XML 48 R32.htm IDEA: XBRL DOCUMENT v3.25.0.1
Fair Value Measurements
 12 Months Ended
Dec. 31, 2024
Fair Value Disclosures [Abstract]  
Fair Value Measurements

NOTE 20: FAIR VALUE MEASUREMENTS

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The inputs used to measure fair value into the following hierarchy are determined as follows:

 

Level 1 -

Unadjusted quoted prices in active markets for identical assets or liabilities.

Level 2 -

Unadjusted quoted prices in active markets for similar assets or liabilities, or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability.

Level 3 -

Unobservable inputs for the asset or liability.

 

For cash and cash equivalents, accounts receivable, income taxes receivable and accounts payable, the fair value approximates the carrying value due to the short maturity periods of these financial instruments. For long-term borrowings, the fair value is measured using Level 2 market values.

The interest rate swaps, interest rate caps and foreign exchange contracts are carried at fair value in the Consolidated Balance Sheets. The fair value measurement is classified within Level 2 of the fair value hierarchy, as the inputs to the derivative pricing model are generally observable and do not contain a high level of subjectivity. The fair value of the interest rate agreements is estimated using industry standard valuation models using market-based observable inputs.

Valuation of Contingent Consideration Liability

The fair value of earnout consideration was estimated based on applying a Monte Carlo simulation method to forecast achievement of the gross profit targets. This method involves many possible value outcomes which are evaluated to establish an estimated value. Key inputs in the valuation include volatility and discount rates. Due to the significant unobservable inputs used in the valuations, these liabilities are categorized within Level 3 of the fair value hierarchy.

The Company determined the initial value for the contingent consideration liability of $15.2 million using the Level 3 inputs as of the issuance date on August 23, 2024. No changes in fair value of contingent consideration liability were recorded during the year ended December 31, 2024, in the consolidated statements of operations and comprehensive loss as the initial fair value approximates the fair value as of December 31, 2024.

The following table represents the significant inputs used in calculating the fair value of the contingent consideration liability on the issuance date and as of December 31, 2024:

 

Longest midpoint term

 

 

1.86

 

Gross profit discount rate

 

 

10.7

%

Risk-free rate

 

 

3.9

%

Gross profit volatility

 

 

23.3

%

Payment discount rate

 

 

13.2

%

 

The following table summarizes the carrying amounts and fair values of financial instruments:

 

 

 

 

 

 

As of December 31, 2024

 

 

As of December 31, 2023

 

 

Balance Sheet Classification

 

Level

 

Carrying
Amount

 

 

Fair
Value

 

 

Carrying
Amount

 

 

Fair
Value

 

 

 

 

 

 

(in thousands)

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest rate swaps

 

Prepaid expenses and other current assets

 

2

 

$

1,539

 

 

$

1,539

 

 

$

7,197

 

 

$

7,197

 

Foreign exchange contracts

 

Prepaid expenses and other current assets

 

2

 

 

—

 

 

 

—

 

 

 

922

 

 

 

922

 

Total assets

 

 

 

 

 

$

1,539

 

 

$

1,539

 

 

$

8,119

 

 

$

8,119

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest rate swaps

 

Other non-current liabilities

 

2

 

$

—

 

 

$

—

 

 

$

1,379

 

 

$

1,379

 

Interest rate caps

 

Accrued expenses and other current liabilities

 

2

 

 

8,967

 

 

 

8,967

 

 

 

3,491

 

 

 

3,491

 

Interest rate caps

 

Other non-current liabilities

 

2

 

 

3,709

 

 

 

3,709

 

 

 

9,015

 

 

 

9,015

 

Contingent consideration - current

 

Accrued expenses and other current liabilities

 

3

 

 

7,000

 

 

 

7,000

 

 

 

—

 

 

 

—

 

Contingent consideration - non-current

 

Other non-current liabilities

 

3

 

 

8,150

 

 

 

8,150

 

 

 

—

 

 

 

—

 

Long-term debt, including current portion:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

New 2024 Term Loan Facility

 

(1)

 

2

 

 

2,211,822

 

 

 

2,250,000

 

 

 

—

 

 

 

—

 

Prior 2023 Term Loan Facilities

 

(1)

 

2

 

 

—

 

 

 

—

 

 

 

2,515,996

 

 

 

2,562,125

 

Prior Senior Notes

 

(1)

 

2

 

 

—

 

 

 

—

 

 

 

665,038

 

 

 

675,468

 

Total liabilities

 

 

 

 

 

$

2,239,648

 

 

$

2,277,826

 

 

$

3,194,919

 

 

$

3,251,478

 

 

 

(1)
The carrying amount of debt instruments is presented net of the debt issuance costs, premium and discount. Refer to Note 12, “Debt”, for gross carrying amounts

The gains (losses) on the Company’s derivative instruments were as follows:

 

 

 

 

Year ended December 31,

 

 

Statement of Operations Classification

 

2024

 

 

2023

 

 

2022

 

 

 

 

(in thousands)

 

Amount of gain (loss) recognized in net income (loss):

 

 

 

 

 

 

 

 

 

 

 

Interest rate swaps

 

Interest expense

 

$

9,458

 

 

$

18,956

 

 

$

(7,252

)

Interest rate caps

 

Interest expense

 

 

(293

)

 

 

(625

)

 

 

(27

)

Foreign exchange contracts

 

Selling, general and administrative expense

 

 

818

 

 

 

265

 

 

 

(420

)

Total gain (loss) in net income (loss)

 

 

 

$

9,983

 

 

$

18,596

 

 

$

(7,699

)

Amount of gain (loss) recognized in other comprehensive income (loss):

 

 

 

 

 

 

 

 

 

 

 

Interest rate swaps

 

Cash flow hedge gain

 

$

4,876

 

 

$

7,851

 

 

$

30,750

 

Interest rate caps

 

Cash flow hedge loss

 

 

(519

)

 

 

(7,686

)

 

 

(5,384

)

Foreign exchange contracts

 

Cash flow hedge gain (loss)

 

 

(103

)

 

 

1,677

 

 

 

(973

)

Total gain recognized in other comprehensive income

 

 

 

$

4,254

 

 

$

1,842

 

 

$

24,393