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Fair value measurements (Tables)
 9 Months Ended
Jul. 31, 2013
Fair value measurements [Abstract]  
Financial assets and liabilities measured on recurring basis

The following table sets forth our financial assets and liabilities as of July 31, 2013 that are measured on a recurring basis during the period, segregated by level within the fair value hierarchy:

 

                                 
    Level 1     Level 2     Level 3     Total  
    (All amounts are presented in thousands)  

Assets at Fair Value:

                                

Investment in Limoneira Company (1)

   $ 38,789       —         —       $ 38,789  
   

 

 

    

 

 

    

 

 

    

 

 

  

Total assets at fair value

   $ 38,789     $ —       $ —       $ 38,789  
   

 

 

    

 

 

    

 

 

    

 

 

  

 

(1) The investment in Limoneira Company consists of marketable securities in the Limoneira Company stock. We currently own approximately 15% of Limoneira’s outstanding common stock. These securities are measured at fair value by quoted market prices. Limoneira’s stock price at July 31, 2013 and October 31, 2012 equaled $22.44 per share and $22.47 per share. Unrealized gains and losses are recognized through other comprehensive income. Unrealized investment holding gains arising during the three months ended July 31, 2013 and 2012 were $6.6 million and $1.9 million. Unrealized investment holding losses arising during the nine months ended July 31, 2013 were $0.1 million. Unrealized investment holding gains arising during the nine months ended July 31, 2012 were $1.0 million.

 

                                 
    Level 1     Level 2     Level 3 (3)     Total  
    (All amounts are presented in thousands)  

Liabilities at fair value:

                                

Salsa Lisa contingent consideration (2)

     —         —       $ 893     $ 893  

RFG contingent consideration (2) (3)

     —         —         —         —    
   

 

 

    

 

 

    

 

 

    

 

 

  

Total liabilities at fair value

   $ —       $ —       $ 893     $ 893  
   

 

 

    

 

 

    

 

 

    

 

 

  

 

(2) Each period we revalue the contingent consideration obligations to their fair value and record increases or decreases in the fair value into selling, general and administrative expense. Increases or decreases in the fair value of the contingent consideration obligations can result from changes in assumed discount periods and rates, changes in the assumed timing and amount of revenue and expense estimates. Significant judgment is employed in determining the appropriateness of these assumptions as of the acquisition date and for each subsequent period. Accordingly, future business and economic conditions, as well as changes in any of the assumptions described above, can materially impact the amount of contingent consideration expense we record in any given period. Total net increase to the contingent considerations during the three and nine months ended July 31, 2013 totaled $0.4 million and $1.8 million.
(3) We have amended our acquisition agreement with RFG in regards to the cash payment portion of the Stage II earnout. As of July 31, 2013, we no longer will pay $5 million in cash, but rather in the form of shares of our common stock. We recorded a revalue adjustment of $0.4 million in the third quarter of 2013 and the entire liability of $4.2 million has been reclassified to additional paid in capital. See Note 11 for additional information.
Reconciliation of contingent consideration

The following is a reconciliation of the beginning and ending amounts of the contingent consideration for Salsa Lisa and RFG:

 

                                         
    Balance at
October 31,
2012		     Interest     Revalue
Adjustment		     Reclassification (1)     Balance
July 31,
2013		  
    (All amounts are presented in thousands)  

Salsa Lisa contingent consideration

   $ 857     $ 36     $ —       $ —       $ 893  

RFG contingent consideration

     2,322       97       1,801       (4,220 )      —    
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total

   $ 3,179     $ 133     $ 1,801     $ (4,220 )    $ 893  
   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

(1) We have amended our acquisition agreement with RFG in regards to the cash payment portion of the Stage II earnout. As of July 31, 2013, we no longer will pay $5 million in cash, but rather in the form of shares of our common stock. We recorded a revalue adjustment of $0.4 million in the third quarter of 2013 and the entire liability of $4.2 million has been reclassified to additional paid in capital. See Note 11 for additional information.