NIOCORP DEVELOPMENTS LTD 10-Q

ITEM 1. FINANCIAL STATEMENTS Contents Page Condensed consolidated balance sheets as of March 31, 2022 and June 30, 2021 (unaudited) 2 Condensed consolidated statements of operations and comprehensive loss for the three and nine months ended March 31, 2022 and 2021 (unaudited) 3 Condensed consolidated statements of cash flows for the nine months ended March 31, 2022 and 2021 (unaudited) 4 Condensed consolidated statements of shareholders’ equity for the three and nine months ended March 31, 2022 and 2021 (unaudited) 5 Notes to condensed consolidated financial statements (unaudited) 6 – 12 1 NioCorp Developments Ltd. Condensed Consolidated Balance Sheets (expressed in thousands of U.S. dollars, except share data) (unaudited) As of Note March 31, 2022 June 30, 2021 ASSETS Current Cash $ 3,464 $ 7,317 Prepaid expenses and other 541 24 Total current assets 4,005 7,341 Non-current Deposits 35 35 Investment in equity securities 10 16 Right-of-use assets 110 156 Land and buildings, net 851 837 Mineral interests 16,085 16,085 Total assets $ 21,096 $ 24,470 LIABILITIES Current Accounts payable and accrued liabilities 4 $ 720 $ 408 Related party loan 7 2,000 2,318 Convertible debt 5 2,585 1,123 Operating lease liability 9 79 69 Total current liabilities 5,384 3,918 Non-current Convertible debt, net of current 5 - 6,784 Operating lease liability 9 44 105 Total liabilities 5,428 10,807 SHAREHOLDERS’ EQUITY Common shares, unlimited shares authorized; shares outstanding: 268,083,716 at March 31, 2022 and 256,379,931 at June 30, 2021 6 123,045 113,882 Accumulated deficit ( 106,310 ) ( 99,076 ) Accumulated other comprehensive loss ( 1,067 ) ( 1,143 ) Total shareholders’ equity 15,668 13,663 Total liabilities and equity $ 21,096 $ 24,470 The accompanying notes are an integral part of these condensed consolidated financial statements. 2 NioCorp Developments Ltd. Condensed Consolidated Statements of Operations and Comprehensive Loss (expressed in thousands of U.S. dollars, except share and per share data) (unaudited) For the three months ended March 31, For the nine months ended March 31, Note 2022 2021 2022 2021 Operating expenses Employee related costs $ 308 $ 327 $ 1,859 $ 1,332 Professional fees 16 83 530 276 Exploration expenditures 8 845 297 1,957 711 Other operating expenses 217 138 1,324 802 Total operating expenses 1,386 845 5,670 3,121 Other income - ( 22 ) - ( 208 ) Loss on debt extinguishment - - - 163 Change in financial instrument fair value - ( 60 ) - ( 32 ) Foreign exchange (gain) loss ( 48 ) ( 94 ) 101 ( 497 ) Interest expense 477 354 1,457 612 Other loss (gain) on equity securities 1 ( 10 ) 6 ( 12 ) Loss before income taxes 1,816 1,013 7,234 3,147 Income tax benefit - - - - Net loss 3 $ 1,816 $ 1,013 $ 7,234 $ 3,147 Other comprehensive loss: Net loss $ 1,816 $ 1,013 $ 7,234 $ 3,147 Other comprehensive loss (gain): Reporting currency translation 18 93 ( 76 ) 480 Total comprehensive loss $ 1,834 $ 1,106 $ 7,158 $ 3,627 Loss per common share, basic and diluted $ 0.01 $ 0.00 $ 0.03 $ 0.01 Weighted average common shares outstanding 265,764,404 241,931,563 261,729,813 239,283,205 The accompanying notes are an integral part of these condensed consolidated financial statements. 3 NioCorp Developments Ltd. Condensed Consolidated Statements of Cash Flows (expressed in thousands of U.S. dollars) (unaudited) For the nine months ended March 31, 2022 2021 CASH FLOWS FROM OPERATING ACTIVITIES Net loss for the period $ ( 7,234 ) $ ( 3,147 ) Adjustments to reconcile net loss to net cash used in operations: Change in financial instrument fair value - ( 32 ) Unrealized loss (gain) on equity securities 6 ( 12 ) Accretion of convertible debt 1,300 219 Noncash lease expense ( 5 ) 10 Depreciation 2 - Gain on debt forgiveness - ( 196 ) Loss on debt extinguishment - 163 Foreign exchange loss (gain) 151 ( 453 ) Share-based compensation 1,568 797 total ( 4,212 ) ( 2,651 ) Change in working capital items: Prepaid expenses and other ( 516 ) 9 Accounts payable and accrued liabilities 314 ( 1,006 ) Net cash used in operating activities ( 4,414 ) ( 3,648 ) CASH FLOWS FROM INVESTING ACTIVITIES Acquisition of land and buildings ( 16 ) - Net cash used in financing activities ( 16 ) - CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issuance of common shares 973 2,847 Loan repayments - ( 406 ) Share issuance costs - ( 1 ) Proceeds