Company: BIAF
Filing Date: 2025-04-15
Form Type: DRS
Source: 0001641172-25-004915
Chunk: 199

Company: bioAffinity Technologies, Inc.
Filing Date: 2025-04-15
Form: DRS
Chunk 199
---
 FASB accounting standard for such instruments. Under this standard, financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.

The three levels of the hierarchy and the related inputs are as follows:

| Level |     | Inputs                                                                                                     |
| 1     |     | Unadjusted quoted prices in active markets for identical assets and liabilities.                           |
|       |     | Unadjusted                                                                                                 
 quoted prices in active markets for similar assets and liabilities;                                        |
| 2     |     | Unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active; or |
|       |     | Inputs other than quoted prices that are observable for the asset or liability.                            |
| 3     |     | Unobservable inputs for the asset or liability.                                                            |

The estimated fair value of certain financial instruments, including cash and cash equivalents, accounts and other receivables, prepaid and other current assets, accounts payable, accrued expenses, and loan payable, are carried at historical cost basis, which approximates their fair values because of the short-term nature of these instruments.

Note 9. LEASES

The Company has one operating lease for its real estate and office space for the CAP/CLIA laboratory, as well as multiple finance leases for lab equipment in Texas that were acquired through the September 18, 2023 acquisition. Additionally, the Company entered into another operating lease on September 1, 2024 with regard to office space. The Company has operating leases consisting of office space with remaining lease terms ranging from 3.1 to 5.9 years as of December 31, 2024. The Company has finance leases consisting of office and lab equipment with remaining lease terms ranging from approximately 1.25 to 3.0 years as of December 31, 2024, for which the Company has determined that it will use the equipment for a major part of its remaining economic life.

The lease agreements generally do not provide an implicit borrowing rate. Therefore, the Company used a benchmark approach as of the date of inception of the leases to derive an appropriate incremental borrowing rate to discount remaining lease payments. The Company benchmarked itself against other companies of similar credit ratings and comparable quality and derived imputed interest rates ranging from 7.41% to 8.03% for the lease term lengths.

Leases with an initial term of 12 months or less are not recorded on the consolidated balance sheets. There are no material