Company: PTHS
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001753926-25-000503
Chunk: 1389

Company: Pelthos Therapeutics Inc.
Filing Date: 2025-03-27
Form: 10-K
Item: Item 7
Chunk 1389
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 Company has not recorded a liability for uncertain tax benefits.

The
federal and state income tax returns of the Company are subject to examination by the Internal Revenue Service and state taxing
authorities, generally for three years after they were filed. The Company has filed its tax returns for the year ended December
31, 2023 and after review of the prior year consolidated financial statements and the results of operations through December 31,
2024, the Company has recorded a full valuation allowance on its deferred tax asset.

Recently
Issued Accounting Pronouncements

In December 2023, the FASB issued ASU 2023-09,
Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires disaggregated information about a reporting entity’s
effective tax rate reconciliation, as well as information related to income taxes paid to enhance the transparency and decision
usefulness of income tax disclosures. This ASU will be effective for the annual periods beginning after December 15, 2024. The
Company is currently evaluating the impacts of adoption of this ASU.

    F-12 

In
November 2023, the FASB issued ASU 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures,”
which is intended to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant
segment expenses. The purpose of the amendment is to enable investors to better understand an entity’s overall performance
and assess potential future cash flows. The guidance is effective for fiscal years beginning after December 15, 2023, and interim
periods within fiscal years beginning after December 15, 2024, with early adoption permitted. The guidance is to be applied retrospectively
to all prior periods presented in the consolidated financial statements. The Company adopted this ASU in 2024, see Note 9.

NOTE
4 – RELATED PARTY TRANSACTIONS

Employment
Agreement

On
February 14, 2024, the board of directors of the Company (the “Board”) received a demand letter from an attorney
representing Chromocell Holdings and Christian Kopfli, the Company’s former Chief Executive Officer and former Chief Strategy
Officer. Mr. Kopfli alleged an improper termination for “cause” and claimed to seek monetary damages in the amount
of $479,169. Of the $479,169 asserted by Mr. Kopfli, as of December 31, 2024