| Fair Value Measurements and Marketable Securities Available for Sale |
NOTE 4. FAIR VALUE MEASUREMENTS AND MARKETABLE SECURITIES The Company provides disclosure of financial assets and financial liabilities that are carried at fair value based on the price that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurements may be classified based on the amount of subjectivity associated with the inputs to fair valuation of these assets and liabilities using the following three levels: Level 1 — Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. Level 2 — Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (i.e., interest rates, yield curves, etc.) and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs). Level 3 — Unobservable inputs that reflect the Company’s estimates of the assumptions that market participants would use in pricing the asset or liability. The Company develops these inputs based on the best information available, including its own data. The following table presents information about the Company’s marketable securities and the Warrant liability as of December 31, 2022 and 2021, measured at fair value on a recurring basis, and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value. The Company’s Warrant liabilities are included within the Level 1 and Level 3 fair value hierarchy. The fair value of the Public and Forward Purchase Warrants is determined using the closing price of the warrants on the NYSE market. The fair value of the Private Placement Warrants is determined using the Black-Scholes option pricing formula. The primary unobservable input utilized in determining the fair value of the Private Warrants is the expected volatility. The expected volatility was estimated considering observable Nuvation public warrant pricing, Nuvation’s own historical volatility and the volatility of guideline public companies. There have not been any transfers between the levels during the periods.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2022 |
|
|
|
Total |
|
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
|
|
(In thousands) |
|
Financial assets: |
|
|
|
|
|
|
|
|
|
|
|
|
Cash equivalents: |
|
|
|
|
|
|
|
|
|
|
|
|
Money market funds |
|
$ |
35,204 |
|
|
$ |
35,204 |
|
|
$ |
— |
|
|
$ |
— |
|
U.S. government securities |
|
|
32,779 |
|
|
|
— |
|
|
|
32,779 |
|
|
|
— |
|
Corporate bonds |
|
|
328 |
|
|
|
— |
|
|
|
328 |
|
|
|
— |
|
|
|
|
68,311 |
|
|
|
35,204 |
|
|
|
33,107 |
|
|
|
— |
|
Marketable securities: |
|
|
|
|
|
|
|
|
|
|
|
|
Certificate of deposits |
|
|
13,984 |
|
|
|
— |
|
|
|
13,984 |
|
|
|
— |
|
Commercial paper |
|
|
50,173 |
|
|
|
— |
|
|
|
50,173 |
|
|
|
— |
|
U.S. government and government agency securities |
|
|
305,657 |
|
|
|
— |
|
|
|
305,657 |
|
|
|
— |
|
Corporate bonds |
|
|
187,130 |
|
|
|
— |
|
|
|
187,130 |
|
|
|
— |
|
Municipal bonds |
|
|
2,971 |
|
|
|
— |
|
|
|
2,971 |
|
|
|
— |
|
|
|
|
559,915 |
|
|
|
— |
|
|
|
559,915 |
|
|
|
— |
|
Total financial assets: |
|
$ |
628,226 |
|
|
$ |
35,204 |
|
|
$ |
593,022 |
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
Warrants |
|
$ |
850 |
|
|
$ |
813 |
|
|
$ |
— |
|
|
$ |
37 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2021 |
|
|
|
Total |
|
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
|
|
(In thousands) |
|
Financial assets: |
|
|
|
|
|
|
|
|
|
|
|
|
Cash equivalents: |
|
|
|
|
|
|
|
|
|
|
|
|
Money market funds |
|
$ |
53,292 |
|
|
$ |
53,292 |
|
|
$ |
— |
|
|
$ |
— |
|
Commercial paper |
|
|
30,845 |
|
|
|
— |
|
|
|
30,845 |
|
|
|
— |
|
Corporate bonds |
|
|
571 |
|
|
|
— |
|
|
|
571 |
|
|
|
— |
|
|
|
|
84,708 |
|
|
|
53,292 |
|
|
|
31,416 |
|
|
|
— |
|
Marketable securities: |
|
|
|
|
|
|
|
|
|
|
|
|
Certificate of deposits |
