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Fair Value Measurement

6 Months Ended

Jun. 30, 2021

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENT

11. FAIR VALUE MEASUREMENT

Measured or disclosed at fair value on a recurring basis

The Group measured its financial assets and liabilities, including cash and cash equivalents, restricted cash and convertible notes at fair value on a recurring basis as of December 31, 2020 and June 30, 2021. Cash and cash equivalents and restricted cash are classified within Level 1 of the fair value hierarchy because they are valued based on the quoted market price in an active market. The Group determines the fair value of convertible notes, with the assistance of an independent third-party appraiser, based on Level 3 inputs. To determine the fair value of the convertible notes, the Group used probability expected return method.

The key assumptions used in valuation of convertible notes as of June 30, 2021 are summarized in the table below:

Probability for Conversion		90%
Probability for Redemption		10%
Remaining life		0.1 – 2.5 years

As of December 31, 2020 and June 30, 2021, information about inputs for the fair value measurements of the Group’s assets and liabilities that are measured at fair value on a recurring basis in periods subsequent to their initial recognition is as follow:

		Fair Value Measurement as of December 31, 2020
		Quoted Prices in Active Market for Identical Assets			Significant Other Observable Inputs		Significant Unobservable Inputs		Total
		(Level 1)			(Level 2)		(Level 3)
Cash and cash equivalents		$	21,496		—		—		$	21,496
Restricted cash			19,700		—		—			19,700
Total		$	41,196		—		—		$	41,196

		Fair Value Measurement as of June 30, 2021
		Quoted Prices in Active Market for Identical Assets			Significant Other Observable Inputs		Significant Unobservable Inputs		Total
		(Level 1)			(Level 2)		(Level 3)
Cash and cash equivalents		$	13,367		—		—		$	13,367
Restricted cash			20,460		—		—			20,460
Convertible notes			—		—		64,343			64,343
Total		$	33,827		—		64,343		$	98,170

The following is a reconciliation of the beginning and ending balances for assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the three and six months ended June 30, 2021:

		Convertible notes
Balance as of January 1, 2021		$	—
Issuance of convertible notes			57,500
Changes in fair value of convertible notes			3,600
Balance as of March 31, 2021		$	61,100
Changes in fair value of convertible notes			3,243
Balance as of June 30, 2021		$	64,343

Measured or disclosed at fair value on a nonrecurring basis

The Group measured the long-lived assets using the income approach — discounted cash flow method, when events or changes in circumstances indicate that the carrying amount of an asset may no longer be recoverable.

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

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