Fair Values of Financial Instruments (Tables)

9 Months Ended

Sep. 29, 2019

Deferred Compensation Plan Commodity Hedging Agreements and Acquisition Related Contingent Consideration

The following tables summarize, by assets and liabilities, the carrying amounts and fair values by level of the Company’s deferred compensation plan, commodity hedging agreements, debt and acquisition related contingent consideration:

	September 29, 2019
	Carrying		Total		Fair Value		Fair Value		Fair Value
(in thousands)	Amount		Fair Value		Level 1		Level 2		Level 3
Assets:
Deferred compensation plan assets	$	38,920	$	38,920	$	38,920	$	-	$	-
Liabilities:
Deferred compensation plan liabilities		38,920		38,920		38,920		-		-
Commodity hedging agreements		8,212		8,212		-		8,212		-
Nonpublic variable rate debt		304,706		305,000		-		305,000		-
Nonpublic fixed rate debt		374,710		383,700		-		383,700		-
Public debt securities		347,927		369,800		-		369,800		-
Acquisition related contingent consideration		425,191		425,191		-		-		425,191

	December 30, 2018
	Carrying		Total		Fair Value		Fair Value		Fair Value
(in thousands)	Amount		Fair Value		Level 1		Level 2		Level 3
Assets:
Deferred compensation plan assets	$	33,160	$	33,160	$	33,160	$	-	$	-
Liabilities:
Deferred compensation plan liabilities		33,160		33,160		33,160		-		-
Commodity hedging agreements		10,305		10,305		-		10,305		-
Nonpublic variable rate debt		372,074		372,500		-		372,500		-
Nonpublic fixed rate debt		274,717		261,200		-		261,200		-
Public debt securities		457,612		455,400		-		455,400		-
Acquisition related contingent consideration		382,898		382,898		-		-		382,898

Summary of Reconciliation of Acquisition Related Contingent Consideration

The acquisition related contingent consideration is the Company’s only Level 3 asset or liability. A reconciliation of the Level 3 activity is as follows:

	Third Quarter						First Nine Months
(in thousands)	2019			2018			2019			2018
Beginning balance - Level 3 liability	$	412,450		$	374,537		$	382,898		$	381,291
Measurement period adjustments⁽¹⁾		-			(1,279	)		-			813
Payments of acquisition related contingent consideration		(5,948	)		(7,049	)		(18,784	)		(18,312	)
Reclassification to current payables		(60	)		-			(940	)		(1,540	)
Increase (decrease) in fair value		18,749			(2,373	)		62,017			1,584
Ending balance - Level 3 liability	$	425,191		$	363,836		$	425,191		$	363,836

⁽¹⁾

^{Measurement period adjustments relate to post-closing adjustments made in accordance with the terms and conditions of the applicable asset purchase agreement or asset exchange agreement for distribution territories acquired or exchanged by the Company in April 2017 and October 2017 as part of the System Transformation. All final post-closing adjustments for these transactions were completed during 2018.}