Note 5 - Fair Value Measurement |
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| Fair Value Disclosures [Text Block] |
5. Fair Value Measurements
The fair value of the Company's cash, cash equivalents, current restricted cash, accounts receivable, accounts payable, and accrued liabilities approximate their carrying values because of the short-term nature of these instruments.
Restricted cash Restricted cash includes a separately maintained cash account, as required under the terms of a lease agreement the Company entered into on October 10, 2018 for office space in New York City. On April 15, 2025, the Company received the landlord’s consent for the second amendment to its sublease, which reduced the subleased premises and payments, effective March 19, 2025. The consent also approved the extension of the sublease term by years, effective April 15, 2025. In connection with this lease agreement, the Company recorded $710 in non-current restricted cash as of June 30, 2025, and $1,255 in current restricted cash as of December 31, 2024, on the consolidated balance sheets. The Company also recorded $1,673 as current restricted cash on the consolidated balance sheets as of June 30, 2025 related to the SLR Credit Agreement (as defined below in Note 4, Long-term debt, net). As of June 30, 2025, the Company regards the fair value of its long-term debt to approximate its carrying value.
The following tables present the Company’s fair value hierarchy for assets and liabilities that are measured at fair value on a recurring basis as of June 30, 2025 and December 31, 2024:
Convertible Notes with related parties
The Company issued the Convertible Notes on August 19, 2024 and elected the fair value option. See Note 4, Long-term debt, net. The following is a reconciliation of the fair value from December 31, 2024 to June 30, 2025:
As the Convertible Notes mature on April 2, 2029, and bear interest at 13% per annum paid in kind but may be converted into shares of the Company’s common stock (the "call option"), the estimated fair value is computed as the sum of (a) the present value of the expected interest and principal payments using the discounted cash flow method based on an estimated discount rate and (b) the fair value of the call option computer using the Black-Scholes model. Both approaches are based on the following assumptions:
Contingent Consideration
In connection with the contingent consideration received related to the initial consolidation of TAPP, the Company had to determine the fair value of the identified assets acquired and liabilities assumed. The Company determined that the estimated fair value of the net assets acquired, excluding the net working capital, was a Level 3 measurement, as certain inputs to determine fair value were unobservable.
The fair value of certain long-lived non-financial assets and liabilities may be required to be measured on a nonrecurring basis in certain circumstances, including when there is evidence of impairment. As of June 30, 2025, certain non-financial assets have been measured at fair value subsequent to their initial recognition. The Company determined the estimated fair value to be a Level 3 measurement, as certain inputs used to determine fair value are unobservable. See Note 1(f), Goodwill. |
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