from debt issuance, net of expenses - 9,477 Related party debt repayments ( 318 ) - Net cash provided by financing activities 655 11,917 Exchange rate effect on cash and cash equivalents ( 78 ) 50 Change in cash and cash equivalents during period ( 3,853 ) 8,319 Cash and cash equivalents, beginning of period 7,317 307 Cash and cash equivalent, end of period $ 3,464 $ 8,626 Supplemental cash flow information: Amounts paid for interest $ 40 $ 734 Amounts paid for income taxes - - Non-cash financing transactions: Conversions of debt for common shares $ 6,622 $ 1,256 Recognition of operating lease liabilities - 231 Loan amounts forgiven - 196 Accounts payable to convertible debt conversion - 1,640 The accompanying notes are an integral part of these condensed consolidated financial statements. 4 NioCorp Developments Ltd. Condensed Consolidated Statements of Shareholders’ Equity (expressed in thousands of U.S. dollars, except for Common Shares outstanding) (unaudited) For the nine months ended March 31, 2022 and 2021 Common Shares Outstanding Common Shares Accumulated Deficit Accumulated Other Comprehensive Loss Total Balance, June 30, 2020 235,925,684 $ 97,682 $ ( 94,686 ) $ ( 355 ) $ 2,641 Exercise of warrants 4,732,261 2,633 - - 2,633 Exercise of options 2,942,177 215 - - 215 Fair value of warrant granted - 1,775 - - 1,775 Debt conversions 1,945,465 1,256 - - 1,256 Share issuance costs - ( 1 ) - - ( 1 ) Share-based compensation - 797 - - 797 Reporting currency presentation - - - ( 480 ) ( 480 ) Loss for the period - - ( 3,147 ) - ( 3,147 ) Balance, March 31, 2021 245,545,587 $ 104,357 $ ( 97,833 ) $ ( 835 ) $ 5,689 Balance, June 30, 2021 256,379,931 $ 113,882 $ ( 99,076 ) $ ( 1,143 ) $ 13,663 Exercise of warrants 871,750 543 - - 543 Exercise of options 1,926,533 430 - - 430 Debt conversions 8,905,502 6,622 - - 6,622 Share-based compensation - 1,568 - - 1,568 Reporting currency presentation - - - 76 76 Loss for the period - - ( 7,234 ) - ( 7,234 ) Balance, March 31, 2022 268,083,716 $ 123,045 $ ( 106,310 ) $ ( 1,067 ) $ 15,668 For the three months ended March 31, 2022 and 2021 Common Shares Outstanding Common Shares Accumulated Deficit Accumulated Other Comprehensive Loss Total Balance, December 31, 2020 240,110,267 $ 100,683 $ ( 96,820 ) $ ( 742 ) $ 3,121 Exercise of warrants 1,954,839 1,138 - - 1,138 Exercise of options 2,503,560 74 - - 74 Fair value of warrant granted - 1,712 - - 1,712 Debt conversions 976,921 750 - - 750 Share-based compensation - - - - - Reporting currency presentation - - - ( 93 ) ( 93 ) Loss for the period - - ( 1,013 ) - ( 1,013 ) Balance, March 31, 2021 245,545,587 $ 104,357 $ ( 97,833 ) $ ( 835 ) $ 5,689 Balance, December 31, 2021 264,026,990 $ 120,935 $ ( 104,494 ) $ ( 1,049 ) $ 15,392 Exercise of options 906,917 10 - - 10 Debt conversions 3,149,809 2,100 - - 2,100 Share-based compensation - - - - - Reporting currency presentation - - - ( 18 ) ( 18 ) Loss for the period - - ( 1,816 ) - ( 1,816 ) Balance, March 31, 2022 268,083,716 $ 123,045 $ ( 106,310 ) $ ( 1,067 ) $ 15,668 The accompanying notes are an integral part of these condensed consolidated financial statements. 5 NioCorp Developments Ltd. Notes to the Condensed Consolidated Financial Statements March 31, 2022 (expressed in thousands of U.S. dollars, except per share amounts or as otherwise stated) (unaudited) 1. DESCRIPTION OF BUSINESS NioCorp Developments Ltd. (“NioCorp” or the “Company”) was incorporated on February 27, 1987, under the laws of the Province of British Columbia and currently operates in one reportable operating segment consisting of exploration and development of mineral deposits in North America, specifically, the Elk Creek Niobium/Scandium/Titanium property (the “Elk Creek Project”) located in southeastern Nebraska. These financial statements have been prepared on a going concern basis that contemplates the realization of assets and discharge of liabilities at their carrying values in the normal course of business for the foreseeable future. These financial statements do not reflect any adjustments that may be necessary if the Company is unable to continue as a going concern. The Company currently earns no operating revenues and will require additional capital in order to advance the Elk Creek Project to construction and commercial operation. As further discussed in Note 3, the Company’s ability to continue as a going concern is uncertain and is dependent upon obtaining sufficient financing, the generation of profits from mineral properties, and maintaining continued support from its shareholders and creditors. 