Fair Value Measurements

3 Months Ended

Mar. 31, 2020

Assets and Liabilities Accounted for at Fair Value

In measuring fair values of assets and liabilities, the Company uses valuation techniques that maximize the use of observable inputs (Level 1) and minimize the use of unobservable inputs (Level 3). The Company does not have any assets or liabilities measured using unobservable Level 3 inputs. The Company also uses market data or assumptions that it believes market participants would use in pricing an asset or liability, including assumptions about risk when appropriate. The carrying value for certain of the Company's financial instruments approximate fair value because of their short-term nature. The Company’s assets and liabilities that are measured at fair value on a recurring basis include the following:



				Fair Value Measurement at March 31, 2020 Reporting Date Using
	Total			Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)			Carrying Value

Recurring fair value measurements
Cash and cash equivalents	$	31.0		$	31.0	$	—		$	31.0
Interest rate caps - liability position	(3.6		)	—		(3.6		)	(3.6		)
Total recurring fair value measurements	$	27.4		$	31.0	$	(3.6	)	$	27.4

				Fair Value Measurement at December 31, 2019 Reporting Date Using
	Total			Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)			Carrying Value

Recurring fair value measurements
Cash and cash equivalents	$	12.5		$	12.5	$	—		$	12.5
Interest rate caps - liability position	(4.1		)	$	—	(4.1		)	(4.1		)
Total recurring fair value measurements	$	8.4		$	12.5	$	(4.1	)	$	8.4

The fair value of the interest rate caps are determined using standard option valuation models with assumptions about interest rates based on those observed in underlying markets (Level 2 in fair value hierarchy).

Fair Value of Debt

The fair value of the Company’s debt (Level 2) is estimated using indirectly observable market inputs, except for the Revolver for which cost approximates fair value due to the short-term nature of the interest rate. Although the Company has determined the estimated fair value amounts using quoted market prices, considerable judgment is required in interpreting the information and in developing the estimated fair values. Therefore, these estimates are not necessarily indicative of the amounts that the Company, or holders of the instruments, could realize in a current market exchange. The fair value estimates are based on information available as of March 31, 2020 and December 31, 2019, respectively.

The estimated fair value of the Company’s debt is as follows:



	March 31, 2020		December 31, 2019
Revolver	$	44.0	$	30.0
Senior Notes	431.4		443.4
Term Loan B	1,348.1		1,379.4
	$	1,823.5	$	1,852.8

The carrying value of the Company’s debt at March 31, 2020 and December 31, 2019 was $1,830.7 and $1,827.5, respectively.

- 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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