XML 53 R43.htm IDEA: XBRL DOCUMENT v3.21.2
Fair Value of Financial Instruments (Tables)
 9 Months Ended
Sep. 30, 2021
Fair Value Disclosures [Abstract]  
Valuation of Foreign Currency Exchange Contracts by Pricing Levels
The following table summarizes the valuation of the Company’s foreign currency forward contracts and interest rate hedge agreements (see Note 17) that are measured at fair value on a recurring basis by the above pricing levels at September 30, 2021 and December 31, 2020 (in thousands):
Fair
Value		Level 1Level 2Level 3
September 30, 2021
Foreign currency forward contracts—asset position(1)
$4,855 $— $4,855 $— 
Foreign currency forward contracts—liability position(1)
(470)— (470)— 
Interest rate hedge agreements—liability position(2)
(12,224)— (12,224)— 
$(7,839)$— $(7,839)$— 
December 31, 2020
Foreign currency forward contracts—asset position(1)
$90 $— $90 $— 
Foreign currency forward contracts—liability position(1)
(1,553)— (1,553)— 
Interest rate hedge agreements—liability position(2)
(17,922)— (17,922)— 
$(19,385)$— $(19,385)$— 
(1)The fair value of the Company’s foreign currency forward contracts is 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 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 (see Note 17).
(2)The fair value of interest rate hedge contracts is 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 (see Note 17).
Fair Value Relating to Financial Assets and Liabilities
The carrying values of cash and cash equivalents, net accounts receivable, accounts payable and accrued expenses, and other current liabilities, at September 30, 2021 and December 31, 2020 are categorized within Level 1 of the fair value hierarchy. The table below illustrates 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, 2021 and December 31, 2020 (in thousands).
 September 30, 2021December 31, 2020
Carrying
Value		Fair
Value		Carrying
Value		Fair 
Value
Term Loan Facility(1)$438,000 $439,883 $441,600 $443,243 
Japan Term Loan Facility(2)14,379 13,381 18,390 16,083 
Convertible Notes(3)258,750 452,937 258,750 414,191 
U.S. Asset-Based Revolving Credit Facility(4)30,108 30,108 22,130 22,130 
Equipment Notes(5)25,546 24,777 31,822 29,385 
Topgolf Revolving Credit Facility(6)35,000 28,556 — — 
Mortgage Loans(7)46,522 52,546 — — 
Topgolf Term Loan(8)341,250 339,782 — — 
(1)In January 2019, the Company entered into a Term Loan Facility. The fair value of this debt is based on quoted prices for similar instruments in active markets combined with quantitative pricing models, and is therefore categorized within Level 2 of the fair value hierarchy. See Note 7 for further information.
(2)In August 2020, the Company entered into the Japan Term Loan Facility. The fair value is categorized within Level 2 of the fair value hierarchy. The Company used discounted cash flows and market-based expectations for interest rates, credit risk, and the contractual terms of the debt to derive the fair value. See Note 7 for further information.
(3)In May 2020, the Company issued $258,750,000 of 2.75% Convertible Notes due in 2026. The fair value of this debt is based on quoted prices in secondary markets combined with quantitative pricing models, and is therefore categorized within Level 2 of the fair value hierarchy. For further discussion, see Note 7.
(4)The carrying value of the amounts outstanding under the Company's 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 7 for information on the Company's credit facilities, including certain risks and uncertainties related thereto.
(5)The Company entered into equipment notes in 2017, 2019 and 2020 that are 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. The Company used discounted cash flows and market-based expectations for interest rates, credit risk, and the contractual terms of the debt to derive the fair value. See Note 7 for further information.
(6)The carrying amount of the Topgolf Revolving Credit Facility approximates its fair value because the applicable interest rate is adjusted regularly based on current market conditions. See Note 7 for further information.
(7)The fair value of the mortgage loans is calculated based on the future payments under the mortgage agreement discounted at the incremental borrowing rate. See Note 7 for further information.
(8)The fair value of the Topgolf Term Loan is based on quoted market rate from the lender. See Note 7 for further information.