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FAIR VALUE MEASUREMENTS
9 Months Ended
Mar. 31, 2024
FAIR VALUE MEASUREMENTS  
FAIR VALUE MEASUREMENTS

NOTE 9 – FAIR VALUE MEASUREMENTS

 

The following table presents the fair value hierarchy for the Company’s assets and liabilities measured at fair value on a recurring basis as of March 31, 2024 and June 30, 2023:

 

 

 

March 31, 2024

 

 

June 30, 2023

 

Description

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Convertible Bridge Loans

 

$

 

 

$

 

 

$

 

 

$

 

 

$

 

 

$247,254

 

 

The fair value of the Convertible Bridge Loans has three components: (i) principal, (ii) interest, and (iii) a redemption feature. The first two components (i.e. principal and interest) were valued using an income approach. For the redemption feature, the Company uses a Black-Scholes Merton (“BSM”) valuation technique because it believes that this technique is reflective of all significant assumption types, and ranges of assumption inputs, that market participants would likely consider in transactions involving this component. Such assumptions include market price, strike price, term, market trading volatility and risk-free rates.

Significant inputs and results arising from the BSM process are as follows for the redemption feature component of the Convertible Bridge Loans:

 

 

 

Inception Dates

 

Quoted market price on valuation date

 

$0.017 - $0.05

 

Effective contractual conversion rates

 

$0.01 - $0.012

 

Contractual term to maturity

 

0.4 -3 year

 

Market volatility:

 

 

 

Volatility

 

115% - 137%

 

Risk-adjusted interest rate

 

4.32% - 5.14%

 

 

The following table summarizes the total carrying value of the Company’s Level 3 instruments held as of March 31, 2024, including cumulative unrealized gains and losses recognized during the period ended March 31, 2024, and the year ended June 30, 2023:

 

 

 

Period Ended

March 31,

 

 

Year Ended

June 30,

 

 

 

2024

 

 

2023

 

Balances at beginning of period

 

$247,254

 

 

$-

 

Issuances:

 

 

 

 

 

 

 

 

Convertible Bridge Loans

 

 

-

 

 

 

189,886

 

Changes in fair value inputs and assumptions reflected in income

 

 

2,448

 

 

 

57,368

 

Reclassified from fair value to straight debt

 

 

(249,702 )

 

 

-

 

Balances at end of period

 

$-

 

 

$247,254