FAIR VALUE MEASUREMENTS
|6 Months Ended
Jun. 30, 2022
|Derivative Instruments and Hedging Activities Disclosure [Abstract]
|FAIR VALUE MEASUREMENTS
|FAIR VALUE MEASUREMENTS
The following table provides the fair value measurement hierarchy of the Company’s assets and liabilities, except for those assets and liabilities that are short term in nature and approximate the fair values, as of the periods presented:
Investment – Cansativa
Our investment in Cansativa’s equity securities that was previously accounted for using the equity method was partially divested during the three months ended June 30, 2022. Given that this investment does not have a “readily determinable fair value,” or is not traded in a verifiable public market, the Company accounted for this investment under ASC 321, Investments - Equity Securities. The Company used the practical expedient available under ASU 2016-01, the cost method investment which presents and carries this investment using the alternative measurement method which is cost minus impairment, if any, plus or minus changes resulting from observable price changes in “orderly transactions,” as defined in ASC 321, for the identical or a similar investment of the same issuer. The Company periodically reviews the investments for other than temporary declines in fair value below cost and more frequently when events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. As of June 30, 2022, the Company believes the carrying value of its cost method investments were recoverable in all material respects. For more information, refer to Note 7 to our unaudited condensed consolidated interim financial statements for the period ended of June 30, 2022.
The following table provides a summary of changes in fair value of the Company’s level 3 investments for the six months ended June 30, 2022:
During the six months ended June 30, 2022, there were no transfers between fair value measurement levels.
The change in fair value of warrant liabilities related to private warrants during the six months ended June 30, 2022, is as follows:
The Company determined the fair value of its private warrants using the Monte Carlo simulation model. The following assumptions were used to determine the fair value of the Private Warrants as of June 30, 2022 and December 31, 2021:
•The risk-free interest rate assumptions are based on U.S. dollar zero curve derived from swap rates at the valuation date, with a term to maturity matching the remaining term of warrants.
•The expected volatility assumptions are based on average of historical volatility based on comparable industry volatilities of public warrants.