2. BASIS OF PREPARATION a) Basis of Preparation and Consolidation The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles of the United States of America (“US GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”). The interim condensed consolidated financial statements include the consolidated accounts of the Company and its wholly owned subsidiaries with all significant intercompany transactions eliminated. The accounting policies followed in preparing these interim condensed consolidated financial statements are those used by the Company as set out in the audited consolidated financial statements for the year ended June 30, 2021. In the opinion of management, all adjustments considered necessary (including reclassifications and normal recurring adjustments) to present fairly the financial position, results of operations, and cash flows at March 31, 2022, and for all periods presented, have been included in these interim condensed consolidated financial statements. Certain information and footnote disclosures normally included in the consolidated financial statements prepared in accordance with US GAAP have been condensed or omitted pursuant to appropriate SEC rules and regulations. These interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the year ended June 30, 2021. The interim results are not necessarily indicative of results for the full year ending June 30, 2022, or future operating periods. b) Recent Accounting Standards Issued and Adopted In December 2019, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes” (“ASU 2019-12”). ASU 2019-12 removes certain exceptions to the general principles in ASC Topic 740. ASU 2019-12 is effective for public entities for fiscal years beginning after December 15, 2020, with early adoption permitted. The Company adopted ASU 2019-12 on July 1, 2021, with no material effect on the Company’ s current financial position, results of operations or financial statement disclosures. Issued and Not Effective In August 2020, the FASB issued ASU No. 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”), which simplifies the accounting for convertible instruments. ASU 2020-06 removes certain accounting models which separate the embedded conversion features from the host contract for convertible instruments. Either a modified retrospective method of transition or a fully retrospective method of transition is permissible for the adoption of this standard. ASU 2020-06 is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. The Company is currently evaluating the potential impact of the new guidance on our financial statements. 6 NioCorp Developments Ltd. Notes to the Condensed Consolidated Financial Statements March 31, 2022 (expressed in thousands of U.S. dollars, except per share amounts or as otherwise stated) (unaudited) From time to time, new accounting pronouncements are issued by the FASB that are adopted by the Company as of the specified effective date. Unless otherwise discussed, management believes that the impact of recently issued standards did not or will not have a material impact on the Company’s consolidated financial statements upon adoption. c) Use of Estimates The preparation of consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to the deferred income tax asset valuations, convertible debt valuations, and share-based compensation. The Company bases its estimates and assumptions on current facts, historical experience, and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between estimates and the actual results, future results of operations will be affected. d) Basic and Diluted Earnings per Share Basic net loss per share is computed by dividing net loss by the weighted average number of Common Shares outstanding during the period. Diluted net loss per share is computed by dividing the net loss by the weighted-average number of Common Share equivalents outstanding for the period determined using the treasury stock method or the if-converted method, as applicable. For purposes of this calculation, options to purchase Common Shares (“Options”) and warrants to purchase Common Shares (“Warrants”) are considered to be Common Share equivalents and are only included