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Fair Value Measurement
 6 Months Ended
Jun. 30, 2019
Fair Value Disclosures [Abstract]  
Fair Value Measurement

NOTE 7. FAIR VALUE MEASUREMENT

 

In accordance with ASC Topic 820 — Fair Value Measurements and Disclosures (“ASC 820”), the Company utilizes the market approach to measure fair value for its financial assets and liabilities. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets, liabilities or a group of assets or liabilities, such as a business.

 

ASC 820 utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The following is a brief description of those three levels:

 

  ● Level 1 — Quoted prices in active markets for identical assets and liabilities
     
  ● Level 2 — Other significant observable inputs (including quoted prices in active markets for similar assets or liabilities)
     
  ● Level 3 — Significant unobservable inputs (including the Company’s own assumptions in determining the fair value)

 

The following table represents the Company’s hierarchy for its financial assets and liabilities measured at fair value on a recurring basis as of June 30, 2019 and December 31, 2018.

 

   June 30, 2019 
   Level 1   Level 2   Level 3   Total 
Liabilities:                
Proceeds Investment Agreement  $—   $—   $6,240,000   $6,240,000 

 

   December 31, 2018 
   Level 1   Level 2   Level 3   Total 
Liabilities:                
Proceeds Investment Agreement  $—   $—   $9,142,000   $9,142,000 

 

The following table represents the change in Level 3 tier value measurements:

 

   Proceeds
Investment
Agreement		 
December 31, 2018  $9,142,000 
Repayment of obligation   (6,000,000)
Change in fair value   3,098,000 
      
June 30, 2019  $6,240,000