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Fair Value Measurements

9 Months Ended

Sep. 30, 2020

Note 7 – Fair Value Measurements

The following table sets forth by level within the fair value hierarchy the Company’s financial assets that were recorded at fair value on a recurring basis and the Company’s non-financial assets that were recorded at fair value on a non-recurring basis.



Recurring Fair Value Measurements		As of September 30, 2020
		Level 1		Level 2		Level 3		Total
ASSETS:
Cash equivalents and restricted cash equivalents	$	7,992	$	-	$	-	$	7,992
Restricted certificates of deposit	$	182	$	-	$	-	$	182


Non-recurring Fair Value Measurements		As of September 30, 2020
		Level 1		Level 2		Level 3		Total
ASSETS:
Assets held for sale	$	-	$	-	$	10,383	$	10,383
Right of use asset	$	-	$	-	$	27,697	$	27,697


Recurring Fair Value Measurements		As of December 31, 2019
		Level 1		Level 2		Level 3		Total
ASSETS:
Cash equivalents and restricted cash equivalents	$	4,580	$	-	$	-	$	4,580
Restricted certificates of deposit	$	3,769	$	-	$	-	$	3,769
Escrow receivable	$	-	$	-	$	930	$	930

The sale of the Company’s railcar repair and maintenance services business on September 30, 2015 resulted in $1,960 of the aggregate purchase price being placed into escrow in order to secure the indemnification obligations of FCRS and FCSL. The fair market value of the remaining escrow receivable as of December 31, 2019 represents the escrow balance of $980, net of the fair value of the indemnification obligations, which was estimated using the discounted probability-weighted cash flow method. The remaining escrow balance of $980 was collected by the Company in September 2020.

On September 10, 2020 the Company announced its plan to permanently close its Shoals facility. In connection with the closure, the Company estimated the fair value of the related asset group because it determined that an impairment trigger had occurred due to the shortened asset recoverability timeframe. Non-cash impairment charges of $8,978 for property, plant and equipment at the Shoals facility and $17,540 for the right of use asset were recognized during September 2020. Assets held for sale represents property, plant and equipment to be sold or transferred to the Shoals landlord as consideration for the landlord’s entry into the lease amendment as

described in Note 17 –Subsequent Events. See Note 16 –Restructuring and Impairment Charges for a description of the valuation techniques used.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

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