Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2019

Fair Value Disclosures [Abstract]

Tabular disclosure of financial instruments measured at fair value on a recurring basis

The following table presents the fair value of the Company’s financial instruments that are measured at fair value on a recurring basis as of June 30, 2019:

(in thousands)	Level 1		Level 2		Level 3		Total
Tax amortization benefit contingency(1)	$	—	$	—	$	42,239	$	42,239
Contingent consideration(2)	—		—		772		772
Liability-classified stock compensation(3)	—		—		144		144
Total	$	—	$	—	$	43,155	$	43,155

The following table presents the fair value of the Company’s financial instruments that are measured at fair value on a recurring basis as of December 31, 2018:

(in thousands)	Level 1		Level 2		Level 3		Total
Tax amortization benefit contingency(1)	$	—	$	—	$	40,467	$	40,467
Contingent consideration(2)	—		—		379		379
Liability-classified stock compensation(3)	—		—		550		550
Total	$	—	$	—	$	41,396	$	41,396

———————————————————————————————

(1) The fair value of the tax amortization benefit contingency is measured using an income approach based on the Company’s best estimate of the undiscounted cash payments to be made, with the current portion tax effected at 21.5% and the non-current portion tax effected at 21.5% due to the TCJA enacted in the U.S. and discounted to present value utilizing an appropriate market discount rate.

(2) The fair value of the contingent consideration related to the Tecnidex acquisition.

(3) The fair value of the stock appreciation rights was measured using a Black Scholes pricing model during the six months ended June 30, 2019. The fair value of time based phantom shares is based on the fair value of the Company's common stock. The fair value of performance based phantom shares was measured using Monte Carlo pricing model during the six months ended June 30, 2019. The valuation technique used did not change during the six months ended June 30, 2019.

Changes in financial instruments measured at level 3 fair value on a recurring basis

The following table presents the changes during the period presented in our Level 3 financial instrument liabilities that are measured at fair value on a recurring basis.

(in thousands)	Tax amortization benefit contingency		Contingent consideration related to acquisition		Liability-classified stock compensation		Total
Balance, December 31, 2018	$	40,467	$	379	$	550	$	41,396
Accretion	1,772		—		—		1,772
Tecnidex earnout activity	—		393		—		393
Stock compensation activity	—		—		(406)		(406)
Balance, June 30, 2019	$	42,239	$	772	$	144	$	43,155