Company: INDP
Filing Date: 2025-03-13
Form Type: 10-K
Source: 0001493152-25-010136
Chunk: 338

Company: Indaptus Therapeutics, Inc.
Filing Date: 2025-03-13
Form: 10-K
Item: Item 1B
Chunk 338
---
 and the price volatility of the underlying stock. The Company estimates the fair value
of options granted by using the Black-Scholes model with the following assumptions:

Expected
Volatility—The Company estimates volatility for option grants by evaluating the historical volatility of a peer group of companies
for the period immediately preceding the option grant for a term that is approximately equal to the options’ expected term.

    F-9

Expected
Term—The expected term of the Company’s options represents the period that the stock-based payment awards are expected
to be outstanding. The expected term is estimated using the simplified method for employee stock options since the Company does not have
adequate historical exercise data to estimate the expected term.

Risk-Free
Interest Rate—The risk-free interest rate is based on the implied yield currently available on U.S. Treasury zero-coupon issues
with a term that is equal to the options’ expected term at the grant date.

Dividend
Yield—The Company has not declared or paid dividends to date and does not anticipate declaring dividends. As such, the dividend
yield has been estimated to be zero.

The
Company has elected to recognize forfeitures as they occur.

Fair
value measurements

Fair
value is defined as the exchange price that would be received for an asset or an exit price that would be paid to transfer a liability
in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the
measurement date. The Company follows the established framework for measuring fair value and providing disclosures about fair value measurements.

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.

ASC
820, Fair Value Measurement, requires all entities to disclose the fair value of financial instruments, both assets and liabilities,
for which it is practicable to estimate fair value, and defines the fair value of a financial instrument as the amount at which the instrument
could be exchanged in a current transaction between willing parties. As of December 31,