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Fair Value Measurements (Tables) | 9 Months Ended
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Sep. 30, 2023
Fair Value Disclosures [Abstract] |
Schedule of fair value measurements, recurring | The following table presents the Company’s liabilities that are measured at fair value on a recurring basis and the level within the fair value hierarchy (in thousands):
|  |  |  |  |  | September 30, |  |  |  |  |  |  |  | December 31,
| Level 1 |  | Level 2 |  | Level 3 | 2023 |  | Level 1 |  | Level 2 |  | Level 3 |  | 2022
Contingent earnout consideration | $ | — |  |  | $ | — |  |  | $ | 199 |  | $ | 199 |  |  | $ | — |  |  | $ | — |  |  | $ | 583 |  |  | $ | 583 |
Initial ProFrac Agreement Contract Consideration Convertible Notes | — |  |  | — |  |  | — |  | — |  |  | — |  |  | — |  |  | 14,220 |  |  | 14,220 |
Amended ProFrac Agreement Contract Consideration Convertible Notes | — |  |  | — |  |  | — |  | — |  |  | — |  |  | — |  |  | 69,350 |  |  | 69,350 |
Total | $ | — |  |  | $ | — |  |  | $ | 199 |  | $ | 199 |  |  | $ | — |  |  | $ | — |  |  | $ | 84,153 |  |  | $ | 84,153 |
Schedule of valuation techniques |
| September 30, 2023 | December 31, 2022
Risk-free interest rate | 5.19 | % | 4.34 | %
Expected volatility | 90.0 | % | 100.0 | %
Term until liquidation (years) | 1.63 |  | 2.38 |
Stock price (pre-Reverse Stock Split basis) | $ | 4.43 |  | $ | 1.12 |
Discount rate | 13.31 | % | 9.95 | %
The key inputs into the Monte Carlo simulation used to estimate the fair value of the Initial ProFrac Agreement Contract Consideration Convertible Notes Payable maturing February 2, 2023, as of December 31, 2022 were as follows:
|  | December 31, 2022
Risk-free interest rate |  | 4.12%
Expected volatility |  | 100.0%
Term until liquidation (years) |  | 0.09
Stock price (pre-Reverse Stock Split basis) |  | $1.12
Discount rate |  | 4.12%
The key inputs into the Monte Carlo simulation used to estimate the fair value of the Amended ProFrac Agreement Contract Consideration Convertible Notes Payable maturing May 17, 2023, as of December 31, 2022 were as follows:
| December 31, 2022
Risk-free interest rate | 4.59%
Expected volatility | 100.0%
Term until liquidation (years) | 0.38
Stock price (pre-Reverse Stock Split basis) | $1.12
Discount rate | 4.59%
Schedule of fair value, liabilities measured on recurring basis, unobservable input reconciliation | The following table presents the changes in balances of liabilities for the three and nine months ended September 30, 2023 and 2022 classified as Level 3 (in thousands):
| Three months ended September 30, |  | Nine months ended September 30,
| 2023 |  | 2022 |  | 2023 |  | 2022
Balance - beginning of period | $ | 260 |  |  | $ | 67,694 |  |  | $ | 84,153 |  |  | $ | 608 |
Transfer of ProFrac Agreement Contract Consideration Convertible Notes Payable from Level 2 | — |  |  | — |  |  | — |  |  | 10,000 |
Issuance of Amended ProFrac Agreement Contract Consideration Convertible Notes Payable | — |  |  | — |  |  | — |  |  | 69,460 |
Increase in principal of Initial ProFrac Agreement Contract Consideration Convertible Notes Payable for paid-in-kind interest | — |  |  | 266 |  |  | 85 |  |  | 681 |
Increase in principal of Amended ProFrac Agreement Contract Consideration Convertible Notes Payable for paid-in-kind interest |  |  | 1,293 |  |  | 2,043 |  |  | 1,905 |
Change in fair value of contingent earnout consideration | (61) |  |  | 28 |  |  | (384) |  |  | (106) |
Change in fair value of Initial ProFrac Agreement Contract Consideration Convertible Notes Payable | — |  |  | 634 |  |  | 786 |  |  | 1,889 |
Change in fair value of Amended ProFrac Agreement Contract Consideration Convertible Notes Payable | — |  |  | 3,617 |  |  | (30,754) |  |  | (10,905) |
Conversion of Initial ProFrac Agreement Contract Consideration Convertible Notes Payable on maturity | — |  |  | — |  |  | (15,092) |  |  | — |
Conversion of Amended ProFrac Agreement Contract Consideration Convertible Notes Payable on maturity |  |  | — |  |  | (40,638) |  |  | — |
Balance - end of period | $ | 199 |  |  | $ | 73,532 |  |  | $ | 199 |  |  | $ | 73,532 |

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- Definition Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Name Accounting Standards Codification -Section 50 -Paragraph 2C -SubTopic 10 -Topic 820 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482106/820-10-50-2C Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482106/820-10-50-2 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 3 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482106/820-10-50-3 Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482106/820-10-50-2 + Details
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- Definition Tabular disclosure of input and valuation technique used to measure fair value and change in valuation approach and technique for each separate class of asset and liability measured on recurring and nonrecurring basis. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (bbb) -SubTopic 10 -Topic 820 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482106/820-10-50-2 + Details
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- Definition Tabular disclosure of the fair value measurement of liabilities using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets), and gains or losses recognized in other comprehensive income (loss) and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs) by class of liability. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (c) -SubTopic 10 -Topic 820 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482106/820-10-50-2 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 3 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482106/820-10-50-3 + Details
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