Company: SHPH
Filing Date: 2025-02-27
Form Type: 424B3
Source: 0001493152-25-008474
Chunk: 109

Company: Shuttle Pharmaceuticals Holdings, Inc.
Filing Date: 2025-02-27
Form: 424B3
Chunk 109
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 notes due in October 2025, with substantially similar terms as the October 14, 2024, issuance. The notes include a 5% original issue discount and the Company received $220,000 in proceeds. The Company also issued warrants to the lenders to purchase an aggregate 88,544 shares of common stock, exercisable at $1.49 per share, with such warrants expiring five years from issuance. Upon completing this issuance, the Company closed the senior secured convertible note offering after receiving a total of $790,000 in proceeds.

After analyzing the terms of the 2024 Convertible Bridge Notes (“Convertible Bridge Notes”) and its embedded features, the Company elected to account for the 2024 Convertible Bridge Notes at fair value under the allowable fair value option election. As such, the Company initially recognized the 2024 Convertible Bridge Notes at their fair value and will subsequently measure the note at fair value with changes in fair value recorded in current period earnings (or other comprehensive income, if specific to Company credit risk). The Company initially recorded the 2024 Convertible Bridge Notes at their estimated issuance date fair value of $806,758. As the fair value of the 2024 Convertible Bridge Notes exceeded the proceeds received, the Company recorded a loss on issuance of convertible notes of $16,758, which is included as a finance fee on the consolidated statement of operations. The proceeds were allocated in full to the 2024 Convertible Bridge Notes recorded at fair value. The warrants issued in connection with the 2024 Convertible Bridge Notes were deemed to be equity instruments. In addition, the Company allocated the issuance costs incurred to these instruments to the 2024 Convertible Bridge Notes and as such, expensed $107,491 in issuance costs during the year ended December 31, 2024, including $41,579 of original issue discount on the 2024 Convertible Bridge Notes.

The Company used a Monte Carlo simulation model to calculate the fair value of the 2024 Convertible Bridge Notes and the related warrants as of the issuance date and for the 2024 Convertible Bridge Notes as of December 31, 2024. These financial instruments were classified within Level 3 of the fair value hierarchy at the initial measurement date, due to the use of unobservable inputs. The key inputs into the model were as follows at issuance and December 31, 2024:

Schedule of Key Inputs of Convertible Bridge Note

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