XML 33 R23.htm IDEA: XBRL DOCUMENT
v3.20.2

Fair Value of Financial Instruments | 9 Months Ended
--- | ---
Sep. 30, 2020
Fair Value Disclosures [Abstract] |
Fair Value of Financial Instruments | Note 16. Fair Value of Financial Instruments Certain of the Company’s financial assets and liabilities are measured at fair value on a recurring and nonrecurring basis. Fair value is defined as the price that would be received to sell an asset or the price paid to transfer a liability (the exit price) in the principal and most advantageous market for the asset or liability in an orderly transaction between market participants. Assets and liabilities carried at fair value are classified using the following three-tier hierarchy: Level 1: Quoted market prices in active markets for identical assets or liabilities; Level 2: Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which significant inputs and significant value drivers are observable in active markets; and Level 3: Fair value measurements derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. The following table summarizes the valuation of the Company’s foreign currency forward contracts (see Note 17) that are measured at fair value on a recurring basis by the above pricing levels at September 30, 2020 and December 31, 2019 (in thousands):
| Fair Value |  | Level 1 |  | Level 2 |  | Level 3
September 30, 2020 |  |  |  |  |  |  |
Foreign currency forward contracts—asset position | $ | 2,701 |  |  | $ | — |  |  | $ | 2,701 |  |  | $ | — |
Foreign currency forward contracts—liability position | (2,440 | ) |  | — |  |  | (2,440 | ) |  | — |
Interest rate hedge agreements—liability position | (19,505 | ) |  | — |  |  | (19,505 | ) |  | — |
| $ | (19,244 | ) |  | $ | — |  |  | $ | (19,244 | ) |  | $ | — |
December 31, 2019 |  |  |  |  |  |  |
Foreign currency forward contracts—asset position | $ | 61 |  |  | $ | — |  |  | $ | 61 |  |  | $ | — |
Foreign currency forward contracts—liability position | (766 | ) |  | — |  |  | (766 | ) |  | — |
Cross-currency debt swap agreements—asset position | 6,163 |  |  | — |  |  | 6,163 |  |  | — |
Cross-currency debt swap agreements—liability position | (25 | ) |  | — |  |  | (25 | ) |  | — |
Interest rate hedge agreements—liability position | (8,894 | ) |  | — |  |  | (8,894 | ) |  | — |
| $ | (3,461 | ) |  | $ | — |  |  | $ | (3,461 | ) |  | $ | — |
The fair value of the Company’s foreign currency forward contracts and cross-currency debt swap contracts are based on observable inputs that are corroborated by market data. Observable inputs include broker quotes, daily market foreign currency rates and forward pricing curves. Remeasurement gains and losses on foreign currency forward contracts and cross-currency debt swap contracts designated as cash flow hedges are recorded in accumulated other comprehensive income (loss) until recognized in earnings during the period that the hedged transactions take place. The fair value of interest rate hedge contracts are based on observable inputs that are corroborated by market data. Observable inputs include daily market foreign currency rates and interest rate curves. Remeasurement gains and losses are recorded in accumulated other comprehensive income (loss) until recognized in earnings as interest payments are made or received on the Company’s variable-rate debt. Remeasurement gains and losses on foreign currency forward contracts that are not-designated as cash flow hedges are recorded in other income (expense) (see Note 17). Disclosures about the Fair Value of Financial Instruments The carrying values of cash and cash equivalents at September 30, 2020 and December 31, 2019 are categorized within Level 1 of the fair value hierarchy. The table below summarizes information about fair value relating to the Company’s financial assets and liabilities that are recognized in the accompanying consolidated condensed balance sheets as of September 30, 2020 and December 31, 2019, as well as the fair value of contingent contracts that represent financial instruments (in thousands).
| September 30, 2020 |  | December 31, 2019
| Carrying Value |  | Fair Value |  | Carrying Value |  | Fair Value
Term Loan Facility(1) | $ | 442,800 |  |  | $ | 443,221 |  |  | $ | 446,400 |  |  | $ | 450,864 |
2020 Japan Term Loan Facility(2) | $ | 18,966 |  |  | $ | 18,966 |  |  | $ | — |  |  | $ | — |
Convertible Notes(3) | $ | 258,750 |  |  | $ | 349,561 |  |  | $ | — |  |  | $ | — |
Primary Asset-Based Revolving Credit Facility(4) | $ | 28,813 |  |  | $ | 28,813 |  |  | $ | 114,480 |  |  | $ | 114,480 |
Japan ABL Facility(4) | $ | 1,422 |  |  | $ | 1,422 |  |  | $ | 30,100 |  |  | $ | 30,100 |
Equipment notes(5) | $ | 33,881 |  |  | $ | 33,881 |  |  | $ | 19,715 |  |  | $ | 19,715 |
(1) | In January 2019, the Company entered into a Term Loan Facility. The fair value of this debt is categorized within Level 2 of the fair value hierarchy. See Note 6 for further information.
(2) | In August 2020, the Company entered into the 2020 Japan Term Loan Facility. The fair value of this debt is categorized within Level 2 of the fair value hierarchy. See Note 6 for further information.
(3) | In May 2020, the Company issued $258,750,000 of 2.75% Convertibles Notes due in 2026. The fair value of this debt is categorized within Level 2 of the fair value hierarchy. For further discussion, see Note 6.
(4) | The carrying value of the amounts outstanding under the Company's ABL Facility and Japan ABL Facility approximates the fair value due to the short-term nature of these obligations. The fair value of this debt is categorized within Level 2 of the fair value hierarchy based on the observable market borrowing rates. See Note 6 for information on the Company's credit facilities, including certain risks and uncertainties related thereto.
(5) | In December 2017, August 2019 and March 2020, the Company entered into equipment notes that are both secured by certain equipment at the Company's golf ball manufacturing facility. The fair value of this debt is categorized within Level 2 of the fair value hierarchy. See Note 6 for further information.
Nonrecurring Fair Value Measurements The Company measures certain assets at fair value on a nonrecurring basis at least annually or more frequently if certain indicators are present. These assets include long-lived assets, goodwill, non-amortizing intangible assets and investments that are written down to fair value when they are held for sale or determined to be impaired. During the second quarter of 2020, the Company considered the macroeconomic conditions related to the COVID-19 pandemic and its potential impact to sales and operating income for the remainder of fiscal 2020, and determined that there were indicators of impairment and proceeded with a quantitative assessment of goodwill for all reporting units. As a result of the second quarter assessment, the Company determined that the fair value of one of its reporting units was less than its carrying value, and therefore recognized a goodwill impairment loss of $148,375,000 in the second quarter of 2020. In addition, the Company recognized an impairment loss of $25,894,000 on one of its trade names (see Note 9). There were no impairment losses recorded during the three months ended September 30, 2020.

X
- References No definition available. + Details
Name: | us-gaap_FairValueDisclosuresAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=117815213&loc=d3e19207-110258 + Details
Name: | us-gaap_FairValueDisclosuresTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration