the “Company”) is an innovative revenue-generating company focused on acquiring, developing and commercializing non-opioid pain management products for the treatment of acute and chronic pain. The Company was originally formed in 2019 and currently has eight subsidiaries, of which the following five are wholly owned: Scilex Inc. (“Legacy Scilex”), Scilex Pharmaceuticals Inc. (“Scilex Pharma”), SCLX DRE Holdings LLC, and SCLX Stock Acquisition JV LLC (“SCLX JV”), Scilex BVI Limited (“Scilex BVI”); and the following three subsidiaries are controlled by Scilex: Scilex Bio, Inc. (“Scilex Bio”) and Semnur Pharmaceuticals, Inc. (“Semnur”) and Vivasor Holding Company (“Vivasor”). The business combination with Vivasor started in December 2025. The business combination with Vickers (the “Business Combination”) was closed in November 2022.

The Company launched its first commercial product in October 2018, ZTlido (lidocaine topical system) 1.8% (“ZTlido”), a prescription lidocaine topical system that is designed with novel technology to address the limitations of current prescription lidocaine therapies by providing significantly improved adhesion and continuous pain relief throughout the 12-hour administration period. In June 2022, the Company in-licensed the exclusive right to commercialize GLOPERBA (colchicine USP) oral solution (“GLOPERBA”), a U.S. Food and Drug Administration (“FDA”)-approved prophylactic treatment for painful gout flares in adults, in the United States (“U.S.”). In February 2023, the Company acquired the rights related to ELYXYB (celecoxib oral solution) (“ELYXYB”) and the commercialization thereof in the U.S. and Canada. ELYXYB is a first-line treatment and the only FDA-approved, ready-to-use oral solution for the acute treatment of migraine, with or without aura, in adults. The Company launched ELYXYB in the U.S. in April 2023 and commercialized GLOPERBA in the U.S. in June 2024. In January 2025, the Company received approval from Health Canada’s Pharmaceutical Drugs Directorate, Bureau of Cardiology, Allergy and Neurological Sciences for ELYXYB for the acute treatment of migraine with or without aura in Canada and in-licensed the rights to commercialize GLOPERBA outside the U.S.

The Company is currently developing three product candidates, SP-102 (10 mg, dexamethasone sodium phosphate viscous gel), a novel, viscous gel formulation of a widely used corticosteroid for epidural injections to treat lumbosacral radicular pain, or sciatica for which the Company initiated a second Phase 3 study (“SP-102” or “SEMDEXA”) in September 2025, SP-103 (lidocaine topical system) 5.4% (“SP-103”), a next-generation, triple-strength formulation of ZTlido, for the treatment of chronic neck pain and for which the Company completed a Phase 2 trial in acute low back pain (“LBP”), and SP-104 (4.5 mg, low-dose naltrexone hydrochloride delayed-burst release low dose naltrexone hydrochloride capsules) (“SP-104”), a novel low-dose delayed-release naltrexone hydrochloride being developed for the treatment of fibromyalgia, for which Phase 1 trials were completed. The Company has devoted substantially all of its efforts to the development of SP-102, SP-103 and SP-104, and the commercialization of ZTlido, ELYXYB and GLOPERBA.

Basis of Presentation and Principles of Consolidation

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and include all adjustments necessary for the fair presentation of the Company’s financial position for the periods presented. The consolidated financial statements include 100% of the accounts of the wholly owned and majority owned subsidiaries as well as a variable interest entity for which the Company is the primary beneficiary. The proportion of profit and loss and changes in equity allocated to the shareholders of the Company and the non-controlling interests are determined on the basis of existing ownership interest. All intercompany balances and transactions have been eliminated.

The Company consolidates those entities in which it has a direct or indirect controlling financial interest based on either the variable interest model (the “VIE model”) or the voting interest model (the “VOE model”). Variable interest entities (“VIEs”) are entities that, by design, either lack sufficient equity to permit the entity to finance its activities without additional subordinated financial support from other parties, or have equity investors that do not have the

F-9

ability to make significant decisions relating to the entity’s operations through voting rights, or do not have the obligation to absorb the expected losses, or do not have the right to receive the residual returns of the entity.

The Company consolidates its VIEs under the VIE model if the Company is considered the primary beneficiary due to (i) the power to direct activities of the VIE that most significantly impact the entity's economic performance; and (ii) the obligation to absorb losses of the entity or the right to receive benefits from the entity that could potentially be significant to the VIE. If the Company is not deemed to be the primary beneficiary in a VIE, the Company accounts for the investment or other variable interests in a VIE in accordance with the applicable GAAP.

Upon the occurrence of certain significant events, as required by the VIE model, the Company reassesses whether a legal entity in which the Company is involved is a VIE. The reassessment process considers whether the Company has acquired or divested the power to direct the activities of the VIE through changes in governing documents or other circumstances. The reassessment also considers whether the Company has acquired or disposed of a financial interest that could be significant to the VIE, or whether an interest in the VIE has become significant or is no longer significant. The consolidation status of the entities with which the Company is involved may change as a result of such reassessments. Changes in consolidation status are applied prospectively, with assets and liabilities of a newly consolidated VIE initially recorded at fair value.

Reverse Stock Split

On April 3, 2025, the Board of Directors of the Company (the “Board”) approved a reverse stock split of the Common Stock at a ratio of 1-for-35 (the “Reverse Stock Split”), which was effected on April 15, 2025. As a result of the Reverse Stock Split, every 35 shares of pre-Reverse Stock Split Common Stock was combined into one share of post-Reverse Stock Split Common Stock, without any change in par value per share. No fractional shares were issued as a result of the Reverse Stock Split, as fractional shares of Common Stock were rounded down to the nearest whole share. Stockholders who would have otherwise received a fractional share of Common Stock pursuant to the Reverse Stock Split, received cash-in-lieu of the fractional share. All Common Stock amounts and references have been retroactively adjusted for all figures presented to reflect the Reverse Stock Split unless specifically stated otherwise. The Company also adjusted the amounts for shares of Common Stock reserved for issuance upon the exercise of outstanding warrants, outstanding stock options and shares reserved under the Company’s stock-based compensation plans, except for the outstanding Penny Warrants and the Deposit Warrant (each as defined below), which do not contain antidilution provisions and therefore were not adjusted in connection with the Reverse Stock Split, to the extent they were outstanding at the time of the Reverse Stock Split. As a result, a deemed dividend of $43.8 million was recognized, representing the increase in value to Penny Warrant holders. The Company has an accumulated deficit, as a result, the deemed dividend was not recorded as a reduction in additional paid-in capital, resulting in a net impact of zero to additional paid-in capital in the accompanying consolidated balance sheet. The non-cash deemed dividend has been included as an increase to the net loss allocated to common shareholders, and thus increase the net loss per share for both basic and diluted net loss per share.

Segments

Operating segments are identified as components of an entity where separate discrete financial information is available for evaluation by the chief operating decision maker (the “CODM”) in making decisions on how to allocate resources and assessing performance. The Company has determined that its CODM is its Chief Executive Officer. The Company is engaged primarily in the development of non-opioid products focused on pain management based on its platform technologies and all sales are based in the United States. Accordingly, the Company has determined that it operates its business as a single reportable segment. The CODM reviews consolidated operating results to make decisions about allocating resources and assessing performance for the entire Company based on consolidated results that are reported on the consolidated statements of operations and comprehensive loss. The Company has also evaluated the significant segment expenses incurred by the single segment that are regularly provided to the CODM and concluded they are consistent with those reported on the consolidated statements of operations and comprehensive loss and include cost of revenue, research and development, selling, general and administrative. The Company manages assets on a consolidated basis as reported on the consolidated balance sheets. Accordingly, the consolidated financial statements and accompanying notes contained herein include the measure of profit or loss, net revenue, categories of expenses, assets and other financial information that is evaluated by the CODM.

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Use of Estimates

The preparation of these consolidated financial statements in conformity with U.S. GAAP requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of these consolidated financial statements and the reported amounts of expenses during the reporting period. These estimates include, but are not limited to, revenue recognition, fair value of financial instruments and certain assumptions used in estimating stock-based compensation, the fair value of assets acquired and liabilities assumed in acquisitions, and the noncontrolling interests recognized in acquisitions. Management believes that these estimates are reasonable; however, actual results may differ from these estimates.

Customer and Supplier Concentration Risk

The Company had four and three customers during the years ended December 31, 2025 and 2024, respectively, each of which individually generated 10% or more of the Company’s total revenue. These customers accounted for 98% and 86% of the Company’s revenue for the years ended December 31, 2025 and 2024, respectively, individually ranging from 12% to 33% and 23% to 34%, respectively. As of December 31, 2025 and 2024, four and three customers represented 96% and 95% of the Company’s outstanding accounts receivable, respectively, individually ranging between 10% and 35% and 30% and 33% for respective periods. Additionally, during the years ended December 31, 2025 and 2024, the Company purchased ZTlido, ELYXYB and GLOPERBA inventories from its sole supplier, Itochu Chemical Frontier Corporation (“Itochu”), Contract Pharmaceuticals Ltd. Canada (“CPL”) and Ferndale Laboratories, Inc., respectively. This exposes the Company to concentration of customer and supplier risk. The Company monitors the financial condition of its customers and limits its credit exposure by setting credit limits. During the years ended December 31, 2025 and 2024, the Company had allowances for expected credit losses of nil and $1.2 million, respectively.

Digital Assets

In September 2025, the Company adopted a cryptocurrency treasury strategy and began acquiring Bitcoin. We account for all digital assets held as crypto assets, a subset of indefinite-lived intangible assets in accordance with ASC 350-60, Intangibles - Goodwill and Other - Crypto Assets. We have ownership of and control over our digital assets and are held in custody accounts and are not considered cash equivalents. The digital assets are initially recorded at cost on a first-in, first-out basis and are subsequently remeasured on the consolidated balance sheets at fair value at each reporting period.

We determine and record the fair value of our digital assets in accordance with ASC 820, Fair Value Measurement (“ASC 820”), based on quoted prices on the active exchange(s) that we have determined is the principal market for such assets (Level I inputs). Realized and unrealized gains and losses are recorded to Other (income) expense, net in our consolidated statement of operations and comprehensive loss.

Noncontrolling Interests

The Company consolidates entities in which it has a controlling financial interest, including variable interest entities (VIEs) where it is the primary beneficiary. Noncontrolling interests represent the portion of equity in consolidated subsidiaries not attributable to the Company and are presented separately in the consolidated balance sheets and statements of operations and comprehensive loss. Profit or loss and changes in equity attributable to noncontrolling interests are allocated based on ownership percentages as well as the preferential rights and obligations associated with the respective equity class of noncontrolling interests.

Datavault Investment

On September 25, 2025, we entered into a Securities Purchase Agreement (the “Datavault SPA”) with Datavault AI Inc., a Delaware corporation (“Datavault”), pursuant to which Datavault agreed to issue and sell, and we agreed to purchase, 15.0 million shares (the “Datavault Shares”) of common stock of Datavault (“Datavault Common Stock”) in the initial closing which occurred on September 26, 2025 (the “Initial Datavault Closing” and the date of such closing, the “Initial Datavault Closing Date”) and a pre-funded warrant (the “Datavault Pre-Funded Warrant”) to

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purchase 263,914,094 shares of Datavault Common Stock in a subsequent closing (the “Subsequent Datavault Closing”), for an aggregate purchase price of $150 million in Bitcoin (“BTC”) (based on the spot exchange rate for BTC as published by Coinbase.com at 8:00 p.m. (New York City time) on the trading day immediately prior to the date of the Initial Datavault Closing Date, or September 25, 2025. (such rate, the “Spot Exchange Rate”)). On November 25, 2025, the Subsequent Datavault Closing was consummated with us transferring an amount of BTC (based on the Spot Exchange Rate) in satisfaction of the payment of the remainder of the aggregate purchase price to Datavault and Datavault issuing the Datavault Pre-Funded Warrant to us. Also on November 25, 2025, following the Subsequent Datavault Closing, we exercised the Datavault Pre-Funded Warrant in full for an aggregate exercise price of approximately $26.4 thousand, paid in cash. The Company has the ability to nominate two out of nine board seats, and holds approximately 37% of Datavault’s outstanding voting shares as of December 31, 2025, and the Company believes it is able to exercise significant influence over Datavault. As such, following the exercise of the Datavault Pre-Funded Warrants, the Company accounts for its investment in Datavault under the equity method under Accounting Standards Codification (“ASC”) 323, Investments - Equity Method and Joint Venture as of this date.

Fair Value Measurements

Financial assets and liabilities are recorded at fair value on a recurring basis in the consolidated balance sheets. The carrying values of the Company’s financial assets and liabilities, including cash and cash equivalents, restricted cash, prepaid and other current assets, accounts payable and accrued expenses approximate to their fair value due to the short-term nature of these instruments. Equity method investment and digital assets are also recorded at fair value in our consolidated balance sheets.

The valuation of the derivative warrant liability for the Private Warrants, the February 2024 BDO Firm Warrants, the Deposit Warrant, the October 2024 Noteholder Warrants, the December 2024 RDO Common Warrants the Exchange Warrants, the September 2025 Warrants and the November 2025 Warrants (each as defined below) is outlined in Note 5, utilizing the Black-Scholes option pricing model. The Company has chosen the fair value option for the Oramed Note, FSF Deposit, and Tranche B Notes (each as defined below), with the valuation methodologies detailed in Note 8. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. Assets and liabilities recorded at fair value are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Hierarchical levels are directly related to the amount of subjectivity with the inputs to the valuation of these assets or liabilities as follows:

Level 1 - Observable inputs such as unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date;

Level 2 - Inputs (other than quoted prices included in Level 1) that are either directly or indirectly observable inputs for similar assets or liabilities. These include quoted prices for identical or similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active; and

Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

Cash, Cash Equivalents, Restricted Cash and Marketable Securities

The Company considers all highly liquid investments that are readily convertible into cash without penalty and with original maturities of three months or less at the date of purchase to be cash equivalents. The carrying amounts reported in the consolidated balance sheets for cash and cash equivalents are valued at cost, which approximate their fair value. The Company considers marketable securities as current investments if the maturity date is less than or equal to one year from the balance sheet date. The Company considers marketable securities as non-current investments if the maturity date is in excess of one year from the balance sheet date.

Restricted cash as of December 31, 2025 and December 31, 2024 is nil, because Scilex Pharma paid off the outstanding amount of all obligations and indebtedness under the eCapital Credit Agreement in October 2024, which agreement was terminated thereafter.

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Cash equivalents were immaterial as of December 31, 2025 and 2024.

Accounts Receivable, Net

Accounts receivable are presented net of allowances for expected credit losses and prompt payment discounts. Accounts receivable consists of trade receivables from product sales to customers, which are generally unsecured. Estimated credit losses related to trade accounts receivable are recorded as general and administrative expenses and as an allowance for expected credit losses within accounts receivable, net. The Company reviews reserves and makes adjustments based on historical experience and known collectability issues and disputes. When internal collection efforts on accounts have been exhausted, the accounts are written off by reducing the allowance for expected credit losses. As of December 31, 2025 and 2024, the Company recorded nil and $1.2 million, allowances for credit losses on its accounts receivable, respectively. As of December 31, 2025 and 2024, allowances for prompt payment discounts were $0.4 million and $0.6 million, respectively.

Inventory

The Company determines inventory cost on a first-in, first-out basis, with the exception of the Vivasor entity which determines inventory cost using the average cost method. The Company reduces the carrying value of inventories to a lower of cost or net realizable value for those items that are potentially excess, obsolete or slow- moving. The Company reserves for excess and obsolete inventory based upon historical experience, sales trends, and specific categories of inventory and expiration dates for on-hand inventory. Inventory costs resulting from these adjustments are recognized as cost of sales in the period in which they are incurred. When future commercialization is considered probable and the future economic benefit is expected to be realized, based on management’s judgment, the Company capitalizes pre-launch inventory costs prior to regulatory approval. As of December 31, 2025 and 2024, the Company’s inventory was composed of equal parts of raw material and finished goods.

Property and Equipment, Net

Property and equipment are carried at cost less accumulated depreciation. Property and equipment for the Vivasor entity was fair valued on the date of the acquisition under acquisition accounting. Depreciation of property and equipment is computed using the straight-line method over the estimated useful lives of the assets, which are generally five to seven years. Leasehold improvements are amortized over the lesser of their estimated useful lives or the term of the respective lease on a straight-line basis. The cost of repairs and maintenance is expensed as incurred.

Acquisitions

The Company accounts for business combinations using the acquisition method of accounting, which requires that assets acquired, including in-process research and development (“IPR&D”) projects and liabilities assumed be recorded at their fair values as of the acquisition date on the Company`s consolidated balance sheets. Any excess of purchase price over the fair value of net assets acquired is recorded as goodwill. The determination of estimated fair value requires the Company to make significant estimates and assumptions. As a result, the Company may record adjustments to the fair values of assets acquired and liabilities assumed within the measurement period (up to one year from the acquisition date) with the corresponding offset to goodwill. Transaction costs associated with business combinations are expensed as they are incurred.

When the Company determines net assets acquired do not meet the definition of a business combination under the acquisition method of accounting, the transaction is accounted for as an acquisition of assets and, therefore, no goodwill is recorded and contingent consideration such as payments upon achievement of various developmental, regulatory and commercial milestones generally is not recognized at the acquisition date. In an asset acquisition, up-front payments allocated to IPR&D projects at the acquisition date and subsequent milestone payments are charged to expense in the Company`s consolidated statements of operations and comprehensive loss unless there is an alternative future use.

The Company has acquired and may continue to acquire the rights to develop and commercialize new product candidates. Intangible assets acquired in a business combination that are used for IPR&D activities are considered indefinite-lived until the completion or abandonment of the associated research and development efforts. Upon

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commercialization of the relevant research and development project, the Company amortizes the acquired IPR&D over its estimated useful life. Capitalized IPR&D is reviewed annually for impairment or more frequently as changes in circumstance or the occurrence of events suggest that the remaining value may not be recoverable.

Goodwill and Other Long-Lived Assets

Goodwill, which has an indefinite life, represents the excess cost over fair value of net assets acquired. Goodwill is reviewed for impairment at least annually during the fourth quarter, or more frequently if events occur indicating the potential for impairment. The Company has two reporting unit. During its goodwill impairment review, the Company may assess qualitative factors to determine whether it is more likely than not that the fair value of its reporting unit is less than its carrying amount, including goodwill. The qualitative factors include, but are not limited to, macroeconomic conditions, industry and market considerations, and the overall financial performance of the Company. If, after assessing the totality of these qualitative factors, the Company determines that it is not more likely than not that the fair value of its reporting unit is less than its carrying amount, then no additional assessment is deemed necessary. Otherwise, the Company performs a quantitative goodwill impairment test. The Company may also elect to bypass the qualitative assessment in a period and elect to proceed to perform the quantitative goodwill impairment test.

The Company evaluates its long-lived and intangible assets with definite lives, such as property and equipment, patent rights, and acquired technology, for impairment by considering competition by products prescribed for the same indication, the likelihood and estimated future entry of non-generic and generic competition with the same or similar indication and other related factors. The factors that drive the estimate of useful life are often uncertain and are reviewed on a periodic basis or when events occur that warrant review. Recoverability is measured by comparison of the assets’ book value to future net undiscounted cash flows that the assets are expected to generate to determine if a write-down to the recoverable amount is appropriate. If such assets are written down, an impairment will be recognized as the amount by which the book value of the asset group exceeds the recoverable amount.

Valuation of Purchased In-Process Research and Development, Goodwill, and Other Intangible Assets

When we acquire another company, the purchase price is allocated, as applicable, between in-process research and development, other identifiable intangible assets, tangible assets, liabilities assumed and goodwill as required by generally accepted accounting principles in the U.S. Purchased in-process research and development is defined as the value assigned to those projects for which the related products have not received regulatory approval and have no alternative future use. Determining the portion of the purchase price allocated to in-process research and development and other intangible assets requires us to make significant estimates. The amount of the purchase price allocated to purchased in-process research and development and other intangible assets is determined by estimating the future cash flows of each project or technology and discounting the net cash flows back to their present values. The discount rate used is determined at the time of the acquisition in accordance with accepted valuation methods. For purchased in-process research and development, these methodologies include consideration of the risk of the project not achieving commercial feasibility.

Goodwill represents the excess of the aggregate purchase price over the fair value of net assets, including in-process research and development, of the acquired businesses, net of the fair value of liabilities assumed. Goodwill is tested for impairment annually, or more frequently if changes in circumstance or the occurrence of events suggest an impairment exists. The test for impairment requires us to make several estimates about fair value, most of which are based on projected future cash flows. Our estimates associated with the goodwill impairment tests are considered critical due to the amount of goodwill recorded on our consolidated balance sheets and the judgment required in determining fair value amounts, including projected future cash flows.

The purchase price allocation in connection with the purchase of Vivasor is preliminary and subject to adjustment. As the Company continues to evaluate the fair value of assets acquired, including in-process research and development (IPR&D), adjustments may result in a reallocation between goodwill and identified intangible assets. Any such measurement period adjustments will be recorded in accordance with ASC 805, with corresponding offsets to goodwill, and will be finalized no later than one year from the acquisition date.

Contingent Consideration

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The fair value of contingent consideration liabilities assumed in business combinations is recorded as part of the purchase price consideration of the acquisition, and is determined using a discounted cash flow model or Monte Carlo simulation model. The significant inputs of such models are not observable in the market, such as certain financial metric growth rates, volatility rates, projections associated with applicable milestones, discount rates and the related probabilities and payment structure in the contingent consideration arrangement. Fair value adjustments to contingent consideration liabilities are recorded through operating expenses in the consolidated statements of operations and comprehensive loss. Other than contingent consideration that is accounted for in accordance with FASB ASC Topic 480, Distinguishing Liabilities from Equity, and Topic 815, Derivatives and Hedging, contingent consideration arrangements assumed in an asset acquisition will be measured and accrued when such contingency is resolved.

Warrants

In accordance with ASC Subtopic No. 815-40, Contracts on an Entity’s Own Equity, the Company determines how to account for warrants either assumed in connection with the Business Combination or issued under various financing arrangements. Warrants classified as equity are recorded at their issuance cost and are not subject to remeasurement at each subsequent balance sheet date. The Company records them in additional paid-in capital in the Company’s consolidated balance sheets. Warrants accounted for as liabilities are recorded at their estimated fair value on the date of issuance and are revalued at each subsequent balance sheet date, with fair value changes recognized in the consolidated statement of operations. The Company estimates the value of these warrants using a Black-Scholes option pricing formula.

Debt

The Company may enter into financing arrangements, the terms of which involve significant assumptions and estimates. This involves estimating future net product sales, determining interest expense, determining the amortization period of the debt discount, as well as determining the classification between current and long-term portions.

Debt assumed in connection with the Vivasor, Business Combination was recorded at fair value at the acquisition date. Subsequent to initial recognition, such debt is carried at amortized cost, with any difference between fair value and contractual amounts accreted or amortized to interest expense over the remaining term of the instrument using the effective interest method.

The Oramed Note, FSF Deposit, Tranche B Notes

The Company has elected the fair value option to account for the FSF Deposit and the Tranche B Notes (each as defined in Note 2 “Liquidity and Going Concern” below) and the Oramed Note (as defined in Note 5 “Fair Value Measurements” below) that were issued in June 2024, October 2024, and September 2023, respectively, as discussed further in Note 8. The Company recorded these financial instruments at fair value upon issuance with changes in fair value recorded as change in fair value of debt and liability instruments in the consolidated statements of operations, with the exception of changes in fair value due to instrument-specific credit risk, if any, which are recorded as a component of other comprehensive income. Interest expense related to these financial instruments is included in the changes in fair value. As a result of applying the fair value option, direct costs and fees related to these financial instruments were expensed as incurred. The weighted-average interest rates for the short-term loans, including these financial instruments, were 12.35% and 6.67% for the years ended December 31, 2025 and 2024, respectively.

Scilex-St. James Loans

The Company accounted for Scilex-St. James Loans using amortized cost model. Transaction fees paid to the lender are treated as debt discounts which are recorded as reduction to the principal of the notes. The debt discounts are amortized over the contractual term of the notes, using the effective interest method, and recorded as interest expense in the consolidated statements of operations and comprehensive loss.

Purchased Revenue Liability

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The purchased revenue liability is associated with the Purchase and Sale Agreement that the Company entered into in October 2024 with certain institutional investors (collectively, the “ZTlido Royalty Investors”) and Oramed (the “ZTlido Royalty Purchase Agreement”) and the Purchase and Sale Agreement that the Company entered into in February 2025 with certain institutional investors (collectively, the “Gloperba-Elyxyb Royalty Investors”) and Oramed (the “Gloperba-Elyxyb Royalty Purchase Agreement”, and together with the ZTlido Royalty Purchase Agreement, the “Royalty Purchase Agreements”) (Note 8). The Company elected the fair value option to account for the purchased revenue liability (as described in Note 5 “Fair Value Measurements” below). The Company recorded the these Royalty Purchase Agreements at fair value upon issuance with changes in fair value recorded as change in fair value of debt and liability instruments in the consolidated statements of operations, with the exception of changes in fair value due to instrument-specific credit risk, if any, which are recorded as a component of other comprehensive income. Interest expense related to these financial instruments is included in the changes in fair value. As a result of applying the fair value option, direct costs and fees related to the purchased revenue liability were expensed as incurred.

Derivative Liabilities

Derivative liabilities are recorded on the Company’s consolidated balance sheets at their fair value on the date of issuance and are revalued on each balance sheet date until such instruments are exercised or expire, with changes in the fair value between reporting periods recorded as other income or expense.

Research and Development Costs

The Company expenses the cost of research and development as incurred. Research and development expenses are comprised of costs incurred in performing research and development activities, including clinical trial costs, manufacturing costs for both clinical and preclinical materials as well as other contracted services, license fees and other external costs. Nonrefundable advance payments for goods and services that will be used in future research and development activities are expensed when the activity is performed or when the goods have been received, rather than when payment is made, in accordance with FASB ASC Topic 730, Research and Development.

Income Taxes

The provisions of the FASB ASC Topic 740, Income Taxes, address the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the consolidated financial statements. Under ASC Subtopic 740-10, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by taxing authorities, based on the technical merits of the position. The Company has determined that it has uncertain tax positions.

The Company accounts for income taxes using the asset and liability method to compute the differences between the tax basis of assets and liabilities and the related financial amounts, using currently enacted tax rates.

The Company has deferred tax assets, which are subject to periodic recoverability assessments. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount that more likely than not will be realized. As of December 31, 2025 and 2024, the Company maintained a full valuation allowance against its deferred tax assets.

Leases

The Company determines if an arrangement is a lease at inception. Operating lease right-of-use (“ROU”) assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. As the Company’s leases do not provide an implicit rate, it uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The operating lease ROU asset also includes any lease payments made and is reduced by lease incentives. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term in selling, general and administrative expenses.

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Revenue Recognition

The Company’s revenue is primarily generated from product sales within the United States. The Company does not incur significant direct costs to obtain contracts with its customers.

Revenue from product sales is comprised of sales of ZTlido, ELYXYB and GLOPERBA. The Company’s performance obligation with respect to sales of ZTlido, ELYXYB and GLOPERBA is satisfied at a point-in-time, when control is transferred upon delivery of product to the customer. The Company considers control to have transferred upon delivery because the customer has legal title to the product, physical possession of the product has been transferred to the customer, the customer has significant risks and rewards of ownership of the product, and the Company has a present right to payment at that time. Invoicing typically occurs upon shipment and the length of time between invoicing and when payment is due is not significant. The aggregate dollar value of unfulfilled orders as of December 31, 2025 and 2024 were not material.

