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DEBT | 3 Months Ended
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Mar. 31, 2025
Debt Disclosure [Abstract] |
DEBT | DEBT Convertible Senior Notes 2025 Notes On July 24, 2020, the Company issued $575.0 million aggregate principal amount of its 0.50% Convertible Senior Notes due July 15, 2025 (the “2025 Notes”) in a private placement. The 2025 Notes bear interest at a rate of 0.50% per year, payable semi-annually on January 15 and July 15 of each year, beginning on January 15, 2021. The 2025 Notes will mature on July 15, 2025, unless earlier repurchased, redeemed or converted. The initial conversion rate of the 2025 Notes is 2.1683 shares of the Company's common stock per $1,000 principal amount of 2025 Notes (which is equivalent to an initial conversion price of approximately $461.19 per share). In the first quarter of 2025, the Company repurchased approximately $20.0 million of its 2025 Notes, through individual privately-negotiated transactions with certain holders of the 2025 Notes, for $19.7 million in cash plus an immaterial amount of accrued and unpaid interest. The repurchase resulted in a $0.3 million gain on the extinguishment of debt which is included in interest expense, net in the consolidated statement of operations and comprehensive income. During 2023 and 2024, the Company repurchased $459.7 million in principal amount of the 2025 Notes. The remaining balance outstanding on the 2025 Notes as of March 31, 2025 is $95.3 million and will mature in July 2025. Holders of the 2025 Notes were not entitled to convert the 2025 Notes during the calendar quarter ended March 31, 2025 as the last reported sale price of the Company's common stock, for at least 20 trading days (whether or not consecutive) during the period of 30 consecutive trading days ending on December 31, 2024, was not greater than or equal to 130% of the conversion price of the 2025 Notes on each applicable trading day. Under the terms of the 2025 Notes, on or after March 13, 2025, until the close of business on the second scheduled trading day immediately preceding the maturity date of the 2025 Notes, holders of the 2025 Notes may convert all or a portion of their 2025 Notes regardless of the foregoing conditions. There have been no conversions in the first quarter of 2025. In the first three months of 2025, the Company recorded interest expense on the 2025 Notes of $0.2 million which consisted of $0.1 million associated with the 0.50% coupon rate and $0.1 million associated with the amortization of the debt issuance costs. In the first three months of 2024, the Company recorded interest expense on the 2025 Notes of $0.8 million which consisted of $0.4 million associated with the 0.50% coupon rate and $0.4 million associated with the amortization of the debt issuance costs. As of March 31, 2025, the fair value of the 2025 Notes is estimated to be approximately $90.7 million using the Level 1 observable input of the last quoted market price on March 31, 2025. A summary of the gross carrying amount, debt issuance costs, and net carrying value of the 2025 Notes, all of which is recorded as a current liability in the March 31, 2025 consolidated balance sheet, are as follows (in thousands):
| March 31, 2025 |  | December 31, 2024
Gross carrying amount | $ | 95,307 |  |  | $ | 115,307 |
Debt issuance costs | 147 |  |  | 331 |
Net carrying amount | $ | 95,160 |  |  | $ | 114,976 |
The Company intends to use cash on hand and future cash flows from operations for the repayment of the $95.3 million outstanding principal amount of its 2025 Notes. Convertible Note Hedge and Warrant Transactions 2020 Hedge and Warrants On July 24, 2020, in connection with the issuance of the 2025 Notes, the Company entered into Convertible Note Hedge (the “2020 Hedge”) and warrant transactions with respect to the Company’s common stock. The 2020 Hedge transactions cover 1.2 million shares of the Company’s common stock, the same number of shares initially underlying the 2025 Notes, and are exercisable upon any conversion of the 2025 Notes. The 2020 Hedge transactions are expected generally to reduce the potential dilution to the Company’s common stock upon conversion of the 2025 Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of the converted 2025 Notes, as the case may be, in the event that the market price per share of common stock, as measured under the terms of the 2020 Hedge transactions, is greater than the strike price of the 2020 Hedge transactions, which initially corresponds to the initial conversion price of the 2025 Notes, or approximately $461.19 per share of common stock. The 2020 Hedge transactions will expire upon the maturity of the 2025 Notes. On July 24, 2020, the Company sold to the counterparties, warrants (the “2020 Warrants”) to acquire 1.2 million shares of the Company's common stock at an initial strike price of $709.52 per share, which represents a premium of 100% over the last reported sale price of the common stock of $354.76 on July 21, 2020. If the market price per share of the common stock, as measured under the terms of the 2020 Warrants, exceeds the strike price of the 2020 Warrants, the 2020 Warrants could have a dilutive effect, unless the Company elects, subject to certain conditions, to settle the 2020 Warrants in cash. As of March 31, 2025, the outstanding portion of the 2020 Hedge covers 0.2 million shares of the Company's common stock and the 2020 Warrants to acquire 0.2 million shares of the Company's common stock remain outstanding. 