Fair Value Measurement

9 Months Ended

Sep. 30, 2020

Fair Value Disclosures [Abstract]

Fair Value Measurement

24. Fair Value Measurement

The Company complies with ASC 820, Fair Value Measurements, for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period, and non-financial assets and liabilities that are re-measured and reported at fair value at least annually. In general, fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities. Fair values determined by Level 2 inputs utilize data points that are observable such as quoted prices, interest rates and yield curves. Fair values determined by Level 3 inputs are unobservable data points for the asset or liability, and includes situations where there is little, if any, market activity for the asset or liability.

The following tables present information about the Company’s assets that are measured at fair value on a recurring basis as of September 30, 2020 and December 31, 2019 and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value:

	Quoted prices
	in active
	markets for		Other		Significant
	identical		observable		unobservable
	assets		inputs		inputs
	(Level 1)		(Level 2)		(Level 3)			Total
As of September 30, 2020
Investments
Equity investments measured at fair value	$	2,207	$	—	$	—		$	2,207
Debt securities classified as available-for-sale		844		—		4,921			5,765
Warrant liability		—		—		(71,636	)		(71,636	)
Total recurring fair value measurements	$	3,051	$	—	$	(66,715	)	$	(63,664	)

	Quoted prices
	in active
	markets for		Other		Significant
	identical		observable		unobservable
	assets		inputs		inputs
	(Level 1)		(Level 2)		(Level 3)			Total
As of December 31, 2019
Investments
Equity investments measured at fair value	$	4,183	$	—	$	—		$	4,183
Debt securities classified as available-for-sale		727		—		4,320			5,047
Acquisition-related contingent consideration		—		—		(420	)		(420	)
Total recurring fair value measurements	$	4,910	$	—	$	3,900		$	8,810

Items measured at fair value on a recurring basis

The Company’s financial assets and liabilities required to be measured on a recurring basis are its equity investments measured at fair value, debt securities classified as available-for-sale, acquisition-related contingent consideration, and warrant liability.

Debt securities classified as available-for-sale and equity investments recorded at fair value: The estimated fair value is determined using quoted market prices, broker or dealer quotations or discounted cash flows.

Warrant liability: The warrants associated with the warrant liability are classified as Level 3 derivatives. Consequently, the estimated fair value of the warrant liability is determined using the Monte Carlo pricing model (refer to Note 14). Until the warrants are exercised, expire, or other facts and circumstances lead the warrant liability to be reclassified to stockholders’ equity, the warrant liability (which relates to warrants to purchase shares of Class 2 common stock) is marked-to-market each reporting period with the change in fair value recorded in change in fair value of warrant liability,. Any significant adjustments to the unobservable inputs disclosed in the table below would have a direct impact on the fair value of the warrant liability.

The opening balances of assets and liabilities categorized within Level 3 of the fair value hierarchy measured at fair value on a recurring basis are reconciled to the closing balances as follows:

	Debt securities classified as available-for- sale		Warrant liability
Opening balance as at December 31, 2019	$	4,320	$	—
Additions and settlements
Additions		—		(69,414	)
Exercise		—		49,053
Total gains or losses for the period:		—		—
Included in net loss		—		—
Interest expenses, net		601		—
Change in fair value of warrant liability		—		(51,275	)
Impairment of assets		—		—
Foreign currency translation loss, net		—		—
Closing balance as at September 30, 2020	$	4,921	$	(71,636	)

	Quantitative information about Level 3 fair value measurements
	Fair value at September 30, 2020			Valuation technique	Unobservable input	Range (weighted average)
					Discount rate	16.5%
Debt securities classified as available-for-sale	$	4,921		Discounted cash flow	Probability of conversion/ prepayment	nil
					Probability of default	nil
Warrant liability	$	(71,636	)	Monte Carlo	Volatility	100%
					Expected life	0.2 years to 5 years (2.4 years)

Items measured at fair value on a non-recurring basis

The Company's prepayments and other current assets, long lived assets, including property and equipment, goodwill and intangible assets are measured at fair value when there is an indicator of impairment and are recorded at fair value only when an impairment charge is recognized.

Land and buildings (held for sale): The Company used a third-party real estate agent to assist management in its determination of the fair value of the assets held for sale at the High Park Gardens facility. Management, in its determination of the fair value of the assets held for sale reviewed market data from recent sales of similar properties to determine an implied sale price per acre of land and greenhouse space and wrote-down the carrying value of the land and greenhouse space held for sale to the estimated fair value less selling costs.

In connection with an evaluation of such assets during the nine months ended September 30, 2020, the carrying values of the land and buildings at the High Park Gardens facility (Level 2), ABG finance receivable and certain intangible assets (Level 3) were concluded to exceed their fair values. As a result, the Company recorded impairment charges that incorporates fair value measurements based on Level 2 (refer to Note 2) and Level 3 inputs (refer to Note 3, Note 8 and Note 10).

The estimated fair value of cash and cash equivalents, accounts receivable, net, accounts payable, accrued expenses and other current liabilities, convertible notes and Senior Facility at September 30, 2020 (December 31, 2019 – the fair value of all aforementioned, except the Senior Facility which was entered into in 2020) approximate their carrying value.