Revenues from product sales are recorded net of reserves established for commercial and government rebates, fees and chargebacks, wholesaler and distributor fees, sales returns, special marketing programs and prompt payment discounts. Such variable consideration is estimated in the period of the sale and is estimated using a most likely amount approach based primarily upon provisions included in the Company’s customer contract, customary industry practices and current government regulations.

Deductions from Revenues

The Company’s gross product revenues are subject to a variety of deductions, which generally are estimated and recorded in the same period that the revenues are recognized. Such variable consideration represents chargebacks, rebates, sales allowances and sales returns. These deductions represent estimates of the related obligations and, as such, knowledge and judgment are required when estimating the impact of these product revenue deductions on net sales for a reporting period.

Rebates and Chargebacks

Rebates are discounts which the Company pays under either government or private health care programs. Government rebate programs include state Medicaid drug rebate programs, the Medicare coverage gap discount programs and the Tricare programs. Commercial rebate and fee programs relate to contractual agreements with commercial healthcare providers, under which the Company pays rebates and fees for access to and position on that provider’s patient drug formulary. Rebates and chargebacks paid under government programs are generally mandated under law, whereas private rebates and fees are generally contractually negotiated by the Company with commercial healthcare providers. Both types of rebates vary over time. The Company records a reduction to gross product sales at the time the customer takes title to the product based on estimates of expected rebate claims. The Company monitors the sales trends and adjusts for these rebates on a regular basis to reflect the most recent rebate experience and contractual obligations. Reserves for rebates and chargebacks are separately presented as accrued rebates and fees under current liabilities within the Company’s consolidated balance sheets.

Prompt Payment Discounts

The Company provides its customers with prompt payment discounts which may result in adjustments to the price that is invoiced for the product transferred, in the case that payments are made within a defined period. The prompt payment discount reserve is based on actual gross sales and contractual discount rates. Reserves for prompt payment discounts are included in accounts receivable, net on the consolidated balance sheets.

Service Fees

The Company compensates its customer and others in the distribution chain for wholesaler and distribution services. The Company has determined such services received to date are not distinct from the Company’s sale of products to the customer and, therefore, these payments have been recorded as a reduction of revenue. Service fees are presented as accrued rebates and fees under current liabilities within the Company’s consolidated balance sheets.

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Product Returns

The Company is obligated to accept the return of products sold that are expiring within six months, damaged or do not meet certain specifications. The Company may authorize the return of products sold in accordance with the term of its sales contracts, and estimates allowances for such amounts at the time of sale. The Company estimates the amount of its product sales that may be returned by its customer and records this estimate as a reduction of revenue in the period the related product revenue is recognized. Product returns are presented as accrued rebates and fees under current liabilities within the Company’s consolidated balance sheets.

The allowance for product returns is determined based on historical return rates, product shelf life, and inventory levels within the distribution channel. This estimated rate is applied to gross sales to accrue the sales allowance.

Discounts

Discounts, typically 2% of sales, are offered to wholesalers for prompt payment. Upon receipt of actual product returns, the Company updates its balances accordingly, while continuing to refine its estimates based on historical trends.

Co-Payment Assistance

Patients who have commercial insurance or pay cash and meet certain eligibility requirements may receive co-payment assistance. The Company accrues for co-payment assistance based on actual program participation and estimates of program redemption using data provided by third-party administrators. Co-payment assistance is presented as accrued rebates and fees under current liabilities within the Company’s consolidated balance sheets.

Stock-Based Compensation

The Company accounts for stock-based compensation in accordance with FASB ASC Topic 718, Compensation – Stock Compensation, which establishes accounting for equity instruments exchanged for employee and consulting services. Under such provisions, stock-based compensation cost is measured at the grant date, based on the calculated fair value of the award, and is recognized as an expense, under the straight-line method, over the employee’s requisite service period (generally the vesting period of the equity grant) or non-employee’s vesting period. The Company accounts for forfeitures as incurred.

For purposes of determining the inputs used in the calculation of stock-based compensation, the Company determines the expected life assumption for options issued using the simplified method, which is an average of the contractual term of the option and its ordinary vesting period since the Company does not have historic exercise behavior. Then the Company determines an estimate of option volatility based on an assessment of historical volatilities of comparable companies whose share prices are publicly available. The Company uses these estimates as variables in the Black-Scholes option pricing model. Depending upon the number of stock options granted, any fluctuations in these calculations could have a material effect on the results presented in our consolidated statements of operations and comprehensive loss.

Treasury Stock

The Company uses the cost method to account for repurchases of its stock. In the computation of net (loss) income per share, treasury shares are not included as part of the outstanding shares.

Net Loss per Share

Basic and diluted net loss per share attributable to common stockholders is presented in conformity with the two-class method required for participating securities.

Under the two-class method, basic net loss per share attributable to common stockholders is computed by dividing the net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period. Diluted earnings per share attributable to common stockholders adjusts basic earnings per share for

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the potentially dilutive impact of stock options and warrants, which consists of the incremental Common Stock issuable upon the exercise of stock options and warrants (using the treasury stock method or the reverse treasury stock method, as applicable).

In accordance with FASB ASC 260, Earnings Per Share, Penny Warrants are warrants that would be exercised for no or little consideration and therefore should be included in the calculation of weighted average shares outstanding for purposes of calculating basic and diluted net income (loss) per share to the extent all vesting conditions or exercise contingencies are removed except for the passage of time.

Recent Accounting Pronouncements

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The update requires a public business entity to disclose, on an annual basis, a tabular rate reconciliation using both percentages and currency amounts, broken out into specified categories with certain reconciling items further broken out by nature and jurisdiction to the extent those items exceed a specified threshold. In addition, all entities are required to disclose income taxes paid, net of refunds received disaggregated by federal, state/local, and foreign and by jurisdiction if the amount is at least 5% of total income tax payments, net of refunds received. Adoption of the ASU allows for either the prospective or retrospective application of the amendment and is effective for annual periods beginning after December 15, 2024, with early adoption permitted. We adopted this ASU for our 2025 annual period prospectively. See Note 14 for the revised disclosures consistent with the new standard.

In December 2023, the FASB issued ASU No. 2023-08, Intangibles—Goodwill and Other—Crypto Assets (Subtopic 350-60): Accounting for and Disclosure of Crypto Assets. The amendments in ASU No. 2023-08 are intended to improve the accounting for certain crypto assets by requiring an entity to measure those crypto assets at fair value each reporting period with changes in fair value recognized in net income. The amendments also improve the information provided to investors about an entity’s crypto asset holdings by requiring disclosure about significant holdings, contractual sale restrictions, and changes during the reporting period. The amendments are effective for all entities for fiscal years beginning after December 15, 2024, including interim periods within those fiscal years. We adopted ASU 2023-08 in 2025, and it did not have a material impact on the Company’s financial statements when adopted, as the Company did not hold any crypto assets as of the adoption date. During the third quarter of 2025, the Company began holding crypto assets, which are accounted for in accordance with ASU 2023-08. See Note 6 for related disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures, which will require additional expense disclosures for all public entities. The amendments require that at each interim and annual reporting period, an entity will disclose certain disaggregated expenses included in each relevant expense caption, as well as the total amount of selling expenses and, in annual periods, an entity’s definition of selling expenses. ASU 2024-03 is effective for annual reporting periods beginning with the fiscal year ending December 31, 2027, and interim periods thereafter, with early adoption permitted. The Company is currently evaluating the incremental disclosures that will be required in its consolidated financial statements.

In November 2024, the FASB issued ASU 2024-04, Debt—Debt with Conversion and Other Options, which clarify the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as an induced conversion. ASU 2024-04 is effective for annual reporting periods beginning after December 15, 2025 and interim reporting periods within those annual reporting periods. Early adoption is permitted for all entities that have adopted the amendments in ASU 2020-06. The Company is currently evaluating the impact of this amendment on its consolidated financial statements.

In July 2025, the FASB issued ASU No. 2025-05, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets. The amendments in this update provide a practical expedient permitting an entity to assume that conditions at the balance sheet date remain unchanged over the life of the asset when estimating expected credit losses for current classified accounts receivable and contract assets. This update is effective for annual periods beginning after December 15, 2025, including interim periods within those fiscal years. Adoption of this ASU can be applied prospectively for reporting periods after its effective date. Early adoption is permitted. The Company is currently evaluating the provisions of this ASU and do not expect this ASU to have a material impact on its consolidated financial statements.

F-19

2. Liquidity and Going Concern

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. Management has assessed the Company’s ability to continue as a going concern for at least one year after the issuance date of the accompanying consolidated financial statements.

On December 22, 2023, the Company entered into a Sales Agreement (the “ATM Sales Agreement”) with B. Riley Securities, Inc., Cantor Fitzgerald & Co. and H.C. Wainwright & Co., LLC (the “Sales Agents”), which agreement was voluntarily terminated by us effective as of March 5, 2025. Pursuant to the ATM Sales Agreement, the Company was able to offer and sell (the “Offering”) shares of Common Stock up to $170.0 million (the “ATM Shares”), through or to the Sales Agents as part of the Offering. The Company had no obligation to sell any shares of Common Stock under the ATM Sales Agreement and could suspend offers thereunder at any time. As of December 31, 2025, no sales of Common Stock had been made under the ATM Sales Agreement. As of December 31, 2024, the Company sold 78,976 shares of Common Stock pursuant to the ATM Sales Agreement for net proceeds of approximately $2.7 million.

On June 11, 2024, the Company entered into that certain Commitment Side Letter (the “Commitment Letter”) with FSF 33433 LLC (“FSF Lender”), pursuant to which FSF Lender committed to provide the Company a loan (the “FSF Loan”) in the aggregate amount of $100.0 million (the “Commitment Amount”). The Commitment Amount shall be payable as follows: (i) $85.0 million no later than the date that is 70 days following the date on which the Company receives the FSF Deposit (as defined below) (the “Outside Date” and the funding of the initial $85.0 million, the “Initial Commitment Closing”) and (ii) the remaining $15.0 million within 60 days following the Initial Closing (the funding of the second $15.0 million, the “Second Closing”). Pursuant to the Commitment Letter, FSF Lender was required to provide the Company a non-refundable deposit in immediately available funds in the aggregate principal amount of $10.0 million (the “FSF Deposit” and the date on which such funds are fully received, the “Deposit Date”), which amount will be creditable towards the $85.0 million required to be funded by FSF Lender at the Initial Commitment Closing. The Company received the FSF Deposit on June 18, 2024, and issued to FSF Lender a warrant to purchase up to an aggregate of 3,250,000 shares of the Common Stock (the “Deposit Warrant”), with an exercise price of $1.20 per share. The exercise price and number of shares of Common Stock issuable upon the exercise of the Deposit Warrant may be subject to certain adjustments in the event of any stock dividend, stock split, recapitalization, reorganization or similar transaction, as described in the Deposit Warrant. The Deposit Warrant is immediately exercisable and will expire five years from the date of issuance.

On September 17, 2024, the Company entered into a Satisfaction Agreement (the “Satisfaction Agreement”) with FSF Lender and Endeavor Distribution LLC, a Delaware limited liability company and affiliate of FSF Lender (“Endeavor”), pursuant to which the remaining obligations in respect of the FSF Deposit shall be fully satisfied by the Company’s delivery of 28,000 cartons of ZTlido to Endeavor (the “Additional Product”), which delivery shall occur no later than December 31, 2024. Upon satisfaction of such remaining obligations, the Commitment Letter shall be terminated and of no further force or effect and neither FSF Lender nor the Company shall have any further liability or obligations thereunder. In consideration of Endeavor assuming the payment obligation of the Company in respect of the FSF Deposit, Endeavor will not be responsible for making any payment to the Company for (i) the product already delivered as of the date of such agreement in an amount of approximately $13.2 million and (ii) the Additional Product. In November 2024, the Company delivered the Additional Product to Endeavor and fully satisfied the remaining obligations in respect of the FSF Deposit.

On October 7, 2024, the Company entered into a securities purchase agreement (the “Tranche B Securities Purchase Agreement”) with certain institutional investors (collectively, the “Tranche B Investors”) and Oramed Pharmaceuticals Inc. (“Oramed”, and together with the Tranche B Investors, the “Tranche B Noteholders”), to issue and sell, in a registered offering by the Company directly to the Tranche B Noteholders, a new tranche B of senior secured convertible notes of the Company in the aggregate principal amount of $50.0 million (the “Tranche B Notes”) which notes will mature on the two-year anniversary of the issuance date and will be convertible into shares of Common Stock at a conversion price equal to $36.40 per share. In exchange for the issuance of the Tranche B Notes to the Tranche B Investors, the Company has received an aggregate amount in cash of $22,500,000, excluding fees and expenses payable by the Company. In consideration for the Tranche B Notes issued to Oramed, the Company has

F-20

received from Oramed an exchange and reduction of the principal balance under the Oramed Note (as defined below) of $22,500,000.

On December 1, 2025, the Company entered into a Non-Recourse Loan and Securities Pledge Agreement (the “Scilex-St. James Loan Agreement”) to issue loans (the “Scilex-St. James Loans”) with St. James Bank & Trust Company Ltd., a corporation existing under the laws of the Bahamas (“St. James”), in up to an aggregate principal amount of $50.0 million, which may be advanced in one or more tranches. The Scilex-St. James Loans are non-recourse loans, which are collateralized by the shares of Datavault common stock held by the Company, wherein St. James will act as the custodian over these collateralized shares.

On December 8, 2025, the Company and St. James executed an amendment to the "Scilex-St. James Loan Agreement (the “Scilex-St. James Loan Amendment”). The Scilex-St. James Loan Amendment, among other things, increased the maximum amount borrowable under the Scilex-St. James Loan Agreement from $50.0 million to $100.0 million, and increased the number of shares of Datavault common stock collateralizing the Scilex-St. James Loans to 85,838,800 shares.

On December 19, 2025, (the “Initial Scilex-St. James Loan Closing Date”), St. James funded $10.0 million of principal of the Scilex-St. James Loans (the “Scilex-St. James Loan Tranche 1”), net of a $0.8 million financing fees, collateralized by 17,361,111 shares of Datavault Common Stock, at a collateral price per share of $0.96. The Company has received proceeds of the Scilex-St. James Loan Tranche 1 and aggregate amount of $9.2 million in cash, excluding fees and expenses payable by the Company.

On December 22, 2025 (the “Scilex-St. James Tranche 2 Closing Date”), St. James funded and the Company received in cash $12.6 million of principal of the Scilex-St. James Loans (the “Scilex-St. James Tranche 2”), collateralized by 21,841,689 shares of Datavault Common Stock, excluding fees and expenses payable by the Company.

As of December 31, 2025, the Company’s negative working capital was $445.3 million, including cash and cash equivalents of approximately $5.0 million. During the year ended December 31, 2025, the Company had operating losses of $346.0 million and cash flows outflows from operations of $3.8 million. The Company had an accumulated deficit of $921.8 million as of December 31, 2025.

The Company has plans to obtain additional resources to fund its currently planned operations and expenditures and to service its debt obligations (whether under the Oramed Note, the Tranche B Notes or otherwise) for at least twelve months from the issuance of these consolidated financial statements through a combination of equity offerings, debt financings, collaborations, government contracts or other strategic transactions. The Company’s plans are also dependent upon the success of future sales of ZTlido, ELYXYB and GLOPERBA, among which GLOPERBA and ELYXYB are still in the early stages of commercialization.

Although the Company believes such plans, if executed, should provide the Company with financing to meet its needs, successful completion of such plans is dependent on factors outside the Company’s control. As a result, management has concluded that the aforementioned conditions, among other things, raise substantial doubt about the Company’s ability to continue as a going concern for one year after the date the consolidated financial statements are issued.

3. Acquisitions

SP-104 Acquisition

In May 2022, the Company acquired the Delayed Burst Release Low Dose Naltrexone asset and intellectual property rights for the treatment of chronic pain, fibromyalgia and chronic post-COVID syndrome (collectively, the “SP-104 Assets”). Pursuant to the acquisition provisions, the Company is obligated to pay Aardvark Therapeutics, Inc. (“Aardvark”) (i) $3.0 million upon initial approval by the FDA of a new drug application for the SP-104 Assets (which amount may be paid in shares of Common Stock or cash, in the Company’s sole discretion) (the “Development Milestone Payment”) and (ii) $20.0 million in cash, upon achievement of certain net sales by the Company of a commercial product that uses the SP-104 Assets (the “Sales Milestone Payment”). The Company will also pay Aardvark certain royalties in the single digits based on percentages of annual net sales by the Company of a commercial product that uses the SP-104 Assets.

F-21

The Sales Milestone Payment and sale volume-based future royalties were determined to meet a scope exception for derivative accounting and will not be recognized until the contingencies are realized. The Development Milestone Payment represents a liability, which will be measured at fair value for each reporting period. As of December 31, 2025 and December 31, 2024, the contingent consideration associated with the Development Milestone Payment was $0.2 million, recorded in the other long-term liabilities.

ELYXYB Acquisition

In February 2023, the Company entered into an asset purchase agreement (the “ELYXYB APA”) with BioDelivery Sciences International, Inc. (“BDSI”) and Collegium Pharmaceutical, Inc. (“Collegium”, and together with BDSI, the “Sellers”) to acquire the rights to certain patents, trademarks, regulatory approvals, data, contracts, and other rights related to ELYXYB and its commercialization in the United States and Canada (the “ELYXYB Territory”).

As consideration for the acquisition, the Company assumed various rights and obligations under the asset purchase agreement between BDSI and Dr. Reddy’s Laboratories Limited, a company incorporated under the laws of India (“DRL”), dated August 3, 2021 (the “DRL APA”), including an irrevocable, royalty-free, exclusive license to know-how and patents of DRL related to ELYXYB and necessary or used to exploit ELYXYB in the ELYXYB Territory. No cash consideration was or will be payable to the Sellers for such acquisition; however, the obligations under the DRL APA that were assumed by the Company include contingent sales and regulatory milestone payments and sales royalties. The Company is also obligated to make quarterly royalty payments to DRL on net sales of ELYXYB in the ELYXYB Territory. In April 2023, the Company launched ELYXYB in the U.S.

As of each of December 31, 2025 and 2024, the Company had ending balances of accrued royalty payables of $0.2 million, which was recorded as accrued expenses under current liabilities on the consolidated balance sheets. During the years ended December 31, 2025 and 2024, the Company made royalty payments in the amount of $0.2 million and $0.3 million, respectively. As of December 31, 2025, a regulatory milestone payment of $1.0 million had been accrued.

Semnur Business Combination Agreement and Sponsor Interest Purchase Agreement

On August 30, 2024, Semnur entered into an agreement and plan of merger (as may be amended or restated from time to time in accordance with its terms, including by Amendment No. 1 thereto, dated as of April 16, 2025 (“Amendment No.1”), the “Semnur Business Combination Agreement”) with Denali and Denali Merger Sub Inc., a Delaware corporation and wholly owned subsidiary of Denali (“Denali Merger Sub”). On July 22, 2025, Semnur entered into Amendment No. 2 to the Semnur Business Combination Agreement with Denali and Denali Merger Sub (“Amendment No. 2”). Amendment No. 2 amends the Semnur Business Combination Agreement to, among other things, modify the definitions of the “Exchange Ratio” and “Merger Consideration” to facilitate the issuance of additional shares of common stock of Semnur prior to the closing of the Semnur Business Combination in connection with any potential private placement financing or for issuance to advisors and other service providers for services rendered and maintain the 1.25-to-1 exchange ratio.

The Semnur Business Combination Agreement provides that, among other things, (i) on the terms and subject to the conditions set forth therein, Denali Merger Sub will merge with and into Semnur, with Semnur surviving as a wholly owned subsidiary of Denali (the “Semnur Business Combination”), and (ii) prior to the closing of the Semnur Business Combination, Denali will migrate to and domesticate as a Delaware corporation in accordance with Section 388 of the General Corporation Law of the State of Delaware, as amended (the “DGCL”), and de-register in the Cayman Islands in accordance with Section 206 of the Cayman Companies Act (the “Domestication”). Upon the closing of the Semnur Business Combination, it is anticipated that Denali will change its name to “Semnur Pharmaceuticals, Inc.” (“New Semnur”). Shares of Denali common stock following the Domestication are hereinafter referred to as “New Semnur Common Shares”. Shares of Denali Series A preferred stock following the Domestication are hereinafter referred to as “New Semnur Preferred Shares”. Warrants to purchase New Semnur Common Shares following the Domestication are hereinafter referred to as “New Semnur Warrants”.

F-22

In accordance with the terms and subject to the conditions of the Semnur Business Combination Agreement, following the Domestication and at the effective time of the Semnur Business Combination (the “Effective Time”): (i) each share of Semnur Common Stock issued and outstanding immediately prior to the Effective Time will be automatically converted into the right to receive, without interest, a number of New Semnur Common Shares equal to the Exchange Ratio (as defined in the Semnur Business Combination Agreement); (ii) each share of Series A preferred stock of Semnur issued and outstanding immediately prior to the Effective Time will be automatically converted into the right to receive, without interest, (a) one New Semnur Preferred Share and (b) one-tenth of one New Semnur Common Share, and (iii) subject to Denali’s receipt of the Option Exchange Approval (as defined in the Semnur Business Combination Agreement), each option to purchase a share of Semnur Common Stock that is then outstanding shall be converted into the right to receive an option to purchase a number of New Semnur Common Shares as determined by the Exchange Ratio upon substantially the same terms and conditions as are in effect with respect to such option immediately prior to the Effective Time, with the exercise price thereof adjusted by the Exchange Ratio. Pursuant to Amendment No. 1, among other things, the parties agreed to (i) modify certain covenants of the parties to address the potential delisting of the Denali ordinary shares and warrants from the Nasdaq Capital Market, (ii) extend the Outside Date (as defined in Amendment No. 1) to September 30, 2025, and (iii) require Denali to amend its organizational documents to extend the period of time within which Denali can complete a business combination to December 11, 2025, or such other date that is mutually agreed to by Semnur and Denali.

In connection with the execution and delivery of the Semnur Business Combination Agreement, the Sponsor and the Company entered into a Sponsor Interest Purchase Agreement (the “SIPA”) dated August 30, 2024 (the “Signing Date”). Pursuant to the SIPA, the Company agreed to purchase 500,000 Class B ordinary shares, par value $0.0001 per share, of Denali (the “Purchased Interests”) that were held by the Sponsor. The aggregate consideration for the purchase and sale of the Purchased Interests is as follows: (i) $2,000,000 (the “Cash Consideration”) and (ii) 8,571 shares of Common Stock. Pursuant to the SIPA, the Company paid the Cash Consideration and has agreed to issue Common Stock to the Sponsor contingent upon and following the occurrence of the Semnur Business Combination. The Purchased Interests converted automatically, on a one-for-one basis, into one New Semnur Common Share upon the closing of the Semnur Business Combination pursuant to the terms of the Semnur Business Combination Agreement. On September 22, 2025, the requirement to deliver the shares was discharged pursuant to that certain Satisfaction and Discharge Agreement by and among the Company, Sponsor and Semnur.

As of December 31, 2025, and December 31, 2024, the Company had deferred offering costs of approximately nil and $6.0 million, respectively, related to the Semnur Business Combination. Because the transaction was completed without cash consideration, these costs were recognized as an expense in the Company’s consolidated statements of operations upon closing.

Vivasor Business Combination

On December 5, 2025 (the “VHC Transaction Date”), the Company entered into a Share Transfer Agreement with EAR SPV LLC, a Delaware corporation (“EAR SPV”) and Vivasor Holding Company (“VHC”), a privately held biotechnology company, pursuant to which, among other things, EAR SPV agreed to sell, and the Company agreed to buy, all 6,101,468 shares of VHC’s Series A-1 Preferred Stock, par value $0.00001 per share, held by EAR SPV, for an aggregate purchase price of $9.0 million (“VHC Business Combination”).

The Company evaluated VHC under the VIE model in accordance with ASC 810 and concluded that VHC is a VIE because it lacked sufficient equity at risk to finance its activities without additional subordinated support. Due to the Company’s power to direct key activities through its eligible majority board representation and its significant economic exposure through its 30.8% equity interest, it was determined that the Company was the primary beneficiary of VHC. As a result, the Company consolidated VHC as of the VHC Transaction Date. The Company will reassess its primary beneficiary status and VIE conclusion for VHC upon the occurrence of any reconsideration events.

The Company accounted for the transaction as a business combination using the acquisition method of accounting in accordance with ASC 805. The identifiable assets acquired and liabilities assumed of VHC were recorded at their estimated fair values as of the VHC Transaction Date. Any excess of the purchase consideration over the fair value of net identifiable assets acquired was recorded as goodwill. Acquisition-related expenses were not material for the year ended December 31, 2025.

F-23

The purchase price allocation is preliminary and subject to adjustment. As the Company continues to evaluate the fair value of assets acquired, including in-process research and development (“IPR&D”), fair value of inventory and receivables, adjustments may result in a reallocation between goodwill and identified tangible and intangible assets. Any such measurement period adjustments will be recorded in accordance with ASC 805, with corresponding offsets to goodwill, and will be finalized no later than one year from the acquisition date.

The fair value estimates for the assets acquired and liabilities assumed were based upon valuations using information known and knowable as of the date of this filing. Changes to these assumptions and estimates could cause an impact to the valuation of assets acquired including goodwill. The Company is in the process of finalizing the purchase price allocation. Accordingly, the allocation of the purchase price to the assets acquired and liabilities assumed is preliminary and subject to adjustment during the measurement period, which may not exceed one year from the VHC Transaction Date.

The fair value of the total purchase consideration for the VHC Business Combination was $71.3 million, subject to purchase price adjustment and was comprised of the following (in thousands):

Purchase Consideration

Fair Value

Cash consideration

$

9,000

Upside consideration – Aardvark shares claw back

3,111

Debt assumed (short-term and long-term)

47,415

69.2% noncontrolling interest in VHC

11,805

Total purchase consideration

$

71,331

The purchase consideration includes the cash paid for the equity interest in VHC, the fair value of debt assumed at acquisition, the upside consideration payable to Sorrento Therapeutics, Inc. (“Sorrento”) based on a percentage of proceeds from the Aardvark Therapeutics, Inc. (“Aardvark”) equity investment, and the fair value of the noncontrolling interests. The 69.2% noncontrolling interest in VHC was measured at fair value using an option pricing model backsolve methodology with a discount for lack of control of 23.1%. The 7.0% noncontrolling interest relates to Sorrento’s retained interest in certain VHC subsidiaries pursuant to the Asset Purchase Agreement dated March 8, 2024 between Sorrento and VHC.

The preliminary allocation of the VHC Business Combination purchase consideration to the estimated fair value of the net assets acquired and liabilities assumed at the VHC Transaction Date was as follows (in thousands):

Liabilities presented below exclude assumed debt and upside consideration, which are presented as components of the purchase consideration above.

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Fair Value

Assets acquired:

Cash and cash equivalents

$

1,517

Marketable securities

6,223

Accounts receivable

5,122

Prepaid expenses and other current assets

1,234

Inventory

4,135

Property, plant and equipment

13,023

Right-of-use assets

13,405

Other long-term assets

404

Total assets acquired

45,063

Liabilities assumed:

Accounts payable

17,587

Accrued expenses

14,802

Operating lease liabilities

13,405

Other current liabilities

1,296

Total liabilities assumed

47,090

Total identifiable net liabilities

-2,027

Goodwill

73,358

Total purchase consideration

$

71,331

Goodwill of $73.4 million represents the excess of the purchase consideration over the fair value of the net identifiable assets acquired and liabilities assumed. Goodwill is primarily attributable to the assembled workforce, expected synergies from combining the operations of VHC with those of the Company, and the platform VHC provides for the Company’s strategy to pursue in-license opportunities in the biotechnology industry. Goodwill recognized in the transaction is not deductible for income tax purposes. As of December 31, 2025, based on the results of both qualitative and quantitative goodwill impairment tests performed, the Company concluded that the carrying amount of the goodwill associated with the VHC Business Combination was impaired, and therefore recognized a total goodwill impairment charge of $73.4 million for the year then ended (see Note 7).

