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Fair Value Measurements
 3 Months Ended
Mar. 31, 2022
Fair Value Disclosures [Abstract]  
Fair Value Measurements Fair Value Measurements
The Company complies with the provisions of ASC 820, which defines fair value, provides a framework for measuring fair value and expands the disclosures required for fair value measurements of financial and non-financial assets and liabilities. ASC 820 clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that is determined based on assumptions that market participants would use in pricing an asset or a liability. As a basis for considering such assumptions, ASC 820 establishes a three-tier value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value.
§Level 1 – Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.
§Level 2 – Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
§Level 3 – Unobservable inputs which are supported by little or no market activity.

The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

The Company’s money market funds are classified within Level 1. The Company values these Level 1 investments using quoted market prices. The fair value of long-term debt is determined using recent quoted market prices or dealer quotes for each of the Company’s instruments, which are Level 1 inputs. The fair value of the Company’s debt instruments was approximately $1.2 billion and $1.3 billion, as of March 31, 2022 and December 31, 2021, respectively (see Note 8 - Debt).

The Retained Consensus Shares are equity securities for which the Company elected the fair value option, and the fair value of the Retained Consensus Shares and subsequent fair value changes are included in our assets of and results from continuing operations, respectively. As of March 31, 2022 and December 31, 2021, the Company’s investment in Consensus common stock was remeasured at fair value based on Consensus’ closing stock price with a balance of $238.2 million and $229.2 million included on the Condensed Consolidated Balance Sheets, respectively. Unrealized gain of $9.0 million was recorded on the Condensed Consolidated Statements of Operations for the three months ended March 31, 2022. The fair value of the investment in Consensus is determined using quoted market prices, which is a Level 1 input.

The fair value of our 4.625% Senior Notes (as defined in Note 8 below) was determined using quoted market prices or dealer quotes for instruments with similar maturities and other terms and credit ratings, which are Level 1 inputs. The fair value of the Credit Facility (as defined in Note 8 below) approximated its carrying amount due to its variable interest rate, which approximated a market interest rate, and was considered a Level 2 input.

The Company classifies its contingent consideration liability in connection with acquisitions within Level 3 because factors used to develop the estimated fair value are unobservable inputs, such as volatility and market risks, and are not supported by market activity. The valuation approaches used to value Level 3 investments considers unobservable inputs in the market such as time to liquidity, volatility, dividend yield, and breakpoints. Significant increases or decreases in either of the inputs in isolation would result in a significantly lower or higher fair value measurement.
 
The following table presents the fair values, valuation techniques, unobservable inputs, and ranges of the Company’s financial liabilities categorized within Level 3. The weighted averages below are a product of the unobservable input and fair value of the contingent consideration arrangement as of March 31, 2022.
Valuation TechniqueUnobservable InputRangeWeighted Average
Contingent ConsiderationOption-Based ModelRisk free rate
1.9% - 2.2%
2.0 %
Debt spread
0.0% - 74.7%
13.6 %
Probabilities
10.0% - 100.0%
78.0 %
Present value factor
2.2% - 26.9%
18.1 %
Discount rate
27.3% - 38.0%
31.1 %

The following tables present the fair values of the Company’s financial assets or liabilities (in thousands):
March 31, 2022Level 1Level 2Level 3Fair ValueCarrying Value
Assets:
Cash equivalents:
   Money market and other funds$38,483 $— $— $38,483 $38,483 
Investment in Consensus238,151 — — 238,151 238,151 
Total assets measured at fair value$276,634 $— $— $276,634 $276,634 
Liabilities:
Contingent consideration$— $— $10,087 $10,087 $10,087 
Debt1,186,652 — — 1,186,652 1,122,945 
Total liabilities measured at fair value$1,186,652 $— $10,087 $1,196,739 $1,133,032 
December 31, 2021Level 1Level 2Level 3Fair ValueCarrying Value
Assets:
Cash equivalents:
   Money market and other funds$144,255 $— $— $144,255 $144,255 
Investment in Consensus229,200 — — 229,200 229,200 
Total assets measured at fair value$373,455 $— $— $373,455 $373,455 
Liabilities:
Contingent consideration$— $— $5,775 $5,775 $5,775 
Debt1,345,311 — — 1,345,311 1,090,627 
Total liabilities measured at fair value$1,345,311 $— $5,775 $1,351,086 $1,096,402 

At the end of each reporting period, management reviews the inputs to the fair value measurements of financial and non-financial assets and liabilities to determine when transfers between levels are deemed to have occurred. For the three months ended March 31, 2022 and 2021, there were no transfers that occurred between levels.
The following table presents a reconciliation of the Company’s Level 3 financial liabilities related to contingent consideration that are measured at fair value on a recurring basis (in thousands):
Level 3Affected line item in the Statement of Operations
Balance as of January 1, 2022$5,775 
Contingent consideration4,200 
Total fair value adjustments reported in earnings112 General and administrative
Contingent consideration payments— Not applicable
Balance as of March 31, 2022$10,087 

In connection with the Company’s other acquisition activity, contingent consideration of up to $10.1 million may be payable upon achieving certain future earnings before interest, taxes, depreciation and amortization (EBITDA), revenue, and/or unique visitor thresholds and had a combined fair value of $10.1 million and $5.8 million at March 31, 2022 and December 31, 2021, respectively. Since certain thresholds were not achieved, there were no payments made during the three months ended March 31, 2022.

The Company recorded a net increase of $0.1 million during the three months ended March 31, 2022 in the fair value of the contingent consideration and reported such changes in General and administrative expenses.