|
|
3,000 |
|
|
|
— |
|
|
|
3,000 |
|
|
|
— |
|
Commercial paper |
|
|
16,892 |
|
|
|
— |
|
|
|
16,892 |
|
|
|
— |
|
U.S. government and government agency securities |
|
|
267,267 |
|
|
|
— |
|
|
|
267,267 |
|
|
|
— |
|
Corporate bonds |
|
|
320,192 |
|
|
|
— |
|
|
|
320,192 |
|
|
|
— |
|
Municipal bonds |
|
|
10,821 |
|
|
|
— |
|
|
|
10,821 |
|
|
|
— |
|
Exchange traded fund |
|
|
14,797 |
|
|
|
14,797 |
|
|
|
— |
|
|
|
— |
|
|
|
|
632,969 |
|
|
|
14,797 |
|
|
|
618,172 |
|
|
|
— |
|
Total financial assets: |
|
$ |
717,677 |
|
|
$ |
68,089 |
|
|
$ |
649,588 |
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
Warrants |
|
$ |
11,037 |
|
|
$ |
10,631 |
|
|
$ |
— |
|
|
$ |
406 |
|
Marketable securities consist of U.S. government and government agency, certificate of deposits, commercial paper, corporate bond and municipal securities ("Debt Securities") and an exchange traded fund that primarily owns fixed income securities. Based on the Company’s intentions regarding its marketable securities, all Debt Securities are classified as available-for-sale and are carried at fair value based on the price that would be received upon sale of the security. The following table provides the amortized cost, aggregate fair value, and unrealized gains (losses) of marketable securities as of December 31, 2022 and December 31, 2021:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2022 |
|
|
|
Amortized
Cost |
|
|
Unrealized Gains |
|
|
Unrealized Losses |
|
|
Fair Value |
|
|
|
(In thousands) |
|
Cash equivalents: |
|
|
|
|
|
|
|
|
|
|
|
|
Money market funds |
|
$ |
35,204 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
35,204 |
|
U.S. government and government agency securities |
|
|
32,773 |
|
|
|
6 |
|
|
|
— |
|
|
|
32,779 |
|
Corporate bonds |
|
|
328 |
|
|
|
— |
|
|
|
— |
|
|
|
328 |
|
|
|
|
68,305 |
|
|
|
6 |
|
|
|
— |
|
|
|
68,311 |
|
Marketable securities: |
|
|
|
|
|
|
|
|
|
|
|
|
Certificate of deposits |
|
|
13,998 |
|
|
|
6 |
|
|
|
(20 |
) |
|
|
13,984 |
|
Commercial paper |
|
|
50,240 |
|
|
|
21 |
|
|
|
(88 |
) |
|
|
50,173 |
|
U.S. government and government agency securities |
|
|
308,510 |
|
|
|
30 |
|
|
|
(2,883 |
) |
|
|
305,657 |
|
Corporate bonds |
|
|
189,695 |
|
|
|
23 |
|
|
|
(2,588 |
) |
|
|
187,130 |
|
Municipal bonds |
|
|
3,004 |
|
|
|
— |
|
|
|
(33 |
) |
|
|
2,971 |
|
|
|
|
565,447 |
|
|
|
80 |
|
|
|
(5,612 |
) |
|
|
559,915 |
|
|
|
$ |
633,752 |
|
|
$ |
86 |
|
|
$ |
(5,612 |
) |
|
$ |
628,226 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2021 |
|
|
|
Amortized
Cost |
|
|
Unrealized Gains |
|
|
Unrealized Losses |
|
|
Fair Value |
|
|
|
(In thousands) |
|
Cash equivalents: |
|
|
|
|
|
|
|
|
|
|
|
|
Money market funds |
|
$ |
53,292 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
53,292 |
|
Commercial paper |
|
|
30,845 |
|
|
|
— |
|
|
|
— |
|
|
|
30,845 |
|
Corporate bonds |
|
|
571 |
|
|
|
— |
|
|
|
— |
|
|
|
571 |
|
|
|
|
84,708 |
|
|
|
— |
|
|
|
— |
|
|
|
84,708 |
|
Marketable securities: |
|
|
|
|
|
|
|
|
|
|
|
|
Certificate of deposits |
|
|
3,000 |
|
|
|
— |
|
|
|
— |
|
|
|
3,000 |
|
Commercial paper |
|
|
16,889 |
|
|
|
3 |
|
|
|
— |
|
|
|
16,892 |
|
U.S government and government agency securities |
|
|
267,792 |
|
|
|
213 |
|
|
|
(738 |
) |
|
|
267,267 |
|
Corporate bonds |
|
|
320,827 |
|
|
|
147 |
|
|
|
(782 |
) |
|
|
320,192 |
|
Municipal bonds |
|
|
10,849 |
|
|
|
— |
|
|
|
(28 |
) |
|
|
10,821 |
|
Exchange traded fund |
|
|
14,963 |
|
|
|
— |
|
|
|
(166 |
) |
|
|
14,797 |
|
|
|
|
634,320 |
|
|
|
363 |
|
|
|
(1,714 |
) |
|
|
632,969 |
|
|
|
$ |
719,028 |
|
|
$ |
363 |
|
|
$ |
(1,714 |
) |
|
$ |
717,677 |
|