Goodwill will not be amortized but will be tested for impairment at least annually or more frequently if events or changes in circumstances indicate that it may be impaired.

Property, plant and equipment was valued at $13.0 million using a combination of the cost and market approaches, resulting in a net step-down of $1.1 million from historical net book value. Marketable securities of $6.2 million represent the Company’s indirect interest in publicly traded shares of Aardvark, measured at the closing market price as of the VHC Transaction Date. Debt assumed of $47.4 million was measured at fair value using discounted cash flow analyses reflecting the Company’s incremental borrowing rate, which resulted in a fair value reduction of $13.2 million from book value.

The Company elected to apply pushdown accounting in accordance with ASC 805-50, recording the fair value adjustments at the VHC entity level.

For the twelve months ended December 31, 2025, net loss from Vivasor attributable to the noncontrolling interest was $11.8 million.

Consulting Agreement — Acea Therapeutics, Inc.

Acea Therapeutics, Inc. (“Acea Therapeutics”) is a biopharmaceutical company in which Henry Ji, Ph.D., the Executive Chairperson of the Board of Directors of the Company and a subsidiary of Vivasor, holds a greater than 50% ownership interest. As a result of Dr. Ji’s position as Executive Chairperson of the Company and his greater than 50% ownership interest in Acea Therapeutics, Acea Therapeutics is considered a related party of the Company for purposes of ASC 850, Related Party Disclosures, and Item 404 of Regulation S-K.

During the year ended December 31, 2025, the Company engaged Acea Therapeutics to provide regulatory strategy

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consulting services in connection with the Company's development and commercialization activities in the People’s Republic of China. The consulting services provided by Acea Therapeutics included advisory support with respect to the regulatory processes, submissions, and related strategic guidance required for the Company’s product candidates under the National Medical Products Administration (“NMPA”) and other applicable Chinese regulatory authorities.

During the year ended December 31, 2025, the Company paid an aggregate of $5.6 million in consulting fees to Acea Therapeutics under this arrangement. All fees were paid in full during the fiscal year ended December 31, 2025.

4. License Agreements

GLOPERBA License Agreement

On June 14, 2022, the Company entered into a License and Commercialization Agreement with RxOmeg Therapeutics LLC (a/k/a Romeg Therapeutics, LLC) (“Romeg”) for the in-licensing of certain intellectual property rights from Romeg with respect to the commercialization of GLOPERBA, which was amended by that First Amendment to License and Commercialization Agreement, dated as of January 16, 2025 (such agreement, as amended, the “Romeg License Agreement”). Under the Romeg License Agreement, among other things, Romeg granted the Company (1) a license, with the right to sublicense, under the patents and know-how specified therein to (a) commercialize a pharmaceutical product comprising liquid formulations of colchicine for the prophylactic treatment of gout in adult humans (the “Initial Licensed Product”) in the United States (including its territories) (the “Romeg U.S. Territory”), (b) develop other products comprising the Initial Licensed Product as an active pharmaceutical ingredient (together with the Initial Licensed Product, the “Licensed Products”) and commercialize any such products in the Romeg U.S. Territory and (c) manufacture Licensed Products anywhere in the world, solely for commercialization in the Romeg U.S. Territory; (2) an exclusive license, with right to sublicense, to use the trademark “GLOPERBA” and logos, designs, translations, and modifications thereof (collectively, the “Licensed Trademark”) in connection with the commercialization of the Initial Licensed Product solely in the Romeg U.S. Territory; and (3) pursuant to the amendment thereto, a license, with the right to (a) sublicense under the know-how and, if any, patents existing worldwide other than the Romeg U.S. Territory (the “Romeg Ex-U.S. Territory”), as specified therein, to develop, manufacture and commercialize Licensed Products in the Romeg Ex-U.S. Territory and (b) to use the Licensed Trademark in connection with the commercialization of the Licensed Products in the Romeg Ex-U.S. Territory. The Initial Licensed Product, GLOPERBA, was approved and made available in the United States in 2020.

As consideration for the license under the Romeg License Agreement, the Company agreed to pay Romeg (1) an up-front license fee of $2.0 million, (2) upon the Company’s achievement of certain net sales milestones, certain milestone payments in the aggregate amount of up to $13.0 million, (3) certain royalties in the mid-single digit percentage based on annual net sales of the Licensed Products attributable to sales of the Licensed Products occurring in the Romeg U.S. Territory during the Romeg U.S. Territory Royalty Term, with a quarterly minimum royalty of $150,000, and (4) pursuant to the amendment thereto, (a) certain royalties at rates in the low-single digit percentage, based on annual net sales of the Licensed Products attributable to sales of License Products in the Romeg Ex-U.S. Territory during the Romeg Ex-U.S. Territory Royalty Term and (b) a one-time, non-refundable, non-creditable payment of $700,000. Pursuant to the amendment agreement, we also transferred to Romeg 22,267 shares of our Common Stock.

In connection with the Romeg License Agreement, the Company recorded an intangible asset for acquired licenses of $5.7 million, which is comprised of the upfront license fee of $2.0 million and deferred consideration of $3.7 million that is the present value of the future minimum royalty payments and immaterial transaction costs. During each of the years ended December 31, 2025, and 2024, the Company made royalty payments in the amount of $0.6 million. No contingent consideration was recognized as a liability or included in the fair value of the assets as of December 31, 2025 or December 31, 2024.

Gloperba Rest of World License Agreement

On February 28, 2025 (the “Gloperba Effective Date”), the Company entered into a License Agreement (the “Gloperba License Agreement”) with Scilex Pharma and the Licensee with respect to (i) services, compositions, products, dosages and formulations comprising Gloperba that have been or are later developed by or on behalf of the Company, including the product and any future product defined as a “Licensed Product” under the Romeg License Agreement, as amended and as may be further amended or restated from time to time, and (ii) any related, improved, successor or

F-26

replacement forms of any such product Controlled (as defined therein) by the Company ((i) and (ii) together, the “Gloperba Product”).

Under the Gloperba License Agreement, the Company granted to the Licensee during the Gloperba License Term (as defined below) a worldwide, exclusive, non-transferable (except in connection with a permitted assignment of the Gloperba License Agreement) right, license and interest in, to, and under all Product Rights Controlled (each as defined therein) by the Company to develop, manufacture, obtain and maintain regulatory approvals for, commercialize and otherwise exploit all Gloperba Products, in all cases solely for commercialization of the Gloperba Products outside of the United States in the Field (as defined therein). The Licensee granted to the Company a non-exclusive, non-transferable (except in connection with a permitted assignment of the Gloperba License Agreement), right and license under the Licensee Non-Blocking Patents (as defined therein) (i) in the United States, to develop, manufacture, obtain and maintain regulatory approvals for, commercialize and otherwise exploit the Gloperba Product for commercialization of the Gloperba Products in the United States in the Field, and (ii) worldwide, to develop and manufacture the Gloperba Product for commercialization in the United States in the Field. Each of the Licensee and the Company will receive 50% of the Net Revenue (as defined therein) generated based on Licensee’s sale of the Gloperba Products, and the Licensee shall effect the foregoing by paying to the Company an amount required for the Company to receive its share of the Net Revenue on a quarterly basis.

Pursuant to the Gloperba License Agreement, the Licensee shall obtain and maintain regulatory approval for the Gloperba Product outside of the United States in accordance with its own business judgment and in its sole and absolute discretion.

Promptly after the Gloperba Effective Date, the Company is required to (i) facilitate an introduction between the Licensee and the Company’s contract manufacturer of the Gloperba Product (the “Gloperba CMO”) as of the Gloperba Effective Date, and (ii) use reasonable efforts to cause such Gloperba CMO to accept a direct engagement with the Licensee for the manufacturing or supply of the Gloperba Product in finished dosage form. In addition, the Company agreed to appoint the Licensee as its exclusive distributor of the Gloperba Product in the entire world other than the United States during the Gloperba License Term.

The term of the Gloperba License Agreement commences on the Gloperba Effective Date and continues until expiration of the last to expire Licensed Patents (as defined therein), unless earlier terminated (the “Gloperba License Term”).

Elyxyb Rest of World License Agreement

On February 28, 2025 (the “Elyxyb Effective Date”), the Company entered into a License Agreement (the “Elyxyb License Agreement”) with Scilex Pharma and the Licensee with respect to (i) services, compositions, products, dosages and formulations comprising Elyxyb that have been or are later developed by or on behalf of the Company, including the product and any future product defined as a “Licensed Product” under the Elyxyb APA, as amended and as may be further amended or restated from time to time, and (ii) any related, improved, successor or replacement forms of any such product Controlled (as defined therein) by the Company ((i) and (ii) together, the “Elyxyb Product”).

Under the Elyxyb License Agreement, the Company granted to the Licensee during the Elyxyb License Term (as defined below) a worldwide, exclusive, non-transferable (except in connection with a permitted assignment of the Elyxyb License Agreement) right, license and interest in, to, and under all Product Rights Controlled (each as defined therein) by the Company to develop, manufacture, obtain and maintain regulatory approvals for, commercialize and otherwise exploit all Elyxyb Products, in all cases solely for commercialization of the Elyxyb Products outside of the United States in the Field (as defined therein). The Licensee granted to the Company a non-exclusive, non-transferable (except in connection with a permitted assignment of the Elyxyb License Agreement), right and license under the Licensee Non-Blocking Patents (as defined therein) (i) in the United States, to develop, manufacture, obtain and maintain regulatory approvals for, commercialize and otherwise exploit Elyxyb Product for commercialization of Elyxyb Products in the United States in the Field, and (ii) worldwide, to develop and manufacture Elyxyb Product for commercialization in the United States in the Field. Each of the Licensee and the Company will receive 50% of the Canadian Net Revenue (as defined therein) generated based on the Licensee’s sale of the Elyxyb Products, and the Licensee shall effect the foregoing by paying to the Company an amount required for the Company to receive its share of the Canadian Net Revenue on a quarterly basis.

F-27

Pursuant to the Elyxyb License Agreement, the Licensee shall obtain and maintain regulatory approval for the Elyxyb Product outside of the United States in accordance with its own business judgment and in its sole and absolute discretion.

Promptly after the Elyxyb Effective Date, the Company is required to (i) facilitate an introduction between the Licensee and CPL as of the Elyxyb Effective Date, and (ii) use reasonable efforts to cause CPL to accept a direct engagement with the Licensee for the manufacturing or supply of the Elyxyb Product in finished dosage form. In addition, the Company agreed to appoint the Licensee as its exclusive distributor of the Elyxyb Product in the entire world other than the United States during the Elyxyb License Term. The term of the Elyxyb License Agreement commences on the Elyxyb Effective Date and continues until expiration of the last to expire Licensed Patents (as defined therein), unless earlier terminated (the “Elyxyb License Term”).

ZTlido Rest of World License Agreement

On February 22, 2025 (the “Lido Effective Date”), Scilex Pharma entered into a License Agreement (the “Lido License Agreement”) with RoyaltyVest Ltd. (the “Licensee”) with respect to services, compositions, products, dosages and formulations comprising lidocaine that have been or are later developed by or on behalf of Scilex Pharma, including the product and any future product defined as a “Product” under Scilex Pharma’s existing (i) Product Development Agreement, dated as of May 11, 2011, with Oishi Koseido Co., Ltd. (“Oishi”) and Itochu, as amended, and (ii) the associated Commercial Supply Agreement, dated February 16, 2017, among Scilex Pharma, Oishi and Itochu, as amended, which include (a) ZTlido (lidocaine topical system) 1.8%, including the composition of matter with the NDC 69557-111-30 and (b) SP-103 (collectively, the “Lido Product”). The Lido License Agreement supersedes and replaces that certain Rest of World License Term Sheet the parties entered into on October 8, 2024.

Under the Lido License Agreement, Scilex Pharma granted to the Licensee during the Lido License Term (as defined below) a worldwide (other than the United States and certain territories stated in the Lido License Agreement), exclusive, non-transferable right, license and interest in, to, and under all Product Rights Controlled (each as defined therein) by Scilex Pharma to develop, manufacture, obtain and maintain regulatory approvals for, commercialize and otherwise exploit all Lido Products, in all cases solely for commercialization of the Lido Products outside of the United States and certain territories stated in the Lido License Agreement (the “Lido Licensee Territory”). The Licensee granted to Scilex Pharma a non-exclusive, non-transferable, right and license under the Licensee Non-Blocking Patents (as defined therein) (i) in the Licensor Territory (as defined therein), to develop, manufacture, obtain and maintain regulatory approvals for, commercialize and otherwise exploit Lido Product for commercialization of Lido Products in the Licensor Territory in the Field (as defined therein), and (ii) worldwide, to develop and manufacture Lido Product for commercialization in the Licensor Territory in the Field. Each of the Licensee and Scilex Pharma will receive 50% of the Net Revenue (as defined therein) generated, and the Licensee shall effect the foregoing by paying to Scilex Pharma its share of the Net Revenue on a quarterly basis.

Pursuant to the Lido License Agreement, the Licensee shall (i) use commercially reasonable efforts to obtain and maintain regulatory approval for the Lido Product in at least one Major Market Country (as defined therein) within 18 months after the Lido Effective Date, and (ii) commit $200,000, or its equivalent in kind, annually towards such efforts until it obtains regulatory approval for the Lido Product in the Lido Licensee Territory. Scilex Pharma shall use commercially reasonable and diligent efforts to obtain and maintain regulatory approvals for SP-103 and all existing Lido Products in each country or jurisdiction in the Licensor Territory.

The term of the Lido License Agreement commences on the Lido Effective Date and continues until expiration of the last to expire Licensed Patents (as defined therein), unless earlier terminated (the “Lido License Term”).

Datavault License Agreement

On November 3, 2025, the Company entered into a license agreement with Datavault (the “Datavault License Agreement”).

Under the Datavault License Agreement, among other things, Datavault granted the Company a worldwide, exclusive, non-transferable license, with the right to sublicense, under the patents and know-how specified therein to among

F-28

other things, research, develop, make, have made, use, sell, have sold, offer for sale, import, export, register, market, promote, advertise, commercialize and distribute the Proprietary Materials (as defined in the Datavault License Agreement), including a suite of patents related to Datavault’s data platforms and any products created therefrom within the Target Market (as defined below).

With respect to the foregoing, “Target Market” shall mean industries including biotechnology, biopharmaceutical, genetic, diagnostic, and data-related industries, and any markets relating to the generation, use, storage, analysis, tokenization, and exchange of DNA, genetic, diagnostic, and therapeutic data or materials.

The Datavault License Agreement expires upon the expiry of the patents underlying the Proprietary Materials, at which point the license shall become perpetual, irrevocable, non-exclusive and royalty-free. The Datavault License Agreement is subject to earlier termination if, among other things: (i) either party ceases to exist or becomes insolvent, (ii) either party commits a material breach of the Datavault License Agreement, (iii) the Company fails to make any required payment to Datavault that is not cured within 15 days, or (iv) the Company does not achieve and maintain annual royalty payments to Datavault of a minimum of $1,000,000 after 24 months following the date of the Datavault License Agreement.

As consideration for the license under the Datavault License Agreement, the Company agreed to pay Datavault (a) a non-refundable license fee of $10.0 million, payable in four equal installments of $2,500,000 on or before the last day of each fiscal quarter, beginning on December 31, 2025, (b) subject to achievement of certain net sales for the Licensed Product (as defined therein), up to an aggregate of $2,550,000,000, and (c) a five-percent (5%) royalty on net sales of the Product (as defined therein) during the applicable royalty term under the Datavault License Agreement.

The Datavault License Agreement contains customary reciprocal indemnification obligations for Datavault and the Company and customary representations and warranties.

The Company has not recognized any sales relating to the Licensed Product. Accordingly, the Company has not recognized any additional liabilities under the Datavault License Agreement, other than the $10.0 million license fee, all of which remains payable as of December 31, 2025.

Vivasor Datavault License Agreement

On December 20, 2025, Vivasor, Inc. entered into a license agreement with Datavault (the “Vivasor-Datavault License Agreement”).

Pursuant to the Vivasor-Datavault License Agreement, Datavault granted the Company a worldwide, exclusive, non-transferable license, with the right to sublicense, under certain patents and know-how to, among other things, research, develop, make, have made, use, sell, have sold, offer for sale, import, export, market, promote, commercialize and distribute products incorporating the licensed technology (the “Vivasor Licensed Product”) within a defined target market.

The “Vivasor Target Market” includes medical imaging and scanning applications, including magnetic resonance imaging (MRI), computed tomography (CT), X-ray (radiography), positron emission tomography (PET), mammography, fluoroscopy, nuclear medicine and three-dimensional scanning technologies utilizing high-performance computing, including quantum-based scanning technologies.

The Vivasor-Datavault License Agreement continues for the life of the patents underlying the licensed technology, after which the license becomes fully paid-up, perpetual, irrevocable and royalty-free. The Vivasor-Datavault License Agreement is subject to earlier termination upon the occurrence of certain customary events, including (i) insolvency of either party, (ii) an uncured material breach and (iii) failure by the Company to make required payments when due, subject to applicable cure periods.

As consideration for the license, Vivasor, Inc. agreed to pay Datavault (i) a non-refundable license fee of $20.0 million, payable within 120 days of the invoice date, (ii) sales-based milestone payments of up to an aggregate of $2.55 billion upon achievement of specified net sales thresholds, and (iii) a royalty equal to five percent (5%) of net sales of Licensed Products.

F-29

The Vivasor-Datavault License Agreement contains customary reciprocal indemnification obligations for Datavault and Vivasor and customary representations and warranties.

The Company has not recognized any sales relating to the Vivasor Licensed Product. Accordingly, the Company has not recognized any liabilities under the Vivasor-Datavault License Agreement, other than the $20.0 million license fee, all of which remains payable as of December 31, 2025.

5. Fair Value Measurements

The following table presents the Company’s financial assets and liabilities that are measured at fair value on a recurring basis and the level of inputs used in such measurements (in thousands):

December 31, 2025

Balance

Quoted Prices

in Active

Markets

(Level 1)

Significant

Other

Observable

Inputs (Level 2)

Significant Unobservable Inputs (Level 3)

Assets

Equity method investment, at fair value

$

159,403

$

159,403

$

—

$

—

Marketable securities

6,026

6,026

—

—

Digital assets

64,711

64,711

—

—

Total assets

$

230,140

$

230,140

$

—

$

—

Liabilities

Oramed Note

$

27,688

$

—

$

—

$

27,688

Tranche B Notes

17,500

—

—

17,500

Purchased revenue liability

8,400

—

—

8,400

Derivative liabilities

50,599

—

—

50,599

Contingent consideration short-term

3,013

3,013

—

—

Other long-term liabilities

174

—

—

174

Total liabilities measured at fair value

$

107,374

$

3,013

$

—

$

104,361

December 31, 2024

Balance

Quoted Prices

in Active

Markets

(Level 1)

Significant

Other

Observable

Inputs (Level 2)

Significant

Unobservable

Inputs (Level 3)

Liabilities

Oramed Note

$

12,161

$

—

$

—

$

12,161

Tranche B Notes

23,560

—

—

23,560

Purchased revenue liability

6,800

—

—

6,800

Derivative liabilities

18,303

—

—

18,303

Other long-term liabilities

155

—

—

155

Total liabilities measured at fair value

$

60,979

$

—

$

—

$

60,979

Equity method investment

As described in Note 1 above and Note 6 below, upon the additional closing under the Datavault SPA, the Company accounted for investment in Datavault Common Stock in accordance with the equity method. The Company determines the fair value of its Datavault investment by taking the publicly available share price as of the balance sheet date multiplied by the number of shares the Company holds. There are no non-observable inputs in determining the fair value.

Digital assets

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As of December 31, 2025, the Company determines the fair value of its digital asset investment by taking the averages of publicly available price of Bitcoin on multiple platform as of the balance sheet date multiplied by the number of Bitcoin the Company holds. There are no non-observable inputs in determining the fair value.

The Oramed Note

In September 2023, the Company issued a senior secured promissory note to Oramed in the principal amount of $101.9 million (the “Oramed Note”) (see Note 8). The Company elected the fair value option to account for the Oramed Note with any changes in the fair value of such note recorded in the consolidated statements of operations, with the exception of changes in fair value due to instrument-specific credit risk, if any, which are recorded as a component of other comprehensive income. The Company uses a discounted cash flow model to determine the fair value of the Oramed Note based on Level 3 inputs. This methodology discounts the interest and principal payments using a risk-adjusted discount rate. The fair value as of December 31, 2025 and 2024 was determined to be $27.7 million and $12.2 million, respectively, by applying a discount rate of 21.00% and 128.82%, respectively. For the years ended December 31, 2025 and 2024, the Company recorded a loss of $8.4 million and $3.6 million in change in fair value of the Oramed Note, respectively. For the years ended December 31, 2025 and 2024, the change in fair value due to instrument-specific credit risk recorded as a component of other comprehensive income was $7.1 million and $6.3 million, respectively. During the year ended December 31, 2024, the Company reclassified $5.0 million from accumulated other comprehensive income to the consolidated statement of operations. This reclassification was related to the principal payments and partial conversion of the Oramed Note balance into the Tranche B Notes (see Note 8).

Tranche B Notes

In October 2024, the Company entered into the Tranche B Securities Purchase Agreement to issue and sell the Tranche B Notes in the principal amount of $50.0 million (see Note 8). The Company elected the fair value option to account for the Tranche B Notes with any changes in the fair value of such notes recorded in the consolidated statements of operations, with the exception of changes in fair value due to instrument-specific credit risk, if any, which are recorded as a component of other comprehensive income. The Tranche B Notes are measured at fair value on a recurring basis using the Level 3 inputs. The Company uses the Binomial Lattice Model valuation technique to measure the fair value of the Tranche B Notes. The fair value as of December 31, 2025 and 2024, was determined to be $17.5 million and $23.6 million. For the year ended December 31, 2025 and 2024, the Company recorded a loss of $12.9 million and a gain of $6.6 million in change in fair value of the Tranche B Notes in the consolidated statement of operations. For the year ended December 31, 2025 and 2024, the change in fair value due to instrument-specific credit risk recorded as a component of other comprehensive income was $4.3 million and nil, respectively.

Purchased Revenue Liability

In October 2024, the Company entered into the ZTlido Royalty Purchase Agreement with the “ZTlido Royalty Investors” and Oramed (see Note 8). In February 2025, the Company also entered into “the Gloperba-Elyxyb Royalty Purchase Agreement”) with the “Gloperba-Elyxyb Royalty Investors” and Oramed (see Note 8). The Company elected the fair value option for the purchased revenue liability with changes in fair value recorded as change in fair value of debt and liability instruments in the consolidated statements of operations, with the exception of changes in fair value due to instrument-specific credit risk, if any, which are recorded as a component of other comprehensive income. The Company uses a Scenario-Based Method valuation technique to measure the fair value of the purchased revenue liability. The aggregate fair value of both agreements as of December 31, 2025 and 2024, was determined to be $8.4 million and $6.8 million, respectively. For the year ended December 31, 2025 and 2024, the Company recorded a loss of $4.4 million and $0.9 million, respectively, in change in fair value of the purchased revenue liability in the consolidated statement of operations.

Derivative Liabilities

As of December 31, 2025, the following warrants to purchase Common Stock that are included in derivative liabilities were outstanding: 1,000,000 Private Warrants, which are currently exercisable for an aggregate of up to 28,572 shares of Common Stock February 2024 BDO Firm Warrants, which are currently exercisable for an aggregate of up to 108,686 shares of Common Stock, 3,250,000 Deposit Warrant, which are currently exercisable for an aggregate of up

F-31

to 3,250,000 shares of Common Stock, 3,750,000 October 2024 Noteholder Warrants, which are currently exercisable for an aggregate of up to 107,142 shares of Common Stock, and 18,809,454 December 2024 RDO Common Warrants, which are currently exercisable for an aggregate of up to 537,298 shares of Common Stock, 500,000 Exchange Warrants, 275,000 September 2025 Warrants and 1,356,594 November 2025 Warrants. As of December 31, 2025, the fair value of derivative warrant liabilities related to these warrants was $50.6 million.

The Company recorded a loss of $22.7 million for the year ended December 31, 2025, attributed to warrant liabilities consisting of the Private Warrants, the February 2024 BDO Firm Warrants, the April 2024 RDO Common Warrants, Deposit Warrant, the October 2024 Noteholder Warrants, December 2024 RDO Common Warrants, the Exchange Warrants, the September 2025 Warrants and November 2025 Warrants (each as defined below). The Company recorded a gain of $17.4 million for the year ended December 31, 2024, attributed to warrant liabilities consisting of the Private Warrants, the February 2024 BDO Firm Warrants, the April 2024 RDO Common Warrants, the October 2024 Noteholder Warrants, and December 2024 RDO Common Warrants.

The Company evaluated the Scilex-St. James Loans for embedded derivatives and identified certain features that required bifurcation because they are not clearly and closely related to the host instrument. The embedded derivatives relate to (i) default provisions that could require additional interest payments, and (ii) a provision which could require the settlement of the principal amount of the Notes through the Pledged Securities upon an uncured event of default. The Company determined that the fair value of these embedded derivatives was immaterial as of the issuance dates of the Notes and as of December 31, 2025.

The following table includes a summary of the derivative liabilities measured at fair value during the years ended December 31, 2025 and 2024 (in thousands):

Fair Value

Ending Balance as of December 31, 2024

$

18,303

Change in fair value measurement

22,693

Issuance of September 2025 Warrants

3,091

Issuance of November 2025 Warrants

6,248

Tranche B deferral modification

(839

)

Change in fair value related to the October 2024 Noteholder Warrants exchanged for Exchange Warrants

1,103

Ending Balance as of December 31, 2025

$

50,599

Warrant Liability Measurement

The derivative warrant liability was valued using the Black-Scholes option pricing model, which is considered to be Level 3 fair value measurement. The primary unobservable input utilized in determining the fair value of the warrant is the expected volatility of the Common Stock. The expected volatility assumption is based on the Company’s historical volatility, historical volatilities of comparable companies whose share prices are publicly available as well as the implied volatility of the Public Warrants (see Note 10).

A summary of the inputs used in valuing the derivative warrant liabilities as of December 31, 2025 is as follows:

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Private Warrants

February 2024 BDO Firm Warrants

Deposit Warrant

October 2024 Noteholder Warrants

December 2024 RDO Common Warrants (5yr)

December 2024 RDO Common Warrants (2.5yr)

Exchange Warrants

September 2025 Warrants

November 2025 Warrants

Exercise price

$

402.50

$

59.50

$

1.20

$

36.40

$

22.72

$

22.72

$

40.00

$

20.00

$

29.00

Term, in years

1.86

3.18

3.47

3.77

3.95

1.45

3.77

3.95

4.90

Volatility

98.0

%

81.0

%

76.0

%

79.0

%

78.0

%

93.0

%

79.0

%

74.0

%

80.0

%

Risk-free rate

3.44

%

3.53

%

3.56

%

3.59

%

3.60

%

3.45

%

3.59

%

3.60

%

3.69

%

Dividend yield

0.0

%

0.0

%

0.0

%

0.0

%

0.0

%

0.0

%

0.0

%

0.0

%

0.0

%

A summary of the inputs used in valuing the derivative warrant liabilities as of December 31, 2024 is as follows:

Private Warrants

February 2024 BDO Firm Warrants

April 2024 RDO Common Warrants

Deposit Warrant

October 2024 Noteholder Warrants

December 2024 RDO Common Warrants (5yr)

December 2024 RDO Common Warrants (2.5yr)

Exercise price

$

402.50

$

59.50

$

38.50

$

1.20

$

36.40

$

22.72

$

22.72

Term, in years

2.86

418.00

4.32

4.47

4.77

4.95

2.45

Volatility

109.0

%

81.0

%

80.0

%

73.0

%

77.0

%

76.0

%

95.0

%

Risk-free rate

4.22

%

4.29

%

4.30

%

4.30

%

4.32

%

4.33

%

4.21

%

Dividend yield

0.0

%

0.0

%

0.0

%

0.0

%

0.0

%

0.0

%

0.0

%

Contingent Consideration Related to SP-104 Acquisition

The Development Milestone Payment related to the SP-104 Assets represents an obligation to potentially settle a fixed value in a variable number of shares of Common Stock and requires remeasurement at fair value through settlement.

