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Fair Value of Financial Instruments | 12 Months Ended
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Dec. 31, 2024
Fair Value Disclosures [Abstract] |
Fair Value of Financial Instruments | 6. Fair Value of Financial Instruments Fair Value Measurements The following fair value hierarchy table presents information about the Company’s assets and liabilities measured at fair value on a recurring basis:
|  | Fair value measurement at reporting date using |
(in thousands) |  | (Level 1) |  |  | (Level 2) |  |  | (Level 3) |
December 31, 2024 |  |  |  |  |  |  |  |  |
Assets: |  |  |  |  |  |  |  |  |
Cash equivalents: |  |  |  |  |  |  |  |  |
Money market accounts |  | $ | 6,839 |  |  | $ | — |  |  | $ | — |
U.S. agency securities |  | $ | — |  |  | $ | 499 |  |  | $ | — |
Marketable securities: |  |  |  |  |  |  |  |  |
Corporate bonds |  | $ | — |  |  | $ | 2,018 |  |  | $ | — |
U.S. agency securities |  | $ | — |  |  | $ | 6,138 |  |  | $ | — |
December 31, 2023 |  |  |  |  |  |  |  |  |
Assets: |  |  |  |  |  |  |  |  |
Cash equivalents: |  |  |  |  |  |  |  |  |
Money market accounts |  | $ | 1,646 |  |  | $ | — |  |  | $ | — |
Marketable securities: |  |  |  |  |  |  |  |  |
Corporate bonds |  | $ | — |  |  | $ | 19,489 |  |  | $ | — |
U.S. agency securities |  | $ | — |  |  | $ | 9,294 |  |  | $ | — |
Liabilities: |  |  |  |  |  |  |  |  |
Contingent shares liability from fSight acquisition |  | $ | 527 |  |  | $ | — |  |  | $ | — |
The following is a summary of the changes in fair value of the Company’s marketable securities as of December 31, 2024, and 2023, respectively:
|  | As of December 31, 2024 |
(in thousands) |  | Amortized cost |  |  | Unrealized gain |  |  | Unrealized loss |  |  | Fair value |
Available-for-sale marketable securities: |  |  |  |  |  |  |  |  |  |  |  |
Current assets |  |  |  |  |  |  |  |  |  |  |  |
Corporate bonds |  | $ | 2,019 |  |  | $ | — |  |  | $ | (1 | ) |  | $ | 2,018 |
U.S. agency securities |  |  | 6,135 |  |  |  | 3 |  |  | $ | — |  |  |  | 6,138 |
Total available-for-sale marketable securities |  | $ | 8,154 |  |  | $ | 3 |  |  | $ | (1 | ) |  | $ | 8,156 |
As of December 31, 2024, all available-for-sale marketable securities consisted of investments that mature within one year.
|  | As of December 31, 2023 |
(in thousands) |  | Amortized cost |  |  | Unrealized gain |  |  | Unrealized loss |  |  | Fair value |
Available-for-sale marketable securities: |  |  |  |  |  |  |  |  |  |  |  |
Current assets |  |  |  |  |  |  |  |  |  |  |  |
Corporate bonds |  | $ | 17,561 |  |  | $ | 2 |  |  | $ | (52 | ) |  | $ | 17,511 |
U.S. agency securities |  |  | 9,300 |  |  |  | 2 |  |  | $ | (7 | ) |  |  | 9,295 |
Total |  |  | 26,861 |  |  |  | 4 |  |  |  | (59 | ) |  |  | 26,806 |
Long-term assets |  |  |  |  |  |  |  |  |  |  |  |
Corporate bonds |  |  | 1,981 |  |  |  | 3 |  |  |  | (7 | ) |  |  | 1,977 |
Total |  |  | 1,981 |  |  |  | 3 |  |  |  | (7 | ) |  |  | 1,977 |
Total available-for-sale marketable securities |  | $ | 28,842 |  |  | $ | 7 |  |  | $ | (66 | ) |  | $ | 28,783 |
The fair value of the preferred stock warrants was calculated using the Black-Scholes option pricing model and was revalued to fair value at the end of each reporting period until the earlier of the exercise or expiration of the preferred stock warrants. As a part of the Business Combination, Legacy Tigo preferred stock warrants were converted into the Legacy Tigo common stock at the conversion rate in effect immediately prior to the consummation of the Business Combination. Please see Note 3, “Merger with Roth CH Acquisition IV Co.” for additional information. The fair value of the warrant liabilities was estimated using the Black-Scholes option pricing model using the following assumptions:
|  | May 23, 2023 (Merger Date) |
Expected volatility |  | 68% - 70% |
Risk-free interest rate |  | 4.10% - 4.28% |
Expected term (in years) |  | 2.0 - 2.6 |
Expected dividend yield |  |  | — |
Fair value of Series C convertible preferred stock |  | $ | 1.89 |
T he table presented below is a summary of the changes in fair value of the Company’s preferred stock warrant liability which was exercised immediately prior to the Business Combination into Legacy Tigo preferred stock and subsequently converted into Legacy Tigo common stock. Upon the consummation of the Business Combination, such shares of Legacy Tigo common stock were converted to shares of common stock. Please see Note 3, “Merger with ROTH CH Acquisition IV Co.” for additional information.
