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Fair Value Measurements
 12 Months Ended
Dec. 27, 2019
Fair Value Disclosures [Abstract]  
Fair Value

4. FAIR VALUE

 

The fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The following table summarizes, for assets or liabilities measured at fair value, the respective fair value and the classification by level of input within the fair value hierarchy:

 

 

 

 

 

 

Fair Value Measurement at

 

 

 

 

 

 

Reporting Date Using

 

Description

 

December 27,

2019

 

 

Quoted Prices in

Active Markets for

Identical Assets

(Level 1)

 

 

Significant

Other Observable

Inputs

(Level 2)

 

 

Significant

Unobservable

Inputs

(Level 3)

 

(In millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Contingent earn-out liability

 

$

9.5

 

 

$

—

 

 

$

—

 

 

$

9.5

 

Common stock purchase obligation

 

$

6.8

 

 

$

—

 

 

$

—

 

 

$

6.8

 

Pension obligation

 

$

4.4

 

 

$

—

 

 

$

—

 

 

$

4.4

 

 

 

 

 

 

 

Fair Value Measurement at

 

 

 

 

 

 

Reporting Date Using

 

Description

 

December 28,

2018

 

 

Quoted Prices in

Active Markets for

Identical Assets

(Level 1)

 

 

Significant

Other Observable

Inputs

(Level 2)

 

 

Significant

Unobservable

Inputs

(Level 3)

 

(In millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Forward contracts

 

$

0.2

 

 

$

—

 

 

$

0.2

 

 

$

—

 

Other liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Contingent earn-out liability

 

$

3.9

 

 

$

—

 

 

$

—

 

 

$

3.9

 

Common stock purchase obligation

 

$

8.5

 

 

$

—

 

 

$

—

 

 

$

8.5

 

Pension obligation

 

$

3.5

 

 

$

—

 

 

$

—

 

 

$

3.5

 

 

There were no transfers from Level 1 or Level 2. Fair value adjustments were noncash, and therefore did not impact the Company’s liquidity or capital resources. Qualitative information about Level 3 fair value measurements are as follow:

 

(Dollars in millions, except rate/multiple)

 

December 27,

2019

 

 

Valuation

Techniques

 

Unobservable

Input

 

Rate/Multiple

 

Contingent earn-out liability

 

$

 

9.5

 

 

Monte carlo simulation

 

Revenue discount rate

 

 

9.0

%

 

 

 

 

 

 

 

 

 

Revenue volatility rate

 

 

28.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock purchase

   obligation

 

$

 

6.8

 

 

Discounted cash flow

 

Revenue Multiple

 

1.3

 

 

 

 

 

 

 

 

 

 

EBITDA Multiple

 

 

8.0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pension obligation

 

$

 

4.4

 

 

Projected unit credit method

 

Discount rate

 

 

2.43

%

 

 

 

 

 

 

 

 

 

Rate on return

 

 

1.37

%

 

 

 

 

 

 

 

 

 

Salary increase rate

 

 

4.42

%

 

Following is a summary of the Level 3 activity:

 

(In millions)

 

Contingent

earn-out

liability

 

 

Common stock

purchase

obligation

 

 

Pension

obligation

 

As of December 28, 2018

 

$

3.9

 

 

$

8.5

 

 

$

3.5

 

Fair value adjustments (DMS)

 

 

9.5

 

 

 

-

 

 

 

-

 

Fair value adjustments (QGT)

 

 

(3.9

)

 

 

(1.7

)

 

 

-

 

Benefits and other adjustments (SSB)

 

 

-

 

 

 

-

 

 

 

0.9

 

As of December 27, 2019

 

$

9.5

 

 

$

6.8

 

 

$

4.4