Company: JUNS
Filing Date: 2025-03-28
Form Type: 10-K
Source: 0001641172-25-001261
Chunk: 377

Company: JUPITER NEUROSCIENCES, INC.
Filing Date: 2025-03-28
Form: 10-K
Item: Item 10
Chunk 377
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3, the Company’s executives agreed to reduce their
salaries by 80% until an initial public offering to limit the Company’s compensation expenses. During December 2024, the
Company returned to paying salaries due to the completion of the initial public offering. See Note 3 – Related Party
Transactions for details related to forgiveness of accrued compensation.

Note
5 – Convertible Debt and Derivative Liability

Convertible
Debt I

Between
August and December 2021, the Company executed twelve convertible promissory notes (“Notes I”) for $527,650 in proceeds with
a maturity date of July 31, 2022, and interest rate of 1%. The Notes I will automatically convert into equity securities on the first
business day following effectiveness of an initial public offering of common stock with the Securities and Exchange Commission (“IPO”).
Upon IPO, the outstanding principle of the Notes I and all unpaid accrued interest will automatically convert into a number of restricted
fully paid and non-assessable shares of common stock, or units of common stock and warrants to purchase common stock if units are offered
to the public in the IPO, equal to the indebtedness divided by 70% of the offering price paid per share at which the IPO is made. For
the avoidance of doubt, in the event the IPO is not declared effective prior to the maturity date, none of the indebtedness shall convert
or be convertible into shares of Common Stock.

At
the time of execution, the Company recorded a debt discount of $257,650 based on the fair value of the embedded conversion feature of
Notes I, which was amortized into interest expense over term of Notes I, each with a maturity date of July 31, 2022. On August 6, 2022,
the Notes I were amended to extend the maturity date to January 31, 2023, and increase the interest rate to 5%. All other terms remain
the same as previously stated in Notes I. The impact of the amendment is prospective and increased accrued interest by $23,072 and is
included in accrued interest on the accompanying balance sheet. On February 2, 2023, the Notes I were amended to extend the maturity
date to December 31, 2023. During January 31, 2024, the Company and all Note I holders agreed to amend and extend the maturity date of
their notes to December 31, 2024. The holders waived any default under the original notes