Company: PTHS
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001753926-25-000503
Chunk: 104

Company: Pelthos Therapeutics Inc.
Filing Date: 2025-03-27
Form: 10-K
Item: Item 1
Chunk 104
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 been instituted against the affected company.
Any litigation of this type brought against us could result in substantial costs and a diversion of our management’s attention
and resources, which would harm our business, results of operations, financial condition and cash flows.

We
have broad discretion in the use of our cash and may not use them effectively.

Our
management will have broad discretion in the application of our cash and could spend the proceeds in ways that do not improve
our results of operations or enhance the value of our Common Stock. The failure by our management to apply these funds effectively
could result in financial losses that could have a material adverse effect on our business, cause the price of our Common Stock
to decline and delay the development of CC8464, CT2000 and any other new compounds that we may develop. Pending their use, we
may invest our cash in a manner that does not produce income or that loses value.

Raising
additional capital may cause dilution to our existing stockholders, restrict our operations or require us to relinquish rights
to our technologies, CC8464, CT2000 and CT3000.

We
may seek additional capital through a combination of draw-downs under the CEF Purchase Agreement, public and private equity offerings,
debt financings, collaborations and licensing arrangements. To the extent that we raise additional capital through the sale of
equity or debt securities, your ownership interest will be diluted, and the terms may include liquidation or other preferences
that adversely affect your rights as a stockholder. The incurrence of indebtedness would result in increased fixed payment obligations
and could involve restrictive covenants, such as limitations on our ability to incur additional debt, limitations on our ability
to acquire or license intellectual property rights and other operating restrictions that could adversely impact our ability to
conduct our business. If we raise additional funds through strategic partnerships and alliances and licensing arrangements with
third parties, we may have to relinquish valuable rights to our technologies, CC8464, CT2000 and CT3000 or grant licenses on terms
unfavorable to us.

We
are an “emerging growth company” and the reduced disclosure requirements applicable to emerging growth companies may
make our Common Stock less attractive to investors.

We
are an “emerging growth company,” as defined in the JOBS Act, and we may take advantage of certain exemptions and
relief from various reporting requirements that are applicable to other public companies that are not “emerging growth companies.”
In particular, while we are