v3.22.2.2
FAIR VALUE MEASUREMENT
Sep. 30, 2022
Fair Value Disclosures [Abstract]  
FAIR VALUE MEASUREMENT

NOTE 4. FAIR VALUE MEASUREMENT

 

In accordance with ASC Topic 820 — Fair Value Measurements and Disclosures (“ASC 820”), the Company utilizes the market approach to measure fair value for its financial assets and liabilities. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets, liabilities or a group of assets or liabilities, such as a business.

 

ASC 820 utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The following is a brief description of those three levels:

 

● Level 1 — Quoted prices in active markets for identical assets and liabilities
   
● Level 2 — Other significant observable inputs (including quoted prices in active markets for similar assets or liabilities)
   
● Level 3 — Significant unobservable inputs (including the Company’s own assumptions in determining the fair value)

 

 

The following table represents the Company’s hierarchy for its financial assets and liabilities measured at fair value on a recurring basis as of September 30, 2022 and December 31, 2021:

 

   Level 1   Level 2   Level 3   Total 
   September 30, 2022 
   Level 1   Level 2   Level 3   Total 
Liabilities:                
Warrant derivative liabilities  $—   $—   $—   $— 
Contingent consideration promissory notes and contingent consideration earn-out agreement   —    —    

1,091,821

    

1,091,821

 
Liabilities, fair value  $—   $—   $

1,091,821

   $

1,091,821

 

 

   Level 1   Level 2   Level 3   Total 
   December 31, 2021 
   Level 1   Level 2   Level 3   Total 
Liabilities:                
Warrant derivative liabilities  $—   $—   $14,846,932   $14,846,932 
Contingent consideration promissory notes and contingent consideration earn-out agreement   —    —    967,212    967,212 
Liabilities, fair value  $—   $—   $15,814,144   $15,814,144 

 

The following table represents the change in Level 3 tier value measurements for the periods ended September 30, 2022:

 

   Contingent
Consideration
Promissory Notes		   Warrant Derivative
Liabilities		 
           
Balance, December 31, 2021  $967,212   $14,846,932 
           
Issuance of contingent consideration promissory note - Revenue Cycle Management Segment Acquisition   750,000    — 
           
Issuance of contingent consideration promissory note - Revenue Cycle Management Segment Acquisition   105,000    — 
           
Principal payments on contingent consideration promissory notes – Revenue Cycle Management Acquisitions   (116,198)   — 
           
Change in fair value of contingent consideration promissory notes - Revenue Cycle Management Acquisitions   56,050    — 
           
Change in fair value of warrant derivative liabilities   —    (148,171)
           
Balance, March 31, 2022  $1,762,064   $14,698,761 
           
Principal payments on contingent consideration promissory notes – Revenue Cycle Management Acquisitions   (100,624)   — 
           
Change in fair value of contingent consideration promissory notes - Revenue Cycle Management Acquisitions   (542,096)   — 
           
Change in fair value of warrant derivative liabilities   —    (5,413,618)
           
Balance, June 30, 2022  $1,119,344   $9,285,143 
           
Principal payments on contingent consideration promissory notes – Revenue Cycle Management Acquisitions   (166,400)   — 
           
Change in fair value of contingent consideration promissory notes - Revenue Cycle Management Acquisitions   138,877    — 
           
Change in fair value of warrant derivative liabilities   —    (1,164,849)
           
Gain on extinguishment of warrant derivative liabilities   —    

(3,624,794

)
           

Issuance of common stock through warrant exchange agreement

   —    (4,495,500)
           
Balance, September 30, 2022  $1,091,821   $—