The Company’s money market funds are categorized as Level 1 within the fair value hierarchy. As of September 30, and June 30, 2023, the Company’s cash and cash equivalents were as follows:

As of September 30 and June 30, 2023, the Company’s contingent consideration liabilities related to acquisitions are categorized as Level 3 within the fair value hierarchy. Contingent consideration was valued at the time of acquisitions and at September 30 and June 30, 2023 using unobservable inputs and have included using the Monte Carlo simulation model. This model incorporates revenue volatility, internal rate of return, and a risk-free rate. The development and determination of the unobservable inputs for Level 3 fair value measurements and fair value calculations are the responsibility of the Company’s management with the assistance of a third-party valuation specialist.

As of September 30, 2023, the Company’s contingent consideration liabilities current and non-current balances were as follows:

A summary of the quantitative significant inputs used to value S5D’s contingent consideration as of September 30, 2023 was: $1.84 per share market price of the Company’s common stock, revenue projections, revenue volatility of 63.5%, weighted average cost of capital discount rate of 15.0% and a risk-free rate of 5.3%. The range of potential additional contingent consideration related to S5D at September 30, 2023 is zero to $14.0 million in the form of Company common stock.

A summary of the quantitative significant inputs used to value BLI’s contingent consideration as of September 30, 2023 was: $1.84 per share market price of the Company’s common stock, revenue projections, revenue volatility of 74.4%, weighted average cost of capital discount rate of 15.8% and risk-free rate of 5.1%. The range of potential additional contingent consideration related to BLI at September 30, 2023 is zero to $24.5 million, of which up to $12.0 million is cash and the remainder in the form of Company common stock.

The change in fair value of contingent consideration for S5D and BLI for the three months ended September 30, 2023 was a non-cash gain of approximately $1.38 million and $1.32 million, respectively, included as change in fair value of acquisition contingent consideration in the consolidated statements of operations. This was primarily driven by the decrease in the Company’s common stock price between the measurement dates.

The change in fair value of contingent consideration for XRT for the three months ended September 30, 2023 reflects the payout to the sellers of XRT for consideration earned in prior periods. This payout was made in September 2023 in the form of Company common stock, fair valued at $0.13 million. In addition, the change reflects a non-cash gain of approximately $0.06 million included as change in fair value of acquisition contingent consideration in the consolidated statements of operations reflecting a decrease in the Company’s common stock price between the measurement dates. The range of potential additional contingent consideration related to XRT at September 30, 2023 is zero to $1.0 million in the form of Company common stock. The Company considers this occurrence as remote, and no provision is made for it.

The range of potential additional contingent consideration related to the previous divestiture of AUGGD assets at September 30, 2023 is zero to $0.65 million in the form of Company common stock. The Company considers this occurrence as remote, and no provision is made for it.

The range of potential additional contingent consideration related to the Pulpo acquisition (see Note 5) at September 30, 2023 is zero to $13.0 million ($12.5 million in Company common stock and $0.5 million cash). The Company considers this occurrence as remote, and no provision is made for it.

As of June 30, 2023, the Company’s contingent consideration liabilities current and non-current balances were as follows:


	As of June 30, 2023
	Contingent Consideration at Purchase Date		Consideration Paid			Changes in Fair Value			Fair Value		Contingent Consideration
Level 3:
Contingent consideration, current - S5D	$	2,060,300	$	(1,359,001	)	$	1,207,501		$	1,908,800	$	1,908,800
Contingent consideration, current - BLI		1,264,200		-			1,693,500			2,957,700		2,957,700
Contingent consideration, current - AUGGD		-		(568,571	)		568,571			-		-
Contingent consideration, current - XRT		-		(331,786	)		586,077			254,291		254,291
Total contingent consideration, current portion	$	3,324,500	$	(2,259,358	)	$	4,055,649		$	5,120,791	$	5,120,791

Level 3:
Contingent consideration, non-current - S5D	$	7,108,900	$	(2,050,000	)	$	(3,807,200	)	$	1,251,700	$	1,251,700
Contingent consideration, non-current - BLI		6,060,700		-			(2,807,400	)		3,253,300		3,253,300
Total contingent consideration, net of current portion	$	13,169,600	$	(2,050,000	)	$	(6,614,600	)	$	4,505,000	$	4,505,000

A summary of the quantitative significant inputs used to value S5D’s contingent consideration as of June 30, 2023 was: $3.56 per share market price of the Company’s common stock, revenue projections, revenue volatility of 66.6%, weighted average cost of capital discount rate of 15.7% and a risk-free rate of 5.1%.

A summary of the quantitative significant inputs used to value BLI’s contingent consideration as of June 30, 2023 was: $3.56 per share market price of the Company’s common stock, revenue projections, revenue volatility of 75.6%, weighted average cost of capital discount rate of 16.4% and a risk-free rate of 4.8%.

The change in fair value of contingent consideration for S5D and BLI for the three months ended September 30, 2022 was a non-cash expense of approximately $2.24 million and $0.17 million, respectively, included as change in fair value of acquisition contingent consideration in the consolidated statements of operations. This was primarily driven by the change in the Company’s common stock price between the measurement dates. Also included is the change in fair value of contingent consideration for XRT of $0.20 million reflecting achievement of certain revenue thresholds as defined and not previously accrued.