| Fair Value Measurement |
| 8. |
FAIR VALUE MEASUREMENT |
Assumptions utilized in the valuation of Level 3 liabilities are
described as follows:
| |
|
For the Three Months Ended |
|
|
For the Nine Months Ended |
|
| |
|
September 30, |
|
|
September 30, |
|
| |
|
2020 |
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Risk-free interest rate |
|
|
0.36 |
% |
|
|
1.47%-1.75 |
% |
|
|
0.16%-1.69 |
% |
|
|
1.47%-2.45 |
% |
| Contractual term (years) |
|
|
6.00 |
|
|
|
1.00 - 5.00 |
|
|
|
1.00-8.00 |
|
|
|
1.00 - 10.00 |
|
| Expected volatility |
|
|
137 |
% |
|
|
118% - 139 |
% |
|
|
78%-138 |
% |
|
|
106% - 140 |
% |
| Expected dividend yield |
|
|
0.00 |
% |
|
|
0.00 |
% |
|
|
0.00 |
% |
|
|
0.00 |
% |
For the purposes of estimating the fair value
of the Contingent Consideration as of the date of the acquisition and September 30, 2020, the Company utilized the following assumptions:
(i) a probability threshold of 25% that the Seller would satisfy the conditions of the Contingent Consideration and (ii) a 5% discount
rate. See Note 3 – Business Combination for details.
The following table sets forth a summary of
the changes in the fair value of Level 3 warrant liabilities that are measured at fair value on a recurring basis:
| Contingetnt Consideration |
|
|
|
| Beginning balance as of January 1, 2020 |
|
$ |
- |
|
| Contingent consideration assumed in BlueLA acquisition |
|
|
245,000 |
|
| Change in fair value of contingent consideration |
|
|
- |
|
| Ending balance as of September 30, 2020 |
|
|
245,000 |
|
| |
|
|
|
|
| Warrants Payable |
|
|
|
|
| Beginning balance as of January 1, 2020 |
|
$ |
5,102 |
|
| Change in fair value of warrants payable |
|
|
35,711 |
|
| Ending balance as of September 30, 2020 |
|
$ |
40,813 |
|
Assets and liabilities measured at fair value
on a recurring or nonrecurring basis are as follows:
| |
|
September 30, 2020 |
|
| |
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
|
Total |
|
| Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Alternative fuel credits |
|
$ |
- |
|
|
$ |
164,647 |
|
|
$ |
- |
|
|
$ |
164,647 |
|
| Total assets |
|
$ |
- |
|
|
$ |
164,647 |
|
|
$ |
- |
|
|
$ |
164,647 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Contingent consideration |
|
$ |
- |
|
|
$ |
- |
|
|
$ |
245,000 |
|
|
$ |
245,000 |
|
| Warrants payable |
|
$ |
- |
|
|
$ |
- |
|
|
$ |
40,813 |
|
|
$ |
40,813 |
|
| Total liabilities |
|
$ |
- |
|
|
$ |
- |
|
|
$ |
285,813 |
|
|
$ |
285,813 |
|
| |
|
December 31, 2019 |
|
| |
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
|
Total |
|
| Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Alternative fuel credits |
|
$ |
- |
|
|
$ |
476,992 |
|
|
$ |
- |
|
|
$ |
476,992 |
|
| Marketable securities |
|
|
3,150,332 |
|
|
|
- |
|
|
|
- |
|
|
|
3,150,332 |
|
| Total assets |
|
$ |
3,150,332 |
|
|
$ |
476,992 |
|
|
$ |
- |
|
|
$ |
3,627,324 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Warrants payable |
|
$ |
- |
|
|
$ |
- |
|
|
$ |
5,102 |
|
|
$ |
5,102 |
|
| Total liabilities |
|
$ |
- |
|
|
$ |
- |
|
|
$ |
5,102 |
|
|
$ |
5,102 |
|
|