2021 Credit Facility On September 15, 2021, the Company entered into a credit agreement (the “Credit Agreement”), consisting of a $200.0 million revolving credit facility (the “Revolving Facility”), which matures on September 15, 2026, and a $250.0 million delayed draw term loan facility (the “2021 Term Loan” and together with the Revolving Facility, the “Credit Facility”), which matures on September 15, 2028. As of March 31, 2025, the Company had $243.1 million of borrowings outstanding under the 2021 Term Loan bearing interest at the SOFR option rate of 8.4% and had no borrowings under the Revolving Facility. As of December 31, 2024, the Company had $243.8 million of borrowings outstanding under the 2021 Term Loan and no borrowings under the Revolving Facility. As of March 31, 2025, borrowings of $2.5 million under the 2021 Term Loan are recorded as current portion of long-term debt on the consolidated balance sheet. The Company was in compliance with all covenants at March 31, 2025. In the first three months of 2025, the Company recorded interest expense related to its Revolving Facility of $0.5 million which consisted of $0.3 million in unused commitment fees and $0.2 million associated with the amortization of the debt issuance costs. In the first three months of 2025, the Company recorded interest expense related to the 2021 Term Loan of $5.1 million associated with borrowings bearing interest at the SOFR option rate. In the first three months of 2024, the Company recorded interest expense related to its Revolving Facility of $0.4 million which consisted of $0.2 million in unused commitment fees and $0.2 million associated with the amortization of the debt issuance costs. In the first three months of 2024, the Company recorded interest expense related to the 2021 Term Loan of $5.7 million associated with borrowings bearing interest at the SOFR option rate. 2024 Term Loan On March 27, 2024, the Company entered into a $175.0 million first lien term loan facility (the “2024 Term Loan”), which matures on March 27, 2031. The Company drew $125.0 million of the 2024 Term Loan upon closing and drew the remaining $50.0 million delayed draw term loan on March 27, 2025. The Company incurred fees of $0.5 million in the first quarter of 2025 in connection with the $50.0 million delayed draw. As of March 31, 2025, the Company had $162.5 million borrowings outstanding under the 2024 Term Loan bearing interest based on the SOFR rate of 10.07%. As of December 31, 2024, the Company had $115.6 million of borrowings outstanding under the 2024 Term Loan. As of March 31, 2025, borrowings of $8.8 million under the 2024 Term Loan are recorded as current portion of long-term debt on the consolidated balance sheet. The Company was in compliance with all covenants at March 31, 2025. In the first three months of 2025, the Company recorded interest expense related to the 2024 Term Loan of $3.4 million which consisted of $3.0 million associated with borrowings bearing interest based on the SOFR rate, $0.2 million associated with unused commitment fees, $0.1 million associated with the amortization of debt issuance costs, and $0.1 million associated with the accretion of the original issue discount. In the first three months of 2024, the Company recorded interest expense related to the 2024 Term Loan of $0.2 million which consisted of $0.2 million associated with borrowings bearing interest based on the SOFR rate and immaterial amounts associated with unused commitment fees, the amortization of debt issuance costs, and accretion of the original issue discount. A summary of the gross carrying amount, debt issuance costs, original issue discount, and net carrying value of the 2024 Term Loan in the March 31, 2025 consolidated balance sheet, are as follows (in thousands):
| March 31, 2025 |  |
Current Portion |  |  |
Gross carrying amount | $ | 8,750 |  |  |
Debt issuance costs | 234 |  |  |
Unamortized original issue discount | 149 |  |  |
Net carrying amount | $ | 8,367 |  |  |
Long-term Portion |  |  |
Gross carrying amount | $ | 153,750 |  |  |
Debt issuance costs | 4,173 |  |  |
Unamortized original issue discount | 2,541 |  |  |
Net carrying amount | $ | 147,036 |  |  |

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