Quarterly report pursuant to Section 13 or 15(d)

Total Estimated Purchase Consideration (Detail)

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Total Estimated Purchase Consideration (Detail)
 3 Months Ended
Mar. 31, 2018
USD ($)
Equity consideration $ 61,092,050 [1]
Total estimated purchase consideration 85,526,383
Employee Stock Option [Member]  
Business Combination, Step Acquisition, Equity Interest in Acquiree, Fair Value 187,333 [2]
Preferred Stock [Member]  
Business Combination, Step Acquisition, Equity Interest in Acquiree, Fair Value 19,118,000 [3]
Network Medical Management, Inc. [Member] | Noncontrolling Interest [Member]  
Business Combination, Step Acquisition, Equity Interest in Acquiree, Fair Value $ 5,129,000 [4]
[1] Equity consideration Immediately following the Effective Time, pre-Merger ApolloMed stockholders continued to hold an aggregate of 6,109,205 shares of ApolloMed common stock.
[2] Estimated fair value of the ApolloMed outstanding stock options The estimated fair value of the outstanding ApolloMed stock options is included in consideration transferred in accordance with ASC 805. The outstanding ApolloMed stock options are expected to vest in conjunction with the Merger due to a pre-existing change-of-control provision associated with the awards. There is no future service requirement.
[3] Estimated fair value of ApolloMed’s preferred shares held by NMM NMM currently owns all the shares of ApolloMed Series A preferred stock and Series B preferred stock, which was acquired prior to the Merger. As part of the Merger, the ApolloMed Series A preferred stock and Series B preferred stock is remeasured at fair value and included as part of the consideration transferred to ApolloMed. The fair value of the Series A preferred stock and Series B preferred stock is reflective of the liquidation preferences, claims of priority and conversion option values thereof. In aggregate, the Series A preferred stock and Series B preferred stock were valued to be $19,118,000. The valuation methodology was based on an Option Pricing Method (“OPM”) which utilized the observable publicly traded common stock price in valuing the Series A preferred stock and the Series B preferred stock within the context of the capital structure of the Company. OPM assumptions included an expected term of 2 years, volatility rate of 37.9%, and a risk-free rate of 1.8%. The fair value of the liquidation preference for the Series A preferred stock and the Series B preferred stock was determined to be $12,745,000 and the fair value of the conversion option was determined to be $6,373,000 or an aggregate total fair value of $19,118,000.
[4] Estimated fair value of NMM’s 50% share of APA ACO Inc. Prior to the Merger, APAACO was owned 50% by ApolloMed and 50% NMM. NMM’s noncontrolling interest in APAACO has been remeasured at fair value as of the closing date and is added to the consideration transferred to ApolloMed as a result of NMM relinquishing its equity investment in APAACO in order to obtain control of ApolloMed. The fair value of NMM’s noncontrolling interest in APAACO has been estimated to be $5,129,000 using the discounted cash flow method and NMM recorded a gain on investment for the same amount to reflect the fair value of this investment prior the Merger.