Upon the achievement of FDA approval for a new drug application for SP-104, the Company will transfer $3.0 million in cash or shares of Common Stock, at the discretion of the Company. The fair value of the contingent consideration liability associated with the Development Milestone Payment was estimated using a probability-weighted discounted cash flow method. Significant unobservable inputs assumptions included the likelihood of receiving FDA approval for SP-104, expected timing for receipt of FDA approval for SP-104, and a discount rate of 9.2%. As of December 31, 2025 and 2024, the fair value of contingent consideration related to the Development Milestone Payment was $0.2 million.

There were no transfers between fair value measurement levels during the years ended December 31, 2025 and 2024.

6. Balance Sheet Components

Investment

Convertible Promissory Note

On August 9, 2024, Denali Capital Acquisition Corp. (“Denali”) issued a convertible promissory note (the “Convertible Promissory Note”) in the total principal amount of up to $180,000 to the Company. The Convertible Promissory Note was issued with an initial principal balance of $15,063.70, with the remaining $164,936.30 drawable at Denali’s request and upon the consent of the Company prior to the maturity of the Convertible Promissory Note. The Convertible Promissory Note matures upon the earlier of (i) the effective date of the consummation of Denali’s initial business combination or (ii) the date of the liquidation of Denali. Any future drawdown of the remaining $164,936.26 principal amount available under the Convertible Promissory Note are expected to fund future one-month

F-33

extensions as necessary to provide additional time for Denali to complete a business combination. At the option of the Company, upon consummation of an initial business combination, the Convertible Promissory Note may be converted in whole or in part into additional Class A ordinary shares of Denali, at a conversion price of $10.00 per ordinary share (the “Conversion Shares”). The terms of the Conversion Shares will be identical to those of the private placement shares that were issued to Denali Capital Global Investments, LLC in connection with Denali’s initial public offering (the “Denali IPO”). In the event that Denali does not consummate an initial business combination, the Convertible Promissory Note will be repaid only from funds held outside of the trust account established in connection with the Denali IPO or will be forfeited, eliminated or otherwise forgiven. No interest shall accrue on the unpaid principal balance of the Convertible Promissory Note. As of December 31, 2024, the balance of the Convertible Promissory Note was $75.3 thousand as a result of additional draws after the initial amount. On September 22, 2025, the Company’s majority owned subsidiary Semnur completed the Semnur Business Combination Agreement (see Note 3). Pursuant to the Semnur Business Combination, Legacy Semnur assumed all liabilities of Denali, including writing off its $2,000,000 cash consideration investment in Denali and its existing promissory notes and its liability for its deferred underwriting costs associated with the Semnur Business Combination. Simultaneously upon the closing of the Semnur Business Combination, the agreements for these existing liabilities were terminated and new promissory notes and discharge payment agreements were signed with the holders (see Note 8).

PA OPS Investment Agreement

In August 2025, Scilex Bio entered into an Investment Commitment Agreement (the “Investment Agreement”) with PA OPS Investor LLC (“Investor LLC”). Pursuant to the terms of the agreement, the Company committed to providing $2.5 million (the "Committed Amount") in future funding, contingent upon Investor LLC successfully identifying and acquiring an appropriate target company ("Target") for investment using the Committed Amount by December 31, 2025. Although the arrangement was legally structured as if the Investor LLC had extended a $2,500,000 loan (the “Loan”) to Scilex at an annual interest rate of 4.03%, no cash was exchanged between the Investor LLC and the Company on Day 1. Accordingly, the Company concluded that, in substance, the transaction does not represent a loan. In August 2025, the LLC acquired the Target which consists of certain assets of a nursing home. However, as the Company is yet to provide the full funding of the Committed Amount, the Company has no ownership interest in the LLC or in the nursing home as of December 31, 2025. On December 31, 2025, the Company made $1.0 million in cash (the "Funding") payment to Investor LLC out of the Committed Amount of $2.5 million, this funding was treated as a partial repayment of the Loan, therefore, no equity ownership was granted to Scliex, as the Target has already been acquired, the Funding is no longer subject to a refund. The Company recorded the Funding in equity investment in the Company balance sheet at cost, net of any impairment, as the Funding was provided close to the balance sheet date, there were no indicators of impairment as of December 31, 2025.

Equity Method Investments, at fair value

Datavault Securities Purchase Agreement

On September 25, 2025, the Company entered into the Datavault SPA with Datavault, pursuant to which Datavault agreed to issue and sell, and the Company agreed to purchase, 15.0 million shares of Datavault Common Stock and the Datavault Pre-Funded Warrant to purchase 263,914,094 shares of Datavault Common Stock for an aggregate purchase price of $150.0 million.

On the Initial Datavault Closing Date, the Company acquired 15,000,000 shares of Datavault Common Stock at a purchase price of $0.5378 per share, for an aggregate consideration of approximately $8.1 million, which was settled in Bitcoin and accounted for as an equity investment in equity securities.

On November 25, 2025, the Company exercised the Datavault Pre-Funded Warrant in full for an aggregate exercise price of approximately $26.4 thousand to purchase 263,914,094 shares of Datavault Common Stock (such shares, the “Datavault Pre-Funded Warrant Shares”) in exchange for an aggregate of approximately $141.9 million, to be settled in Bitcoin. The exercise of the Datavault Pre-Funded Warrant increased the Company’s percentage ownership in Datavault to approximately 48.0% and provided the Company with the right to nominate two of the nine members of the board of directors. Although no appointments have been made, the Company has determined that it has obtained the ability to exercise significant influence over its investment. Therefore, the Company began accounting for its investment under the equity method of accounting and elected to apply the fair value option, with changes in the fair

F-34

value recognized in unrealized gains and losses on equity investment in the period in which they occur. The fair value option has been elected as the Company believes it best reflects the underlying economics of this investment.

During the months of October 2025 and prior to the Company exercise of Datavault Pre-Funded Warrant in November 2025, the Company sold a total of 13,389,235 shares of Datavault Common Stock for gross proceeds of $26.4 million, which resulted in realized gains in the amount of $19.2 million accounted for using equity investment. After the Company exercised of Datavault Pre-Funded Warrant in November 2025, the Company sold a total of 21,079,599 shares of Datavault Common Stock for gross proceeds of $13.6 million, which resulted in realized gains in the amount of $4.7 million accounted for using equity method investment.

There have been no transactions between the Company and Datavault other than those arising from the Datavault License Agreements (see Note 4 for more details) and purchases of Bitcoin from Datavault during the year amounting to $25.2 million (See Below Digital Assets for more details).

The fair value measurement of the Company’s investment in Datavault is based on quoted prices in an active market and valued at the closing price reported at the end of each period and thus represents a Level 1 measurement on the fair value hierarchy. The Company recognized a $19.2 million loss accounted for using equity security investment measured at fair value. Upon exercise of the Datavault Pre-funded Warrants on November 25, 2025, the Company recognized $4.7 million gain using equity method, for the year ended December 31, 2025.

As of December 31, 2025 and 2024, the carrying value of the Company investment in Datavault's common stock is $159.4 million and nil, and is recorded in non-current Equity method investment in the consolidated balance sheets.

The Company's ownership of Datavault Common Stock was approximately 37% and nil as of December 31, 2025 and December 31, 2024, respectively.

Summarized Financial Information

The following is a summary of financial data for investments accounted for under the equity method of accounting (in thousands):

Balance Sheets

Balance Sheet

Datavault AI Inc.

December 31,

2025

December 31,

2024

ASSETS

Current assets:

$

142,873

$

6,439

Total assets

$

274,704

$

100,625

LIABILITIES

Current liabilities:

$

26,881

$

4,113

Total liabilities

$

36,730

$

14,899

Statement of Operations

Income Statement

Datavault AI Inc.

December 31,

2025

2024

Loss from operations

$

32,475

$

21,138

Net loss

$

78,994

$

51,409

Digital Assets

On September 23, 2025, the Company entered into a securities agreement with Biconomy PTE Ltd (“Biconomy”), pursuant to which the Company sold to Biconomy an aggregate of 12,500,000 Semnur Common Shares held by the Company for proceeds of $200.0 million in Bitcoin. As noted above, the Company used $150.0 million to purchase

F-35

stock on Datavault payable in Bitcoin. During the twelve month ended December 31, 2025, the Company purchased Bitcoin from Datavault amounting to $25.1 million.

The table below summarizes the amounts shown on our consolidated balance sheet as of December 31, 2025 (in thousands except units of digital assets):

December 31, 2025

Units

Cost Basis

Fair Value

Bitcoin

737

$

76,891

$

64,711

Total Digital assets

737

$

76,891

$

64,711

The following table summarizes the activity in the Company’s digital assets (in thousands) for the period indicated:

Year ended December 31, 2025

Bitcoin

Additions

$

225,233

Disposition

(148,340

)

Unrealized loss on digital assets

(12,182

)

Ending balance at fair value

$

64,711

The Company recorded a $30.2 million realized gain for the year ended December 31, 2025 upon dispositions.

Property and Equipment, Net

Property and equipment, net, consists of the following (in thousands):

December 31,

December 31,

2025

2024

Construction in progress

$

909

$

689

Furniture

139

17

Computers and equipment

75

16

Leasehold improvements

3,746

50

Machinery and lab equipment

8,192

—

Land and Buildings

859

—

Property and equipment, gross

13,920

772

Less: Accumulated depreciation

(321

)

(64

)

Property and equipment, net

$

13,599

$

708

The Company recognized depreciation expense of $258.9 thousand and $14.0 thousand for the years ended December 31, 2025 and 2024, respectively.

Accrued Expenses

Accrued expenses consists of the following (in thousands):

F-36

December 31,

December 31,

2025

2024

Accrued professional service fees

$

356

$

667

Accrued sales and marketing costs

—

876

Accrued research and development costs

13,058

315

Accrued tax payable

50

876

Accrued advisor fees related to Semnur business Combination

14,000

—

Accrued Datavault licenses

30,000

—

Accrued interests

6,862

—

Accrued others

2,088

107

Accrued expenses

$

66,414

$

2,841

Accrued Rebates and Fees

Gross-to-Net Revenue Adjustments

Gross revenue is directly impacted by the Company’s gross-to-net revenue adjustments for sales rebates, discounts, coupons, fees, returns, and chargebacks.

For the year ended December 31, 2025 and 2024, gross revenue was $125.8 million and $167.4 million, respectively, while net revenue was $30.3 million and $56.6 million, respectively. The gross-to-net revenue adjustment of approximately $96.3 million and $110.8 million for the years ended December 31, 2025 and 2024, respectively, was primarily attributable to the following:

December 31,

December 31,

2025

2024

Gross-to-Net Revenue Adjustments

Sales rebates

$

(67,755

)

$

(77,364

)

Service fees

(12,900

)

(16,753

)

Estimated sales returns, discounts, co-payment assistance and coupon

(9,881

)

(9,154

)

Chargebacks

(5,726

)

(7,577

)

Total

$

(96,262

)

$

(110,848

)

The accruals for Medicare, Medicaid and related state program and contractual rebates, chargebacks, sales allowances and sales returns and cash discounts are as follows:

December 31,

December 31,

2025

2024

Other current liabilities:

Accrued rebates

$

220,693

$

152,920

Other accruals

11,063

9,597

Total accrued rebates and fees

$

231,756

$

162,517

As of December 31, 2025, the Company’s accrued rebates and fees liability was $231.8 million, compared to $162.5 million as of December 31, 2024. The increase of approximately $69.3 million year-over-year was mainly due to the fact that the Company made only limited disbursements to counterparties during 2025 as its focus was to deploy its cash resources to repay Company debt. The rebates balance of $220.7 million primarily consists of government disbursements (Medicare and Medicaid) and commercial insurance disbursements. The other accrual balance of $11.1 million consists of service fees, returns, and coupons. Year-over-year the accrued rebates balance increased by approximately $67.8 million while the other accrual and fees balance increased by approximately $1.5 million.

F-37

7. Goodwill and Intangible Assets

As of December 31, 2025 and 2024, the Company had recorded goodwill of $13.5 million. During Q4 2025, the Company recorded a goodwill impairment loss of $73.4 million, attributable to business combination with Vivasor in December 2025. At December 31, 2025, based on the results of both qualitative and quantitative impairment tests performed, the Company concluded that the carrying amount of the goodwill associated with the Vivasor Business Combination exceeded its fair value, thereby resulting in a full write-off of the associated goodwill balance. No goodwill impairment was recognized for the year ended December 31, 2024.

Amortization of the intangible assets that have finite useful lives is generally recorded on a straight-line basis over their useful lives, ranging from 5.8 to 12.4 years. A summary of the Company’s identifiable intangible assets as of December 31, 2025 and 2024 is as follows (in thousands):

December 31, 2025

Gross Carrying Amount

Accumulated Amortization

Intangibles, net

Patent rights

$

32,630

19,946

$

12,684

Acquired technology

22,940

10,650

12,289

Acquired licenses

35,711

1,596

34,115

Assembled workforce

500

500

—

Total intangible assets

$

91,781

$

32,692

$

59,088

December 31, 2024

Gross Carrying Amount

Accumulated Amortization

Intangibles, net

Patent rights

$

32,630

$

17,770

$

14,860

Acquired technology

21,940

9,143

12,797

Acquired licenses

5,711

915

4,796

Assembled workforce

500

500

-

Total intangible assets

$

60,781

$

28,328

$

32,453

As of December 31, 2025, the weighted average remaining life for identifiable intangible assets was 7.5 years. Aggregate amortization expense was $4.3 million and $4.0 million for the years ended December 31, 2025 and 2024, respectively. Patent rights, acquired technology and acquired licenses are amortized over a 15-year period, other than Datavault acquired licenses, which are amortized over a 7-year period. Assembled workforce is amortized over a five-year period.

Estimated future amortization expense related to intangible assets as of December 31, 2025 is as follows (in thousands):

Amount

2026

$

8,368

2027

$

8,368

2028

$

8,368

2029

$

8,368

2030

$

8,368

Thereafter

$

17,248

Total

$

59,088

8. Debt

Scilex-St. James Loan Agreement and Amendment

On December 1, 2025, the Company entered into the Scilex-St. James Loan Agreement with St. James, pursuant to which St. James agreed to loan the Company an aggregate principal amount of up to $50 million in one or more tranches. The timing and amount of any particular tranche of the Scilex-St. James Loans shall be determined at the

F-38

sole discretion of St. James and St. James shall notify the Company in advance of its intention to fund a particular tranche.

The Scilex-St. James Loans will accrue interest at the rate of the 12-month Secured Overnight Financing Rate plus 2.0% per annum, with such interest due and payable on the earlier of Maturity Date and the date of an event of default. The “Maturity Date” of the Scilex-St. James Loans is the fourth anniversary of the closing date of the first tranche of the Scilex-St. James Loans and may be extended by up to 12 months at the request of the Company. The Company is also required to pay a fee of 0.25% of the principal amount of each tranche.

Pursuant to the terms of the Scilex-St. James Loan Agreement, the Company agreed to pledge approximately 39,202,800 shares of common stock of Datavault held by Scilex (the “Scilex-St. James Pledged Securities”) in favor of St. James as security for the Company’s satisfaction of its obligations thereunder. The Scilex-St. James Pledged Securities are held in a securities account that the Company has opened with St. James.

The Scilex-St. James Loan Agreement contains certain events of default, including, without limitation: a decrease in the closing price of the Scilex-St. James Pledged Securities of more than 20%, provided that such decrease is not cured within three days by delivering additional securities into the securities account or depositing cash into a bank account with St. James as security for the Scilex-St. James Loans; a decrease in the average trading volume of the Scilex-St. James Pledged Securities for any three consecutive trading days of more than 20% relative to the average trading volume of the 30 trading day period immediately preceding the closing of a tranche of the Scilex-St. James Loans; or the Scilex-St. James Pledged Securities are delisted from the national securities exchange on which they are currently listed. If an event of default occurs and is not cured within the specified cure period under the terms of the Scilex-St. James Loan Agreement, then St. James has certain remedies under the Scilex-St. James Loan Agreement, in addition to any remedies provided at law or in equity, including, without limitation, the interest rate of the Scilex-St. James Loans will increase by an additional 5.0% per annum and the Scilex-St. James Loan Agreement will terminate automatically with St. James entitled to foreclose upon or otherwise dispose of the Scilex-St. James Pledged Securities.

The Scilex-St. James Loan Agreement also contains positive and negative covenants, representations and warranties and indemnification provisions that are customary for transactions of this type.

On December 8, 2025, the Company and St. James entered into an amendment to the Scilex-St. James Loan Agreement (the “Scilex-St. James Loan Amendment”) pursuant to which the total aggregate principal amount available under the Scilex-St. James Loan Agreement was increased to $100.0 million. Additionally, the amount of Scilex-St. James Pledged Securities was increased to 85,838,800 shares of common stock of Datavault. All other terms of the Scilex-St. James Loan Agreement will continue in full force and effect unamended.

On December 19, 2025, the Company borrowed a principal amount of $10.0 million (i.e., the Scilex-St. James Loan Tranche 1), which was collateralized by 17,361,111 shares of the Scilex-St. James Pledged Securities. Net proceeds were $9.2 million after transaction fees paid to the lender. The net proceeds were paid directly to a vendor of its equity method investee Datavault to settle the investee’s obligation (the “Datavault Obligation”) on the same day.

On December 31, 2025, in exchange for the settlement of the Datavault Obligation, Datavault repaid the Company $9.4 million, which was settled in Bitcoin.

On December 22, 2025, the Company borrowed an additional principal amount of $12.6 million (i.e., Scilex-St. James Loan Tranche 2) which was collateralized by 21,841,689 shares of the Scilex-St. James Pledged Securities. On December 26, 2025, the fair value of the Scilex-St. James Pledged Securities declined, requiring the Company to provide an additional 7,116,816 shares of the Scilex-St. James Pledged Securities.

As of December 31, 2025, the Company received from the original Scilex-St. James Loan Agreement, the first and second tranche, an aggregate of $22.6 million and pledged 49,628,160 shares of common stock of Datavault. The remained available for borrowing under the Scilex-St. James Loan Agreement was $18.0 million, based on the fair value of the Scilex-St. James Pledge Securities and subject to customary covenant conditions as of December 31, 2025.

F-39

The principal amounts under both the Scilex-St. James Loan Tranche 1 and the Scilex-St. James Loan Tranche 2 are due in full on December 19, 2029. Voluntary prepayments may be made 20 months after the closing date without penalty. Interest under both tranches accrues at a fixed per‑annum rate of 5.46%, which equals to the 12‑month Term SOFR plus 2%, payable upon maturity.

The Company evaluated the Scilex-St. James Loan Agreement for embedded derivatives and identified certain features that required bifurcation because they are not clearly and closely related to the host instrument. The embedded derivatives relate to (i) default provisions that could require additional interest payments, and (ii) a provision which could require the settlement of the principal amount of the Notes through the Scilex-St. James Pledged Securities upon an uncured event of default. The Company determined that the fair value of these embedded derivatives was immaterial as of the issuance dates of the Scilex-St. James Loans and as of December 31, 2025.

SCLX JV-St. James Loan Agreement

On December 15, 2025, SCLX JV entered into a Non-Recourse Loan and Securities Pledge Agreement (the “SCLX JV-St. James Loan Agreement”) with St. James, pursuant to which St. James agreed to loan SCLX JV an aggregate principal amount of up to $100.0 million in one or more tranches (the “SCLX JV-St. James Loan”). The timing and amount of any particular tranche of the SCLX JV-St. James Loan shall be determined at the sole discretion of St. James and St. James shall notify SCLX JV in advance of its intention to fund a particular tranche.

The SCLX JV-St. James Loan will accrue interest at the rate of the 12-month Secured Overnight Financing Rate, with such interest due and payable on the earlier of Maturity Date and the date of an event of default. The “Maturity Date” of the SCLX JV-St. James Loan is the eighth anniversary of the closing date of the first tranche of the SCLX JV-St. James Loan and may be extended by up to 12 months at the request of SCLX JV. SCLX JV is also required to pay a fee of 0.25% of the principal amount of each tranche.

Pursuant to the terms of the SCLX JV-St. James Loan Agreement, SCLX JV agreed to pledge such number of shares of common stock of the Company currently held by SCLX JV equal to 70% of the aggregate principal amount of the SCLX JV-St. James Loan, calculated in accordance with the terms set forth in the SCLX JV-St. James Loan Agreement (the “SCLX JV-St. James Pledged Securities”), and together with the Scilex-St. James Pledged Securities, the “St. James Pledged Securities” in favor of St. James as security for SCLX JV’s satisfaction of its obligations thereunder. The SCLX JV-St. James Pledged Securities will be held in a securities account that SCLX JV or its affiliates will open with St. James.

The SCLX JV-St. James Loan Agreement contains certain events of default, including, without limitation: a decrease in the closing price of the SCLX JV-St. James Pledged Securities of more than 20%, provided that such decrease is not cured within three days by delivering additional securities into the securities account or depositing cash into a bank account with St. James as security for the SCLX JV-St. James Loan; a decrease in the average trading volume of the SCLX JV-St. James Pledged Securities for any three consecutive trading days of more than 20% relative to the average trading volume of the 30 trading day period immediately preceding the closing of a tranche of the SCLX JV-St. James Loan; or the SCLX JV-St. James Pledged Securities are delisted from the national securities exchange on which they are currently listed. If an event of default occurs and is not cured within the specified cure period under the terms of the SCLX JV-St. James Loan Agreement, then St. James has certain remedies under the SCLX JV-St. James Loan Agreement, in addition to any remedies provided at law or in equity, including, without limitation, that the interest rate of the SCLX JV-St. James Loan will increase by an additional 5.0% per annum and the SCLX JV-St. James Loan Agreement will terminate automatically with St. James entitled to foreclose upon or otherwise dispose of the SCLX JV-St. James Pledged Securities.

As of December 31, 2025, no amounts were outstanding under the SCLX JV-St. James Loan Agreement.

The Oramed Note

F-40

On September 21, 2023, the Company entered into a securities purchase agreement with Oramed (the “Scilex-Oramed SPA”), pursuant to which the Company issued the Oramed Note. The Oramed Note, which has a principal amount of $101.9 million, matures on March 21, 2025. It is payable in six principal installments, with the first installment of $5.0 million payable on December 21, 2023, the second installment in the principal amount of $15.0 million payable on March 21, 2024, the next three installments each in the principal amount of $20.0 million payable on each of June 21, 2024, September 21, 2024, and December 21, 2024, and the last installment in the entire remaining principal balance of the Oramed Note payable on March 21, 2025. Interest under the Oramed Note accrues at a fluctuating per annum interest rate equal to the sum of (1) the greater of (x) 4% and (y) Term SOFR (as defined in the Oramed Note) and (2) 8.5%, payable in-kind on a monthly basis. Pursuant to the Oramed Note, since the outstanding principal of the Oramed Note was not repaid in full on or prior to March 21, 2024, an exit fee of approximately $3.1 million has been earned with respect to the Oramed Note, which shall be due and payable on the date the outstanding principal amount of the Oramed Note is paid in full. Upon the occurrence and during the continuance of an event of default under the Oramed Note, holders of more than 50% of the aggregate unpaid principal amount of the Oramed Notes may elect to accrue interest at a default rate equal to the lesser of (i) Term SOFR plus 15% or (ii) the maximum rate permitted under applicable law. Voluntary prepayments made before the one-year anniversary of the closing date of the Scilex-Oramed SPA must include a make-whole amount equal to 50% of the additional interest that would accrue on the principal amount so prepaid from the date of such prepayment through and including the maturity date. If the Oramed Note is accelerated upon an event of default, repayment is required at a mandatory default rate of 125% of the principal amount (together with 100% of accrued and unpaid interest thereon and all other amounts due in respect of the Oramed Note). The Oramed Note contains mandatory prepayment provisions requiring use of 70% of net cash proceeds from any Cash Sweep Financing (as defined in the Oramed Note) or advances under the ELOCs (as defined in the Oramed Note) to prepay the outstanding principal after the earlier of April 1, 2024, or full repayment of Acceptable Indebtedness (as defined in the Oramed Note). Following each of the April 2024 RDO (as defined below and as described under Note 10), the receipt of the FSF Deposit (as described below) and the sale of shares of Common Stock pursuant to the ATM Sales Agreement, the Company made a mandatory prepayment of $9,578,835, $7,000,000 and $1,760,796, respectively, to Oramed, which equals 70% of the net cash proceeds the Company received from the April 2024 RDO, the FSF Deposit and sale of shares of Common Stock pursuant to the ATM Sales Agreement. Given such payment was not a voluntary prepayment, such prepayment did not trigger the make-whole amount under the Oramed Note.

The Oramed Note contains affirmative and negative covenants binding on the Company and its subsidiaries, which restrict, among other things, the Company and its subsidiaries from incurring indebtedness or liens, amending charter and organizational documents, repaying or repurchasing stock, repaying, repurchasing, or acquiring indebtedness, paying or declaring cash dividends, assigning, selling, transferring or otherwise disposing of assets, making or holding investments, entering into transactions with affiliates, and entering into settlement agreements, in each case as more fully set forth in, and subject to certain qualifications and exceptions set forth in, the Oramed Note.

In connection with the Oramed Note, the Company and each of its subsidiaries (collectively, the “Guarantors”) entered into a security agreement (the “Security Agreement”) with Oramed (together with its successors and permitted assigns, the “Holder”) and the Agent, which acts as the collateral agent for the holders of the Oramed Note. Under this agreement, the Company and the Guarantors granted to the Agent (on behalf of and for the benefit of the holders of the Oramed Note and any Additional Notes as defined thereunder) a security interest in all or substantially all of the properties of the Company and each of the Guarantors. This was done to ensure the timely payment, performance, and full discharge of all obligations under the Oramed Note. The Security Agreement contains certain customary representations, warranties and covenants regarding the collateral thereunder, all of which are detailed in the Security Agreement.

On September 20, 2024, the Company and Oramed entered into a letter agreement (the “Oramed Letter Agreement”), pursuant to which the Company agreed to pay to Oramed $2,000,000 (the “Specified September Payment”) on September 23, 2024, which payment was applied as follows: (i) $1,700,000 was applied to the amortization payment due under the Oramed Note on March 21, 2025 (the “Maturity Date”) and (y) $300,000 to purchase an aggregate of 4,000,000 SPAC Warrants (as defined below, which are currently exercisable for an aggregate of up to 114,286 shares of Common Stock) owned by Oramed.

F-41

The parties further agreed, upon receipt of the Specified September Payment by Oramed, (i) that notwithstanding the minimum Liquidity (as defined therein) requirements set forth in Section 7(b)(x) of the Oramed Note, the Company and its Subsidiaries (as defined therein) shall be required to maintain the following minimum liquidity during the specified time periods instead: from and after September 19, 2024, until the Maturity Date, $0, and (ii) to extend the due date of the $20,000,000 amortization payment from September 23, 2024, to September 30, 2024. Oramed further agreed to extend such due date to October 8, 2024, on which date a consent and amendment letter was signed with Oramed (“Oramed Consent and Amendment”) under which: (i) the Company made a payment of $12,500,000 to Oramed in lieu of the payment due on September 23, 2024, using the proceeds from the issuance of the Tranche B Notes, and (ii) the remaining payments under the Oramed Note were amended as follows: installment payment of $15,000,000 payable on December 21, 2024, which payment was made on December 13, 2024, and the remaining principal balance, accrued interest and fees payable on the Maturity Date. On January 21, 2025, the Company and Oramed agreed to extend the Maturity Date under and as set forth in the Oramed Note from March 21, 2025 to December 31, 2025. In consideration of such extension, SCLX JV agreed to deliver to Oramed an aggregate of 92,857 shares of Common Stock held by SCLX JV, with a fair value of $1.4 million on the date of delivery, which was recorded as financing costs within the selling, general and administrative expenses in the Company’s consolidated statements of operations.

