Company: PTHS
Filing Date: 2025-05-09
Form Type: PREM14C
Source: 0001140361-25-018219
Chunk: 43

Company: Pelthos Therapeutics Inc.
Filing Date: 2025-05-09
Form: PREM14C
Chunk 43
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 complete the Merger or otherwise raise additional capital to support Channel’s operations if the Merger is not consummated and another strategic transaction cannot be identified, negotiated and consummated in a timely manner, if at all. The volatility of the market price of Channel common stock is exacerbated by low trading volume. Additional factors that may cause the market price of Channel common stock to fluctuate include:

| • | the initiation of, material developments in, or conclusion of litigation to enforce or defend its intellectual property rights or defend against claims involving the intellectual property rights of others; |

| • | the entry into, or termination of, key agreements, including commercial partner agreements; |

| • | announcements by commercial partners or competitors of new commercial products, clinical progress or lack thereof, significant contracts, commercial relationships or capital commitments; |

| • | the introduction of technological innovations or new therapies that compete with its future products; |

| • | the loss of key employees; |

| • | future sales of its common stock; |

| • | general and industry-specific economic conditions that may affect its research and development expenditures; |

| • | the failure to meet industry analyst expectations; and |

| • | period-to-period fluctuations in financial results. |

Moreover, the stock markets in general have experienced substantial volatility that has often been unrelated to the operating performance of individual companies. These broad market fluctuations may also adversely affect the trading price of Channel common stock. In the past, following periods of volatility in the market price of a company’s securities, stockholders have often instituted class action securities litigation against such companies. Channel’s current stockholders will have a reduced ownership and voting interest in, and will exercise less influence over the management of, the combined company following the completion of the Merger as compared to their current ownership and voting interests in the respective companies. After the completion of the Merger, the current stockholders of Channel will own a smaller percentage of the combined company than their ownership of their respective companies prior to the Merger. Immediately following the Transactions, the Channel’s current securityholders as of immediately prior to the Merger are expected to hold approximately 8.0% of the shares of combined company capital stock, Ligand, including its participation in the PIPE Financing, is expected to hold approximately 55.9% of the shares of combined company capital stock, and the other PIPE Investors are expected to hold approximately 36.2% of the shares of combined company capital stock, in each case, on a fully diluted basis, subject to certain assumptions.