Fair Value Measurements

12 Months Ended

Dec. 31, 2021

Fair Value Measurements

Fair Value Measurements

Note 6 Fair Value Measurements

Fair value is the price that would be received upon sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date (exit price). We utilize market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market-corroborated, or generally unobservable. We primarily apply the market approach for recurring fair value measurements and endeavor to utilize the best information available. Accordingly, we employ valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. The use of unobservable inputs is intended to allow for fair value determinations in situations where there is little, if any, market activity for the asset or liability at the measurement date. We are able to classify fair value balances utilizing a fair value hierarchy based on the observability of those inputs. Under the fair value hierarchy:

● Level 1 measurements include unadjusted quoted market prices for identical assets or liabilities in an active market;

● Level 2 measurements include quoted market prices for identical assets or liabilities in an active market that have been adjusted for items such as effects of restrictions for transferability and those that are not quoted but are observable through corroboration with observable market data, including quoted market prices for similar assets; and

● Level 3 measurements include those that are unobservable and of a subjective nature.

Our financial assets and liabilities that are accounted for at fair value on a recurring basis as of December 31, 2021 and 2020 consisted of short term investments in equity securities. During 2021, there were no transfers of our financial assets between Level 1 and Level 2 measures. Our financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. As of December 31, 2020, our short-term investments were carried at fair market value and totaled $9.5 million, and primarily consisted of Level 1 measurements. As of December 31, 2021, our restricted cash held in trust was carried at fair market value and totaled $281.5 million, and primarily consisted of Level 1 measurements. No material Level 2 or Level 3 measurements exist as of any of the periods presented.

Nonrecurring Fair Value Measurements

We applied fair value measurements to our nonfinancial assets and liabilities measured on a nonrecurring basis, which consist of measurements primarily to assets held-for-sale, goodwill, intangible assets and other long-lived assets and assets acquired and liabilities assumed in a business combination. Based upon our review of the fair value hierarchy, the inputs used in these fair value measurements were considered Level 3 inputs.

Fair Value of Financial Instruments

We estimate the fair value of our financial instruments in accordance with U.S. GAAP. The fair value of our long-term debt and revolving credit facilities is estimated based on quoted market prices or prices quoted from third-party financial institutions, thus a Level 2 measurement. The carrying and fair values of these liabilities were as follows:

		As of December 31,
				2021						2020
		Effective						Effective
		Interest		Carrying		Fair		Interest		Carrying		Fair
		Rate		Value		Value		Rate		Value		Value
	(Dollars in thousands)
4.625% senior notes due September 2021		—	%	$	—	$	—	5.65	%	$	86,329	$	78,862
5.50% senior notes due January 2023		5.87	%		24,446		24,736	5.85	%		28,443		18,768
5.10% senior notes due September 2023		5.42	%		82,703		84,044	5.32	%		121,077		78,435
0.75% senior exchangeable notes due January 2024		5.90	%		259,839		257,730	6.06	%		279,700		169,458
5.75% senior notes due February 2025		6.03	%		548,458		508,881	6.01	%		610,818		318,871
6.50% senior priority guaranteed notes due February 2025		6.50	%		50,485		50,490	6.50	%		50,485		44,059
9.00% senior priority guaranteed notes due February 2025		9.00	%		218,082		226,914	9.00	%		192,032		185,221
7.25% senior guaranteed notes due January 2026		7.52	%		559,978		522,079	7.51	%		559,978		396,106
7.375% senior priority guaranteed notes due May 2027		7.74	%		700,000		724,906	—	%		—		—
7.50% senior guaranteed notes due January 2028		7.70	%		389,609		346,966	7.69	%		389,609		267,369
2018 revolving credit facility		3.72	%		460,000		460,000	3.53	%		672,500		672,500
				$	3,293,600	$	3,206,746			$	2,990,971	$	2,229,649
Less: deferred financing costs					30,805						22,270
				$	3,262,795					$	2,968,701

The fair values of our cash equivalents, trade receivables and trade payables approximate their carrying values due to the short-term nature of these instruments.