Fair Value Measurements

12 Months Ended

Dec. 31, 2023

Assets and liabilities measured at fair value on a recurring basis with their corresponding level of the fair value hierarchy as of December 31, 2023 and 2022 is as follows:


	December 31, 2023		December 31, 2022		Fair Value Level
Cash, cash equivalents and restricted cash	$	121,190	$	189,754	Level 1
Collateral on derivatives	2,219		909		Level 1
Fair value of derivative assets – current	6,824		8,479		Level 2
Fair value of derivative assets – noncurrent	3,136		8,184		Level 2
Fair value of derivative liabilities – current	479		163		Level 2
Global Ultraco Debt Facility – Term Facility (1)	262,950		237,750		Level 2
Global Ultraco Debt Facility – Revolving Facility (1)	125,000		—		Level 2
Convertible Bond Debt (2)	181,542		172,661		Level 2
Fair value of derivative liabilities – noncurrent	1,505		—		Level 2

(1)The fair value of floating-rate debt is estimated to be equal to its outstanding principle amount since it bears a variable interest rate that resets every three months.

(2)The fair value of the Convertible Bond Debt is estimated based on pricing data (including observable trade information) sourced from Bloomberg.com.

The following methods and assumptions were used to estimate the fair value of each class of financial instrument:

Cash and cash equivalents and restricted cash—Carrying values reported in the Consolidated Balance Sheets approximate fair value due to their highly liquid and short-term nature.

Collateral on derivatives—Carrying values reported in the Consolidated Balance Sheets approximate fair value due to their short-term nature.

Long-term debt—The fair value of the Convertible Bond Debt, which is traded in the over-the-counter market, is estimated based on quoted prices for identical instruments in markets that are not active. The aggregate outstanding principal amounts of the Term Facility and Revolving Facility under the Global Ultraco Debt Facility approximates their fair value, due to their variable interest rates.

Derivative assets and liabilities—The fair value of derivative assets and liabilities, which includes interest rate swaps, FFAs, bunker swaps and EUA futures, is estimated using observable inputs for similar instruments as of the measurement date and standard valuation techniques to convert future amounts to a single present amount assuming that participants are motivated, but not compelled to transact.

The carrying value of other financial assets and liabilities (primarily accounts receivable, accounts payable and other accrued expenses) approximate their fair value due to the relative short-term nature of the instruments.

The Company applies the fair value measurement framework under ASC 820, Fair Value Measurement, which established a fair value hierarchy for inputs to valuation techniques used to measure fair value. The three levels of inputs used in measuring fair value are as follows:

•Level 1 – Quoted prices in active markets for identical assets or liabilities.

•Level 2 – Quoted prices for similar assets and liabilities in active markets, quoted prices for identical assets and liabilities in markets that are not active or other observable inputs.

•Level 3 – Inputs that are unobservable.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

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