On July 22, 2025, the Company entered into an option agreement (the “Option Agreement”) with Oramed. Pursuant to the Option Agreement, Oramed granted an option (the “Option”) to the Company to repurchase certain Penny Warrants, held by Oramed, in two tranches (the “Warrant Repurchase”) for an aggregate purchase price of $27.0 million (the “Warrant Repurchase Amount”), subject to the terms and conditions set forth therein. In consideration of the Option, the Company agreed to pay $1.5 million (the “Option Payment Amount”) to Oramed in two equal installments, occurring on or before August 8, 2025, and December 16, 2025, respectively. Provided that the Company has made the applicable option payment on or before such dates, the Company shall be entitled to purchase the Penny Warrants as follows: (i) on or before September 30, 2025, it may repurchase 3,130,000 Penny Warrants for $13.0 million, and (ii) on or before December 31, 2025, it may repurchase 3,370,000 Penny Warrants for $14.0 million. Additionally, if the Company effects the Warrant Repurchase and has paid the Option Payment Amount and the Warrant Repurchase Amount in full, then the maturity date of the Oramed Note shall be extended to March 31, 2026, and any make-whole payment due thereunder upon prepayment shall be waived. The modification of the terms of the Oramed Note was accounted for as debt extinguishment and the Option was determined to be an embedded feature of the Oramed Note and was reflected into the remeasurement of Oramed Note liability as of December 31, 2025.

In September 2025 and December 2025, the Company fully exercised its option purchasing an aggregate of 6,500,000 Penny Warrants. As Oramed is a shareholder, the Company accounted for the excess fair value over the repurchase price as a deemed contribution from Oramed, which was recorded within Additional Paid-in Capital.

At issuance, the Company concluded that certain features of the Oramed Note would be considered derivatives that would require bifurcation. In lieu of bifurcating such features, the Company has elected the fair value option for this financial instrument and records the changes in the fair value within the consolidated statements of operations and comprehensive loss at the end of each reporting period. As of December 31, 2025 and 2024, the fair value of the Oramed Note was $27.7 million and $12.2 million, which is classified as debt, current in the consolidated balance sheet.

The following table provides a summary of the changes in the balance and the estimated fair value of the Oramed Note (in thousands):

December 31,

2025

Ending Balance as of December 31, 2024

$

12,161

Change in fair value of Oramed Note – recorded in the consolidated statements of operations

8,413

Change in fair value of Oramed Notes - due to instrument-specific credit risk recorded as a component of other comprehensive income

7,114

Ending Balance as of December 31, 2025

$

27,688

Aggregate principal for the Company’s outstanding debt was $28.2 million as of December 31, 2025.

Commitment Letter

F-42

On June 11, 2024, the Company entered into the Commitment Letter with FSF Lender, pursuant to which FSF Lender committed to provide the Company the FSF Loan in the aggregate amount of $100.0 million. The Commitment Amount should be payable as follows: (i) $85.0 million no later than the Outside Date, which is 70 days following the date on which the Company received the FSF Deposit and (ii) the remaining $15.0 million within 60 days following the Initial Commitment Closing.

Pursuant to the Commitment Letter, FSF Lender provided the Company a non-refundable FSF Deposit in immediately available funds in the aggregate principal amount of $10.0 million on the Deposit Date, which amount would be creditable towards the $85.0 million required to be funded by FSF Lender at the Initial Commitment Closing. The Company received the FSF Deposit on June 18, 2024, and issued to FSF Lender the Deposit Warrant to purchase up to an aggregate of 3,250,000 shares of Common Stock (subject to adjustment for any stock dividend, stock split, or similar transaction), with an exercise price of $1.20 per share. The Deposit Warrant was immediately exercisable and would expire five years from the date of issuance. If the Initial Commitment Closing did not occur on or prior to the Outside Date, the FSF Deposit should automatically convert into an unsecured loan on the first day after the Outside Date. Within five days after such automatic conversion occurs, the Company should issue a promissory note (the “Unsecured Promissory Note”) to FSF Lender to evidence such unsecured loan, which note should be unsecured, had a maturity date of five years after the date of the Unsecured Promissory Note and was prepayable without premium or penalty. The Unsecured Promissory Note should bear interest, payable quarterly in arrears, in an amount equal to the Unsecured Applicable Interest Amount (as defined in the Commitment Letter) for such period based on the actual number of days elapsed while principal is outstanding.

It was contemplated by the Commitment Letter that the Company and FSF Lender would enter into definitive documents with respect to the FSF Loan on terms to be mutually agreed in good faith. If such definitive documents were entered into on or before the Outside Date, the Company agreed to issue to FSF Lender (i) at the Initial Commitment Closing, a warrant to purchase up to an aggregate of 24,375,000 shares (subject to adjustment for any stock dividend, stock split, reverse stock split or similar transaction) of Common Stock (the “Initial Commitment Closing Warrant”), and (ii) at the Second Closing, a warrant to purchase up to an aggregate of 4,875,000 shares (subject to adjustment for any stock dividend, stock split, reverse stock split or similar transaction) of Common Stock (the “Second Closing Warrant”), each to have an exercise price of $1.20 per share. The Initial Commitment Closing Warrant and the Second Closing Warrant would expire five years from the date of issuance. To evidence the FSF Loan, the Company agreed to issue to FSF Lender a Senior Secured Promissory Note (the “Secured Promissory Note”), which shall have a maturity date of five years after the date of issuance. The Secured Promissory Note shall bear interest, payable quarterly in arrears, in an amount equal to the Secured Applicable Interest Amount (as defined in the Commitment Letter) for such period, based on the actual number of days elapsed, while principal is outstanding, subject to certain conditions.

At issuance, the Company concluded that certain features of the FSF Deposit would be considered derivatives that would require bifurcation. In lieu of bifurcating such features, the Company has elected the fair value option for this financial instrument and records the changes in the fair value within the consolidated statements of operations and comprehensive loss at the end of each reporting period.

In connection with the transactions contemplated by the Commitment Letter, the Company also entered into an agreement with FSF Lender and the FSF Lender’s strategic consultant, IVI 66766 LLC (“IVI”), dated July 16, 2024, pursuant to which the Company agreed to reimburse the actual, reasonable and documented consulting fees incurred by FSF Lender in connection with the preparation, negotiation and execution of the Commitment Letter and the definitive documents with respect to the transactions contemplated thereby, which fees were satisfied in full by the Company issuing to IVI a warrant to purchase up to an aggregate of 250,000 shares of Common Stock (the “Fee Warrant”) on July 16, 2024, with an exercise price of $1.20 per share. Subject to certain ownership limitations, the Fee Warrant is immediately exercisable and will expire five years from the date of issuance. The Company accounted for the Fee Warrant as an equity classified instrument and recognized the Fee Warrant in additional paid-in capital in the Company’s consolidated balance sheets. The fair value of the Fee Warrant as of the date of issuance was $0.3 million. In October 2024, the Fee Warrant was exercised by IVI.

On September 17, 2024, the Company entered into the Satisfaction Agreement with FSF Lender and Endeavor, pursuant to which the remaining obligations in respect of the FSF Deposit shall be fully satisfied by the Company’s

F-43

delivery of 28,000 cartons of ZTlido to Endeavor, which delivery shall occur no later than December 31, 2024. Upon satisfaction of such remaining obligations, the Commitment Letter shall be terminated and of no further force or effect and neither FSF Lender nor the Company shall have any further liability or obligations thereunder. In consideration of Endeavor assuming the payment obligation of the Company in respect of the FSF Deposit, Endeavor will not be responsible for making any payment to the Company for (i) the product already delivered as of the date of such agreement in an amount of approximately $13.2 million and (ii) the Additional Product. Pursuant to the terms of the Satisfaction Agreement, if the Company fails to fully deliver the Additional Product by December 31, 2024, the Company shall be liable to Endeavor for liquidated damages in the amount of $20,000,000. In November 2024, the Company delivered the Additional Product to Endeavor and fully satisfied the remaining obligations in respect of the FSF Deposit.

Tranche B Notes

On October 7, 2024, the Company entered into the Tranche B Securities Purchase Agreement with the Tranche B Investors and Oramed to refinance a portion of the Oramed Note and pay off certain other indebtedness of the Company. Pursuant to the Tranche B Securities Purchase Agreement, the Company agreed to issue and sell, in a registered offering by the Company directly to the Tranche B Noteholders: (i) the Tranche B Notes, which notes will mature on the two-year anniversary of the issuance date and will be convertible into shares of Common Stock at a current conversion price equal to $36.40 per share and (ii) warrants (the “October 2024 Noteholder Warrants”) to purchase up to 214,284 shares of Common Stock directly to the Tranche B Noteholders.

In exchange for the issuance of the Tranche B Notes to the Tranche B Investors, the Company has received an aggregate amount in cash of $22,500,000, excluding fees and expenses payable by the Company. In consideration for the Tranche B Notes issued to Oramed, the Company has received from Oramed an exchange and reduction of the principal balance under the Oramed Note of $22,500,000.

The October 2024 Noteholder Warrants are immediately exercisable for cash at a current exercise price equal to $36.40 per share and will expire five years from the issuance date. The October 2024 Noteholder Warrants issued to the Tranche B Investors are initially exercisable for 107,142 shares of Common Stock in the aggregate. The October 2024 Noteholder Warrants issued to Oramed are initially exercisable for 107,142 shares of Common Stock.

In connection with the offering of the Tranche B Notes, the Company issued to StockBlock Securities LLC (“StockBlock”) and its affiliate, Rodman & Renshaw LLC (together, the “October 2024 Placement Agents”) or their respective designees, (i) 62,794 shares of Common Stock (the “October 2024 Placement Agent Shares”) and (ii) warrants to purchase up to 104,848 shares of Common Stock (the “October 2024 Placement Agent Warrants”). The October 2024 Placement Agent Warrants will have the same terms as the October 2024 Noteholder Warrants, except that the October 2024 Placement Agents have agreed not to exercise the October 2024 Placement Agent Warrants for a period of 180 days following the date of issuance.

In conjunction with the Tranche B Securities Purchase Agreement, the Company entered into the ZTlido Royalty Purchase Agreement for $5.0 million of the aggregate purchase price for the ZTlido Purchased Receivables (as defined below) in full consideration for the sale, transfer, conveyance and granting of the ZTlido Purchased Receivables, subject to the terms and conditions set forth in the ZTlido Royalty Purchase Agreement. The $50.0 million of total proceeds received were allocated based on their relative fair value to the Tranche B Notes, the October 2024 Noteholder Warrants, and the ZTlido Royalty Purchase Agreement, with the excess of fair value over the proceeds received in amount of $2.6 million recognized as a loss upon issuance within the change in fair value of debt and liability instruments in the consolidated statements of operations during the year ended December 31, 2024.

Pursuant to the Tranche B Notes, commencing on January 2, 2025, the Company was required to redeem in cash (the “First Amortization Payment”) such portion of the principal amount of the Tranche B Notes equal to each Tranche B Noteholder’s Holder Pro Rata Amount (as defined in the Tranche B Notes) of $6,250,000 per fiscal quarter at a redemption price equal to 100% of such Amortization Amount (as defined in the Tranche B Notes).

On January 2, 2025, the Company entered into a deferral and consent letter with each of (i) Nomis Bay Ltd and BPY Limited (the “Nomis Bay Consent”), (ii) Oramed (the “Oramed Consent”) and (iii) 3i, LP (the “3i Consent” and, collectively with the Nomis Bay Consent and the Oramed Consent, the “Tranche B Consents”), respectively, pursuant

F-44

to which the Tranche B Noteholders agreed to defer the Company’s obligation to make the First Amortization Payment until January 31, 2025, and then further to October 8, 2026. In consideration of such deferral, (i) SCLX JV delivered to the Tranche B Noteholders an aggregate of 142,855 shares of Common Stock held by SCLX JV, with a fair value of $2.2 million on the date of delivery, which was recorded as financing costs within the selling, general and administrative expenses in the Company’s consolidated statements of operations, (ii) the Company paid an aggregate of $1.1 million in respect of a portion of the First Amortization Payment and related make-whole interest, and (iii) the Company entered into the Gloperba-Elyxyb Royalty Purchase Agreement (as described below).

On July 22, 2025, the Company entered into Warrant Exchange Agreements (each, a “Warrant Exchange Agreement” and collectively, the “Warrant Exchange Agreements”) with certain holders of the Company’s then-existing Tranche B warrants (such certain holders (excluding Oramed), the “Exchanging Warrant Holders”) to purchase shares of Common Stock (such Tranche B warrants held by the Exchanging Warrant Holders, the “Existing Tranche B Warrants”). Pursuant to the Warrant Exchange Agreements, the Company and the Exchanging Warrant Holders, in reliance on Section 3(a)(9) of the Securities Act, effected a voluntary securities exchange whereby the Exchanging Warrant Holders exchanged the Existing Tranche B Warrants, which are currently exercisable for an aggregate of 107,142 shares of Common Stock at an exercise price of $36.40 per share, originally issued pursuant to the Tranche B Securities Purchase Agreement, for warrants to purchase an aggregate of 500,000 shares of Common Stock (the “Exchange Warrants”) at an exercise price of $40.00 per share (the “Exchange Warrant Exercise Price”). The Exchange Warrants shall be immediately exercisable, but may only be exercised on a cash basis on or after the earlier of (i) the date that is 90 days following the Closing Date (as defined in the Warrant Exchange Agreements), and (ii) the initial date after the date of the Warrant Exchange Agreements that a registration statement is effective and available for the issuance of the shares of Common Stock underlying the Exchange Warrants to the holders of the Exchange Warrants (or the resale of shares of Common Stock underlying the Exchange Warrants); provided, however, the Exchange Warrants may only be exercised on a cashless basis if there is no registration statement to cover the issuance of the shares of Common Stock underlying the Exchange Warrants or the resale of such shares. The Exchange Warrants shall have an expiration date of October 8, 2029. The Company recognized a loss in the amount of $1.1 million in relation to this exchange transaction. As of December 31, 2025, there were 500,000 Exchange Warrants outstanding.

The terms of the Exchange Warrants are generally identical to the terms of the Existing Tranche B Warrants, other than with respect to the number of shares issuable upon exercise thereof and the Exchange Warrant Exercise Price and certain other matters. The Exchange Warrant Exercise Price of the Exchange Warrants is subject to adjustment for any stock split, stock dividend, stock combination, recapitalization or similar event. The Exchange Warrant Exercise Price is also subject to full-ratchet adjustment (down to the Exchange Warrant Exercise Price Floor (as defined below)) in connection with a subsequent offering at a per share price less than the exercise price then in effect. The Exchange Warrants also permit a voluntary adjustment to the Exchange Warrant Exercise Price, subject to certain conditions set forth therein, including compliance with the Nasdaq Listing Rules and having obtained the prior written consent of the required holders as described therein. The Exchange Warrant Exercise Price cannot be lower than $36.40 per share (as adjusted for stock splits, stock dividends, stock combinations, recapitalizations and similar events, the “Exchange Warrant Exercise Price Floor”), unless shareholder approval is obtained to allow the Exchange Warrants to be exercised at a price lower than the Exchange Warrant Exercise Price Floor in accordance with the Nasdaq Listing Rules. The Company is under no obligation to seek or obtain such shareholder approval.

The following table provides a summary of the changes in the balance and the estimated fair value of the Tranche B Notes (in thousands):

December 31,

2025

Beginning Balance as of December 31, 2024

$

23,560

Repayment of Tranche B Notes principal and interest

(23,221

)

Change in fair value of Tranche B Notes

12,911

Change in fair value of Tranche B Notes - due to instrument-specific credit risk recorded as a component of other comprehensive income

4,250

Ending Balance as of December 31, 2025

$

17,500

Aggregate principal for the Company’s outstanding debt was $17.9 million as of December 31, 2025.

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Promissory Notes

Pursuant to the Semnur Business Combination, Legacy Semnur assumed all liabilities of Denali, including its existing promissory notes and its liability for its deferred underwriting costs associated with the Semnur Business Combination. Simultaneously upon the closing of the Semnur Business Combination, the agreements for these existing liabilities were terminated and new promissory notes and discharge payment agreements were signed with the holders.

Immediately prior to the closing of the Semnur Business Combination, Denali, Sponsor and the Company entered a Satisfaction and Discharge of Indebtedness Agreement, pursuant to which the Sponsor received $1.1 million in cash and a promissory note from Denali for $0.8 million (the “Sponsor Note”). The Sponsor Note shall be payable in six monthly installments of $134.0 thousand beginning on October 1, 2025, and ending on March 1, 2026.

Immediately prior to the closing of the Semnur Business Combination, Denali and FutureTech Capital LLC (“FutureTech”) entered a Satisfaction and Discharge of Indebtedness Agreement, pursuant to which FutureTech received $340.0 thousand in cash and a promissory note from Denali for $1.0 million (the “FutureTech Note”). The FutureTech Note shall be payable in six monthly installments of $170.0 thousand beginning on October 1, 2025, and ending on March 1, 2026.

At closing of the Semnur Business Combination, Denali, the Denali underwriters and the Company entered Satisfaction and Discharge of Indebtedness Agreements, pursuant to which the Denali underwriters received $350.0 thousand in cash and promissory notes from Denali for a total of $2.7 million (the “Denali Underwriter Notes”). The Denali Underwriter Notes shall be payable in nine monthly installments of $300.0 thousand beginning on October 1, 2025, and ending on June 1, 2026, with the last monthly payment being $250 thousand.

As of December 31, 2025, the Company had total current promissory notes of $3.5 million, all which are due in less than a year.

Notwithstanding the payment schedules in the Sponsor Note, the FutureTech Note and the Denali Underwriter Notes, the balance due on any notes (less any payments previously made to the holder thereunder) shall be accelerated and become immediately due and payable in the event Semnur receives gross proceeds from any equity or debt financing (including any private placement offering or registered offering), in an amount equal to or greater than the then-outstanding principal of such note plus any accrued but unpaid interest due thereon.

In addition, in the case of an event of default, the Sponsor Note, the FutureTech Note and the Denali Underwriter Notes shall bear interest at a rate of 10% per annum until such event of default is cured. The Sponsor Note, the FutureTech Note and the Denali Underwriter Notes shall become immediately due and payable (in accordance with the terms thereof), upon the Company’s failure to make payments thereunder when due (subject to a 14-day cure period) or certain other actions related to voluntary or involuntary bankruptcy proceedings (as more fully described therein).

Out of the outstanding promissory notes, the Company did not make certain scheduled installment payments during the fourth quarter of 2025 on the Sponsor Note (monthly installments of $134 thousand) and the Denali Underwriter Note for U.S. Tiger Securities, Inc. (monthly installments of $150 thousand). As of December 31, 2025, the Sponsor Note had an outstanding principal balance of $0.8 million and accrued interest of approximately $20 thousand at 10% per annum (calculated monthly). The Company has not received a notice of default and expects to make the payments in April 2026.

ACEA Hangzhou-Agilent Bio Loan Agreement

In connection with the Company’s acquisition of 30.1% of the outstanding shares of Vivasor (see Note 3), the Company includes in its consolidated financial statements a loan agreement entered into on August 15, 2018 between Hangzhou ACEA Pharmaceutical Research Co., Ltd (“ACEA Hangzhou”), a subsidiary of Vivasor, and Aisen Biological (Hangzhou) Co., Ltd. (“Aisen”), pursuant to which Aisen provided 194.6 million in Chinese Yuan (“RMB”) in funding to ACEA Hangzhou over multiple years from 2013 through 2018 (the “Agilent Loan Agreement”). Aisen was subsequently acquired by Agilent Technologies, Inc. on November 18, 2018, through which the loan agreement was assumed by Agilent Technologies, Inc.

The Agilent Loan Agreement documents cumulative advances made by Aisen to ACEA Hangzhou in the following amounts (denominated in RMB): 2013 – RMB 9.0 million; 2014 – RMB 10.8 million; 2015 – RMB 19.5 million; 2016 – RMB 38.9 million; 2017 – RMB 73.0 million; and 2018 – RMB 43.4 million. The proceeds of the loan are

F-46

designated for the ACEA Hangzhou’s operating activities, and ACEA Hangzhou is restricted from changing the use of funds without Aisen’s consent.

The contractual term of each loan tranche is ten years from the date of funding. Each loan tranche bears interest at an annual rate beginning in the sixth year following each advance. The Agilent Loan Agreement provides for a five-year interest-free period from the date of each loan tranche, after which interest accrues at an annual rate of 5.39%. Interest is calculated and settled on an annual basis, with settlement occurring by December 31 of each applicable year. Based on the contractual repayment schedule, initial interest payments begin in years ranging from 2019 through 2024 depending on the year of the original advance, with principal repayments due between 2023 and 2028.

The Agilent Loan Agreement includes customary provisions permitting Aisen to monitor the ACEA Hangzhou’s operations, financial condition, and use of proceeds, including the right to request financial information and participate in significant financing, restructuring, or liquidation events.

During the year ended December 31, 2018, ACEA Hangzhou repaid RMB 10 million, which repaid the full amount of the 2013 loan tranche and RMB 1 million of the 2014 loan tranche. ACEA Hangzhou has not repaid any other principal balances outstanding with Aisen through the year ended December 31, 2025.

Aisen retains the right to demand early repayment of all or part of the outstanding loan balance, which is outside of the control of the Company. Therefore, the entire loan balance outstanding has been presented within current liabilities.

As part of purchase accounting for the Acquisition, the Company recorded the assumed loan, including accrued interest of $4.6 million, at its estimated fair value of $25.7 million as of December 5, 2025. The fair value was determined using a discounted cash flow approach that reflects the contractual repayment terms, including the interest-free period, and a market-based discount rate commensurate with the credit risk of the borrower. The difference between the contractual principal amount of $30.7 million as of December 5, 2025 and the initial fair value resulted in a discount of $5.0 million, which is being accreted to interest expense over the remaining term of each tranche using the effective interest method. For any tranches that were past due, these will be accreted and paid in the next 12 months.

As of December 31, 2025, the carrying amount of the loan was $21.5 million, net of an unamortized discount of $4.8 million. The accrued interest balance was $4.7 million as of December 31, 2025, and is presented separately under the accrued expenses caption. For the year ended December 31, 2025, the Company recognized interest expense of $0.3 million related to the Agilent Loan Agreement, which includes $0.2 million of non-cash accretion of the discount recognized at the acquisition date. For the period from the acquisition date to December 31, 2025, the Company recognized foreign currency transaction loss of $0.2 million related to the remeasurement of the RMB-denominated loan.

Other Vivasor Borrowings

Vivasor entity contains multiple financing arrangements with various lenders that are each individually immaterial. These borrowings have substantially similar economic characteristics, including denomination in RMB, interest rates ranging from 0% - 6.00% and maturities between currently due to 2030.

As part of purchase accounting for the acquisition of Vivasor, the Company recorded the assumed other borrowings, including accrued interest of $1.9 million, at their estimated fair value of $21.7 million as of December 5, 2025. The fair value was determined using a discounted cash flow approach that reflects the contractual repayment terms, including the interest-free periods, and market-based discount rates commensurate with the credit risk of the borrower. The difference between the contractual principal and accrued interest amounts of $25.1 million and the initial fair values resulted in a discount of $3.4 million, which is being accreted to interest expense over the remaining term of the borrowings using the effective interest method. For any financing arrangements that were past due, these will be accreted and paid in the next 12 months.

During the period from the acquisition date to December 31, 2025, the Company negotiated non-cash settlement of certain debt obligations resulting in a decrease to the debt balance of $2.6 million. Non-cash settlements primarily consisted of the provision of services to certain counterparties in satisfaction of outstanding obligations and the issuance of equity. The Company evaluated these transactions to determine whether they represented modifications or extinguishments of debt. To the extent such arrangements resulted in the legal release of the Company’s obligations,

F-47

the associated liabilities were derecognized. There was no gain recognized with the settlement and extinguishment of these borrowings as the fair value.

As of December 31, 2025, the carrying amount of the borrowings was $17.5 million, net of unamortized discounts of $3.2 million. The accrued interest balance was $2.1 million as of December 31, 2025, and is presented separately in accrued expenses. For the period from the acquisition date to December 31, 2025, the Company recognized interest expense of $0.7 million related to the other borrowings, which includes $0.3 million of non-cash accretion of the discount recognized at the acquisition date. For the period from the acquisition date to December 31, 2025, the Company recognized foreign currency transaction loss of $0.1 million related to the remeasurement of the RMB-denominated loans.

ZTlido Royalty Purchase Agreement

On October 8, 2024, in connection with the closing of the transactions contemplated by the Tranche B Securities Purchase Agreement, the Company and Scilex Pharma entered into the ZTlido Royalty Purchase Agreement with the ZTlido Royalty Purchasers. Pursuant to the ZTlido Royalty Purchase Agreement, Scilex Pharma sold to the ZTlido Royalty Purchasers the right to receive 8% of all aggregate net sales worldwide (the “ZTlido Purchased Receivables”) with respect to ZTlido, SP-103 and any related, improved, successor, replacement or varying dosage forms of the foregoing, which shall be paid within 60 calendar days after the end of each calendar quarter.

In full consideration for the sale, transfer, conveyance and granting of the ZTlido Purchased Receivables, and subject to the terms and conditions set forth in the ZTlido Royalty Purchase Agreement, the aggregate purchase price for the ZTlido Purchased Receivables was $5.0 million (net of expenses of the ZTlido Royalty Purchasers). The ZTlido Royalty Investors paid to Scilex Pharma an aggregate amount equal to $2.5 million minus the expenses of the ZTlido Royalty Investors and Oramed paid to Scilex Pharma an amount equal to $2.5 million minus Oramed’s expenses (collectively, the amount so paid by the ZTlido Royalty Purchasers, the “ZTlido RPA Closing Payment”). Oramed’s portion of the purchase price was paid by exchanging a portion of the outstanding principal balance under the Oramed Note equivalent to its portion of the ZTlido RPA Closing Payment, which amount extinguished and reduced $2.5 million of the outstanding balance under the Oramed Note.

The ZTlido Royalty Purchase Agreement terminates six months following receipt by the ZTlido RPA Purchasers of all payments of the ZTlido Purchased Receivables to which each ZTlido RPA Purchaser is entitled during the period commencing on the closing date of the ZTlido Royalty Purchase Agreement and expiring on the tenth anniversary of such closing date.

The Company elected the fair value option for the ZTlido Royalty Purchase Agreement and records the changes in the fair value within the consolidated statements of operations and comprehensive loss at the end of each reporting period. As of December 31, 2025 and 2024, the fair value of the ZTlido Royalty Purchase Agreement was $6.1 million and $6.8 million, respectively, recorded as a purchased revenue liability on the consolidated balance sheet. The Company incurred $0.2 million of issuance costs in connection with the ZTlido Royalty Purchase Agreement, which were included in the consolidated statement of operations for the year ended December 31, 2024.

