Note 11 − Fair Value Measurement

Fair value is the price that would result from an orderly transaction between market participants at the measurement date. A fair value hierarchy prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). Level 2 measurements utilize either directly or indirectly observable inputs in markets other than quoted prices in active markets.

Our financial instruments are stated at amounts that equal, or approximate, fair value. When we estimate fair value, we utilize market data or assumptions that we believe market participants would use in pricing the financial instrument, including assumptions about risk and inputs to the valuation technique. We use valuation techniques, primarily the income and market approach, which maximizes the use of observable inputs and minimize the use of unobservable inputs for recurring fair value measurements.

Mutual funds: Valued at the quoted net asset value (NAV) of shares held.

U.S. agency and treasury securities: Fair value measured at the closing price reported on the active market on which the individual securities are traded.

The following table shows the adjusted cost, gross unrealized gains, gross unrealized losses, and fair value of our financial assets as of December 31, 2025 and 2024:

	December 31, 2025
	Adjusted Cost		Unrealized Gains		Unrealized Losses		Fair Value		Cash and Cash Equivalents		Investments Available for Sale
Cash	$	801	$	—	$	—	$	801	$	801	$	—
Level 1:
Mutual funds		14,747		—		—		14,747		14,747		—
U.S. agency and treasury securities		5,975		4		—		5,979		—		5,979
		20,722		4		—		20,726		14,747		5,979
Total	$	21,523	$	4	$	—	$	21,527	$	15,548	$	5,979

	December 31, 2024
	Adjusted Cost		Unrealized Gains		Unrealized Losses			Fair Value		Cash and Cash Equivalents		Investments Available for Sale
Cash	$	1,777	$	—	$	—		$	1,777	$	1,777	$	—
Level 1:
Mutual funds		20,077		—		—			20,077		20,077		—
U.S. agency and treasury securities		16,204		25		(1	)		16,228		1,442		14,786
		36,281		25		(1	)		36,305		21,519		14,786
Total	$	38,058	$	25	$	(1	)	$	38,082	$	23,296	$	14,786

The maturities of our investments generally range between one to two years. Actual maturities could differ from contractual maturities due to call or prepayment provisions.

Historical Timeline

Fiscal Year	Filed
2025	Mar 24, 2026	Showing above
2024	Mar 17, 2025

2023	Mar 15, 2024

2022	Mar 31, 2023

2021	Mar 16, 2022

2020	Mar 16, 2021

2019	Mar 16, 2020

2018	Mar 18, 2019

2017	Mar 16, 2018

2016	Mar 16, 2017

2015	Mar 15, 2016

About Fair Value Disclosures

Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.

Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.

VirnetX Holding Corp Fair Value Disclosure

Historical Timeline

About Fair Value Disclosures

Other Available Disclosures