XOMA Corporation Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Fair Value Measurements (Tables)

Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2019

Financial Assets and Liabilities Carried at Fair Value on Recurring Basis

The following tables set forth the Company’s fair value hierarchy for its financial assets and liabilities measured at fair value on a recurring basis as follows (in thousands):

	Fair Value Measurements at September 30, 2019 Using
	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
	(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Long-term equity securities	$	—	$	—	$	873	$	873
Liabilities:
Contingent consideration	$	—	$	—	$	75	$	75

	Fair Value Measurements at December 31, 2018 Using
	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
	(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Long-term equity securities	$	—	$	—	$	392	$	392

Summary of Changes in Estimated Fair Value of Level 3 Financial Assets

The following table provides a summary of changes in the estimated fair value of the Company’s Level 3 financial assets for the nine months ended September 30, 2019 (in thousands):

Balance at December 31, 2018	$	392
Change in fair value		481
Balance at September 30, 2019	$	873

Estimated Fair Value of Equity Securities Assumptions

The estimated fair value of the equity securities was calculated based on the following assumptions as of December 31, 2018:

Discount for lack of marketability		35	%
Estimated time to liquidity of shares	1.45 years

Scenario probabilities
Liquidation		20	%
Near-term sale		5	%
Near-term financing		75	%

The estimated fair value of the equity securities was calculated based on the following assumptions as of September 30, 2019:

Closing common stock price on the Over-the-counter (OTC) exchange	$	0.15

Tranche 1:
Discount for lack of marketability		17	%
Estimated time to liquidity of shares	0.5 years

Tranche 2:
Discount for lack of marketability		33	%
Estimated time to liquidity of shares	1.5 years

Outstanding Long Term Debt Carrying Amount and Estimated Fair Value

The carrying amount and the estimated fair value of the Company’s outstanding long-term debt at September 30, 2019, and December 31, 2018, are as follows (in thousands):

	September 30, 2019				December 31, 2018
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Novartis note	$	15,570	$	15,487	$	15,193	$	14,825
SVB Loans		17,109		17,104		7,286		7,281
Total	$	32,679	$	32,591	$	22,479	$	22,106