Financial Instruments Fair Value Measurements

3 Months Ended

Mar. 31, 2022

Fair Value Disclosures [Abstract]

Financial Instruments Fair Value Measurements

Note 11 — Financial Instruments Fair Value Measurements

Recurring Fair Value Measurements

The fair value hierarchy table for the reporting dates noted is as follows:

		Fair Value Measurement on a Recurring Basis at Reporting Date  Using(1)
		Level-1 Inputs		Level-2 Inputs		Level-3 Inputs		Total
March 31, 2022
Contingent consideration payable	$	—	$	—	$	4,887	$	4,887
Totals	$	—	$	—	$	4,887	$	4,887

⁽¹⁾ As noted above, as presented in the fair value hierarchy table, Level-1 represents quoted prices in active markets for identical items, Level-2 represents significant other observable inputs, and Level-3 represents significant unobservable inputs. There were no transfers between the respective Levels during the period ended March 31, 2022.

Fair value measurements of contingent consideration

The Company recorded $4.9 million, which is the fair value, of contingent consideration related to the RDx acquisition. The Company is required to make contingent consideration payments of up to $5.2 million related to the RDx APA agreement. The contingent agreement is based on achieving milestones to obtain certain certifications and licensing rights. The Company estimated the fair value on a probability based model that assessed achievement of such milestones. The model used present value factors, that applied probability ranges of 94-99%, a discount rate of 7.875% and achievement times ranging from one month to six months to achieve the respective milestones.

The final settlement of contingent consideration liabilities for the acquisition could vary from current estimates based on the actual results of the financial measures described above. This liability is considered to be a Level 3 financial liability that is re-measured each reporting period. The change in fair value of contingent consideration for these acquisitions is included in other income (expense), net.

The following table presents a reconciliation of the liability measured at fair value on a recurring basis using significant unobservable inputs (Level 3):

	March 31, 2022
Fair value of contingent consideration at the date of acquisition	$	4,714
Payments		—
Change in fair value of contingent consideration		173
Contingent consideration payable	$	4,887

As of December 31, 2021 there were no fair value measurements.

See Note 12, Debt for convertible notes the Company has entered into subsequent to March 31, 2022.