The following table summarizes the purchased revenue liability activity related to ZTlido Royalty Purchase Agreement during the year ended December 31, 2025 (in thousands):

December 31,

2025

Ending Balance as of December 31, 2024

$

6,800

Repayment of purchased revenue liability

(3,139

)

Change in fair value of purchased revenue liability

2,439

Ending Balance as of December 31, 2025

$

6,100

Gloperba-Elyxyb Royalty Purchase Agreement

On February 28, 2025 (the “Gloperba-Elyxyb Closing Date”), the Company entered into the Gloperba-Elyxyb Royalty Purchase Agreement with certain institutional investors (collectively, the “Gloperba-Elyxyb Royalty Investors”) and

F-48

Oramed (together with the Gloperba-Elyxyb Royalty Investors, the “Gloperba-Elyxyb RPA Purchasers”). Pursuant to the Gloperba-Elyxyb Royalty Purchase Agreement, Scilex Pharma transferred to the Gloperba-Elyxyb RPA Purchasers the right to receive 4% of all aggregate net sales worldwide (the “Gloperba-Elyxyb Purchased Receivables”) with respect to Gloperba, Elyxyb, and any related, improved, successor, replacement and/or varying dosage forms of the foregoing (the “Gloperba-Elyxyb Covered Products”).

In consideration of the Further Deferral and representing the “grant of the Royalty and Exclusive Rights” (as defined in the Term Sheet), during the period commencing on the Gloperba-Elyxyb Closing Date and expiring on the tenth anniversary of the Gloperba-Elyxyb Closing Date (the “Gloperba-Elyxyb Payment Term”), Scilex Pharma shall pay to each Gloperba-Elyxyb RPA Purchaser, by wire transfer of immediately available funds in U.S. dollars to such Gloperba-Elyxyb RPA Purchaser’s account, such Gloperba-Elyxyb RPA Purchaser’s Specified Percentage (as defined in the Gloperba-Elyxyb Royalty Purchase Agreement) of the Covered Product Revenue Payments (each as defined in the Gloperba-Elyxyb Royalty Purchase Agreement) for each calendar quarter no later than 60 calendar days after the end of each calendar quarter.

The Gloperba-Elyxyb Royalty Purchase Agreement shall terminate six months following receipt by the Gloperba-Elyxyb RPA Purchasers of all payments of the Gloperba-Elyxyb Purchased Receivables to which each Gloperba-Elyxyb RPA Purchaser is entitled during the Gloperba-Elyxyb Payment Term.

The Company elected the fair value option for the Gloperba-Elyxyb Royalty Purchase Agreement and records the changes in the fair value within the consolidated statements of operations at the end of each reporting period. As of each of February 28, 2025, and December 31, 2025, the fair value of the Gloperba-Elyxyb Royalty Purchase Agreement was $0.5 million and $2.3 million, recorded as a purchased revenue liability on the consolidated balance sheet.

December 31,

2025

Beginning Balance as of February 28, 2025

$

500

Repayment of purchased revenue liability

(41

)

Change in fair value of purchased revenue liability

1,841

Ending Balance as of December 31, 2025

$

2,300

The following table shows the outstanding principal balance of the Company's debt, by contractual maturity, as of December 31, 2025 (in thousands):

Due in 2026

$

76,229

Due in 2027

10,855

Due in 2028

6,626

Due in 2029

847

Due in 2030 and thereafter

6,239

Total principal payments

$

100,796

9. Sorrento Stock Purchase Agreement and Equity line of credit

Sorrento Stock Purchase Agreement

On September 21, 2023, the Company entered into that certain Stock Purchase Agreement (the “Sorrento SPA”) with Sorrento Therapeutics, Inc. (“Sorrento”), the Company’s then-controlling stockholder, pursuant to which the Company purchased from Sorrento (i) 1,716,245 shares of Common Stock, (ii) 29,057,097 shares of Series A Preferred Stock, par value $0.0001 per share (the “Series A Preferred Stock”), and (iii) 1,386,617 Public Warrants (as defined below), which are currently exercisable for an aggregate of up to 39,617 shares of Common Stock and 3,104,000 Private Warrants (collectively, the “Purchased Securities”), which are currently exercisable for an aggregate of up to 88,685 shares of Common Stock. As a result, Sorrento no longer holds a majority of the voting power of the Company’s outstanding capital stock entitled to vote. On the same day, the Company and Oramed entered into the Scilex-Oramed SPA. The Company concluded that the Sorrento SPA and the Scilex-Oramed SPA were entered in contemplation of each other and the issuance of the Oramed Note was accounted as part of the consideration payable for the Purchased Securities acquired from Sorrento.

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Pursuant to the terms of the Scilex-Oramed SPA, the Company issued the Oramed Note (see Note 8), which replaced Sorrento’s outstanding obligations to Oramed, warrants to purchase up to an aggregate of 4,500,000 shares of Common Stock (the “Closing Penny Warrant”) with an exercise price of $0.01 per share and restrictions on exercisability, and warrants to purchase up to an aggregate of 8,500,000 shares of Common Stock (the “Subsequent Penny Warrants” and together with the Closing Penny Warrant, the “Penny Warrants”), each with an exercise price of $0.01 per share and each with restrictions on exercisability. Additionally, the Company agreed to transfer to Oramed 4,000,000 SPAC Warrants, which were acquired by the Company under the Sorrento SPA. There was no change in the terms for the warrants transferred to Oramed as a result of the transactions described above. The remaining consideration for the Purchased Securities was composed of a credit bid for all amounts of principal and accrued but unpaid interest outstanding under the Junior DIP Facility in an aggregate principal amount of $20.0 million, a $10.0 million cash payment, and the assumption and assignment of certain obligations of Sorrento for legal fees and expenses amounting to approximately $12.3 million.

The Company allocated the total consideration between the repurchased instruments by allocating to the repurchased Private Warrants their full value, with the remaining consideration allocated to the Common Stock, Series A Preferred Stock, and Public Warrants based on their relative fair values as of September 21, 2023.

Before the closing of the Sorrento SPA transactions and in connection with the transactions contemplated by the Sorrento SPA, the Company formed two entities: (a) Scilex DRE Holdings LLC (“Holdco”), a single purpose entity that is the Company’s direct wholly owned subsidiary and (b) Scilex Stock Acquisition Joint Venture LLC, a single purpose bankruptcy-remote entity that is the Company’s indirect wholly owned subsidiary (“SCLX JV”), which was formed to hold the Purchased Securities. Holdco was formed to hold all the equity interests in SCLX JV. Holdco and SCLX JV are parties to the Security Agreement and Subsidiary Guarantee (see Note 8).

Series A Preferred Stock

Pursuant to the terms of the Sorrento SPA, the Company repurchased all of the outstanding Series A Preferred Stock. The Series A Preferred Stock was classified in permanent equity and did not have any bifurcated features. Therefore, the repurchase of the Series A Preferred Stock by the Company was treated as a redemption of shares, with the excess of the redemption price paid over the carrying value of the shares treated as a deemed dividend. The fair value of Series A Preferred Stock as of the repurchase date of September 21, 2023, was $52.6 million. The Company derecognized the carrying value of $3,000 of the Series A Preferred Stock, with $52.3 million in excess amount allocated as the reduction in additional paid-in capital. Although considered redeemed for accounting purposes, the shares of Series A Preferred Stock remain outstanding as they are held as collateral for the Oramed Note.

Treasury Stock

The Common Stock that has been repurchased by the Company under the Sorrento SPA is not intended for constructive retirement, and is being held as collateral for the Oramed Note. In accordance with treasury stock accounting guidance, the consideration allocated to Common Stock is presented under a separate caption of Treasury Stock as a reduction of equity.

Penny Warrants

The exercise price of the Penny Warrants is $0.01 per share, subject to adjustments provided therein. The exercise price and number of shares of Common Stock issuable upon the exercise of the Penny Warrants may be subject to certain adjustments in the event of any stock dividend, stock split, recapitalization, reorganization or similar transaction, as described in the Penny Warrants. Oramed may exercise the Penny Warrants by means of a “cashless exercise.” The Closing Penny Warrant and the Subsequent Penny Warrants utilize the same form of warrant.

The Company accounted for the Penny Warrants as an equity classified instrument as they are indexed to the Company’s own stock and meet the conditions to be classified in equity under FASB ASC 815, Derivatives and Hedging, including sufficient available shares of Common Stock for the Company to settle the exercise of the warrants in shares of Common Stock. The Penny Warrants are recognized in additional paid-in capital in the Company’s

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consolidated balance sheets. The fair value of Penny Warrants as of September 21, 2023, the date of issuance, was $10.4 million.

During the year ended December 31, 2024, there were 6,500,000 Penny Warrants exercised by Oramed for net proceeds of approximately $0.1 million.

On July 22, 2025, the Company entered into the Option Agreement with Oramed, pursuant to which the Company fully exercised its’ repurchase option and holds Penny Warrants. See Note 9 for the additional discussion of the Option Agreement and the Warrant Repurchase.

Excise Tax

In December 2022, the Department of the Treasury and the Internal Revenue Service (the “IRS”) issued guidelines on the implementation of the new code section added by the Inflation Reduction Act of 2022, which imposes a 1% excise tax on the total fair market value of stock repurchases during the tax year, subject to adjustments. Pursuant to the terms of the Sorrento SPA, the Company repurchased the Purchased Securities from Sorrento. The total fair market value of the Purchased Securities was offset by the fair market value of the shares issued during the year ended December 31, 2023. The Company has accrued $1.3 million of the excise tax liability during the year ended December 31, 2023, which was recorded as accrued expenses under current liabilities on the consolidated balance sheet. During the year ended December 31, 2025 and December 31, 2024, the Company made a total of $0.9 million and 0.5 million payments for the excise tax, respectively. As of December 31, 2025, the remaining balance of the excise tax liability recorded as accrued expenses was $33.5 thousand.

Equity Line of Credit

On July 22, 2025, the Company entered into that certain common stock purchase agreement (the “Tumim Purchase Agreement”), by and between the Company and Tumim Stone Capital, LLC (“Tumim”), the Company had the right, but not the obligation, to sell to the Tumim up to the lesser of: (a) $100,000,000 of newly issued shares of Common Stock (“Commitment Amount”) and (b) the Exchange Cap (as defined below), from time to time, at the Company’s sole discretion (each such sale, a “VWAP Purchase”) by delivering an irrevocable written notice to Tumim (each such notice, a “VWAP Purchase Notice”). The Company was permitted to deliver a VWAP Purchase Notice to Tumim during the period commencing on the Commencement Date (as defined in the Tumim Purchase Agreement) and the date that would have been the first day of the month following the 24-month anniversary of the date on which the initial Tumim Registration Statement (as defined below) would have been declared effective by the SEC, subject to the terms and conditions set forth therein, and unless the Tumim Purchase Agreement was earlier terminated in accordance with its terms.

Tumim’s purchases of shares of Common Stock under the Tumim Purchase Agreement, if any, would have been subject to certain limitations, including that Tumim may not purchase shares that would result in it (together with its affiliates) owning more than 4.99% (or, at the election of Tumim, 9.99%) of the then-issued and outstanding shares of Common Stock. In addition, unless stockholder approval of a waiver of the Exchange Cap (as defined below) was obtained, the Company shall not issue or sell any shares of Common Stock pursuant to the Tumim Purchase Agreement, if, after giving effect thereto, the aggregate number of shares of Common Stock that would have been issued pursuant to the Tumim Purchase Agreement and the transactions contemplated thereby would exceed 1,390,443 (representing 19.99% of the number of shares of Common Stock issued and outstanding immediately prior to the execution of the Tumim Purchase Agreement) (such maximum number of shares, the “Exchange Cap”). However, the Exchange Cap shall not be applicable for any purposes of the Tumim Purchase Agreement and the transactions contemplated thereby, to the extent that (and only for so long as) the average price of all applicable sales of Common Stock under the Tumim Purchase Agreement equaled or exceeded $8.09, which is the Minimum Price (as defined in the Tumim Purchase Agreement). The Company was under no obligation to seek stockholder approval of a waiver of the Exchange Cap.

As consideration for Tumim’s commitment to purchase shares of Common Stock, the Company was required to issue 150,000 shares of Common Stock to Tumim as a commitment fee (the “Commitment Shares”) upon effectiveness of the Tumim Registration Statement (as defined below).

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In connection with the transactions contemplated by, and concurrently with the execution of, the Tumim Purchase Agreement, the Company and Tumim also entered into a Registration Rights Agreement, dated as of July 22, 2025 (the “Tumim Registration Rights Agreement”), pursuant to which the Company agreed to file with the SEC one or more registration statements (each, a “Tumim Registration Statement”), to register under the Securities Act the offer and resale by Tumim of all of the shares that may have been issued by the Company to Tumim from time to time under the Tumim Purchase Agreement, including the Commitment Shares. Tumim’s obligation to purchase shares of Common Stock pursuant to the Tumim Purchase Agreement was subject to such a Tumim Registration Statement being filed with the SEC and declared effective.

On October 30, 2025 the Company and Tumim entered into a termination agreement (the “Termination Agreement”), pursuant to which each of the Tumim Purchase Agreement and the Tumim Registration Rights Agreement (together, the “Original Agreements”) shall terminate upon payment in full of an aggregate of $2.7 million by the Company to Tumim in lieu of the issuance of the Commitment Shares with $500,000 to be paid on or before each of October 31, 2025 and November 14, 2025 and the remaining $1.7 million to be paid on or before December 15, 2025. The Company fully paid the $2.7 million in October 2025, November 2025 and December 2025, respectively. As of December 31, 2025, pursuant to the Termination Agreement, the Original Agreements are terminated.

10. Stockholders’ Deficit

SPAC Warrants

Upon the completion of the Business Combination, the Company assumed the Private Warrants and the public warrants to purchase Common Stock, each with a post reverse split exercise price of $402.50 per share (the “Public Warrants”, and together with the Private Warrants, the “SPAC Warrants”).

Holders of the SPAC Warrants are entitled to acquire shares of Common Stock. The SPAC Warrants will expire five years after the completion of the Business Combination or earlier upon redemption or liquidation.

If the reported last sale price of the Common Stock equals or exceeds $630.00 per share post reverse split price for any 20 trading days within a 30-trading day period ending three business days before the Company sends the notice of redemption to the warrant holders, the Company may redeem all the Public Warrants at a price of $0.01 per warrant upon not less than 30 days’ prior written notice.

If the Company calls the Public Warrants for redemption, the Company will have the option to require all holders that wish to exercise the Public Warrants to do so on a cashless basis. The Company will not be required to net cash settle the SPAC Warrants.

The Public Warrants are equity-classified warrants and recognized in additional paid-in capital in the accompanying consolidated balance sheets. The Private Warrants are liability-classified warrants and are recognized as liabilities (refer to Notes 1 and 4).

During the year ended December 31, 2023, the SPAC Warrants held by Sorrento were repurchased, and certain of such warrants transferred to Oramed, as a result of the Sorrento SPA (refer to Note 9). On September 20, 2024, the Company repurchased 4,000,000 of the SPAC Warrants (which were exercisable for an aggregate of up to 114,286 shares of Common Stock) held by Oramed (refer to Note 8). Following the repurchase, these warrants were cancelled.

As of December 31, 2025 and 2024, there were Public Warrants issued and outstanding and exercisable for an aggregate of up to 156,115 and 156,220 shares of Common Stock, respectively.

As of each of December 31, 2025 and 2024, there were 1,000,000 Private Warrants outstanding, which are currently exercisable for an aggregate of up to 28,572 shares of Common Stock.

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Preferred Stock

The Company is authorized to issue 45,000,000 shares of preferred stock (the “Preferred Stock”) of which there are two series in total.

Series A Preferred Stock

As of December 31, 2025 and 2024, there were 29,057,097 shares of Series A Preferred Stock outstanding. On September 21, 2023, the Series A Preferred Stock was repurchased and derecognized for accounting purposes. The Series A Preferred Stock is currently held as collateral for the Oramed Note.

Series 1 Preferred Stock

On October 27, 2024, the Board declared a stock dividend (the “Dividend”) consisting of an aggregate of 5,000,000 shares (the “Dividend Stock”) of Series 1 Mandatory Exchangeable Preferred Stock, par value $0.0001 per share (the “Series 1 Preferred Stock”), of the Company to record holders of certain of the Company’s securities as of the close of business on November 7, 2024 (which date was subsequently changed to April 11, 2025). Pursuant to the Certificate of Designation of Preferences, Rights and Limitations of Series 1 Mandatory Exchangeable Preferred Stock (the “Certificate of Designation”) filed with the Secretary of State of the State of Delaware on October 28, 2024, the Series 1 Preferred Stock ranks senior to the Common Stock but junior to all other series of Preferred Stock with respect to distributions of assets upon voluntary or involuntary liquidation, dissolution, or winding up of the affairs of the Company. The holders of Series 1 Preferred Stock may become entitled to a pro rata portion of the number of shares that represents the lesser of (a) 10% of the shares of the Semnur Common Stock (or such other securities into which or for which such stock may be exchanged or converted), held by the Company as of immediately prior to the Effective Time (as defined below) (taking into account any adjustment for any stock dividend, stock split, reverse stock split or similar transaction) and (b) that number of shares of Semnur Common Stock (or such other securities into which or for which such stock may be exchanged or converted) equal to $200,000,000 divided by the closing price of such Semnur Common Stock (or such other securities into which or for which such stock may be exchanged or converted) on any national securities exchange on which such shares are listed on the date that is 10 trading days prior to the Determination Date (as defined below), which shares shall be paid from the shares of Semnur Common Stock (or such other securities into which or for which such stock may be exchanged or converted) held by the Company as of immediately prior to the Effective Time (taking into account any adjustment for any stock dividend, stock split, reverse stock split or similar transaction). Furthermore, the holders of Series 1 Preferred Stock shall not be entitled to receive any dividends and shall not have any voting rights by virtue of their ownership of any shares of Series 1 Preferred Stock.

For purposes of the Certificate of Designation, (a) “Effective Time” means the effective time of the Semnur Business Combination as determined under the terms of the Semnur Business Combination Agreement, (b) “Determination Date” means, if the Semnur Common Stock (or such other securities into which or for which such stock may be exchanged or converted) is listed for, and trading on, any national securities exchange, the date that is 15 trading days following the Registration Date, (c) “Registration Date” means the earlier of (i) the Effective Time, at which time the shares of Semnur Common Stock (or such other securities into which or for which such stock has been exchanged or converted) are registered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and (ii) the time at which the Registration Statement is declared effective by the Securities and Exchange Commission and (d) “Registration Statement” means a registration statement, whether under the Exchange Act, or the Securities Act, that is filed by Semnur or any successor thereto or affiliate thereof with respect to the registration of the Semnur Common Stock or any securities into which or for which such stock may be exchanged or converted. The Board has the right to change the Record Date and the right to revoke the Dividend at any time prior to the payment date therefor. There can be no assurance that the Board will not revoke the Dividend or that, even if such Dividend is paid, the conditions for the mandatory exchange set forth in the Certificate of Designations will ever occur (including that the Registration Date shall have occurred on or before 11:59 p.m. Eastern time on October 28, 2025).

The Series 1 Preferred Stock does not have any bifurcated features and is classified in equity at par value because the Company had an accumulated deficit position as of Dividend Stock declaration date. As of December 31, 2025 and as of the date of this filing, none of the Dividend Stock or any shares of the Series 1 Preferred Stock were issued or distributed.

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On February 2, 2026, the Board approved revocation of the declaration of the Dividend (the “Dividend Revocation”). No shares of Series 1 Mandatory Exchangeable Preferred Stock had ever been issued or outstanding as of such date as the Spin-off Dividend (as defined in the Certificate of Designation) did not occur by the Preferred Stock End Date (as defined in the Certificate of Designation).

On February 3, 2026, in connection with the Dividend Revocation, the Company filed a Certificate of Elimination of Series 1 Mandatory Exchangeable Preferred Stock (the “Certificate of Elimination”) with the Secretary of State of the State of Delaware. The Certificate of Elimination, which became effective immediately upon filing, eliminated the previously designated 5,000,000 shares of Series 1 Mandatory Exchangeable Preferred Stock and caused such shares to resume their status as undesignated shares of preferred stock of the Company. No shares of Series 1 Mandatory Exchangeable Preferred Stock were issued or outstanding upon the filing of the Certificate of Elimination.

Treasury Stock

As of December 31, 2025 and 2024, there were 1,458,263 and 1,716,245, respectively, shares of Treasury Stock.

At-the-Market Sales Agreement

On December 22, 2023, the Company entered into a Sales Agreement (the “ATM Sales Agreement”) with B. Riley Securities, Inc., Cantor Fitzgerald & Co. and H.C. Wainwright & Co., LLC (the “Sales Agents”), which agreement was voluntarily terminated by us effective as of March 5, 2025. Pursuant to the ATM Sales Agreement, the Company was able to offer and sell (the “Offering”) shares of Common Stock up to $170,000,000 (the “ATM Shares”), through or to the Sales Agents. The Company had no obligation to sell any shares of Common Stock under the ATM Sales Agreement and could suspend offers at any time.

The ATM Shares offered and sold in the Offering were issued pursuant to the Company’s shelf registration statement on Form S-3 (which was initially filed with the SEC on December 22, 2023, as amended, and declared effective on January 11, 2024 (File No. 333-276245)) (the “Shelf S-3 Registration Statement”). The ATM Shares were offered only by means of a prospectus forming a part of the Shelf S-3 Registration Statement.

The Sales Agents were entitled to a commission equal to 3.0% of the gross proceeds from each sale of shares of Common Stock. The Company agreed to reimburse the Sales Agents for certain expenses and has agreed to provide indemnification and contribution to the Sales Agents against certain civil liabilities, including liabilities under the Securities Act.

For the year ended December 31, 2025 no sales of Common Stock had been made under the ATM Sales Agreement. For the year ended December 31, 2024, the Company sold 78,976 shares of Common Stock pursuant to the ATM Sales Agreement for net proceeds of approximately $2.7 million.

February 2024 Bought Deal Offering Underwriting Agreement

On February 29, 2024, the Company entered into an underwriting agreement (the “February 2024 BDO Underwriting Agreement”) with Rodman & Renshaw LLC and StockBlock, acting as representatives of the underwriters to sell in the “February 2024 BDO” 108,686 shares of the “February 2024 BDO Firm Shares” and accompanying February 2024 BDO Firm Warrants to purchase up to an aggregate of 108,686 shares of Common Stock. The securities in the February 2024 BDO were offered and sold by us pursuant to the Shelf S-3 Registration Statement, a base prospectus dated January 11, 2024, and a final prospectus supplement dated February 29, 2024.

The February 2024 BDO closed on March 5, 2024, and the combined price per February 2024 BDO Firm Share and accompanying February 2024 BDO Firm Warrant paid by the underwriters was $54.74, which amount reflects the combined public offering price of $59.50, less underwriting discounts and commissions. Subject to certain ownership limitations, the Common Warrants are immediately exercisable, set to expire five years later, with an exercise price of $59.50 per share, subject to adjustments. Additionally, the Company issued the “February 2024 BDO Representative Warrants” to the underwriters, allowing them to purchase up to 13,446 shares of Common Stock, with these warrants being immediately exercisable at $74.38 per share, representing 125% of the combined public offering price per February 2024 BDO Firm Share and accompanying February 2024 BDO Firm Warrant.

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The Company accounted for the February 2024 BDO Firm Warrants as a liability classified instrument (see Note 5) and the February 2024 BDO Representative Warrants as an equity classified instrument. The February 2024 BDO Representative Warrants are recognized in additional paid-in capital in the Company’s consolidated balance sheet. The issuance costs allocated to the equity component are recorded as the reduction of the offering proceeds and the amounts allocated to the liability component are expensed as incurred within the selling, general and administrative expenses in the Company’s consolidated statement of operations. The fair value of February 2024 BDO Representative Warrants as of the date of issuance was $0.3 million.

On December 11, 2024, the Company entered into a warrant amendment (the “Warrant Amendment”) with one of its investors to exercise the outstanding number of the February 2024 BDO Firm Warrants that the Company issued to such investor in the February 2024 BDO. Pursuant to the Warrant Amendment, the investor agreed to exercise outstanding February 2024 BDO Firm Warrants to purchase an aggregate of 50,421 shares of Common Stock in cash at an amended exercise price of $20.65 per share. During the year ended December 31, 2025 and 2024, there were nil and 59,397 February 2024 BDO Firm Warrants exercised for total net proceeds of nil and approximately $1.6 million, including the amended February 2024 BDO Firm Warrants. As of December 31, 2025 and 2024, there were 3,803,447 February 2024 BDO Firm Warrants, which are currently exercisable for an aggregate of up to 108,686 shares of Common Stock outstanding and 470,588 February 2024 BDO Representative Warrants, which are currently exercisable for an aggregate of up to 13,446 shares of our Common Stock outstanding.

April 2024 Registered Direct Offering

On April 23, 2024, the Company entered into a securities purchase agreement (the “April 2024 RDO Purchase Agreement”) with the investor named therein, pursuant to which the Company agreed to sell and issue, in a registered direct offering (the “April 2024 RDO”): (i) an aggregate of 428,572 shares of Common Stock (the “April 2024 RDO Shares”), and (ii) common warrants to purchase up to 428,572 shares of Common Stock (the “April 2024 RDO Common Warrants”). The offering price per RDO Share and accompanying April 2024 RDO Common Warrant to purchase one share of Common Stock was $35.00, for aggregate gross proceeds to the Company of $15,000,000, before deducting the placement agent fees and other offering expenses. Subject to certain ownership limitations, the April 2024 RDO Common Warrants are exercisable on the six-month anniversary from the date of issuance, will expire on the five-year anniversary of the date of issuance and have an exercise price of $38.50 per share. The exercise price of the April 2024 RDO Common Warrants is subject to certain adjustments, including stock dividends, stock splits, combinations and reclassifications of the Common Stock.

StockBlock and its affiliate, Rodman & Renshaw LLC, acted as exclusive placement agents (the “April 2024 RDO Placement Agents”) in connection with the April 2024 RDO. As compensation for such placement agent services, the Company paid the April 2024 RDO Placement Agents an aggregate cash fee equal to 8.0% of the gross proceeds actually received by the Company from the April 2024 RDO. The Company also reimbursed the April 2024 RDO Placement Agents $100,000 for actual, reasonable and documented fees and expenses, inclusive of fees and expenses of legal counsel and out-of-pocket expenses and $15,950 for clearing expenses. The Company has also agreed to issue to the April 2024 RDO Placement Agents or their respective designees common warrants, substantially in the form of the April 2024 RDO Common Warrants, to purchase up to 34,286 shares of Common Stock (the “April 2024 RDO Placement Agent Warrants”), representing up to 8.0% of the total number of the April 2024 RDO Shares issued in the April 2024 RDO. The April 2024 RDO Placement Agent Warrants have an exercise price of $43.75 per share (which represents 125% of the combined offering price per share of Common Stock and the April 2024 RDO Common Warrant sold in the April 2024 RDO), will become exercisable on the six-month anniversary of the date of issuance and expire five years from the commencement of sales in the April 2024 RDO.

The Company accounted for the April 2024 RDO Common Warrants as a liability classified instrument (see Note 5) and the April 2024 RDO Placement Agent Warrants as an equity classified instrument. The April 2024 RDO Placement Agent Warrants are recognized in additional paid-in capital in the Company’s consolidated balance sheets. The issuance costs allocated to the equity component are recorded as the reduction of the offering proceeds and the amounts allocated to the liability component are expensed as incurred within the selling, general and administrative expenses in the Company's consolidated statement of operations. The fair value of April 2024 RDO Placement Agent Warrants as of the date of issuance was $0.6 million.

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On November 23, 2025, in connection with the November 2025 Warrant Inducement Agreement (as defined below), the investor agreed to exercise the April 2024 RDO Common Warrants in exchange for the November 2025 Warrants.

As of December 31, 2025, there were no April 2024 RDO Common Warrants outstanding. As of December 31, 2024, there were 15,000,000 April 2024 RDO Common Warrants outstanding, which were exercisable for an aggregate of up to 428,572 shares of Common Stock. As of each of December 31, 2025 and 2024, there were 1,200,000 April 2024 RDO Placement Agent Warrants outstanding, which are currently exercisable for an aggregate of up to 34,286 shares of Common Stock.

