Accrued Expenses and Other Current Liabilities

6 Months Ended

Jun. 30, 2020

Accrued Expenses and Other Liabilities

Accrued Expenses and Other Current Liabilities

6. Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consisted of the following (in thousands):

	June 30,		December 31,
	2020		2019
Accrued payroll and related items	$	2,869	$	3,841
Artist payables		6,892		5,640
Accrued product costs		2,763		1,678
Operating lease liabilities		3,021		2,772
Contingent liabilities		—		1,087
Other		6,142		6,273
Accrued expenses and other current liabilities	$	21,687	$	21,291

As part of the acquisition of Deny Designs in May 2017, contingent consideration of up to $3.6 million is payable to the seller annually in three equal installments on the first through third anniversary of the closing date. The contingent consideration was valued at

$2.8 million as of the acquisition date based on time value, discount rate, and the estimated probability of achieving the contingent criteria related to the ongoing development of new products for sale, as specified in the purchase agreement. Such amounts are adjusted at each subsequent period based on probability of achievement until settlement of such liability. Adjustments to the liability are recorded to income or expense in our condensed consolidated statement of operations. The fair value adjustment to the liability for the six months ended June 30, 2020 was not material. The May 2018, May 2019, and May 2020 installments of the contingent consideration, net of post-closing working capital adjustments to the purchase price, were paid to the seller in the amounts of $1.1 million, $1.2 million, and $1.2 million, respectively. The final installment has been paid and no further liability remains as of June 30, 2020.