Company: ZCARW
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001213900-25-076590
Chunk: 223

Company: Zoomcar Holdings, Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 2
Chunk 223
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During the year ended March 31, 2025,
the Company issued shares of Common Stock, pre-funded, Series A and Series B warrants in the November 2024 and December 2024 offering
and as consideration to the placement agents for the issuance. The Common stock and pre-funded warrants were classified as equity in accordance
with ASC 815-40. The Series A warrants and Series B warrants were initially classified as derivative financial instruments in accordance
with ASC 815-10-15-83.

Subsequently, during
the year ended March 31, 2025, the variability in number of warrants exercisable towards Series A and Series B of both the November 2024
and December 2024 offering was fixed in accordance with agreement. Hence, as per ASC 815-10, the outstanding Series A Series B warrants
for both November 2024 and December 2024 offering have been reclassified to equity at the reclassification date fair value.

Warrants exercised before the reclassification
have been reclassified at their respective exercise date fair value and warrants exercised after the reclassification were adjusted with
additional paid in capital.

(b)
Warrants issued along with Redeemable Promissory Note:

During the year ended March 31, 2025,
the Company issued warrants along with Redeemable Promissory Note and as consideration to the placement agent for the issuance of the
Redeemable Promissory Note. These warrants were classified as equity in accordance with ASC 815-40 on the initial recognition.

Fair value measurements and financial instruments

Fair value is defined as the price that would
be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement
date. In accordance with ASC 820, Fair Value Measurement (“ASC 820”), the Company uses the fair value hierarchy, which prioritizes
the inputs used to measure fair value. The hierarchy, as defined below, gives the highest priority to unadjusted quoted prices in active
markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three levels of the fair value hierarchy
are set forth below:

    Level 1
    Observable inputs such as quoted prices in active markets for identical assets or liabilities.

    Level 2
    Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities in active markets, quoted prices in markets that are not active or inputs other than the quoted prices that are observable either directly or indirectly for the