December 2024 Registered Direct Offering

On December 11, 2024, the Company entered into a securities purchase agreement (the “December 2024 RDO Purchase Agreement”) with the investors named therein, pursuant to which the Company agreed to sell and issue, in a registered direct offering (the “December 2024 RDO”): (i) an aggregate of 753,009 shares of Common Stock, (ii) pre-funded warrants to purchase up to 68,604 shares of Common Stock (the “December 2024 RDO Pre-Funded Warrants”) and (iii) common warrants to purchase up to 1,642,871 shares of Common Stock (the “December 2024 RDO Common Warrants” and together with the December 2024 RDO Pre-Funded Warrants and the warrants issued to StockBlock pursuant to certain contractual obligations between the Company and StockBlock (the “StockBlock Warrants”), the “December 2024 RDO Warrants”). The combined offering price (a) per share of Common Stock and accompanying December 2024 RDO Common Warrants was $20.65 and (b) per December 2024 RDO Pre-Funded Warrant and accompanying December 2024 RDO Common Warrants was $20.6499. The aggregate gross proceeds to the Company from the December 2024 RDO were approximately $17.0 million, before deducting offering fees and expenses. The Company intends to use the net proceeds from the December 2024 RDO for working capital and general corporate purposes, which may include capital expenditures, commercialization expenditures, research and development expenditures, regulatory affairs expenditures, clinical trial expenditures, acquisitions of new technologies and investments, business combinations and the repayment, refinancing, redemption or repurchase of indebtedness or capital stock.

The Company accounted for the December 2024 RDO Common Warrants and December 2024 RDO Pre-Funded Warrants as liability classified instruments (see Note 5) and the StockBlock Warrants as an equity classified instrument. The StockBlock Warrants are recognized in additional paid-in capital in the Company’s consolidated balance sheets. The issuance costs allocated to the equity component are recorded as the reduction of the offering proceeds and the amounts allocated to the liability component are expensed as incurred within the selling, general and administrative expenses in the Company's consolidated statement of operations. The fair value of StockBlock Warrants as of the date of issuance was $1.3 million. On December 26, 2024, the December 2024 RDO Pre-Funded Warrants were exercised by the holder for total net proceeds of approximately $0.2 million.

On November 23, 2025, in connection with the November 2025 Warrant Inducement Agreement (as defined below), one of the investors exercised the December 2024 RDO Common Warrants in exchange for the November 2025 Warrants.

As of December 31, 2025 and 2024, there were December 2024 RDO Common Warrants outstanding, which are exercisable for an aggregate of up to 537,298 and 1,642,871 shares of Common Stock, respectively, and StockBlock Warrants outstanding which are exercisable for an aggregate of up to 131,472 shares of Common Stock.

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Warrant Exercise Agreement

On September 30, 2025, the Company entered into a Warrant Exercise Agreement (the “Warrant Exercise Agreement”) with certain holders (the “Existing Warrant Holders”) of the Company’s existing warrants to purchase shares of the Company’s common stock, par value $0.0001 per share (the “Common Stock”) at an exercise price of $22.72 per share originally issued pursuant to that certain Securities Purchase Agreement, dated December 11, 2024, by and among the Company and the investors named therein (the “Existing December 2024 Warrants”). Pursuant to the Warrant Exercise Agreements, the Existing Warrant Holders will exercise in full the Existing December 2024 Warrants for an aggregate of 179,236 shares of Common Stock and defer, for a deferral fee of $7.72 per share being exercised (the “Deferral Fee”), their right to receive an amortization payment scheduled to be paid by the Company on October 1, 2025, as set forth in the amortization schedule included in the Tranche B Notes issued to each Existing Warrant Holder and Oramed pursuant to that certain Securities Purchase Agreement, dated as of October 7, 2024, by and among the Company and the investors party thereto (including the Existing Warrant Holders) in exchange for the Company’s agreement to issue new warrants to purchase an aggregate of 275,000 shares of Common Stock (the “September 2025 Warrants”) at an exercise price of $20.00 per share as described below. The aggregate gross proceeds from the exercise of the Existing December 2024 Warrants, net of the Deferral Fee, is approximately $2.7 million.

The Company has agreed to use an aggregate of $2.5 million of the gross proceeds from the warrant exercises in connection with the repayment of such aggregate amounts outstanding under the Tranche B Notes, and the remaining proceeds from the exercise of the Existing December 2024 Warrants for general corporate purposes.

The September 2025 Warrants are immediately exercisable upon issuance. The issuance of the September 2025 Warrants was made pursuant to an exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), and Rule 506(b) of Regulation D as promulgated thereunder by the United States Securities and Exchange Commission (the “SEC”). The Company has agreed to file as soon as practicable (and in any event within 30 calendar days of the date of the Warrant Exercise Agreement) a registration statement on Form S-3 (or Form S-1 if Form S-3 is not available to the Company) registering under the Securities Act, the resale by the Existing Warrant Holders of the shares of Common Stock issuable upon exercise of the of the September 2025 Warrants or to include such shares of Common Stock in any other registration statement on Form S-3 filed by the Company. Accordingly, on December 16, 2025, the Company filed a registration statement on Form S-1. The September 2025 Warrants shall have an expiration date of December 13, 2029.

The Exercise Price of the September 2025 Warrants is subject to adjustment for any stock split, stock dividend, stock combination, recapitalization or similar event and is also subject to adjustment in connection with certain subsequent offerings at a per share price less than the exercise price of the September 2025 Warrants then in effect.

A holder of a September 2025 Warrant shall not have the right to exercise any portion of a September 2025 Warrant to the extent that, after giving effect to such exercise, the holder (together with certain related parties) would beneficially own in excess of 4.99% (the “Maximum Percentage”) of shares of Common Stock outstanding immediately after giving effect to such exercise. The Maximum Percentage may be raised or lowered to any other percentage not in excess of 9.99%, at the option of the holder, except that any increase will only be effective upon 61 days’ prior notice to the Company.

The September 2025 Warrants prohibit the Company from entering into specified fundamental transactions unless the successor entity (subject to certain exceptions) assumes all of the Company’s obligations under the September 2025 Warrants under a written agreement before the transaction is completed. Upon specified corporate events, a September 2025 Warrant holder will thereafter have the right to receive upon an exercise such shares, securities, cash, assets or any other property whatsoever which the holder would have been entitled to receive upon the happening of the applicable corporate event had the September 2025 Warrant been exercised immediately prior to the applicable corporate event. When there is a transaction involving specified changes of control, holders of September 2025 Warrants will have the right to force the Company to repurchase such holder’s September 2025 Warrant for a purchase price in cash equal to the Black Scholes value, as calculated under the September 2025 Warrants, of the then unexercised portion of the September 2025 Warrant.

As of December 31, 2025, there were September 2025 Warrants outstanding, which are exercisable for an aggregate of up to 275,000 shares of Common Stock.

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Warrant Inducement Agreement

On November 23, 2025, the Company entered into a Warrant Inducement Agreement (the “Warrant Inducement Agreement”) with an investor, pursuant to which the investor agreed to exercise all of their outstanding April 2024 RDO Common Warrants and December 2024 RDO Common Warrants (collectively, the “Original Warrants”) in exchange for (i) a reduction in the exercise prices from $38.50 per share and $22.72 per share, respectively, to $22.51 per share, and (ii) the issuance of a new unregistered warrant (the “November 2025 Investor Warrant”).

Because the amendments to the exercise price of the April 2024 RDO Common Warrants and December 2024 RDO Common Warrants resulted in an exercise price equal to the fair value of the Common Stock, the Company concluded that the substance of the transaction was an exchange of the Original Warrants for the November 2025 Investor Warrants as an inducement for the issuance of 904,396 shares of Common Stock at a purchase price equal to their fair value. The impact of the warrant exchange, calculated as the difference between the fair value of the November 2025 Investor Warrants and the fair value of the Original Warrants resulted in a loss amounting to $6.3 million, which the Company recorded within the “Loss on settlement of liability classified instruments” in the statement of operations and comprehensive loss. Upon the exercise of the Original Warrants, the Company received in cash $18.6 million, net of issuance costs.

The November 2025 Investor Warrants to purchase 1,356,594 shares of Common Stock have an exercise price of $29.00 per share, may be exercised on a cashless basis under certain circumstances, and have an expiration date of November 25, 2030. The Company accounted for November 2025 Investor Warrants as liability classified instruments.

As of December 31, 2025, there were 1,356,594 shares of November 2025 Investor Warrants and 72,352 shares of November 2025 Placement Agent Warrants outstanding with an exercise price of $29.00 per share, may be exercised on a cashless basis under certain circumstances, which are exercisable for an aggregate of 1,428,946 shares of Common Stock and have an expiration date of November 25, 2030.

Repricing Options

On December 11, 2025 (the “Repricing Date”), the Company’s stockholders approved a one-time repricing (the “Option Repricing”) of certain outstanding stock options held by 14 of the Company’s current employees. The per-share exercise price of these options was reduced to $16.80, the closing price of the Company’s common stock on the Nasdaq Capital Market on the Repricing Date (the “Repricing”).

The Option Repricing applied to certain stock options granted under the Company’s 2022 Equity Incentive Plan, as amended (the “Plan”). This included stock options with an original exercise price of $282.80 per share, representing an aggregate of 289,405 shares of common stock (the “Eligible Options”). The Eligible Options were held by certain current employees, executive officers, and non-employee directors as of the Repricing Date. Only options with an exercise price of $282.80 per share immediately prior to the Repricing were eligible to participate.

Except for the modification to the exercise price, the Eligible Options continue to be subject to their original terms and conditions, including the number of shares underlying the options, vesting schedules, and expiration dates.

The Option Repricing resulted in total incremental stock-based compensation expense of $2.4 million, which was calculated using the Black-Scholes option-pricing model. For the year ended December 31, 2025, the Company recognized incremental stock-based compensation expense of $1.7 million related to repriced options. As of December 31, 2025, there is $0.7 million of unrecognized incremental stock-based compensation expense related to the Option Repricing, which will be recognized over the remaining service period of approximately 1 year.

11. Stock Incentive and Employee Benefit Plan

2017 Scilex Pharmaceuticals Inc. Equity Incentive Plan

In June 2017, the Board of Directors of the Company adopted the Scilex Pharmaceuticals Inc. Equity Incentive Plan (the “Scilex Pharma 2017 Plan”). In connection with the corporate reorganization in March 2019, the Scilex Pharma

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2017 Plan was terminated. Accordingly, after such time, no additional awards were granted under the Scilex Pharma 2017 Plan. However, the 2017 Stock Option Plan will continue to govern outstanding awards granted thereunder.

Scilex Holding Company 2019 Stock Option Plan

In May 2019, the Board of Directors of the Company adopted the Scilex Holding Company 2019 Stock Option Plan (the “2019 Stock Option Plan”), which subsequently was amended in December 2020. The 2019 Stock Option Plan was terminated at the closing of the Business Combination, and no further awards have been granted under the 2019 Stock Option Plan thereafter. However, the 2019 Stock Option Plan will continue to govern outstanding awards granted thereunder.

Scilex Holding Company 2022 Equity Incentive Plan

In October 2022, the Board of Directors of the Company adopted the Scilex Holding Company 2022 Equity Incentive Plan (the “Equity Incentive Plan”). As of December 31, 2025, a total of 1,059,347 shares of Common Stock were available and have been reserved for future issuance under the Equity Incentive Plan.

Scilex Holding Company 2023 Inducement Plan

On January 17, 2023, the compensation committee of the Board of Directors of the Company adopted the Scilex Holding Company 2023 Inducement Plan (the “Inducement Plan”). The Inducement Plan provides for the grant of equity-based awards in the form of non-statutory stock options, stock appreciation rights, restricted stock, restricted stock units, and other awards solely to prospective employees of the Company or an affiliate of the Company, provided that certain criteria are met. The initial maximum number of shares available for grant under the Inducement Plan is 40,000 shares of Common Stock (subject to adjustment for recapitalizations, stock splits, reorganizations and similar transactions). No awards were granted under the Inducement Plan during the years ended December 31, 2025 and 2024.

As of December 31, 2025, options to purchase 1,503,907 shares of Common Stock were outstanding under all equity incentive plans.

The following table summarizes stock option activity during the year ended December 31, 2025 (shares in thousands):

Options

Weighted-Average Exercise Price

Weighted-Average

Remaining Contractual Life,

in years

Aggregate Intrinsic Value

Outstanding as of December 31, 2024

1,028

$

138.23

6.4

$

—

Granted

803

16.62

—

—

Forfeited/Cancelled

(327

)

261.03

—

—

Outstanding as of December 31, 2025

1,504

$

46.59

6.8

$

5

Vested and expected to vest as of December 31, 2025

1,504

46.59

6.8

5

Exercisable as of December 31, 2025

898

$

58.52

5.3

$

1

Intrinsic value is calculated as the difference between the exercise price of the underlying options and the fair value of the Common Stock for the options that had exercise prices that were lower than the per share fair value of the Common Stock as of the measurement date of the intrinsic value. The weighted-average grant date fair value per share of stock options granted during the years ended December 31, 2025 and 2024 was $11.57 and $23.49 per share, respectively. No options were exercised during the year ended December 31, 2025. The total intrinsic values of options exercised during the year ended December 31, 2024 were $47.3 thousand. The maximum term of options granted under each of the equity incentive plans is ten years.

Total stock-based compensation recorded within operating expenses was $15.5 million and $15.7 million for the years ended December 31, 2025 and 2024, respectively.

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The total unrecognized compensation costs related to unvested employee and non-employee stock option grants as of December 31, 2025 were $20.0 million, which the Company expects to recognize over a weighted-average period of approximately 3.1 years.

Scilex Holding Company 2022 Employee Stock Purchase Plan

In October 2022, the Board of Directors of the Company adopted the Scilex Holding Company 2022 Employee Stock Purchase Plan (the “ESPP”). The purchase price of the Common Stock is equal to 85% of the lesser of the market value of such shares at the beginning of an offering period or the date of purchase. As of December 31, 2025, the total number of shares of Common Stock that may be issued under the ESPP shall not exceed 170,575, which was increased from 127,903 shares as a result of automatic annual increase on January 1, 2025.

Total stock-based compensation recorded as operating expense for the ESPP was $0.1 million and $0.2 million for the years ended December 31, 2025 and 2024, respectively.

There were 5,497 and 334,326 shares of Common Stock issued under the ESPP during the years ended December 31, 2025 and 2024, respectively.

Valuation Assumptions

The Company calculates the fair value of stock options and ESPP awards granted to employees and nonemployees using the Black-Scholes option-pricing method. The Black-Scholes option-pricing method requires the use of subjective assumptions.

The following assumptions were used in the Black-Scholes options pricing model to estimate stock-based compensation on the date of grant for stock options and ESPP:

Year Ended

December 31, 2025

Stock options:

Expected dividend yield

0.00%

Expected volatility

72.54% - 99.1%

Risk-free interest rate

3.55% - 4.17%

Term of options (in years)

6.25

Employee stock purchase plan:

Expected dividend yield

0.00%

Expected volatility

112.87%

Risk-free interest rate

4.31%

Expected life (in years)

0.49

Semnur 2024 Stock Option Plan

Concurrent with the signing of the Semnur Business Combination Agreement, the Board, the Company (as the sole stockholder of Semnur) and the board of directors of Semnur approved the 2024 Stock Option Plan (“Semnur 2024 Plan”). Under the Semnur 2024 Plan, 40,000,000 shares of Semnur Common Stock were reserved for future issuance and nonstatutory stock options (“NSOs”) to purchase the same amount of Semnur Common Stock were granted to certain executive officers of Semnur. The NSOs were granted on August 30, 2024 and expire on August 30, 2034. No expense was recorded in connection with the NSOs as of December 31, 2025, as until the date on which all payments and all obligations under the Oramed Note have been paid in full in cash, such options will not be or become exercisable, eligible for exchange, redemption or repurchase, eligible to participate in any dividends or distributions or have any voting rights in respect of the Company or any of its current or future subsidiaries of the Company, and

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following the closing of the transactions contemplated by the Semnur Business Combination Agreement, the Company, Denali or any of their respective current and future subsidiaries, successors and assigns.

Employee Benefit Plan

The Company maintains a defined contribution 401(k) plan available to eligible employees. Employee contributions are voluntary and are determined on an individual basis, limited to the maximum amount allowable under federal tax regulations. The Company made matching contributions to the 401(k) plan totaling $0.4 million and $0.6 million for the years ended December 31, 2025 and 2024, respectively.

Retainer Shares

On February 13, 2023, the Company entered into a Stock Issuance Agreement (the “2023 SIA”) with a law firm for the provision of legal services to the Company. Under the 2023 SIA, the Company issued 114,286 shares of Common Stock to the law firm. On July 1, 2024, the Company entered into another Stock Issuance Agreement (the “2024 SIA”) with the same law firm for the provision of legal services to the Company. Under the 2024 SIA, the Company issued 285,714 shares of Common Stock to the same law firm.

On July 22, 2025, Legacy Semnur entered into a stock issuance agreement with the law firm named therein pursuant to which the law firm was issued 10,000,000 shares of Legacy Semnur common stock as a retainer for legal services and payment for prior services. Upon the closing of the Semnur Business Combination, the shares were exchanged for 12,500,000 shares (i.e., the then-existing 10,000,000 shares of Legacy common stock multiplied by the Exchange ratio) of Semnur common stock.

All such shares are held by the law firm as collateral for current and future outstanding legal fees due from the Company (the “Retainer Shares”). At the option of the law firm, the Retainer Shares may be sold and the net proceeds may be applied against the outstanding legal fees. The Retainer Shares not applied against the outstanding legal fees due will be returned to the Company. As of December 31, 2025, it was not probable that any of the Retainer Shares would be applied against any outstanding legal fees.

12. Variable Interest Entities

Vivasor Business Combination

On December 5, 2025 (the “VHC Transaction Date”), the Company entered into a Share Transfer Agreement with EAR SPV LLC, a Delaware corporation (“EAR SPV”) and Vivasor Holding Company (“VHC”), a privately held biotechnology company, pursuant to which, among other things, EAR SPV agreed to sell, and the Company agreed to buy, all 6,101,468 shares of VHC’s Series A-1 Preferred Stock, par value $0.00001 per share, held by EAR SPV, for an aggregate purchase price of $9.0 million (“VHC Business Combination”).

The Company evaluated VHC under the VIE model in accordance with ASC 810 and concluded that VHC is a VIE because it lacked sufficient equity at risk to finance its activities without additional subordinated support (see Note 3). Due to the Company’s power to direct key activities through its eligible majority board representation and its significant economic exposure through its 30.8% equity interest, it was determined that the Company was the primary beneficiary of VHC. As a result, the Company consolidated VHC as of the VHC Transaction Date. The Company will reassess its primary beneficiary status and VIE conclusion for VHC upon the occurrence of any reconsideration events.

Scilex Bio, Inc. Acquisition

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On April 17, 2025, the Company established a majority and controlling interest in Scilex Bio, a newly formed legal entity created to develop and commercialize KDS2010, a next-generation reversible MAO-B Inhibitor, a novel inhibitor of aberrant GABA production in reactive astrocytes for the treatment of obesity and neurodegenerative diseases including Alzheimer’s disease in the United States. At formation, the Company contributed 5,000,000 shares of common stock, par value $0.00001 per share, of Semnur (the “Semnur Common Stock”) to Scilex Bio in exchange for a 60% equity interest. IPMC Company (“IPMC”) made certain representations to Scilex Bio regarding its rights in certain license and commercialization rights to KDS2010 and agreed to contribute such rights to Scilex Bio in exchange for a 40% equity interest.

The Company evaluated Scilex Bio under the variable interest entity (“VIE”) model in accordance with ASC 810 and concluded that Scilex Bio is a VIE because it lacked sufficient equity at risk to finance its activities without additional subordinated support. Due to the Company’s power to direct key activities through its majority board representation and its significant economic exposure through its 60% equity interest, it was determined that the Company was the primary beneficiary of Scilex Bio. As a result, the Company consolidated Scilex Bio beginning on the formation date.

The Company further concluded that Scilex Bio did not meet the definition of a business under ASC 805, Business Combinations. Therefore, the transaction was accounted for as an asset acquisition under ASC 805-50. As the shares of Semnur Common Stock were contributed by the Company (the parent) to an entity under common control, they were recorded at their historical carrying value of $0 in the consolidated financial statements. The KDS2010 license rights contributed by IPMC were recorded at 40% of their estimated fair value of $9.4 million for $4.9 million and immediately expensed as in-process research and development (“IPR&D”) in accordance with ASC 730, Research and Development, as the contributed IP had no alternative future use. A current liability of $1.1 million was also recognized for the initial upfront payment due under the licensing arrangement (further discussed below).

Additionally, the Company recorded $1.9 million in additional paid-in capital as a capital contribution. For the twelve months ended December 31, 2025, net loss from Scilex Bio attributable to the noncontrolling interest was $2.1 million.

As of December 31, 2025, Scilex Bio had not commenced revenue-generating operations and remains focused on early-stage development efforts for KDS2010. The Company will reassess its primary beneficiary status and the VIE conclusion for Scilex Bio upon the occurrence of any reconsideration events.

In connection with the formation of Scilex Bio, on April 17, 2025, the entity entered into a license agreement with IPMC and NeuroBioGen Company (“NBG”), under which it obtained exclusive rights to develop and commercialize KDS2010 globally, except for Korea. Under the terms of the agreement, Scilex Bio may be required to make aggregate payments of up to KRW 6.5 trillion (approximately $4.8 billion) to NBG, consisting of an upfront fee of KRW 1.5 billion (approximately $1.1 million), and KRW 68.5 billion (approximately $50.7 million) contingent upon the achievement of specified development, regulatory and commercial milestones. Scilex Bio is also required to pay royalties equal to 5% of net sales of licensed products, payable quarterly until the expiration of the last-to-expire licensed patent. Aggregate payments to NBG are capped at KRW 6.5 trillion (approximately $4.8 billion). As of December 31, 2025, only the first tranche of the upfront fee (KRW 1.5 billion or approximately $1.1 million) had become payable, subject to the satisfaction of certain obligations on the part of NBG, and was recorded as a current liability.

Semnur

On September 22, 2025, the Company’s majority owned subsidiary Semnur completed the Semnur Business Combination Agreement (see Note 3). Semnur is the Company’s majority owned clinical late-stage pharmaceutical company focused on the development and commercialization of SEMDEXA.

The Semnur Business Combination was accounted for as a reverse recapitalization. Because the Company controlled Semnur before the Business Combination and also controls Semnur following the Semnur Business Combination, Denali was treated as the “acquired” company for financial reporting purposes. Accordingly, the Semnur Business Combination was treated as the equivalent of Semnur issuing stock for the net assets of Denali, accompanied by a recapitalization whereby the net assets of Denali will be stated at historical cost and no goodwill or other intangible assets are recorded.

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Due to the changes in ownership structure related to the above transactions, the Company reevaluated Semnur under the VIE model in accordance with ASC 810. The Company concluded that Semnur is a VIE because it lacked sufficient equity at risk to finance its activities without additional subordinated support. Due to the Company’s power to direct key activities through its majority board representation and its significant economic exposure, it was determined that the Company was the primary beneficiary of Semnur. As a result, the Company continues to consolidate Semnur and records the interest that the Company does not own as noncontrolling interest in the consolidated financial statements.

The Company’s consolidated balance sheet at December 31, 2025 includes balances for Semnur of $20.0 thousand for cash and cash equivalents, $0.8 million property and equipment, net, $5.9 million accounts payable, $0.7 million accrued expenses, and $3.5 million note payable. For the twelve months ended December 31, 2025, net loss from Semnur attributable to the noncontrolling interest was $1.4 million.

13. Commitments and Contingencies

Securities Purchase Agreement (the “PIPE SPA”)

On August 20, 2025, the Company and Legacy Semnur entered into the PIPE SPA with the investor named therein, pursuant to which the investor agreed to purchase 1,250,000 shares of Common Stock at a price of $16.00 per share, for an aggregate purchase price of $20.0 million following the consummation of the Business Combination. On September 22, 2025, the PIPE SPA was amended to provide that unless such agreement was terminated pursuant to its terms (or otherwise by mutual agreement of the parties thereto), the closing of the transactions contemplated thereby would occur not later than the 14th business day following the closing of the Business Combination, subject to the satisfaction or waiver of the closing conditions set forth therein. As of December 31, 2025, the transaction has not closed and accordingly, the shares have not been issued and the funds have not been received. As the transaction did not close on or before December 31, 2025, the nonbreaching party has an option to terminate the PIPE SPA without liability.

Additionally, in connection with the PIPE SPA, we are obligated to pay a cash financing service fee of 7% of the received investment funds.

Product Development Agreement

In February 2013, Scilex Pharma became a party to a product development agreement (as amended, the “Product Development Agreement”) with Itochu and Oishi Koseido Co., Ltd. (“Oishi,” and together with Itochu, the “Developers”), pursuant to which the Developers will manufacture and supply lidocaine tape products, including ZTlido and SP-103 (the “Products”), for Scilex Pharma. The Developers initially developed and have intellectual property rights relating to the Products. Pursuant to the Product Development Agreement, Scilex Pharma acquired an exclusive right to develop and commercialize the Products worldwide except for Japan. The Developers are responsible for sourcing and supplying lidocaine for development and commercialization purposes.

Pursuant to the Product Development Agreement, Scilex Pharma is required to make aggregate royalty payments between 25% and 35% to the Developers based on net profits. For each of the years ended December 31, 2025 and 2024, Scilex Pharma made royalty payments in the amount of $6.3 million and $8.3 million, respectively. As of December 31, 2025 and 2024, Scilex Pharma had ending balances of accrued royalty payables of $2.1 million and $4.0 million, respectively. Total royalty expense recorded within cost of revenue was $4.4 million and $9.9 million for the years ended December 31, 2025 and 2024, respectively. Net profits are defined as net sales, less cost of goods and marketing expenses. Net sales are defined as total gross sales of any Product, less all applicable deductions, to the extent accrued, paid or allowed in the ordinary course of business with respect to the sale of such Product, and to the extent that they are in accordance with GAAP. If Scilex Pharma were to sublicense the licensed technologies, the Developers will receive the same proportion of any sublicensing fees received therefrom. The Product Development Agreement will continue in full force and effect until October 2, 2028, the date that is ten years from the date of the first commercial sale of ZTlido. The Product Development Agreement will renew automatically for subsequent successive one-year renewal periods unless Scilex Pharma or the Developers terminate it upon six months’ written notice.

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On February 16, 2017, Scilex Pharma entered into a Commercial Supply Agreement (as amended, the “Supply Agreement”) with the two Developers to provide commercial supply of ZTlido and SP-103 to Scilex Pharma. The Supply Agreement contains standard terms regarding term, termination, payment, product quality and supply. In addition, the agreement provides additional terms regarding the calculation and amount of marketing expenses that may be deducted from net sales for purposes of determining the amount of net profit under the Product Development Agreement.

Sales Operations Services

In November 2014, Scilex Pharma entered into a project agreement with a vendor, pursuant to which the vendor has agreed to perform certain services in accordance with written work orders, which was subsequently superseded by a new project agreement entered into in May 2025 (the “Project Agreement”). In connection with the detailing services, the Project Agreement provides that the vendor will provide Scilex Pharma with full-time sales representatives who shall detail the Product by making calls pursuant to a call plan on targets. In connection with the sales operation services, the vendor will provide certain services required for the initial implementation and ongoing operation of the sales force.

In May 2025, Scilex Pharma and the vendor entered into a work order in which the parties agreed to convert substantially all of the sales representatives allocated under the Project Agreement to become employees of the vendor. The work order shall be in effect and remain in effect until the thirty-six months anniversary of the Deployment Date, as set forth in accordance with the terms of the Project Agreement, which is June 3, 2025, or until terminated in accordance with the terms of the Project Agreement or unless extended as provided therein (the “Term”). The Term may be extended for additional periods of one (1) year (each, an “Additional Term”) upon the mutual written agreement of the parties not less than sixty (60) days before the end of the Term or any Additional Term. Scilex Pharma paid a one-time implementation fee of $72 thousand associated with the operational setup and the recruiting of the sales representatives and will pay fixed monthly fee of $1.2 million for year one and $1.3 million for each of year two and year three.

