Company: SHPH
Filing Date: 2025-02-26
Form Type: 10-K
Source: 0001493152-25-008300
Chunk: 955

Company: Shuttle Pharmaceuticals Holdings, Inc.
Filing Date: 2025-02-26
Form: 10-K
Item: Item 5
Chunk 955
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 its long-lived assets for impairment whenever events or changes in business circumstances indicate that the carrying
amount of the asset may not be fully recoverable. Recoverability of assets is measured by a comparison of the carrying amount of an asset
to the estimated undiscounted cash flows expected to be generated by the asset. If the carrying amount of the asset exceeds its estimated
future cash flows, an impairment charge will be recognized in the amount by which the carrying amount of the asset exceeds the fair value
of the asset. There were no impairments of long-lived assets during the periods presented.

Stock-Based
Compensation

Compensation
cost for stock awards, which include restricted stock units (“RSUs”), is measured at the fair value on the grant date and
recognized as expense, over the related service period. The fair value of stock awards is based on the quoted price of
our common stock on the grant date. Compensation expense related to the RSUs is reduced by the fair value of the units that are forfeited
by employees that leave the Company prior to vesting as they occur. Compensation cost for RSUs is recognized using the straight-line
method over the requisite service period.

Research
and Development Expenses

Research
and development expenses are charged to expense as incurred. Research and development expenses include, but are not limited to, product
development, clinical and regulatory expenses, payroll and other personnel expenses, which include a certain portion of the Company’s
chief executive officer, chief operating officer, vice president regulatory (formerly the chief financial officer) and directors’
compensation. For the year ended December 31, 2024 and 2023, a portion of personnel-related expenses and stock-based compensation expense
for these individuals totaling $0.5 million and $0.8 million, respectively, was included within research and development due to their
active involvement in the research and development activities, materials, supplies, related subcontract expenses, and consulting costs.

Regarding
the accounting treatment for reimbursements, GAAP provides limited guidance on the accounting for government grants received by for-profit
companies. In accordance with ASC Topic 832, Government Assistance, as adopted January 1, 2022, the Company discloses certain
types of government assistance received in the notes to the consolidated financial statements that includes: a) the nature of the transaction
including the nature of the assistance being given, b) the accounting policies being used to account for the transaction and c) other
provisions of relevance, where required. Depending on the type of