in the calculation of diluted net loss per share when their effect is dilutive. The following shares underlying Options, Warrants, and outstanding convertible debt were antidilutive due to a net loss in the periods presented and, therefore, were excluded from the dilutive securities computation for the three and nine months ended March 31, 2022 and 2021, as indicated below. Schedule of excluded from the dilutive securities As of March 31, Excluded potentially dilutive securities (1) : 2022 2021 Options 14,089,000 15,990,000 Warrants 13,470,118 14,303,772 Convertible debt 6,329,000 15,084,450 Total potential dilutive securities 33,888,118 45,378,222 ( 1 ) The number of shares is based on the maximum number of shares issuable on exercise or conversion of the related securities as of the period end. Such amounts have not been adjusted for the treasury stock method or weighted average outstanding calculations as required if the securities were dilutive. 3. GOING CONCERN ISSUES The Company incurred a loss of $ 7,234 for the nine months ended March 31, 2022 (2021 - $ 3,147 ) and had a working capital deficit of $ 1,379 and an accumulated deficit of $ 106,310 as of March 31, 2022. As an exploration stage entity, the Company has not yet commenced its mining operations and accordingly does not generate any revenue. As of March 31, 2022, the Company had cash of $ 3,464 , which may not be sufficient to fund normal operations and meet debt obligations for the next twelve months without deferring payment on certain current liabilities and raising additional funds. In addition, the Company will be required to raise additional funds for construction and commencement of operations. These factors raise substantial doubt about the Company’s ability to continue as a going concern. 7 NioCorp Developments Ltd. Notes to the Condensed Consolidated Financial Statements March 31, 2022 (expressed in thousands of U.S. dollars, except per share amounts or as otherwise stated) (unaudited) The Company’s ability to continue operations and fund its expenditures, which have historically averaged approximately $1,118 per quarter, is dependent on management’s ability to secure additional financing. Management is actively pursuing additional sources of financing, and while it has been successful in doing so in the past, there can be no assurance it will be able to do so in the future. The Company did not have any further funding commitments or arrangements for additional financing as of March 31, 2022. These consolidated financial statements do not give effect to any adjustments required to realize the Company’s assets and discharge its liabilities in other than the normal course of business and at amounts different from those reflected in the accompanying financial statements. Since March 2020, several measures have been implemented in the United States, Canada, and the rest of the world in response to the increased impact from the novel coronavirus (“COVID-19”) pandemic. The full extent to which the COVID-19 pandemic and our precautionary measures may continue to impact our business will depend on future developments, which continue to be highly uncertain and cannot be predicted at this time, including, but not limited to, the duration and geographic spread of the pandemic, its severity, the actions to contain the virus or treat its impact, future spikes of COVID-19 infections resulting in additional preventative measures to contain or mitigate the spread of the virus, the effectiveness, distribution and acceptance of COVID-19 vaccines, including the vaccines’ efficacy against emerging COVID-19 variants, and how quickly and to what extent normal economic and operating conditions can resume. We believe this could have an adverse impact on our ability to obtain financing, development plans, results of operations, financial position, and cash flows during the current fiscal year. 4. