XML 19 R9.htm IDEA: XBRL DOCUMENT

Fair Value Measurements

6 Months Ended

Jun. 30, 2022

FAIR VALUE MEASUREMENTS

The fair value of the Company’s financial assets and liabilities is determined in accordance with the fair value hierarchy established in FASB ASC Topic 820, Fair Value Measurements and Disclosures (“ASC 820”). ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The fair value hierarchy of ASC 820 requires an entity to maximize the use of observable inputs when measuring fair value and classifies those inputs into three levels:

Level 1—Observable inputs, such as quoted prices in active markets for identical assets or liabilities.

Level 2—Observable inputs, other than Level 1 inputs, which are observable either directly or indirectly or can be corroborated by observable market data using quoted prices for similar assets or liabilities.

Level 3—Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

The Company's financial instruments that are not re-measured at fair value include accounts receivable, prepaid and other current assets, accounts payable, accrued expenses and other current liabilities, convertible notes, and long-term debt. The carrying values of these financial instruments approximate their fair values.

The Company’s financial assets and liabilities measured at fair value on a recurring basis and the level of inputs used for such measurements were as follows (in thousands):


	Fair Value Measured as of June 30, 2022 Using:
	Adjusted Cost		Unrealized losses		Fair Value		Cash and Cash Equivalent		Marketable Securities
Assets
Level 1
Money market funds	$	195	$	—	$	195	$	195	$	—
Level 2
Asset-backed securities	$	21,675	$	(190)	$	21,485	$	—	$	21,485
Corporate bonds	29,336		(515)		28,821		—		28,821
Commercial paper	42,186		—		42,186		—		42,186
U.S. Government securities	29,958		(924)		29,034		—		29,034
Total financial assets	$	123,350	$	(1,629)	$	121,721	$	195	$	121,526
Liabilities
Level 2
Private placement warrant liability	$	—	$	—	$	46	$	—	$	—
Total financial liabilities	$	—	$	—	$	46	$	—	$	—


	Fair Value Measured as of December 31, 2021 Using:
	Adjusted Cost		Unrealized losses		Fair Value		Cash and Cash Equivalent		Marketable Securities
Assets
Level 1
Money market funds	$	4,863	$	—	$	4,863	$	4,863	$	—
Level 2
Asset-backed securities	$	26,491	$	(68)	$	26,423	$	—	$	26,423
Corporate bonds	48,643		(150)		48,493		—		48,493
Commercial paper	45,145		—		45,145		—		45,145
U.S. Government securities	29,936		(173)		29,763		—		29,763
Total financial assets	$	155,078	$	(391)	$	154,687	$	4,863	$	149,824
Liabilities
Level 2
Private placement warrant liability	$	—	$	—	$	155	$	—	$	—
Total financial liabilities	$	—	$	—	$	155	$	—	$	—

As of June 30, 2022 and December 31, 2021, the Company’s financial assets and liabilities subject to fair value procedures were comprised of the following:

Money Market Funds: The Company holds financial assets consisting of money market funds. These securities are valued using observable inputs, such as quoted prices in active markets for identical assets or liabilities.

Marketable Securities: The Company holds financial assets consisting of fixed-income U.S. government agency securities, corporate bonds, commercial paper and asset-backed securities. The securities are valued using prices from independent pricing services based on quoted prices of identical instruments in less active or inactive markets. Additionally, quoted prices of similar instruments in active market or industry models using data inputs such as interest rates and prices that can be directly observed or corroborated in active markets are used to value marketable securities.

Private Placement Warrant Liability: As of June 30, 2022, Level 2 fair value measurements were used for Private Placement Warrant liabilities. Any changes in the fair value of the liability are reflected in Change in fair value of embedded derivative liability and warrant liabilities on the consolidated statements of operations and comprehensive loss. Private Placement Warrant liability is included within other noncurrent liabilities on the consolidated balance sheets.

For the six months ended June 30, 2022 and year ended December 31, 2021, there were no transfers between Level 1 and Level 2 inputs.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details