Pursuant to the terms set forth in the Project Agreement, either party may terminate this work order without cause upon ninety (90) days prior written notice to the other party; provided, however, that such termination by Scilex Pharma may not occur prior to the twelve (12) month anniversary of the Deployment Date.

PA OPS Investment Agreement

In August 2025, Scilex Bio entered into an Investment Commitment Agreement (the “Investment Agreement”) with PA OPS Investor LLC (“Investor LLC”). Pursuant to the terms of the agreement, the Company committed to providing $2.5 million (the "Committed Amount") in future funding, contingent upon Investor LLC successfully identifying and acquiring an appropriate target company ("Target") for investment using the Committed Amount by December 31, 2025. Although the arrangement was legally structured as if the Investor LLC had extended a $2,500,000 loan (the “Loan”) to Scilex at an annual interest rate of 4.03%, no cash was exchanged between the Investor LLC and the Company on Day 1. Accordingly, the Company concluded that, in substance, the transaction does not represent a loan. In August 2025, the LLC acquired the Target which consists of certain assets of a nursing home. However, as the Company is yet to provide the full funding of the Committed Amount, the Company has no ownership interest in the LLC or in the nursing home as of December 31, 2025. On December 31, 2025, the Company made $1.0 million in cash (the "Funding") payment to Investor LLC out of the the Committed Amount of $2.5 million, this funding was treated as a partial repayment of the Loan, therefore, no equity ownership was granted to Scliex, as the Target has already been acquired, the Funding is no longer subject to a refund. The Company consider the consolidation models provided in ASC 810 to determine if the Company should consolidate Investor LLC as of December 31, 2025 and concluded that the Funding meets the definition of a VIE but are not in scope of ASC 810, as the Company has not yet received any equity ownership in the Investor LLC, does not hold a board seat, does not have the power to direct Investor LLC's significant activities and it does not have an obligation to absorb any of the VIE's losses, or rights to receive any benefits from the VIE, further, the Company assess and concludes it does not meet the definition of a derivative under ASC 815. As of December 31, 2025, the Company accounted for the Funding as an equity security under ASC 321 as it provides the Company with the right to acquire equity ownership in the future at a fixed price through the payment of the remaining Committed Amount. The Company recorded the Funding in equity investment

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in the Company balance sheet at cost, net of any impairment, as the Funding was provided close to the balance sheet date, there were no indicators of impairment as of December 31, 2025.

Litigation

In the normal course of business, the Company may be named as a defendant in one or more lawsuits. Other than the following three lawsuits, the Company is not a party to any outstanding material litigation and management is not aware of any legal proceedings that, individually or in the aggregate, are deemed to be material to the Company’s financial condition or results of operations.

From time to time the Company may become involved in various legal proceedings, including those that may arise in the ordinary course of business. The Company evaluates each matter and assesses its potential financial exposure. If the potential loss from a legal proceeding is considered probable and the amount can be reasonably estimated, the Company records an accrual for the estimated loss. Because the outcome of legal proceedings is inherently uncertain, significant judgment is required in assessing the likelihood of a loss and whether the amount is reasonably estimable. The Company’s assessments and any recorded accruals are based on information available at the time of evaluation. As additional information becomes available, the Company re-evaluates its estimates and may adjust recorded liabilities accordingly.

Former Employee Action

On March 12, 2021, Scilex Pharma and Sorrento (the “Plaintiffs”) filed an action (the “Former Employee Action”) in the Delaware Court of Chancery against the former President of Scilex Pharma, Anthony Mack, and Virpax Pharmaceuticals, Inc. (“Virpax”, and together with Mr. Mack, the “Defendants”), a company founded and then headed by Mr. Mack, alleging, among other things, breach by Mr. Mack of a restrictive covenant agreement with Sorrento related to his sale of his Scilex Pharma stock to Sorrento, tortious interference with that agreement by Virpax, breach of Mr. Mack’s fiduciary duties to Scilex Pharma, aiding and abetting of that breach by Virpax, and misappropriation of Scilex Pharma’s trade secrets by Mr. Mack and Virpax. Such lawsuit sought, among other relief, damages and various forms of injunctive relief. The case was tried from September 12, 2022 to September 14, 2022. On September 1, 2023, the court found in favor of the Plaintiffs on all but three counts deemed to have been waived. In its 95-page opinion, the court instructed the parties to submit supplemental briefing on the appropriate remedy to implement its rulings. On October 18, 2023, the Plaintiffs submitted a supplemental brief on remedies. On November 29, 2023, Defendants submitted a supplemental brief on remedies. On December 21, 2023, the Plaintiffs submitted a supplemental reply brief on remedies. On February 26, 2024, the Company and Virpax entered into a term sheet regarding a mutual release and settlement agreement, pursuant to which the parties have agreed to resolve the ongoing disputes. On February 29, 2024, the Company and Virpax entered into a definitive settlement agreement, which provides for, among other things, that Virpax would be obligated to make the following payments to the Company to settle the Former Employee Action: (i) $3.5 million (the “Initial Payment”) by two business days after the Effective Date (as defined therein), which payment has been made; (ii) $2.5 million by July 1, 2024, which payment has been made on July 8, 2024 and (iii) to the extent any of the following drug candidates are ever sold, royalty payments of (a) 6% of annual Net Sales (as defined therein) of Epoladerm; (b) 6% of annual Net Sales of Probudur and (c) 6% of annual Net Sales of Envelta during the Royalty Term (as defined therein). The Company and Virpax provided mutual releases of all claims that existed as of the Effective Date, whether known or unknown, arising from any allegations set forth in the Former Employee Action. Plaintiffs’ release relates to claims against Virpax only, which does not affect its claims against Mr. Mack. Plaintiffs have not released Mr. Mack, and litigation against him remains ongoing. The Court requested further briefing on the remedies solely as to the remaining defendant, Mr. Mack. The parties filed further briefing and then presented oral argument on November 15, 2024. The Court’s issued its decision on damages as to Mr. Mack on July 31, 2025, crediting Mr. Mack for settlement amounts previously paid to Plaintiffs by Virpax, on the count for which Mr. Mack was found liable, and assessing costs against Mr. Mack for one-third of Plaintiffs’ attorneys fees. On April 2, 2026, the Court entered an order awarding Plaintiffs more than $5.3 million in attorneys fees to be paid by Mr. Mack. The parties are awaiting the entry of final judgment.

ZTlido Patent Litigation

On June 22, 2022, the Company filed a complaint against Aveva Drug Delivery Systems, Inc. (“Aveva”), Apotex Corp., and Apotex, Inc. (together, “Apotex”) in the U.S. District Court for the Southern District of Florida (the “ZTlido

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Patent Litigation”) alleging infringement of certain Orange Book listed patents covering ZTlido (the “ZTlido Patents”). The ZTlido Patent Litigation was initiated following the submission by Apotex, in accordance with the procedures set out in the Hatch-Waxman Act, of an abbreviated new drug application (“ANDA”). Apotex’s ANDA seeks approval to market a generic version of ZTlido prior to the expiration of the ZTlido Patents and alleges that the ZTlido Patents are invalid, unenforceable, and/or not infringed. The Company is seeking, among other relief, an order that the effective date of any FDA approval of Apotex’s ANDA be no earlier than the expiration of the asserted patents listed in the Orange Book, the latest of which expires on May 10, 2031, and such further and other relief as the court may deem appropriate. Apotex and Aveva were subject to an automatic 30-month stay preventing them from selling a generic version of ZTlido during that time which was extinguished by the U.S. District Court for the Southern District of Florida decision described below. Aveva received FDA approval for any generic version of ZTlido on March 25, 2025. The two Apotex entities were dismissed from the litigation without prejudice, as they no longer had an interest in the generic product that Aveva seeks to market. Before trial, Aveva dropped its challenge to the validity and enforceability of the Company’s patents. Trial in the ZTlido Patent Litigation was held from July 8, 2024 to July 11, 2024. Final post-trial briefing was submitted by the parties on July 25, 2024, and the case was submitted to the U.S. District Court for the Southern District of Florida. On August 26, 2024, that court issued a decision finding that Aveva’s product does not infringe the Company’s ZTlido Patents. The Company is appealing that decision to the U.S. Court of Appeals for the Federal Circuit, and it filed a Notice of Appeal with the U.S. District Court for the Southern District of Florida on September 25, 2024. Briefing by the parties has been completed. Oral argument is scheduled for May 11, 2026.

Former Employees Litigation

On November 3, 2023, four former employees of the Company filed a complaint in California Superior Court in San Diego County, consisting of claims for back compensation that they allege were promised but not paid to them. The Company investigated those claims, conducted and responded to discovery, and vigorously contested this lawsuit. The parties concluded a settlement of all claims on June 2, 2025, the terms of which are confidential.

Sorrento Equity Holders Litigation

On April 3, 2026, a complaint was filed in the United States District Court for the Southern District of California captioned Mevi et al. v. Ji et al., Case No. 3:26-cv-02113-DMS-DEB. The plaintiffs are former equity holders of Sorrento and have named as defendants, among others, the Company and Semnur. The complaint alleges, among other things, wrongful conduct relating to Sorrento’s bankruptcy proceedings and subsequent transactions involving Sorrento’s assets, and asserts claims including aiding and abetting breach of fiduciary duty and violation of California Penal Code Section 496. The complaint seeks unspecified compensatory damages, treble damages, disgorgement, punitive damages, attorneys’ fees, costs, and other relief. The Company intends to defend the action vigorously. At this time, the Company cannot predict the outcome of this matter or reasonably estimate the possible loss or range of loss, if any.

Operating Leases

The Company leases administrative and research and development facilities under various non-cancelable lease agreements. Facility leases generally provide for periodic rent increases and may include options to extend. As of December 31, 2025, the Company’s leases have remaining lease terms of approximately 10.2 years. The terms of the Company’s leases, ranging from 1 to 13 years, include extension options that were reasonably certain to be exercised. Many of the Company’s leases are subject to variable lease payments. Variable lease payments are recognized in the period in which the obligations for those payments are incurred, are not included in the measurement of the ROU assets or lease liabilities, and are immaterial. Additionally, the Company subleases certain properties to third parties. Sublease income is recognized on a straight-line basis and is immaterial.

As the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The Company calculates the associated lease liability and corresponding ROU asset upon lease commencement using a discount rate based on a credit-adjusted secured borrowing rate commensurate with the term of the lease. As of December 31, 2025, the Company has no finance leases.

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Lease expense was $1.2 million and $1.0 million for the years ended December 31, 2025 and December 31, 2024, respectively, and was primarily comprised of operating lease costs. The lease expense also included variable lease costs and sublease income, which were immaterial for the periods presented.

Supplemental quantitative information related to leases includes the following:

Year Ended December 31,

2025

2024

Cash paid for amounts included in the measurement of lease liabilities:

Operating cash flows from operating leases (in thousands)

$

(1,139

)

$

(1,042

)

Weighted average remaining lease term in years — operating leases

10.2

2.8

Weighted average discount rate — operating leases

11.1

%

11.0

%

Approximate future minimum lease payments under operating leases were as follows (in thousands):

Year Ended December 31,

Amount

2026

$

3,624

2027

$

3,023

2028

$

2,101

2029

$

2,080

2030

$

2,154

Thereafter

$

17,340

Total lease payments

30,322

Less imputed interest

15,438

Total lease liabilities

14,884

Less current portion of lease liability

1,733

Lease liability, net of current portion

$

13,151

14. Income Taxes

The components of the provision (benefit) expense were as follows for the years ended December 31, 2025 and 2024 (in thousands):

Year Ended December 31,

2025

2024

Current income tax (benefit) expense:

Federal

$

—

$

—

State

26

(1

)

Foreign

0

—

Total current income tax (benefit) expense

26

(1

)

Deferred income tax benefit:

Federal

12,786

(16,279

)

State

1,076

(2,803

)

Foreign

(295

)

—

Total deferred income tax benefit

13,567

(19,082

)

Changes in tax rate

—

2,155

Changes in valuation allowance

(13,567

)

16,927

Total income tax (benefit) expense from continuing operations

$

26

$

(1

)

The reconciliation between U.S. federal income taxes at the statutory rate and the Company’s provision for income taxes are as follows for the years ended December 31, 2025 (in thousands):

Upon adoption of ASU 2023-09, Improvements to Income Tax Disclosures the reconciliation of taxes at the federal statutory rate to our provision for (benefit from) income taxes for the year ended December 31, 2025 was as follows (in thousands, except for percentages):

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Year Ended December 31, 2025

Amount

Percentage

U.S. federal statutory tax rate

$

(78,545

)

21.00

%

Foreign tax effects

Statutory tax rate difference between Foreign and United States

$

110

-0.02

%

Other

$

—

0

%

State taxes, net of federal benefit

$

22

-0.01

%

Tax credits

$

254

-0.09

%

Changes in valuation allowances

$

(11,327

)

3.76

%

Nontaxable or nondeductible items

0

%

Gain on sale of Semnur 12.5Mn shares

$

38,424

-12.49

%

Gain or Loss on Derivative Liability

$

4,766

-1.60

%

Revaluation of Oramed notes & Tranch B Notes

$

5,805

-1.95

%

Despac Issuance Cost

$

8,820

-2.97

%

Consulting & Legal expenses related to Cryptos

$

3,878

-1.30

%

Goodwill impairment

$

15,392

0

%

Other

$

12,427

-4.47

%

Changes in unrecognized tax benefits

$

—

0

%

Other adjustments

$

—

0

%

Provision for income tax

$

26

0

%

The reconciliation of taxes at the federal statutory rate to the provision for (benefit from) income taxes for the year ended December 31, 2024 in accordance with the guidance prior to the adoption of ASU 2023-09 was as follows (in thousands):

Year Ended December 31,

2024

Income tax benefit at federal statutory rate

$

(15,290

)

Valuation allowance

18,559

Compensation expense

2,772

Acquisition related charges

485

Prior year true-up and carryback

(1,182

)

State, net of federal tax benefit

(2,705

)

Change in fair value of Convertible Debentures

(4,449

)

Change in tax rates

2,155

Other

(346

)

Income tax (benefit) expense

$

(1

)

Upon adoption of ASU 2023-09, Improvements to Income Tax Disclosures cash paid for income taxes, net of refunds, during the year ended December 31, 2025 was as follows (in thousands)

Federal

$

—

State

21

Foreign

—

Total cash paid for income taxes, net of refunds

$

21

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The components of the Company’s net deferred tax liabilities and related valuation allowance are as follows as of December 31, 2025 and 2024 (in thousands):

F-68

Year Ended December 31,

2025

2024

Deferred tax assets:

Net operating loss carryforwards

US

$

86,748

$

85,226

Foreign

9,514

—

Total Net operating loss carryforwards

96,262

85,226

Debt related interest

14,567

16,228

Capitalized research and development

1,821

5,228

Tax credit carryforwards

3,960

4,415

Stock-based compensation

1,326

1,157

Accrued expense and reserves

2,541

1,812

Purchased revenue liability

1,888

1,754

Operating lease liabilities

2,674

577

Outside basis difference - investment in subsidiaries

704

—

Investment in digital asset

2,702

—

Other

353

303

Total deferred tax assets

128,798

116,700

Less valuation allowance

(111,385

)

(113,703

)

Total deferred tax assets

17,413

2,997

Deferred tax liabilities:

Intangible assets

(1,842

)

(2,423

)

Investment in Datavault shares - equity method investment

(12,911

)

—

Operating lease right-of-use assets

(2,660

)

(574

)

Total deferred tax liabilities

(17,413

)

(2,997

)

Net deferred tax liabilities

$

—

$

—

The Company has evaluated the available evidence supporting the realization of its gross deferred tax assets, including the amount and timing of future taxable income, and has determined that it is more likely than not that the deferred tax assets will not be realized. Due to such uncertainties surrounding the realization of the deferred tax assets, the Company maintains a valuation allowance of $111.4 million against its deferred tax assets as of December 31, 2025. Realization of the deferred tax assets will be primarily dependent upon the Company’s ability to generate sufficient taxable income prior to the expiration of its net operating losses. The valuation allowance is $113.7 million as of December 31, 2024, and $111.4 million as of December 31, 2025. The valuation allowance decreases by $2.3 million during the year ended December 31, 2025.

As of December 31, 2025, the Company had a federal net operating loss carryforward of approximately $345.8 million, of which approximately $14.7 million will begin to expire in 2033 for federal tax purposes, and approximately $331.1 million in federal net operating losses carryforward can be carried forward indefinitely. While these federal net operating loss (“NOL”) do not expire, the Tax Cuts & Jobs Act of 2017 limits the amount of federal net operating loss utilized each year after December 31, 2017, to 80% of taxable income. As of December 31, 2025, the Company has a state net operating loss carryforward of approximately $250.5 million.

As of December 31, 2025, the Company had a foreign net operating loss carryforward of approximately $38.1 million for the Vivasor China entities.

As of December 31, 2025, the Company had federal research and development income tax credits of $3.4 million which will begin to expire in 2033. As of December 31, 2025, the Company had California research and development income tax credits of $1.9 million that have an indefinite life and will not expire.

F-69

Pursuant to Internal Revenue Code Section 38, a corporation’s ability to utilize its NOL and tax credit carryforwards may be subject to annual limitations in the event of an ownership change, as defined under Section 382.

The Company has not performed a Section 382 ownership change analysis for periods subsequent to December 31, 2022. Management has been advised to undertake a Section 382 study for the period from 2023 through 2025; such analysis is currently in progress.

Utilization of pre-2020 NOLs has been carried out in accordance with the limitations established in the prior study performed.

The Company is subject to taxation in U.S. federal and state tax jurisdictions. The Company has incurred net operating losses since inception. Accordingly, all tax years remain open to examination by taxing authorities to the extent of net operating losses carried forward and utilized in future periods. Upon utilization, the statute of limitations will remain open for examination for three years from the date of utilization. There are no active tax examinations as of December 31, 2025.

During the year ended December 31, 2025, Semnur ceased to be a member of the consolidated federal income tax group of the Company due to a reduction in ownership below the threshold required under Internal Revenue Code Section 1504.

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows for the years ended December 31, 2025 and 2024 (in thousands):

2025

2024

Gross unrecognized tax benefits at the beginning of the year

$

1,198

$

1,071

Increase related to prior year tax positions

(127

)

—

Increase related to current year tax positions

—

127

Gross unrecognized tax benefits at the end of the year

$

1,071

$

1,198

As of December 31, 2025 and 2024, the Company had $1.1 million and $1.2 million in total unrecognized tax benefits, respectively, which have been reflected as a reduction in deferred tax assets. If these were to be recognized, they would affect the effective tax rate, however given the full valuation allowance in the jurisdiction in which the unrecognized tax benefits relate to, the impact on the effective tax rate would be nil.

The Company’s policy is to recognize interest and penalties related to income tax matters in income tax expense. No interest or penalties have been recognized as of and for the years ended December 31, 2025 and 2024.

The Company believes that no material amount of the liabilities for uncertain tax positions are expected to reverse within 12 months of December 31, 2025.

15. Net Loss Per Share

The following table sets forth the reconciliation of basic and diluted loss per share for the years ended December 31, 2025 and 2024 (in thousands except per share data):

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Year Ended December 31,

2025

2024

Net loss

$

(374,053

)

$

(72,807

)

Net loss attributable to noncontrolling interest

$

(15,319

)

$

—

Deemed dividend for anti-dilution adjustments to Oramed Penny Warrants upon reverse stock-split

(43,753

)

—

Net loss for basic loss per share available to common stockholders

$

(402,487

)

$

(72,807

)

Reversal of mark-to-market adjustment for liability classified warrants

—

(8,895

)

Net loss for diluted loss per share available to common stockholders

$

(402,487

)

$

(81,702

)

Weighted average number of shares outstanding

5,350

3,561

Weighted average Common Stock warrants exercisable for nominal consideration

5,684

6,500

Weighted average number of shares, basic

11,034

10,061

Effect of dilutive securities

—

84

Weighted average number of shares, diluted

11,034

10,145

Loss per share

Basic

$

(36.48

)

$

(7.24

)

Diluted

$

(36.48

)

$

(8.05

)

Basic net loss per share is computed by dividing net loss by the weighted average number of shares of Common Stock outstanding during the period. Premium paid on redemption of Series A Preferred Stock was added to the net loss to arrive at loss available for common stockholders as it represents a dividend to the Series A preferred stockholder. Diluted earnings per share is computed using the weighted average number of Common Stock and, if dilutive, potential Common Stock outstanding during the period. Potential Common Stock consists of the incremental Common Stock issuable upon the exercise of stock options and warrants (using the treasury stock method or the reverse treasury stock method, as applicable).

In the computation of net loss per share, treasury shares are not included as part of the outstanding shares. Shares of the Dividend Stock, as declared by the Board of Directors of the Company on October 27, 2024 and not yet distributed as of December 31, 2024, are also excluded from the computation of net loss per share because the associated Series 1 Preferred Stock is not considered to be a participating security.

In accordance with FASB ASC 260, Earnings Per Share, Penny Warrants are warrants that would be exercised for no or little consideration and therefore should be included in the calculation of weighted average shares outstanding for purposes of calculating basic and diluted net income (loss) per share. The Closing Penny Warrants become exercisable upon the passage of time and are included in basic and diluted net income (loss) per share from the closing date of September 21, 2023. The Subsequent Penny Warrants to purchase up to an aggregate of 8,500,000 shares of Common Stock were not vested as of the closing date of September 21, 2023 and the vesting was based on the passage of time, the Company’s repayment of the Oramed Note or the occurrence of the Management Sale Trigger Date (as defined therein), therefore are included in the computation for basic and diluted net income per share once all other exercise contingencies were removed except for the passage of time.

F-71

The following potentially dilutive outstanding securities were excluded from the computation of diluted net loss per share because their effect would have been anti-dilutive for the periods presented:

December 31,

December 31,

2025

2024

Stock options

1,503,907

1,027,977

Public Warrants

156,115

156,220

February 2024 BDO Firm Warrants

108,686

108,686

February 2024 BDO Representative Warrants

13,446

13,446

April 2024 RDO Placement Agent Warrants

34,286

34,286

Retainer Shares

399,999

399,999

Private Warrants

28,572

28,572

Shares Issuable pursuant to the ESPP

576

2,204

Shares issuable under the SIPA

8,571

8,571

Deposit Warrants

3,250,000

—

October 2024 Noteholder Warrants

107,142

—

October 2024 Placement Agent Warrants

104,848

104,848

December 2024 RDO Common Warrants

537,298

1,642,871

StockBlock Warrants

131,472

131,472

Shares issuable under Tranche B Notes

493,004

1,158,617

Exchange Warrants

500,000

—

September 2025 Warrants

275,000

—

November 2025 Warrants

1,356,594

—

November 2025 Placement Agent Warrants

72,352

—

Total

9,081,868

4,817,769

16. Subsequent Events

Oramed Debt Extension

On March 29, 2026, the Company entered into Oramed debt extension agreement with Oramed to extend the final payment due under Oramed note and the April 1, 2026 amortization payment due under Tranche B note to April 20, 2026.

Litigation

Scilex-St. James Loan Lawsuit

On March 11, 2026, the Company filed a complaint against Marc Wade, The St. James Bank & Trust Company Ltd., Omega & Corinth Group Ltd., certain associates thereof (collectively, the “Wade Defendants”), and Bank of New York Mellon Corporation (“BNY”) in the United States District Court for the Central District of California. The complaint asserts five causes of action: (1) federal securities fraud (against all defendants); (2) state securities fraud (against the Wade Defendants); (3) fraudulent inducement (against the Wade Defendants); (4) unlawful conversion (against all defendants); and (5) negligence (against BNY). The Company seeks money damages in excess of $100 million, punitive damages, pre- and post- judgment interest, disgorgement of profits, and attorney fees.

Sorrento Equity Holders Litigation

On April 3, 2026, a complaint was filed in the United States District Court for the Southern District of California captioned Mevi et al. v. Ji et al., Case No. 3:26-cv-02113-DMS-DEB. The plaintiffs are former equity holders of Sorrento and have named as defendants, among others, the Company and Semnur. The complaint alleges, among other things, wrongful conduct relating to Sorrento’s bankruptcy proceedings and subsequent transactions involving Sorrento’s assets, and asserts claims including aiding and abetting breach of fiduciary duty and violation of California Penal Code Section 496. The complaint seeks unspecified compensatory damages, treble damages, disgorgement, punitive damages, attorneys’ fees, costs, and other relief. The Company intends to defend the action vigorously. At

F-72

this time, the Company cannot predict the outcome of this matter or reasonably estimate the possible loss or range of loss, if any.

Warrant Agreement

On February 19, 2026, the Company entered into a Warrant Agreement (the “Oramed Warrant Agreement”) with Oramed. Pursuant to the Oramed Warrant Agreement, Oramed deferred its right to receive an amortization payment scheduled to be paid by the Company on October 1, 2025, as set forth in the amortization schedule included in the Tranche B Notes in exchange for the Company’s agreement to issue a new warrant to purchase an aggregate of 100,000 shares of Common Stock (the “February 2026 Warrant”) at an initial exercise price of $20.00 per share (the “Exercise Price”) as described below. The deferred amortization payment was made to Oramed in November 2025.

The February 2026 Warrant is immediately exercisable upon issuance. The issuance of the February 2026 Warrant was made pursuant to an exemption from registration provided by Section 4(a)(2) of the Securities Act, and Rule 506(b) of Regulation D as promulgated thereunder by the SEC. The Company has agreed to file as soon as practicable (and in any event within the later of (i) 30 calendar days following the date of the Oramed Warrant Agreement, (ii) 10 days following the date of the filing with the SEC of the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, and (iii) March 31, 2026) a registration statement on Form S-3 (or Form S-1 if Form S-3 is not available to the Company) registering under the Securities Act the resale by Oramed of the shares of Common Stock issuable upon exercise of the February 2026 Warrant or to include such shares of Common Stock in any other registration statement on Form S-3 filed by the Company. The February 2026 Warrant shall have an expiration date of December 13, 2029.

Quantum Scan Holdings Investment

The Company entered into a convertible promissory note, dated January 29, 2026, (the “Q Scan Note”), with Quantum Scan Holdings, Inc. (“Q Scan”). Pursuant to the Q Scan Note, the Company loaned Q Scan an aggregate of $20 million. The Q Scan Note shall be due upon request of the Company on or after October 29, 2026, and would commence accruing interest at a rate of 3.66% per annum commencing on April 29, 2026. The Q Scan Note contains customary representations and warranties of the Company and Q Scan and customary covenants of Q Scan. As of December 31, 2025, the Company prepaid $2.5 million for services related to these transactions in November 2025.

The Company and Q Scan entered into a common stock purchase agreement, dated January 29, 2026, the “Q Scan Stock Purchase Agreement”). Pursuant to the Q Scan Stock Purchase Agreement, Q Scan agreed to sell to the Company, and the Company agreed to purchase from Q Scan, an aggregate of 193,021,436 shares of common stock of Q Scan (the “Q Scan Stock Purchase”) for an aggregate purchase price of approximately $27.5 million. The closing of the Q Scan Stock Purchase shall occur within five business days of written notice delivered by Q Scan to the Company. The Q Scan Stock Purchase Agreement contains customary representations, warranties and covenants of the Company and Q Scan.

PA OPS Investor LLC Investment

In January 2026, the Company and the Investor LLC reached an agreement to extend the Letter commitment period from December 31, 2025 to April 30, 2026. As such, the Company now has until April 30, 2026, to fund the remaining Commitment Amount of $1,500,000.

F-73