Note
14 – Fair value measurements
The
fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy requires that the
Company maximize the use of observable inputs and minimize the use of unobservable inputs. The levels of the fair value hierarchy
are described below:
| |
Level
1 — |
Quoted
prices for identical instruments traded in active markets. |
| |
|
|
| |
Level 2
— |
Quoted
prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not
active, and model-based valuation techniques for which all significant assumptions are observable in the market. |
| |
|
|
| |
Level 3 — |
Unobservable
inputs that cannot be supported by market activity and that are significant to the fair
value of the asset, liability, or equity such as the use of certain pricing models, discounted
cash flow models and similar techniques that use significant assumptions. These unobservable
inputs reflect our own estimates of assumptions that market participants would use in
pricing the asset or liability.
|
Fair
Value Measurements on a Recurring Basis
The
Company’s financial assets (liabilities) measured at fair value on a recurring basis are as follows:
Schedule
of fair value of financial assets (liabilities) measured on recurring basis
| | |
| Significant
Other
Observable
Inputs | |
| As
of June 30, 2026 | |
Level 1 | | |
Level 2 | | |
Level 3 | |
| Derivative
asset (see Note 15) | |
$ | 144 | | |
$ | — | | |
$ | — | |
| Accounts
receivable (subject to provisional pricing) | |
| — | | |
| 43 | | |
| — | |
| | |
| Significant
Other
Observable
Inputs | |
| As
of March 31, 2026 | |
Level 1 | | |
Level 2 | | |
Level 3 | |
| Derivative
asset (see Note 15) | |
$ | 1 | | |
$ | — | | |
$ | — | |
| Accounts
receivable (subject to provisional pricing) | |
| — | | |
| 58 | | |
| — | |
| SAFEs
(see Note 11) | |
| — | | |
| — | | |
| (25,210 | ) |
| Conversion
feature of convertible notes (see Note 12) | |
| — | | |
| — | | |
| (26,244 | ) |
The
following table provides a summary of the changes in the fair value of the Company’s Level 3 financial instruments that are measured
at fair value on a recurring basis as of June 30, 2026, and 2025:
| | |
SAFEs | | |
Conversion
feature | |
| Balance
as of April 1, 2026 | |
$ | 25,210 | | |
$ | 26,244 | |
| Proceeds
from issuances of SAFEs | |
| 1,650 | | |
| — | |
| Change
in fair value (gain) loss | |
| 789 | | |
| (2,096 | ) |
| Conversion
of SAFEs into common stock (See Note 11) | |
| (25,821 | ) | |
| — | |
| Settlement
of SAFEs through issuance of promissory note (See Note 11) | |
| (1,828 | ) | |
| — | |
| Conversion
of convertible debt into common stock (See Note 12) | |
| — | | |
| (24,148 | ) |
| Balance
as of June 30, 2026 | |
$ | — | | |
$ | — | |
| | |
| | | |
| | |
Balance
as of April 1, 2025 | |
$ | 19,774 | | |
$ | 25,384 | |
| Proceeds
from issuances of SAFEs | |
| 495 | | |
| — | |
| Change
in fair value | |
| 1,938 | | |
| — | |
| Balance
as of June 30, 2025 | |
$ | 22,207 | | |
$ | 25,384 | |
| | |
| | | |
| | |
The
carrying value of cash & cash equivalents, accounts receivable, accounts payable approximate fair value because of their short-term
nature. Long-term debt includes promissory notes which have a fixed interest rate, so the carrying amount approximates fair value
because interest rates on these instruments approximate the interest rate on debt with similar terms available to us.
There
were no transfers between levels during the three months ended June 30, 2026 and 2025.
|