Company: PTHS
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001753926-25-000503
Chunk: 108

Company: Pelthos Therapeutics Inc.
Filing Date: 2025-03-27
Form: 10-K
Item: Item 1
Chunk 108
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 and sell to Tikkun under the CEF Purchase Agreement more than 2,000,000 Purchase Shares being
registered for resale under the registration statement on Form S-1 filed with the SEC on July 29, 2024 in order to receive aggregate
gross proceeds equal to the Total Commitment of an aggregate of $30.0 million under the CEF Purchase Agreement, we must file with
the SEC one or more additional registration statements to register under the Securities Act the resale by Tikkun of any such additional
Purchase Shares we wish to sell from time to time under the CEF Purchase Agreement, which the SEC must declare effective. Tikkun
will not be required to purchase any Purchase Shares if such sale would result in Tikkun and its affiliates’ beneficial
ownership exceeding than 4.99% of the outstanding shares of the Common Stock (the “Beneficial Ownership Limit”).

Any
issuance and sale by us under the CEF Purchase Agreement of a substantial amount of Purchase Shares could cause additional substantial
dilution to our stockholders. The number of Purchase Shares ultimately offered for resale by Tikkun is dependent upon the number
of Purchase Shares we ultimately sell to Tikkun under the CEF Purchase Agreement.

Our
inability to access a portion or the full amount available under the CEF Purchase Agreement, in the absence of any other financing
sources, could have a material adverse effect on our business.

Sales
of a substantial number of our Common Stock in the public market by our existing stockholders could cause the price of our shares
of our Common Stock to fall.

Tikkun may resell up to 2,000,000 Purchase
Shares, from time to time during the term of the CEF Purchase Agreement. If all of the 2,000,000 Purchase Shares were issued and
outstanding as of the date hereof (without taking into account the Exchange Cap limitation), such shares would represent approximately
24.7% of the total number of outstanding shares of our Common Stock and approximately 26.9% of the total number of outstanding
shares of our Common Stock held by non-affiliates of our Company, in each case as of March 7, 2025.

Sales
of a substantial number of our shares of our Common Stock in the public market by Tikkun and/or by our other existing stockholders,
or the perception that those sales might occur, could depress the market price of shares of our Common Stock and could impair