(in thousands) |  | Fair value of preferred stock warrant liability |
Balance at December 31, 2022 |  |  | 1,507 |
Change in fair value |  |  | 501 |
Exercise of warrants |  |  | (2,008 | )
Balance at December 31, 2023 |  | $ | — |
The table presented below is a summary of the changes in fair value of the Company’s Level 3 financial instruments. The contingent shares from the fSight Acquisition (Note 4) were initially classified as a Level 3 measurement and upon the Merger were transferred out of Level 3 into Level 1, as they were valued on the observable stock price of the Company. In addition, the Company bifurcated the conversion options associated with the convertible promissory notes and separately account for them as a derivative liability. On September 24, 2023, the Company and L1 Energy entered into the Convertible Note Amendment. As a result of the Convertible Note Amendment, the conversion options no longer meet the requirements to be bifurcated into a convertible note derivative liability in accordance with ASC 815, “Derivatives and Hedging”. The carrying value of the convertible note derivative liability was remeasured to fair value immediately prior to the execution of the Convertible Note Amendment and was reclassified to equity. The reclassification was recorded in additional paid-in capital on the Company’s consolidated balance sheet. Please refer to Note 9 “Long-Term Debt” for additional details regarding the derivative instrument.
(in thousands) |  | Fair value of contingent shares from fSight acquisition |  |  | Fair value of derivative liability |
Balance at December 31, 2022 |  | $ | — |  |  | $ | — |
Fair value at inception |  |  | 2,167 |  |  |  | 23,525 |
Change in fair value |  |  | 29 |  |  |  | (12,247 | )
Transfer out of level 3 |  |  | (2,196 | ) |  |  | (11,278 | )
Balance at December 31, 2023 |  | $ | — |  |  | $ | — |
The fair value of the convertible note derivative liability was estimated using the Black-Scholes option pricing model using the following assumptions:
|  | As of September 24, 2023 (1) |
Expected volatility |  |  | 58.6 | %
Risk-free interest rate |  |  | 4.9 | %
Expected term (in years) |  |  | 2.3 |
Expected dividend yield |  |  | — |
(1) The fair value of the convertible note derivative liability was remeasured on September 24, 2023, immediately prior to the execution of the Convertible Note Amendment. During the year ended December 31, 2024, there were no transfers between Level 1, Level 2 and Level 3. Fair Value of Financial Instruments The carrying amounts of cash and cash equivalents, restricted cash, marketable securities, accounts receivable, accounts payable, and customer deposits approximate fair value due to their short-term nature. As of December 31, 2024, the fair value and carrying value of the Company’s Convertible Promissory Note (Note 9) was $44.0 million and $40.5 million, respectively. The estimated fair value for the Company’s Convertible Promissory Note was based on discounted expected future cash flows using prevailing interest rates which are Level 3 inputs under the fair value hierarchy.

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- Definition 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. + References Reference 1: http://www.xbrl.org/2003/role/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 107 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-107 Reference 2: http://www.xbrl.org/2003/role/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 100 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-100 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (c)(3) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2E -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2E Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (g) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 940 -SubTopic 820 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147478119/940-820-50-1 + Details
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