Company: SHPH
Filing Date: 2025-02-26
Form Type: 10-K
Source: 0001493152-25-008300
Chunk: 421

Company: Shuttle Pharmaceuticals Holdings, Inc.
Filing Date: 2025-02-26
Form: 10-K
Item: Item 1B
Chunk 421
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000 of Units, SRO LLC will
own a 22% interest in Diagnostics. The Company filed an initial registration statement on Form S-1 (the “Form S-1”) with
the SEC in April 2024 related to the registration of subscription rights to purchase the Units to be sold in the Rights Offering. The
Company incurred $142,000 of costs which were expensed during the year ended December 31, 2024 due to delays in consummating the Rights
Offering. In January 2025, the Company withdrew the registration statement on Form S-1 for this offering. The registration statement
was never effective and no securities were issued pursuant to the registration statement.

Note
7 – Derivative Liabilities

Fair
Value Assumptions Used in Accounting for Derivative Liabilities

ASC
815 requires the Company to assess the fair market value of derivative liabilities at the end of each reporting period and recognize
any change in the fair market value as other income or expense.

In
October 2024, in connection with the Equity Financing, the Company issued warrants to purchase 2,950,820 shares of common stock, with
an exercise price of $1.40 per share, valued at inception at $0.2 million and as of December 31, 2024, at less than $0.1 million. The
Company determined that the derivative liabilities from the warrants issued in relation to the October 2024 Equity Financing did not
qualify for classification as equity instruments as they did not meet the requirements to be considered indexed to the Company’s
own stock, due to potential variability in the settlement amount upon a fundamental transaction, as defined.

In
January 2023, in connection with the Alto Convertible Note, the Company issued warrants to purchase 127,260 shares of common stock, with
an exercise price of $0.48 per share, as adjusted, valued at inception at $1.2 million and as of December 31, 2024, at less than $0.1
million. The Company determined that the derivative liabilities from the warrants issued in relation to the Alto Convertible Note did
not qualify for classification as equity instruments due to the existence of certain net cash settlement provisions that are not within
the sole control of the Company. In addition, there are certain down round provisions that could reduce the exercise price if the Company
issues securities at lower prices in the future.

The
Company has determined the Acceleration Option in the