XML 53 R12.htm IDEA: XBRL DOCUMENT
v2.4.1.9

Available-for-Sale and Fair Value Measurements | 12 Months Ended
--- | ---
Dec. 31, 2014
Available-for-Sale and Fair Value Measurements [Abstract] |
Available-for-Sale and Fair Value Measurements |
6. | Available-for-Sale and Fair Value Measurements
The classification of the Company’s available-for-sale securities consisted of the following (in thousands):
|  | December 31, 2014 |  |  | December 31, 2013 |
Money Market funds |  | $ | 67,569 |  |  | $ | 82,759 |
U.S. treasury securities |  |  | - |  |  |  | 19,989 |
|  | $ | 67,569 |  |  | $ | 102,748 |
The Company had no unrealized gains or losses associated with its available-for-sale securities as of December 31, 2014. As of December 31, 2013, gross unrealized losses of approximately $1,000 were included in accumulated comprehensive loss on its consolidated balance sheet. Fair value is defined as the exchange price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company applies Accounting Standards Codification Topic 820, Fair Value Measurement and Disclosures, (“ASC 820”), which establishes a framework for measuring fair value and a fair value hierarchy that prioritizes the inputs used in valuation techniques. The accounting standard describes a fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value which are the following: Level 1 – Observable inputs, such as quoted prices in active markets for identical assets or liabilities. Level 2 – Observable inputs, either directly or indirectly, other than quoted prices in active markets for similar assets or liabilities, that are not active or other inputs that are not observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities; therefore, requiring an entity to develop its own valuation techniques and assumptions. 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 of December 31, 2014 and 2013 as follows (in thousands):
|  | Fair Value Measurements at December 31, 2014 Using |  |  |  |
|  | Quoted Prices in Active Markets for Identical Assets |  |  | Significant Other Observable Inputs |  |  | Significant Unobservable Inputs |  |  |  |
|  | (Level 1) |  |  | (Level 2) |  |  | (Level 3) |  |  | Total |
Assets: |  |  |  |  |  |  |  |  |  |  |  |
Money market funds (1) |  | $ | 67,569 |  |  | $ | - |  |  | $ | - |  |  | $ | 67,569 |
Foreign exchange options |  |  | - |  |  |  | 6 |  |  |  | - |  |  |  | 6 |
Total |  | $ | 67,569 |  |  | $ | 6 |  |  | $ | - |  |  | $ | 67,575 |
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Contingent warrant liabilities |  | $ | - |  |  | $ | - |  |  | $ | 31,828 |  |  | $ | 31,828 |
|  | Fair Value Measurements at December 31, 2013 Using |  |  |  |
|  | Quoted Prices in Active Markets for Identical Assets |  |  | Significant Other Observable Inputs |  |  | Significant Unobservable Inputs |  |  |  |
|  | (Level 1) |  |  | (Level 2) |  |  | (Level 3) |  |  | Total |
Assets: |  |  |  |  |  |  |  |  |  |  |  |
Money market funds (1) |  | $ | 82,759 |  |  | $ | - |  |  | $ | - |  |  | $ | 82,759 |
U.S. treasury securities |  |  | 19,989 |  |  |  | - |  |  |  | - |  |  |  | 19,989 |
Foreign exchange options |  |  | - |  |  |  | 361 |  |  |  | - |  |  |  | 361 |
Total |  | $ | 102,748 |  |  | $ | 361 |  |  | $ | - |  |  | $ | 103,109 |
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Contingent warrant liabilities |  | $ | - |  |  | $ | - |  |  | $ | 69,869 |  |  | $ | 69,869 |
(1) Included in cash and cash equivalents There were no transfers between Level 1 and Level 2 during the twelve months ended December 31, 2014. The fair value of the foreign exchange options at December 31, 2014 and 2013 was determined using readily observable market inputs from actively quoted markets obtained from various third-party data providers. These inputs, such as spot rate, forward rate and volatility have been derived from readily observable market data, meeting the criteria for Level 2 in the fair value hierarchy. The fair value of the contingent warrant liabilities at December 31, 2014 and 2013 was determined using the Black-Scholes Model, which requires inputs such as the expected term of the warrants, volatility and risk-free interest rate. These inputs are subjective and generally require significant analysis and judgment to develop. In 2013, the Company changed its expected volatility assumption in the Black-Scholes Model from a volatility implied from warrants issued by XOMA in recent private placement transactions to a volatility based on historical stock price volatility observed on XOMA’s underlying stock. A historical stock price volatility rate was determined to be a more precise indicator for the fair value calculation of the Company’s warrants due to time elapsed since these warrants were granted. The Company’s common stock price represents a significant input that impacts sensitivity in the valuation of the warrants. The fair value of the contingent warrant liabilities was estimated using the following range of assumptions at December 31, 2014 and 2013:
|  | December 31, 2014 |  |  | December 31, 2013 |
Expected volatility |  |  | 69.6% - 72.9 | % |  |  | 66.1% - 86.6 | %
Risk-free interest rate |  |  | 0.03% - 0.67 | % |  |  | 0.10% - 0.80 | %
Expected term |  | 0.09 - 2.19 years |  |  | 0.90 - 3.20 years |
The following table provides a summary of changes in the fair value of the Company’s Level 3 financial liabilities for the years ended December 31, 2014, 2013, and 2012 (in thousands):
|  | Warrant Liabilities |
Balance at December 31, 2011 |  | $ | 379 |
Initial fair value of warrants issued in March 2012 |  |  | 6,390 |
Reclassification of contingent warrant liability to equity upon exercise of warrants |  |  | (940 | )
Net increase in fair value of contingent warrant liabilities upon revaluation |  |  | 9,172 |
Balance at December 31, 2012 |  |  | 15,001 |
Reclassification of contingent warrant liability to equity upon exercise of warrants |  |  | (6,171 | )
Net increase in fair value of contingent warrant liabilities upon revaluation |  |  | 61,039 |
Balance at December 31, 2013 |  |  | 69,869 |
Initial fair value of warrants issued in December 2014 warrant |  |  | 10,258 |
Reclassification of contingent warrant liability to equity upon exercise of warrants |  |  | (2,526 | )
Net decrease in fair value of contingent warrant liabilities upon revaluation |  |  | (45,773 | )
Balance at December 31, 2014 |  | $ | 31,828 |
The fair value of the Company’s outstanding debt is estimated based on market interest rates. The carrying amount and the estimated fair value of the Company’s outstanding debt at December 31, 2014 and 2013 are as follows:
|  | December 31, 2014 |  |  | December 31, 2013 |
|  | Carrying Amount |  |  | Fair Value |  |  | Carrying Amount |  |  | Fair Value |
Outstanding debt |  | $ | 35,537 |  |  | $ | 36,461 |  |  | $ | 40,985 |  |  | $ | 41,813 |

X
- Definition The entire disclosure for available-for-sale and the fair value measurement. + References No definition available. + Details
Name: | xoma_AvailableForSaleAndFairValueDisclosuresTextBlock
Namespace Prefix: | xoma_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Details
Name: | xoma_AvailableForSaleAndFairValueMeasurementsAbstract
Namespace Prefix: | xoma_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration