Fair Value Measurements

12 Months Ended

Dec. 31, 2020

Fair Value Disclosures [Abstract]

Fair Value Measurements

Note 7 - Fair Value Measurements

The Company has certain financial assets and liabilities which have been classified as either Level 1, 2, or 3 within the fair value hierarchy as described below.

Level 1 — Fair value based on quoted prices in active markets for identical assets or liabilities.

Level 2 — Fair value based on inputs other than Level 1 inputs that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, 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 — Fair value based on unobservable inputs that are supported by little or no market activity and such inputs are significant to the fair value of the assets or liabilities.

The following table represents the Company’s fair value hierarchy for its financial assets and liabilities that are measured at fair value on a recurring basis (in thousands):

	Fair Value Measurements
	As of  December 31, 2020
	Level 1		Level 2			Level 3		Total
Assets:
Money market funds (1)	$	503	$	—		$	—	$	503
Total Assets	$	503	$	—		$	—	$	503
Liabilities:
Interest rate swap (2)	$	—	$	(1,144	)	$	—	$	(1,144	)
Total Liabilities	$	—	$	(1,144	)	$	—	$	(1,144	)

	Fair Value Measurements
	As of December 31, 2019
	Level 1		Level 2			Level 3			Total
Assets:
Money market funds (1)	$	2,354	$	—		$	—		$	2,354
Total Assets	$	2,354	$	—		$	—		$	2,354
Liabilities:
Interest rate swap (2)	$	—	$	(144	)	$	—		$	(144	)
Contingent purchase price (3)		—		—			(2,511	)		(2,511	)
Total Liabilities	$	—	$	(144	)	$	(2,511	)	$	(2,655	)

(1) Included in cash and cash equivalents in the Consolidated Balance Sheets.

(2) The Company has an interest rate swap contract that hedges the risk of variability from interest payments on its borrowings (refer to Note 4 – Debt and Note 6 – Derivatives and Hedging). The fair value of the interest rate swap is based on mark-to-market valuations prepared by a third-party broker. Those valuations are based on observable interest rates and other observable market data, which the Company considers Level 2 inputs.

(3) Included in accrued expenses and other current liabilities in the Consolidated Balance Sheets.

During the years ended December 31, 2020 and 2019, the Company did not transfer assets or liabilities between levels of the fair value hierarchy. Additionally, there have been no changes to the valuation techniques for Level 2 or Level 3 liabilities.

Level 3 activity consists entirely of the contingent purchase price related to the acquisition of FeedbackNow (see Note 2 – Acquisitions). Changes in the fair value of Level 3 contingent consideration were as follows (in thousands):

	Contingent
	Consideration
Balance at December 31, 2017	$	—
Acquisition of FeedbackNow (1)		(3,388	)
Fair value adjustment of contingent purchase price (2)		(780	)
Foreign exchange effect		(28	)
Balance at December 31, 2018		(4,196	)
Fair value adjustment of contingent purchase price (2)		(68	)
Payment of contingent purchase price (3)		1,769
Foreign exchange effect		(16	)
Balance at December 31, 2019		(2,511	)
Fair value adjustment of contingent purchase price (2)		(22	)
Payment of contingent purchase price (4)		2,680
Foreign exchange effect		(147	)
Balance at December 31, 2020	$	—

(1) Refer to Note 2 – Acquisitions for a discussion of the fair value of the contingent purchase price as of the acquisition date.

(2) Subsequent to the acquisition of FeedbackNow, the increases in the fair value of the contingent consideration were primarily due to the achievement of contract bookings during these periods. The Monte Carlo simulation was used to determine the fair value and increases or decreases in the simulation’s inputs would have resulted in higher or lower fair value measurements. These amounts were recognized as acquisition and integration costs in the Consolidated Statements of Operations.

(3) During the third quarter of 2019, the first year financial targets were met and $1.8 million was paid to the sellers during the same period.

(4) During the third quarter of 2020, the second year financial targets were met and $2.7 million was paid to the sellers during the fourth quarter of 2020.