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES Schedule of account payable and accrued liabilities As of Note March 31, 2022 June 30, 2021 Accounts payable, trade $ 59 $ 163 Interest payable to related party 7 158 40 Other accruals 503 205 Total accounts payable and accrued liabilities $ 720 $ 408 5. CONVERTIBLE DEBT Schedule of convertible debt As of March 31, 2022 June 30, 2021 Current portion Lind III convertible security $ 2,585 $ - Nordmin note - 1,123 2,585 1,123 Non-current portion Lind III convertible security $ - $ 6,784 8 NioCorp Developments Ltd. Notes to the Condensed Consolidated Financial Statements March 31, 2022 (expressed in thousands of U.S. dollars, except per share amounts or as otherwise stated) (unaudited) Changes in the convertible security (the “Lind III Convertible Security”) issued to Lind Global Asset Management III, LLC, and the convertible note issued to Nordmin Engineering Ltd. (the “Nordmin Note”), are as follows: Lind III Convertible Security Nordmin Note Balance, June 30, 2021 $ 6,784 $ 1,123 Accretion expense 1,251 49 Conversions ( 5,450 ) ( 1,172 ) Balance, March 31, 2022 $ 2,585 $ - Based on the Company’s closing Common Share price of C$1.08 as of March 31, 2022, conversion of the remaining Lind III Convertible Security balance, including accrued interest, would require the issuance of approximately 6,329,000 Common Shares. For each C$ 0.01 change in the fair value of one Common Share, the total Common Shares the Company would be obligated to issue would change by approximately 59,000 shares . 6. COMMON SHARES a) Stock Options Schedule of stock option Number of Options Weighted Average Exercise Price Balance, June 30, 2021 15,965,000 C$ 0.65 Granted 3,975,000 1.36 Exercised ( 1,926,533 ) 0.71 Cancelled/expired ( 3,924,467 ) 0.77 Balance, March 31, 2022 14,089,000 C$ 0.81 On December 17, 2021, the Company granted 3,975,000 options to purchase Common Shares (“Options”) at a fair value price of $C0.50 per Option, based on Black-Scholes models with an average risk-free rate of 1.18%, average share price volatility of 53.9%, and a three-year expected option life. The following table summarizes information about Options outstanding at March 31, 2022: Exercise Price Expiry Date Number Outstanding Aggregate Intrinsic Value Number Exercisable Aggregate Intrinsic Value C$ 0.47 November 9, 2022 2,804,000 1,710 2,804,000 1,710 C$ 0.84 September 18, 2023 1,050,000 252 1,050,000 252 C$ 0.54 November 15, 2023 3,910,000 2,111 3,910,000 2,111 C$ 0.75 December 14, 2023 1,825,000 602 1,825,000 602 C$ 0.75 December 16, 2023 525,000 173 525,000 173 C$ 1.36 December 17, 2024 3,975,000 - 3,975,000 - 14,089,000 C$ 4,848 14,089,000 C$ 4,848 The aggregate intrinsic value in the preceding table represents the total intrinsic value, based on the Company’s closing Common Share price of C$1.08 as of March 31, 2022, that would have been received by the Option holders had all Option holders exercised their Options as of that date. There were 10,114,000 in-the-money Options vested and exercisable as of March 31, 2022. As of March 31, 2022, there was $0 of unrecognized compensation cost related to unvested share-based compensation arrangements granted under the Option plans. 9 NioCorp Developments Ltd. Notes to the Condensed Consolidated Financial Statements March 31, 2022 (expressed in thousands of U.S. dollars, except per share amounts or as otherwise stated) (unaudited) b) Warrants Schedule of warrant transactions Number of Warrants Weighted Average Exercise Price Balance, June 30, 2021 14,341,868 C$ 1.16 Exercised ( 871,750 ) 0.78 Balance, March 31, 2022 13,470,118 C$ 1.18 At March 31, 2022, the Company had outstanding exercisable Common Share purchase warrants (“Warrants”), as follows: Number Exercise Price Expiry Date 500,000 C$ 0.80 December 18, 2022 4,412,118 C$ 1.63 May 10, 2023 8,558,000 C$ 0.97 February 19, 2025 13,470,118 7. RELATED PARTY TRANSACTIONS AND BALANCES Borrowings under the non-revolving credit facility agreement (the “Smith Credit Facility”) with Mark Smith, Chief Executive Officer, President, and Executive Chairman of NioCorp, bear interest at a rate of 10% and drawdowns from the Smith Credit Facility are subject to a 2.5 % establishment fee. Amounts outstanding under the Smith Credit Facility are secured by all of the Company’s assets pursuant to a general security agreement. The Smith Credit Facility contains financial and non-financial covenants customary for a facility of its size and nature. On December 13, 2021, the maturity date for the Smith Credit Facility was extended from December 15, 2021, to June 30, 2022. As of March 31, 2022, the principal amount outstanding under the Smith Credit Facility was $ 2,000 . On July 23, 2021, the Company paid Mr. Smith $ 40 related to accrued interest outstanding on the Smith Credit Facility. Accounts payable and accrued liabilities as of March 31, 2022, include accrued interest of $ 158 payable under the Smith Credit Facility. 