Company: PTHS
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001753926-25-000503
Chunk: 599

Company: Pelthos Therapeutics Inc.
Filing Date: 2025-03-27
Form: 10-K
Item: Item 1C
Chunk 599
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Os”) under
the 2023 Plan. The administrator determines the number of shares of our Common Stock subject to each option, its exercise price,
its duration and the manner and time of exercise; provided, however, that no option may be issued under the 2023 Plan with an
exercise price that is less than the fair market value of our Common Stock as of the date the option is granted, and no option
issued as an ISO will have a duration that exceeds ten years. ISOs may be issued only to our employees or employees of our corporate
subsidiaries, and in the case of a more than ten percent stockholder, must have an exercise price that is at least 110% of the
fair market value of our Common Stock as of the date the option is granted, and may not have a duration of more than five years.

The
administrator, in its discretion, may provide that any option is subject to vesting limitations that make it exercisable during
its entire duration or during any lesser period of time.

The
exercise price of an option may be paid in cash, by delivery of a recourse promissory note secured by the Common Stock acquired
upon exercise of the option (except that such a loan would not be available to any of our executive officers or directors), by
means of a “cashless exercise” procedure in which a broker transmits to us the exercise price in cash, either as a
margin loan or against the optionee’s notice of exercise and confirmation by us that we will issue and deliver to the broker
stock certificates for that number of shares of Common Stock having an aggregate fair market value equal to the exercise price,
or agrees to pay the exercise price to us in cash upon our receipt of stock certificates, by delivery of shares of our Common
Stock already owned by the optionee, by a “net exercise” in the case of an NSO or by any combination of the methods
listed.

Stock
Appreciation Rights (“SARs”). The administrator may also grant SARs to participants on such terms and conditions
as it may determine. SARs may be granted separately or in connection with an option. No SAR may be issued under the 2023 Plan
with an exercise price that is less than the Fair Market Value of our Common Stock as of the date the SAR is granted, and no SAR
will have a duration that exceeds ten years. Upon the exercise of an SAR, the participant is entitled to receive payment equal
to the excess of the