Company: PTHS
Filing Date: 2025-05-09
Form Type: PREM14C
Source: 0001140361-25-018219
Chunk: 9

Company: Pelthos Therapeutics Inc.
Filing Date: 2025-05-09
Form: PREM14C
Chunk 9
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ger is completed, Merger Sub will merge with and into LNHC, with LNHC surviving the Merger as a wholly-owned subsidiary of Channel.

Subject to the terms and conditions of the Merger Agreement, at the closing of the Merger, among other things, each then outstanding share of LNHC capital stock will be converted into the right to receive a number of shares of Channel Series A Preferred Stock (subject to the payment of cash in lieu of fractional shares) calculated in accordance with the exchange ratio set forth in the Merger Agreement. Based on Channel’s and LNHC’s capitalization as of May 2, 2025, Ligand is expected to receive an aggregate of approximately 31,599.44 shares of Channel Series A Preferred Stock in the Merger.

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For purposes of calculating the exchange ratio, (1) no Channel stock options that are (x) unvested and outstanding as of immediately prior to the Effective Time or (y) vested and outstanding as of immediately prior to the Effective Time with an exercise price equal to or greater than the volume weighted average closing trading price of a share of Channel common stock on The NYSE American for the five consecutive trading days ending five trading days immediately prior to the closing of the Merger (the “Public Company Closing Price”) will be included in the total number of shares of Channel common stock and (2) other than with respect to shares of Channel common stock underlying vested outstanding Channel stock options and Channel Warrants with an exercise price less than the Public Company Closing Price of Channel common stock reserved for issuance under the Amended and Restated 2023 Plan as of immediately prior to the Effective Time shall not be included in the total number of shares of Channel common stock outstanding for purposes of determining the number of outstanding shares of Channel common stock. The total number of the shares of Channel common stock outstanding will be calculated using the treasury stock method. The exchange ratio is based on a stipulated value for Channel of $15 million (excluding the PIPE Financing) and for LNHC of $67 million, as further described in the Merger Agreement.

Immediately following the closing of the Transactions, the Channel securityholders as of immediately prior to the Merger are expected to hold approximately 8.0% of the shares of combined company capital stock, Ligand, including its participation in the PIPE Financing, is expected to hold approximately 55.9% of the shares of combined company capital stock (including Series A Preferred Stock