Company: HURA
Filing Date: 2025-05-23
Form Type: 424B3
Source: 0001193125-25-125499
Chunk: 808

Company: TuHURA Biosciences, Inc./NV
Filing Date: 2025-05-23
Form: 424B3
Chunk 808
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 market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. See Note 5 for more information related to the Company’s Level 3 fair value measurement. The carrying values reported in the Company’s balance sheets for cash and cash equivalents, other current assets, accounts payable, and accrued expenses are reasonable estimates of their fair values due to the short-term nature of these items. Derivative Financial Instruments -The Company evaluates all of its agreements to determine if such instruments have derivatives or contain features that qualify as embedded derivatives. The Company accounts for F-78

TUHURA BIOSCIENCES, INC AND SUBSIDIARIES

Notes to the consolidated financial statements

For the years ended December 31, 2024, and 2023

certain make-whole features that are associated with convertible notes as derivative liabilities at fair value and adjusts the instruments to their fair value at the end of each reporting period.
Derivative financial liabilities are initially recorded at fair value, with gains and losses arising from changes in the fair value recognized in other income (expense) in the accompanying consolidated statements of operations for each reporting
period while such instruments are outstanding. The embedded derivative liabilities are valued using a probability-weighted expected return method (“PWERM”). The critical inputs used to value the PWERM are a discount rate, the estimated
make-whole interest payments for various settlement scenarios and the probability of each settlement scenario. If the Company repays the noteholders or if, during the next round of financing, the noteholders convert the debt into equity, the
derivative financial liabilities will be de-recognized and reclassified to the consolidated statements of stockholders’ (deficit) equity on that date. Derivative instrument liabilities are classified in
the balance sheet as current or non-current based on whether net-cash settlement of the derivative instrument could be required within 12 months of the balance sheet
date.

Debt Discount and Debt Issuance Costs-Debt issuance costs are deferred and presented as a reduction to the
convertible note payable. The initial fair value of the derivative liability on the make-whole premium is treated as a debt discount. Debt discount and debt issuance costs are amortized using the effective interest rate method over the term of the
convertible promissory note.