Contingent Consideration (Tables)

6 Months Ended

Jun. 30, 2021

Schedule of financial instruments measured at fair value on a recurring basis

The following table summarizes information about the Company’s financial instruments measured at fair value on a recurring basis, grouped into Level 1 to 3 based on the degree to which the input to fair value is observable (in thousands):


	June 30, 2021
	Level I		Level II		Level III		Total
DBOT - Contingent consideration1	$	—	$	—	$	649	$	649
Tree Technology - Contingent consideration2	—		—		6,404		6,404
Wave - Contingent consideration3	—		—		7,657		7,657
Solectrac - Contingent consideration4	—		—		1,639		1,639

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Note

1 This represents the liability incurred in connection with the acquisition of DBOT shares during the third quarter of 2019 and as remeasured as of April 17, 2020. The contractual period which required periodic remeasurement has expired, and therefore the Company will not remeasure this liability in the future. The fair value of DBOT contingent consideration as of June 30, 2021 was valued using the Black-Scholes Merton method. The Company issued 11.3 million shares during the six months ended June 30, 2020 and partially satisfied this liability. No shares have been issued in the six months ended June 30, 2021.

2 This represents the liability incurred in connection with the acquisition of Tree Technology shares during the fourth quarter of 2019 and as subsequently remeasured as of June 30, 2021. The fair value of the Tree Technology contingent consideration was valued using a scenario-based method which incorporates various estimates, including projected gross revenue for the periods, probability estimates, discount rates and other factors.

3 This represents the liability incurred in connection with the acquisition of WAVE. The liability represents the combination of the contingent shares and the earnout. The contingent shares are the remaining shares to be issued contingent on the receipt of certain customer consents as disclosed in Note 6. The fair value of this contingent consideration was valued using a scenario-based method that indicated based on the probabilities that 100% of the consents will be received. The earnout liability is dependent on WAVE achieving certain revenue and gross profit margin criteria in 2021, 2022 and cumulatively 2021 and 2022. The fair value of zero has been determined using a scenario-based method which indicated that none of the criteria are likely to be achieved.

4 This represents the liability incurred in connection with the acquisition of Solectrac. The liability represents the fair value of the three earnouts that were entered into at closing. The fair value of $1.6 million has been determined using a scenario-based method which indicated partial achievement of the criteria over the three years.

Schedule of reconciliation of level 3 fair value measurements

The following table summarizes the reconciliation of Level 3 fair value measurements (in thousands):


	Contingent Consideration
January 1, 2021	$	8,960
Addition	9,296
Settlement	—
Remeasurement loss/(gain) recognized in the statement of operations	(1,907)
June 30, 2021	$	16,349