Company: APM
Filing Date: 2025-07-15
Form Type: DRS
Source: 0001213900-25-063906
Chunk: 451

Company: Aptorum Group Ltd
Filing Date: 2025-07-15
Form: DRS
Chunk 451
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 -40are reclassified to a liability account at the fair value of the instrument on the reclassification date. The Company has no financial instruments meeting the criteria for derivative accounting as of May 31, 2024 and 2023. Stock Based Compensation The Company accounts for share -basedcompensation arrangements with employees and non -employeesusing a fair value method which requires the recognition of compensation expense for costs related to all share -basedpayments including share options. The fair value method requires the Company to estimate the fair value of share -basedpayment awards on the date of grant using an option -pricingmodel. The Company uses the Black -Scholesoption -pricingmodel to estimate the fair value of options granted that are expensed on a straight -linebasis over the requisite service period, which is generally the vesting period. The Company accounts for forfeitures as they occur. Leases The Company accounts for its operating leases under ASC 842, Leases. Accordingly, the Company determines whether a contract is, or contains, a lease at inception. Right -of -useassets represent the Company’s right to use an underlying asset during the lease term, and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Right -of -useassets and lease liabilities are recognized at lease commencement based upon the estimated present value of unpaid lease payments over the lease term. The Company uses its incremental borrowing rate based on the information available at lease commencement in determining the present value of unpaid lease payments. Convertible Notes Payable Debt issuance costs and discounts (premiums) related to notes payable are reported as direct deductions (increases) to the outstanding debt and amortized over the term of the debt using the effective interest method as an addition (reduction) to interest expense. In August 2020, the FASB issued ASU No. 2020 -06, Debt — Debt with Conversion and Other Options (Subtopic 470 -20 ) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815 -40 ) — “Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity”, which simplifies the accounting for convertible instruments by removing major separation models currently required. Consequently, more convertible debt instruments will be reported as a single liability instrument with no separate accounting for embedded conversion features. ASU 2020 -06removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception, which will permit more equity contracts to qualify for it.