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Fair Value Measurements

9 Months Ended

Sep. 30, 2023

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

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

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

Derivative assets and liabilities—The fair values of derivative assets and liabilities, which include interest rate swaps, FFAs and bunker swaps, are 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.

Long-term Debt—The fair value of Convertible Bond Debt, which is traded in the over-the-counter market, is estimated based on quoted prices in markets that are not active on identical instruments. The carrying amount of the Term Facility under the Global Ultraco Debt Facility approximates its fair value, due to its variable interest rates.

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

The Company defines fair value, establishes a framework for measuring fair value and provides disclosures about fair value measurements. The fair value hierarchy for disclosure of fair value measurements is 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.


			Fair Value
September 30, 2023	Carrying Value		Level 1		Level 2
Assets
Cash, cash equivalents and restricted cash	$	116,454	$	116,454	$	—
Collateral on derivatives	4,380		4,380		—
Fair value of derivative assets – current	8,653		—		8,653
Fair value of derivative assets – noncurrent	5,435		—		5,435
Liabilities
Global Ultraco Debt Facility (1)(2)	275,400		—		275,400
Convertible Bond Debt (1)(3)	104,119		—		146,839
Fair value of derivative liabilities – current	585		—		585


			Fair Value
December 31, 2022	Carrying Value		Level 1		Level 2
Assets
Cash, cash equivalents and restricted cash	$	189,754	$	189,754	$	—
Collateral on derivatives	909		909		—
Fair value of derivative assets – current	8,479		—		8,479
Fair value of derivative assets – noncurrent	8,184		—		8,184
Liabilities
Global Ultraco Debt Facility (1)(2)	237,750		—		237,750
Convertible Bond Debt (1)(3)	104,119		—		172,661
Fair value of derivative liabilities – current	163		—		163

- 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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