Company: PTHS
Filing Date: 2025-11-25
Form Type: DEF 14A
Source: 0001753926-25-001827
Chunk: 60

Company: Pelthos Therapeutics Inc.
Filing Date: 2025-11-25
Form: DEF 14A
Chunk 60
---
ii)
Xepi.

Assignment Agreement Amendment

As an inducement to
certain Investors to enter into the November 2025 Securities Purchase Agreement, on the Convertible Note Financing Closing Date,
LNHC and Ligand entered into Amendment No. 1 to the Assignment Agreement, pursuant to which Ligand agreed to pay the Company (i)
75% of the milestone payment received by Ligand from Sato in respect of the first commercial sale of the “Licensed Product”
(as defined in Amended Sato Agreement) in Japan; and (ii) fifty percent (50%) of any other amounts received by Ligand from Sato
under the Amended Sato Agreement solely in respect of the “Licensed Product” (and, for the avoidance of doubt, no other
product covered by the Amended Sato Agreement) in the “Licensed Field” (in each case, as defined in the Amended Sato
Agreement), less any out-of-pocket costs incurred by Ligand to effectuate its rights, obligations and responsibilities under the
Amended Sato Agreement.

<div align='center'>32

AUDIT COMMITTEE REPORT</div>

The following report (the “Audit Report”) of the Board’s audit committee (the “Audit Committee”) does not constitute soliciting material and should not be deemed filed or incorporated by reference into any other Company filing under the Securities Act or the Exchange Act except to the extent the Company specifically incorporates this Audit Report by reference therein.

Role of the Audit Committee

The Audit Committee’s primary responsibilities fall into three (3) broad categories:

First, the Audit Committee is charged with monitoring the preparation of quarterly and annual financial reports by the Company’s management, including discussions with management and the Company’s outside auditors about draft annual financial statements and key accounting and reporting matters.

Second, the Audit Committee is responsible for matters concerning the relationship between the Company and its outside auditors, including recommending their appointment or removal, reviewing the scope of their audit services and related fees, as well as any other services being provided to the Company, and determining whether the outside auditors are independent.

Third, the Audit Committee reviews financial reporting, policies, procedures, and internal controls of the Company. In addition, the Audit Committee is responsible for reviewing and approving related person transactions and overseeing the Company’s compliance with legal and regulatory requirements. The Audit Committee also prepares the audit committee report included in the Company’s annual proxy statement.

The Audit Committee has implemented procedures to ensure that during the course of each fiscal year it devotes the