Company: INDP
Filing Date: 2025-08-13
Form Type: 10-Q
Source: 0001641172-25-023333
Chunk: 4

Company: Indaptus Therapeutics, Inc.
Filing Date: 2025-08-13
Form: 10-Q
Item: Part I, Item 8
Chunk 4
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 will be recorded as a prepaid expense, which will be amortized or expensed as the contracted services are performed.

Fair
Value Measurement

ASC
820, Fair Value Measurements, (“ASC 820”) provides guidance on the development and disclosure of fair value measurements.
Under this accounting guidance, fair value is defined as an exit price, representing the amount that would be received to sell an asset
or paid to transfer a liability in an orderly transaction between willing market participants at the measurement date. As such, fair
value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset
or a liability.

The
accounting guidance classifies fair value measurements in one of the following three categories for disclosure purposes:

    Level
    1:
    Quoted
    prices in active markets for identical assets or liabilities.

    Level
    2:
    Inputs
    other than Level 1 prices for similar assets or liabilities that are directly or indirectly observable in the marketplace.

    Level
    3:
    Unobservable
    inputs which are supported by little or no market activity and values determined using pricing models, discounted cash flow methodologies,
    or similar techniques, as well as instruments for which the determination of fair value requires significant judgment or estimation.

The
Company evaluates assets and liabilities subject to fair value measurements on a recurring basis to determine the appropriate level at
which to classify them for each reporting period. This determination requires significant judgments to be made by the Company.

As
of June 30, 2025 and December 31, 2024, the recorded values of cash and cash equivalents, prepaid expenses, accounts payable, and accrued
expenses and other liabilities approximated their fair values due to the short-term nature of these items.

Convertible
notes

The
Company issued convertible notes during the six months ended June 30, 2025 and elected to account for the debt at fair value. Such fair
value measurements are categorized within Level 3 of the fair value hierarchy. The changes in the fair value of the debt are recognized
in other income (expense) for each reporting period. For more details, see Note 7.

    F-7

The
following table summarizes the change in fair value of the Company’s Level 3 liabilities for the three and six months ended June
30, 2025:

 SCHEDULE OF CONVERTIBLE DEBT

    Convertible notes 
  
    Fair value, January 1, 2025 
    $-