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FAIR VALUE OF FINANCIAL INSTRUMENTS
 6 Months Ended
Jun. 30, 2025
Fair Value Disclosures [Abstract]  
FAIR VALUE OF FINANCIAL INSTRUMENTS

6. FAIR VALUE OF FINANCIAL INSTRUMENTS

 

The following table sets forth the Company’s financial instruments that were measured at fair value on a recurring basis by level within the fair value hierarchy at June 30, 2025 (no material financial instruments were measured at fair value on a recurring basis at December 31, 2024):

                
   Fair Value Measurement at June 30, 2025 
   Total   Level 1   Level 2   Level 3 
Embedded conversion feature liabilities  $3,531,000   $-   $-   $3,531,000 

 

The Company assesses the inputs used to measure fair value using the three-tier hierarchy based on the extent to which inputs used in measuring fair value are observable in the market. For investments where little or no public market exists, management’s determination of fair value is based on the best available information which may incorporate management’s own assumptions and involves a significant degree of judgment, taking into consideration various factors including earnings history, financial condition, recent sales prices of the issuer’s securities and liquidity risks.

 

The changes in Level 3 fair value hierarchy during the three and six months ended June 30, 2025 and 2024 were as follows:

                         
   Level 3 Balance at
Beginning of
Period		   Fair Value
Adjustments		   Sales and
Settlement		   Grants   Level 3 Balance
at End of Period		 
Six months ended June 30, 2025                         
Embedded conversion feature liabilities  $-   $662,000   $(1,274,000)  $4,143,000   $3,531,000 
                          
   Level 3 Balance
at Beginning of
Period 		   Fair Value
Adjustments 		   Sales and
Settlement		   Grants    Level 3 Balance
at End of Period 		 
Six months ended June 30, 2024                         
Warrant liabilities  $-   $(99,000)  $-   $677,000   $578,000 
Embedded conversion feature liabilities  $910,000   $(755,000)  $-   $-   $155,000 
                          
   Level 3 Balance
at Beginning of
Period 		   Fair Value
Adjustments 		   Sales and
Settlement		   Grants    Level 3 Balance
at End of Period 		 
Three months ended June 30, 2025                         
Embedded conversion feature liabilities  $2,269,000   $662,000   $(1,274,000)  $1,874,000   $3,531,000 
                          
   Level 3 Balance
at Beginning of
Period 		   Fair Value
Adjustments 		   Sales and
Settlement		   Grants    Level 3 Balance
at End of Period 		 
Three months ended June 30, 2024                         
Warrant liabilities  $560,000   $18,000   $-   $-   $578,000 
Embedded conversion feature liabilities  $155,000   $-   $-   $-   $155,000