Company: SHPH
Filing Date: 2025-02-27
Form Type: 424B3
Source: 0001493152-25-008476
Chunk: 82

Company: Shuttle Pharmaceuticals Holdings, Inc.
Filing Date: 2025-02-27
Form: 424B3
Chunk 82
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 effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.

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Critical Accounting Policies and Significant Judgments and Estimates

This discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). The preparation of these consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, as well as the reported expenses incurred during the reporting periods. Our estimates are based on our historical experience and on various other factors that the Company believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. While the significant accounting policies are described in more detail in the notes to the consolidated financial statements included elsewhere in this report, the Company believes that the following accounting policies are critical to understanding our historical and future performance, as these policies relate to the more significant areas involving management’s judgments and estimates.

Our most critical accounting policies and estimates relate to the following:

| ● | Research                                  
 and Development Expenses                  |
| ● | Fair                                      
 Value of Convertible Notes                |
| ● | Fair                                      
 Value of Warrant to Purchase Common Stock |
| ● | Fair                                      
 Value of Derivative Financial Instruments |

Research and Development Expenses

Research and development expenses are expensed as incurred, net of contract expense reimbursements, if applicable. Research and development expenses include, but are not limited to, product development, clinical and regulatory expenses, payroll and other personnel expenses, and are subject to allocation.

Fair Value of Convertible Notes

As permitted under ASC 825, Financial Instruments (“ASC 825”), the Company elected the fair value option to account for the October 2024 Convertible Bridge Notes. The valuation of the October 2024 Convertible Bridge Notes utilizes a Monte Carlo simulation model. Monte Carlo simulation models require the use of simulations that are weighted based on projected future stock prices,
the volatility of a set of guideline companies and significant unobservable inputs including probabilities assigned to not achieving a successful capital raise and a registration of related securities. Each simulation is based on the range of inputs in a scenario with the mean of the output on each simulation calculated as an