Note 7 - Fair Value Measurements

3 Months Ended

Mar. 31, 2019

Notes to Financial Statements

Fair Value Disclosures [Text Block]

NOTE

7

–

FAIR VALUE MEASUREMENTS

The following table presents information about warrant derivative liabilities, and indicate the fair value hierarchy of the valuation techniques we utilized to determine such fair value. In general, fair values determined by Level 

1

inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities. We consider a security that trades at least weekly to have an active market. Fair values determined by Level 

2

inputs utilize data points that are observable, such as quoted prices, interest rates and yield curves. Fair values determined by Level 

3

inputs are unobservable data points for the asset or liability, and include situations where there is little, if any, market activity for the asset or liability.

	Derivatives at Fair Value as of March 31, 2018
(in thousands)	Level 1		Level 2		Level 3			Total
Warrant derivative liabilities		-		-	$	(1,871	)	$	(1,871	)
Total warrant derivative liabilities	$	-	$	-	$	(1,871	)	$	(1,871	)

	Derivatives at Fair Value as of March 31, 201 9
(in thousands)	Level 1		Level 2		Level 3		Total
Warrant derivative liabilities		-		-		-		-
Total warrant derivative liabilities	$	-	$	-	$	-	$	-

The following table presents a reconciliation of Level

3

activity for the

three

month period ended

March 31, 2019:

	Level 3 Liabilities
(in thousands)	Warrant Derivative Liabilities
Balance at December 31, 2018	$	865
Reclassification of warrant liability to additional paid-in capital upon adoption of ASU 2017-11		(865	)
Balance at March 31, 2019	$	-

On

January 1, 2019,

the Company adopted ASU

2017

-

11.

As a result, the Company reclassified a warrant liability in the amount of

$865

thousand to additional paid-in capital. In addition, during the years ended

December 31, 2018

and

2017,

the Company recognized annual gains of

$1.5

million and

$0.5

million, respectively, from revaluating the Warrants. Upon adoption of ASU

2017

-

11,

the Company recorded

$2.0

million in additional paid-in capital with a corresponding adjustment to the opening balance of retained earnings (deficit) related to these previously recorded gains.