Company: JUNS
Filing Date: 2025-11-26
Form Type: S-1
Source: 0001493152-25-025204
Chunk: 257

Company: JUPITER NEUROSCIENCES, INC.
Filing Date: 2025-11-26
Form: S-1
Chunk 257
---
 the equity issued in the qualified financing. Note III is also convertible upon the completion of an IPO by the Company into shares of common stock equal to 70% of the per share price of the equity issued in connection with the IPO. In both cases the Holder can elect to receive the principal and accrued interest instead of converting the note.

During December 2024, the Company fully repaid the Convertible Debt III pursuant to the terms in the amount of $ 178,386.

| F-15 |

JUPITER NEUROSCIENCES, INC.

NOTES TO FINANCIAL STATEMENTS

December 31, 2024 and 2023

Note 5 – Convertible Debt and Derivative Liability, continued

Summary

During the years ended December 31, 2024 and 2023, $ 147,705and $ 143,761, respectively, are included in interest expense for the combined convertible Notes I, II and III on the accompanying statements of operations. As of December 31, 2024 and 2023 the balance of the combined convertible promissory Note I, II and III was $ 0and $ 1,745,472, respectively, net of the debt discount and loan origination costs of $ 0and $ 43,288, respectively.

Derivative Liability Pursuant to Convertible Debt

In connection with the issuance of the Notes, the Company determined that the terms of Notes contain an embedded conversion option to be accounted for as a derivative liability due to the Holder having the potential to gain value upon IPO. Accordingly, under the provisions of ASC 815-40 – Derivatives and Hedging – Contracts in an Entity’s Own Stock, the embedded conversion option contained in Notes was accounted for as derivative liability and debt discount at the date of issuance and has been adjusted to fair value through earnings at each reporting date. The fair value of the embedded conversion option was determined using the Monte Carlo valuation model.

During the years ended December 31, 2024 and 2023, the derivative liabilities were revalued, and a $ 857,723and $ ( 887,946), respectively, adjustment was recorded as a gain/ (loss) on extinguishment of debt to other expenses reflected in the accompanying statements of operations.

The Company also recorded $( 53,257) and $ 148,751as a (loss) / gain on the change in the fair value of the derivative liability for the years ended December 31, 2024