Company: PTHS
Filing Date: 2025-05-09
Form Type: PREM14C
Source: 0001140361-25-018219
Chunk: 22

Company: Pelthos Therapeutics Inc.
Filing Date: 2025-05-09
Form: PREM14C
Chunk 22
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 as a “reorganization” within the meaning of Section 368(a) of the Code or that a court will not sustain such a challenge by the IRS. Subject to the qualifications and limitations set forth in the section titled “ The Merger—Material U.S. Federal Income Tax Consequences of the Merger,” if the Merger qualifies as a “reorganization” within the meaning of Section 368(a) of the Code, then Ligand, as the sole holder of LNHC capital stock, generally should not recognize gain or loss for U.S. federal income tax purposes upon the receipt of shares of Channel Series A Preferred Stock in exchange for shares of LNHC capital stock in the Merger. However, if the Merger does not qualify as a “reorganization” within the meaning of Section 368(a) of the Code, the Merger would generally be a taxable transaction to Ligand. See the section titled “ The Merger—Material U.S. Federal Income Tax Consequences of the Merger” beginning on page 127of this information statement for a more complete description of the material U.S. federal income tax consequences of the Merger to Ligand. Because the Channel stockholders will not sell, exchange or dispose of any shares of Channel common stock in the Merger, there will be no material U.S. federal income tax consequences to Channel stockholders upon consummation of the Merger. Risk Factor Summary Both Channel and LNHC are subject to various risks associated with their businesses and their industries. In addition, the Merger, including the possibility that the Merger may not be completed, poses a number of risks to each company and its respective securityholders, including the following risks: Risks Related to the Merger

| • | The exchange ratio will not be adjusted based on the market price of Channel common stock, so the merger consideration at the closing may have a greater or lesser value than at the time the Merger Agreement was signed; |

| • | Failure to complete the Merger may result in harm to the common stock price of Channel and future business and operations of either Channel or LNHC; |

| • | If the conditions to the Merger are not satisfied or waived, the Merger may not occur; and |

| • | The PIPE Financing may not be completed. |

Risks Related to Channel’s Business

| • | The report of the independent registered public accounting firm on our 2024 and 2023 financial statements contains a going concern qualification; and |

| • | Channel