Company: ZVRA
Filing Date: 2025-08-12
Form Type: 10-Q
Source: 0001628280-25-039967
Chunk: 132

Company: ZEVRA THERAPEUTICS, INC.
Filing Date: 2025-08-12
Form: 10-Q
Item: Part I, Item 8
Chunk 132
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 model. The following assumptions were used in determining the fair value of the warrant liabilities valued using the BSM option pricing model as of June 30, 2025, and December 31, 2024:June 30, 2025December 31, 2024Risk-free interest rate3.63% - 4.18%4.08% - 4.23%Volatility44.10% - 59.83% 62.14% - 68.68%Dividend yield— %— %Expected term (years)0.53 - 3.401.02 - 3.89Weighted average fair value$2.88 $3.25 The following table is a reconciliation for the common stock warrant liabilities measured at fair value using Level 3 unobservable inputs (in thousands):Balance as of December 31, 2024$17,804 Change in fair value measurement of warrant liabilities(1,997)Balance as of June 30, 2025$15,807 For the six months ended June 30, 2025, the changes in fair value of the warrant liabilities primarily resulted from changes in the discount rate.Contingent ConsiderationContingent consideration liabilities relate to the Company's liabilities arising in connection with the CVRs issued as a result of the Merger. The contingent consideration is classified as Level 3 in the fair value hierarchy. The fair value is measured based on a Monte Carlo simulation or a scenario-based method, depending on the earn-out achievement objectives, utilizing projections about future performance. Significant inputs include volatility and projected financial information, including projections representative of a market participant's view of the expected cash payments associated with the agreed upon regulatory milestones based on probabilities of technical success, timing of the potential milestone events for the compounds, and estimated discount rates.The following table provides a reconciliation of the beginning and ending balances related to the contingent consideration liabilities for the CVRs (dollars in thousands):Balance as of December 31, 2024$3,500 Change in fair value measurement of contingent consideration liabilities(2,130)Balance as of June 30, 2025$1,370 For the six months ended June 30, 2025, the changes in fair value of contingent consideration primarily resulted from changes in market data and revenue projections.

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J.    Net Income (Loss) Per Share

The two-class method requires earnings for the period to be allocated between common stock and participating