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Fair Value Measures
6 Months Ended
Jul. 01, 2019
Fair Value Disclosures [Abstract]  
Fair Value Measures

(13) Fair Value Measures

The Company measures at fair value its financial and non-financial assets by using a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, essentially an exit price, based on the highest and best use of the asset or liability.

The carrying amount and estimated fair value of the Company’s financial instruments as of July 1, 2019 and December 31, 2018 were as follows:

 

 

 

As of

 

 

As of

 

 

 

July 1, 2019

 

 

December 31, 2018

 

 

 

Carrying

Amount

 

 

Fair Value

 

 

Carrying

Amount

 

 

Fair Value

 

 

 

(In thousands)

 

Derivative liabilities, current

 

$

 

 

$

 

 

$

139

 

 

$

139

 

Derivative liabilities, non-current

 

 

12,693

 

 

 

12,693

 

 

 

4,735

 

 

 

4,735

 

Term Loan due September 2024

 

 

796,366

 

 

 

798,828

 

 

 

825,161

 

 

 

782,592

 

Senior Notes due October 2025

 

 

369,300

 

 

 

369,274

 

 

 

368,929

 

 

 

350,880

 

Convertible Senior Notes

 

 

233,604

 

 

 

293,571

 

 

 

228,335

 

 

 

290,858

 

ABL Revolving Loans

 

 

70,000

 

 

 

70,000

 

 

 

70,000

 

 

 

70,000

 

The fair value of the derivative instruments was determined using pricing models developed based on the LIBOR swap rate, foreign currency exchange rates, and other observable market data, including quoted market prices, as appropriate using Level 2 inputs. The values were adjusted to reflect non-performance risk of both the counterparty and the Company, as necessary.

 

The fair value of the long-term debt was estimated based on quoted market prices or discounting the debt over its life using current market rates for similar debt as of July 1, 2019 and December 31, 2018, which are considered Level 2 inputs.

The fair value of the Convertible Senior Notes was estimated based on quoted market prices of the securities on an active exchange, which are considered Level 2 inputs.

As of July 1, 2019 and December 31, 2018, the Company’s other financial instruments also included cash and cash equivalents, accounts receivable, and accounts payable. Due to short-term maturities, the carrying amount of these instruments approximates fair value. The Company’s cash and cash equivalents as of July 1, 2019 consisted of $79,661 held in the U.S., with the remaining $204,805 held by foreign subsidiaries.

The majority of the Company’s non-financial assets and liabilities, which include goodwill, intangible assets, inventories, and property, plant and equipment, are not required to be carried at fair value on a recurring basis. However, if certain triggering events occur (or are tested at least annually in the case of goodwill) such that a non-financial instrument is required to be evaluated for impairment, based upon a comparison of the non-financial instrument’s fair value to its carrying value, an impairment is recorded to reduce the carrying value to the fair value, if the carrying value exceeds the fair value.