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Fair Value Measurements
 9 Months Ended
Sep. 30, 2024
Fair Value Measurements  
Fair Value Measurements

(15) Fair Value Measurements

Under ASC 820, Fair Value Measurements and Disclosures, disclosures relating to how fair value is determined for assets and liabilities are required and a hierarchy for which these assets and liabilities must be grouped is established, based on significant levels of inputs, as follows:

●Level 1 – Quoted prices in active markets for identical assets and liabilities.
●Level 2 – Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
●Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Company utilizes several valuation techniques to assess the fair value of its financial assets and liabilities.

The following tables set forth the fair value of the Company’s financial assets and liabilities measured at fair value on a recurring basis as of September 30, 2024 and December 31, 2023 based on the three-tier fair value hierarchy (in thousands):

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

    

September 30, 2024

​

Balance Sheet Classification

Level 1

​

Level 2

​

Level 3

​

Total

Assets

​

​

​

​

​

​

​

​

​

​

​

​

Cash and cash equivalents

Cash and cash equivalents

$

13,479

​

$

—

​

$

—

​

$

13,479

Restricted cash

Restricted cash

​

10,660

​

​

—

​

​

—

​

​

10,660

Total

​

$

24,139

​

$

—

​

$

—

​

$

24,139

Liabilities

​

​

​

​

​

​

​

​

​

​

​

​

Convertible note

Convertible note

$

—

​

$

—

​

$

21,642

​

$

21,642

Public warrants

Other noncurrent liabilities

​

147

​

​

—

​

​

—

​

​

147

Total

​

$

147

​

$

—

​

$

21,642

​

$

21,789

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

    

December 31, 2023

​

Balance Sheet Classification

Level 1

​

Level 2

​

Level 3

​

Total

Assets

​

​

​

​

​

​

​

​

​

​

​

​

Cash and cash equivalents

Cash and cash equivalents

$

36,566

​

$

—

​

$

—

​

$

36,566

Restricted cash

Restricted cash

​

5,700

​

​

—

​

​

—

​

​

5,700

Total

​

$

42,266

​

$

—

​

$

—

​

$

42,266

Liabilities

​

​

​

​

​

​

​

​

​

​

​

​

Convertible note

Convertible note

$

—

​

$

—

​

$

23,854

​

$

23,854

Public warrants

Other noncurrent liabilities

​

48

​

​

—

​

​

—

​

​

48

Total

​

$

48

​

$

—

​

$

23,854

​

$

23,902

​

Cash, Cash Equivalents and Restricted Cash

​

Cash, cash equivalents and restricted cash are comprised of credit card receivables and cash and are categorized as Level 1 instruments. The Company maintains cash with various high-quality financial institutions and holds restricted cash with certain credit card processors as a financial guarantee. Cash, cash equivalents and restricted cash are carried at cost, which management believes approximates fair value. As of September 30, 2024 and December 31, 2023, the Company had $13.5 million and $36.6 million, respectively, of cash and cash equivalents. As of September 30, 2024 and December 31, 2023, the Company had $10.7 million and $5.7 million, respectively, of restricted cash.

Public Warrants

The Company is party to issued and outstanding Public Warrants, which have been recorded within other noncurrent liabilities within the Condensed Consolidated Balance Sheets. The Company accounts for the Public Warrants as liabilities at fair value as the Public Warrants do not meet the criteria for classification within equity. As the Public Warrants utilize an observable price in an active market to assess their fair value the warrants are categorized as Level 1 instruments and are subject to remeasurement at each balance sheet date. During the three and nine months ended September 30, 2024, the Company recognized less than $0.1 million and $0.1 million, respectively, in fair market value adjustments, and during the three and nine months ended September 30, 2023, the Company recognized $0.3 million and $0.5 million, respectively, in fair market value adjustments. Fair market value adjustments are recognized to loss (gain) on fair value instruments within the Company’s Condensed Consolidated Statements of Operations and Comprehensive Income (Loss).

Convertible Note

The estimated fair value of the Note has been determined to be a Level 3 measurement, as the Company utilizes a binomial lattice model where both the debt and stock features of the Note are considered. In reviewing the debt features of the Note, the Company considered its scheduled coupon and principal payments and compared them to those of instruments currently outstanding in the market of companies with similar credit ratings as well as the risk-free rate. In considering the stock features of the Note, the Company considered the value and volatility of its own stock, in addition to considering volatility of similar instruments in the marketplace as well as the conversion feature of the Note, which is discounted at the risk-free rate.