Company: JUNS
Filing Date: 2025-08-19
Form Type: 10-Q
Source: 0001641172-25-024684
Chunk: 8

Company: JUPITER NEUROSCIENCES, INC.
Filing Date: 2025-08-19
Form: 10-Q
Item: Item 8
Chunk 8
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. Note II was fully repaid in December 2024 for $2,102,797, which included all outstanding principal and accrued interest.

Convertible
Debt III

In
March 2023, the Company issued a convertible note (“Note III”) with a principal amount of $150,000 in connection with an
investor relations settlement, maturing February 28, 2026 and a compounding 5% annual interest rate. In December 2024, the then outstanding
balance of Note III totaling $178,386 was fully repaid, which included all then outstanding principal and accrued interest.

    14

JUPITER
NEUROSCIENCES, INC.

NOTES
TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE
30, 2025

Note
5 – Convertible Debt and Derivative Liability, continued

Interest

During
the three and six months ended June 30, 2024, interest expense of $37,505 and $44,151, respectively, is included in the accompanying
2024 condensed consolidated statement of operations, related to Notes I, II and III (collectively, the “Notes”), all of which
were paid in full in December 2024.

Embedded Derivative

Based on the terms of the Notes, the Company determined,
at the time of issuance, that the conversion option represented an embedded component of a host instrument, the Notes, and was required
to be accounted for separately as a derivative financial instrument. Accordingly, the Company recorded the value of the embedded conversion
option as a derivative liability with a corresponding discount to the face value of the Notes at the time of issuance. Thereafter, the
derivative liability was measured at fair value, as determined using a Monte Carlo valuation model, at each reporting date and changes
in fair value were recognized through earnings.

During the second quarter of 2024,
the terms of Note II were modified including the terms of the conversion option accounted for as a derivative liability. In
connection therewith, the fair value of the derivative liability was measured based on the modified terms and as a result of that
remeasurement, the Company recorded a gain totaling $951,868,
which is included in other income in the accompanying 2024 statement of operations.

During
the three and six months ended June 30, 2024, the Company recorded a loss totaling $25,431 and $63,142, respectively, relating to the
change in the fair