8. Exploration Expenditures Schedule of exploration expenditures For the Three Months Ended March 31, For the Nine Months Ended March 31, 2022 2021 2022 2021 Technical studies and engineering $ 45 $ 10 $ 179 $ 11 Field management and other 139 198 420 527 Metallurgical development 625 44 1,211 128 Geologists and field staff 36 45 147 45 Total $ 845 $ 297 $ 1,957 $ 711 10 NioCorp Developments Ltd. Notes to the Condensed Consolidated Financial Statements March 31, 2022 (expressed in thousands of U.S. dollars, except per share amounts or as otherwise stated) (unaudited) 9. Leases The Company incurred lease costs as follows: For the Three Months Ended March 31, For the Nine Months Ended March 31, 2022 2021 2022 2021 Operating Lease Cost: Fixed rent expense $ 23 $ 27 $ 66 $ 86 Variable rent expense 2 2 7 4 Short term lease cost 4 4 12 10 Sublease income ( 8 ) ( 4 ) ( 23 ) ( 14 ) Net lease cost 21 29 62 86 Lease cost – other operating expense 21 23 62 67 Lease cost – exploration expenditures - 6 - 19 Net lease cost $ 21 $ 29 $ 62 $ 86 The maturities of lease liabilities are as follows at March 31, 2022: Fiscal Year Lease Maturities 2021 $ 24 2022 92 2023 and thereafter 23 Total lease payments 139 Less portion of payments representing interest ( 16 ) Present value of lease payments 123 Less current portion of lease liability ( 79 ) Noncurrent lease liability $ 44 10. Fair Value Measurements The Company measures the fair value of financial assets and liabilities based on US GAAP guidance which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. The Company classifies financial assets and liabilities as held-for-trading, available-for-sale, held-to-maturity, loans and receivables, or other financial liabilities depending on their nature. Financial assets and financial liabilities are recognized at fair value on their initial recognition. Financial assets and liabilities classified as held-for-trading are measured at fair value, with gains and losses recognized in net income. Financial assets classified as held-to-maturity, loans and receivables, and financial liabilities other than those classified as held-for-trading are measured at amortized cost, using the effective interest method of amortization. Financial assets classified as available-for-sale, including investments in equity securities, are measured at fair value, with unrealized gains and losses being recognized in income. Financial instruments including receivables, accounts payable and accrued liabilities, and related party loans are carried at amortized cost, which management believes approximates fair value due to the short-term nature of these instruments. 11 NioCorp Developments Ltd. Notes to the Condensed Consolidated Financial Statements March 31, 2022 (expressed in thousands of U.S. dollars, except per share amounts or as otherwise stated) (unaudited) The following tables present information about the assets and liabilities that are measured at fair value on a recurring basis as of March 31, 2022, and June 30, 2021, respectively, and indicate the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value. In general, fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical instruments. Fair values determined by Level 2 inputs utilize data points that are observable, such as quoted prices, interest rates, and yield curves. Fair values determined by Level 3 inputs are unobservable data points for the financial instrument and include situations where there is little, if any, market activity for the instrument. Schedule of fair values determined by level 3 inputs are unobservable data As of March 31, 2022 Total Level 1 Level 2 Level 3 Assets: Cash and cash equivalents $ 3,464 $ 3,464 $ - $ - Equity securities 10 10 - - Total $ 3,474 $ 3,474 $ - $ - As of June 30, 2021 Total Level 1 Level 2 Level 3 Assets: Cash and cash equivalents $ 7,317 $ 7,317 $ - $ - Equity securities 16 16 - - Total $ 7,333 $ 7,333 $ - $ - The Lind III Convertible Security discussed in Note 5 was initially recorded at fair value, which represented a nonrecurring fair value measurement using a Level 3 input. At March 31, 2022, the estimated fair value of this instrument approximates carrying value given that the instrument was issued in fiscal 2021 and has a short time period until maturity. 12