Company: PTHS
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001753926-25-000503
Chunk: 1487

Company: Pelthos Therapeutics Inc.
Filing Date: 2025-03-27
Form: 10-K
Item: Item 7A
Chunk 1487
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900 

    Lab Materials 
     1,818  
     — 

    Lab Cell Storage 
     88,662  
     48,572 

    Chemistry Manufacturing and Controls (“CMC”) 
     642,304  
     — 

    IP Services 
     159,972  
     2,461,946 

    Total 
    $1,179,436  
    $2,579,418 

Fair
Value Measurements and Fair Value of Financial Instruments

The
Company determines fair value based on assumptions that market participants would use in pricing an asset or liability in the
principal or most advantageous market. When considering market participant assumptions in fair value measurements, the following
fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following levels:

    ●
    Level
    1 Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date.

    ●
    Level
    2 Inputs are unadjusted quoted prices for similar assets and liabilities in active markets, quoted prices for identical or
    similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs
    derived from or corroborated by observable market data.

    ●
    Level
    3 Inputs are unobservable inputs which reflect the reporting entity’s own assumptions on what assumptions the market
    participants would use in pricing the asset or liability based on the best available information.

The
Company did not identify any assets or liabilities that are required to be presented on the balance sheets at fair value in accordance
with ASC Topic 820.

Due
to the short-term nature of all financial assets and liabilities, their carrying value approximates their fair value as of the
balance sheet dates.

Stock-Based
Compensation

The
Company accounts for stock-based compensation costs under the provisions of ASC 718, Compensation—Stock Compensation (“ASC
718”), which requires the measurement and recognition of compensation expense related to the fair value of stock-based compensation
awards that are ultimately expected to vest. Stock-based compensation expense recognized includes the compensation cost for all
stock-based payments granted to employees, officers, and directors based on the grant date fair value estimated in accordance
with the provisions of ASC 718. ASC 718 is also applied to awards modified, repurchased, or cancelled during the periods reported.
Stock-based compensation is recognized as expense over the employee’s requisite vest