3. FINANCIAL INSTRUMENTS

 

Assets and liabilities recorded at fair value on a recurring basis in the Condensed Consolidated Balance Sheets and assets and liabilities measured at fair value on a non-recurring basis or disclosed at fair value, are categorized based upon the level of judgment associated with inputs used to measure their fair values. The accounting guidance for fair value provides a framework for measuring fair value and requires certain disclosures about how fair value is determined. Fair value is defined as the price that would be received upon the sale of an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. The accounting guidance also establishes a three-level valuation hierarchy that prioritizes the inputs to valuation techniques used to measure fair value based upon whether such inputs are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions made by the reporting entity. The three-level hierarchy for the inputs to valuation techniques is briefly summarized as follows:

 

Level 1-Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date;

 

Level 2-Inputs are observable, unadjusted quoted prices in active markets for similar assets or liabilities, unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities; and

 

Level 3-Unobservable inputs that are significant to the measurement of the fair value of the assets or liabilities that are supported by little or no market data.

 

The following table shows the Company’s short-term investments by significant investment category as of June 30, 2026, and December 31, 2025.

 

	As of June 30, 2026
		Adjusted Cost				Unrealized Gains				Unrealized Losses				Market Value
Level 1:	$				$				$				$
Money Market Funds	$	641			$	-			$	-			$	641
Total financial assets	$	641			$	-			$	-			$	641

 

	As of December 31, 2025
		Adjusted Cost				Unrealized Gains				Unrealized Losses				Market Value
Level 1:	$				$				$				$
Money Market Funds	$	639			$	-			$	-			$	639
Total financial assets	$	639			$	-			$	-			$	639

 

As of June 30, 2026 and December 31, 2025, the Company has no warrant liabilities. All outstanding warrants are classified within permanent equity following amendments completed on June 30, 2025. Refer to Note 8 for further discussion. Other financial instruments, including accounts receivable, accounts payable, accrued liabilities and customer deposits, are carried at cost which approximates fair value due to their short-term nature.