For the years ended December 31, 2022 and 2021, the activity related to the net gains (losses) on marketable securities included in other income (expense) on the consolidated statements of operations and comprehensive loss were as follows (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
Years Ended December 31, |
|
|
|
2022 |
|
|
2021 |
|
Realized gains (losses) on available-for-sale securities were as follows: |
|
|
|
|
|
|
Realized gains from sales of available-for-sale securities |
|
$ |
9 |
|
|
$ |
88 |
|
Realized losses from sales of available-for-sale securities |
|
|
(1,065 |
) |
|
|
(2 |
) |
|
|
|
(1,056 |
) |
|
|
86 |
|
Net gains (losses) on equity securities were as follows: |
|
|
|
|
|
|
Net realized losses on equities sold |
|
|
(172 |
) |
|
|
— |
|
Net unrealized losses on equities |
|
|
— |
|
|
|
(166 |
) |
|
|
|
(172 |
) |
|
|
(166 |
) |
|
|
|
|
|
|
|
Total losses on marketable securities |
|
$ |
(1,228 |
) |
|
$ |
(80 |
) |
|
|
|
|
|
|
|
The following tables provide marketable securities with continuous unrealized losses for less than 12 months and 12 months or greater and the related fair values as of December 31, 2022 and 2021 were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2022 |
|
|
|
Less than 12 Months |
|
|
12 Months or Greater |
|
|
Total |
|
|
Total |
|
|
|
Fair Value |
|
|
Unrealized Losses |
|
|
Fair Value |
|
|
Unrealized Losses |
|
|
Fair Value |
|
|
Unrealized Losses |
|
|
|
(In thousands) |
|
Certificate of deposits |
|
$ |
7,139 |
|
|
$ |
(20 |
) |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
7,139 |
|
|
$ |
(20 |
) |
Commercial paper |
|
|
26,938 |
|
|
|
(88 |
) |
|
|
— |
|
|
|
— |
|
|
|
26,938 |
|
|
|
(88 |
) |
U.S. government and government agency securities |
|
|
150,126 |
|
|
|
(977 |
) |
|
|
101,095 |
|
|
|
(1,906 |
) |
|
|
251,221 |
|
|
|
(2,883 |
) |
Corporate bonds |
|
|
69,402 |
|
|
|
(565 |
) |
|
|
108,748 |
|
|
|
(2,023 |
) |
|
|
178,150 |
|
|
|
(2,588 |
) |
Municipal bonds |
|
|
— |
|
|
|
— |
|
|
|
2,971 |
|
|
|
(33 |
) |
|
|
2,971 |
|
|
|
(33 |
) |
|
|
$ |
253,605 |
|
|
$ |
(1,650 |
) |
|
$ |
212,814 |
|
|
$ |
(3,962 |
) |
|
$ |
466,419 |
|
|
$ |
(5,612 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2021 |
|
|
|
Less than 12 Months |
|
|
12 Months or Greater |
|
|
Total |
|
|
Total |
|
|
|
Fair Value |
|
|
Unrealized Losses |
|
|
Fair Value |
|
|
Unrealized Losses |
|
|
Fair Value |
|
|
Unrealized Losses |
|
|
|
(In thousands) |
|
Certificate of deposits |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
Commercial paper |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
U.S. government and government agency securities |
|
|
218,106 |
|
|
|
(738 |
) |
|
|
— |
|
|
|
— |
|
|
|
218,106 |
|
|
|
(738 |
) |
Corporate bonds |
|
|
279,557 |
|
|
|
(782 |
) |
|
|
— |
|
|
|
— |
|
|
|
279,557 |
|
|
|
(782 |
) |
Municipal bonds |
|
|
10,821 |
|
|
|
(28 |
) |
|
|
— |
|
|
|
— |
|
|
|
10,821 |
|
|
|
(28 |
) |
Exchanged traded funds |
|
|
14,798 |
|
|
|
(166 |
) |
|
|
— |
|
|
|
— |
|
|
|
14,798 |
|
|
|
(166 |
) |
|
|
$ |
523,282 |
|
|
$ |
(1,714 |
) |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
523,282 |
|
|
$ |
(1,714 |
) |
Maturity information based on fair value of the available-for-sale securities is as follows as of December 31, 2022:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Within one year |
|
|
After one year
through five years |
|
|
Total |
|
|
|
(In thousands) |
|
Corporate bonds |
|
$ |
140,099 |
|
|
$ |
47,031 |
|
|
$ |
187,130 |
|
U.S. government and government agency securities |
|
|
271,032 |
|
|
|
34,625 |
|
|
|
305,657 |
|
Commercial paper |
|
|
50,173 |
|
|
|
— |
|
|
|
50,173 |
|
Municipal bonds |
|
|
2,971 |
|
|
|
— |
|
|
|
2,971 |
|
Certificate of deposits |
|
|
13,984 |
|
|
|
— |
|
|
|
13,984 |
|
|
|
$ |
478,259 |
|
|
$ |
81,656 |
|
|
$ |
559,915 |
|
|