Company: PTHS
Filing Date: 2025-08-13
Form Type: 10-Q
Source: 0001753926-25-001326
Chunk: 25

Company: Pelthos Therapeutics Inc.
Filing Date: 2025-08-13
Form: 10-Q
Item: Part I, Item 1
Chunk 25
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 the Contribution Agreement and the option grants, there were 118,731 shares (on an as converted basis
reflecting the conversion of the 600,000 Series A Convertible Preferred Stock held by Chromocell Holdings). The Series
A Convertible Preferred Stock was converted into common stock with the consummation of the IPO and as of June 30, 2025, all of
the Series A Convertible Preferred Stock shares have been converted. The resulting value per share of common stock was $377.10.
The Company then adjusted this value in accordance with the following:

 Schedule of of Servicing Assets at Fair Value

    Value
    of intellectual property
     
    $
    44.8 million

    Common shares outstanding
    (as converted)

    118,731

    Value per common
    share
     
    $
    377.10

    Illiquidity discount

    20
    %

    Minority discount

    20
    %

    Fair value of the
    common stock
     
    $
    226.80

    17 

After
the completion of the Company’s IPO, the trading price of the Company’s Common Stock is used as the fair value of
the Company’s Common Stock.

The
Company determined the expected volatility assumption for options granted using the historical volatility of comparable public
companies’ common stock. The Company will continue to monitor peer companies and other relevant factors used to measure
expected volatility for future option grants, until such time that the Company’s Common Stock has enough market history
to use historical volatility.

The
dividend yield assumption for options granted is based on the Company’s history and expectation of dividend payouts. The
Company has never declared nor paid any cash dividends on its Common Stock, and the Company does not anticipate paying any cash
dividends in the foreseeable future.

The
Company recognizes option forfeitures as they occur as there is insufficient historical data to accurately determine future forfeiture
rates.

The
following is an analysis of the stock option grant activity:

    Weighted
    Average

    Weighted
    Average

    Number
    of
    Shares

    Exercise
        
        Price

    Remaining
    Life

    Stock Options

    Outstanding December 31,
    2024

    87,049

    $
    58.50

    9.19

    Granted

    7,899

    13.5

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