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FINANCIAL INSTRUMENTS & FAIR VALUE MEASUREMENTS
 12 Months Ended
Dec. 31, 2024
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
FINANCIAL INSTRUMENTS & FAIR VALUE MEASUREMENTS NOTE 21. FINANCIAL INSTRUMENTS & FAIR VALUE MEASUREMENTS
Financial Instruments

The Company considers credit risk associated with its own standing as well as the credit standing of any counterparties involved in the valuation of its financial instruments. Concentrations of credit risk with respect to our cash and cash equivalents are limited primarily to amounts held with financial institutions in excess of federally insured limits.

Money Market Funds

Money market funds are included within cash and cash equivalents on the Company’s consolidated balance sheets. Interest income from money market funds was $11.5 million, $4.8 million, and nominal for the years ended December 31, 2024, 2023 and 2022, respectively, which was recorded in interest income on the consolidated statements of operations.

Certificates of Deposit

The Company's certificates of deposit are included within short-term investments on the Company's consolidated balance sheets and are classified as held-to-maturity securities as the Company intends to hold until their maturity dates. The certificates of deposit carry interest rates of 5.3% with original maturity dates of six months and are scheduled to mature in
January 2025. Interest income from certificates of deposit was $1.9 million for the year ended December 31, 2024, which was recorded in interest income on the consolidated statements of operations.

Interest Rate Swap

In 2022, the Company entered into an interest rate swap contract ("VNB Swap") for the purpose of hedging the variability of interest expense and interest payments on the Company's long-term variable rate debt. The VNB Swap was entered into in conjunction with four promissory term notes of a total corresponding amount. The four promissory term notes were priced at the SOFR, as defined in the agreement plus 3.00%, per annum. The VNB Swap effectively fixes the floating SOFR-based interest of the SOFR-based debt to 7.53% per annum until maturity on January 1, 2028.

The fair value of the interest rate swap liability is recorded in other long-term liabilities on the consolidated balance sheets. As of December 31, 2024 and 2023, the notional value was $68.4 million and $70.0 million, respectively.

Fair Value Measurements

The Company applies the following fair value hierarchy, which prioritizes the inputs used to measure fair value into three levels, and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:
Level 1 –Observable inputs based on unadjusted quoted prices in active markets for identical assets or liabilities;
Level 2 –Inputs other than quoted prices in active markets, which are observable for the asset or liability, either directly or indirectly; and
Level 3 –Unobservable inputs for which there is little or no market data requiring the Company to develop its own assumptions.

Recurring Fair Value Measurements

The fair values of financial instruments measured on a recurring basis by class are as follows as of December 31:
 
Fair Value
Hierarchy Level (1)
20242023
Financial Assets:  
Money market funds (2)
Level 1$204,314 $145,995 
Certificates of deposit (3)
Level 160,393 — 
Total financial assets$264,707 $145,995 
Financial Liabilities:  
Interest rate swap (4)
Level 2$1,011 $2,341 
(1)There were no transfers between hierarchy levels.
(2)As short-term, highly liquid investments readily convertible to known amounts of cash, their carrying values approximate fair value.
(3)They are valued using inputs based on industry standard data and due to their short maturities, their amortized cost approximates fair value.
(4)The fair value is based on a valuation model that utilizes interest rate yield curves and credit spreads observable in active markets as the significant inputs to the model.
Nonrecurring Fair Value Measurements

In addition to assets and liabilities that are recorded at fair value on a recurring basis, the Company's assets and liabilities are subject to nonrecurring fair value measurements, such as property, goodwill, and intangible assets. If events or indicators occur that require an impairment assessment, impairment charges may be recorded to reduce the assets to fair value.

The Company recorded impairment charges related to assets moved to held for sale during the years December 31, 2024, 2023, and 2022 totaling $1.2 million, $3.8 million, $8.6 million, respectively, which was recorded to impairment and disposal of long-lived assets, net of (recoveries) on the consolidated statements of operations. The impairment charges were derived from the difference between the carrying value and the estimated fair value of the relevant asset, minus estimated selling costs. The fair value was estimated using an income capitalization approach with estimates and assumptions regarding the asset's future cash flows and return on investment (Level 3).

In June 2023, the Company identified one event as a risk indicator for goodwill impairment, which was a decline in the Company's share price negatively affecting the Company's market capitalization. The Company concluded the decline in stock price was a triggering event to perform an interim quantitative goodwill impairment test as of June 30, 2023, specific to the resulting market capitalization of the Company. As the sole risk to the value of goodwill was the stock price, the Company concluded it most appropriate to apply a market approach utilizing control premiums which were obtained from transactions of comparable publicly traded companies (Level 2) to calculate a reasonable control premium (Level 3). The Company applied the control premium to the Company's market capitalization to derive the fair value. The subsequent reconciliation between the single reporting unit's book value and the fair value indicated the fair value was less than the carrying value, resulting in a $307.6 million goodwill impairment.

Estimated Fair Values of Financial Instruments

The following table presents the carrying values and estimated fair values of the Company’s financial instruments that are not accounted for at fair value in the consolidated balance sheets as of December 31. The table excludes cash and cash equivalents, restricted cash, accounts receivable, other receivables, accounts payable, and other payables as their carrying values approximate fair value due to their short maturities of less than one year (Level 1). The table also excludes notes payable with variable interest rates as their carrying value approximates fair value. This determination is based on the variable interest rates applied to the debt, which reflect current market conditions, or other observable inputs (Level 2). The Company's notes receivable are also excluded from the table below as the majority of the balance is due within one year; therefore, the carrying value approximates fair value due to the short maturity.
20242023
Fair Value Hierarchy LevelCarrying ValueFair ValueCarrying ValueFair Value
Liabilities
Private placement notes (1) (2)
Level 2$368,000 $366,660 $368,000 $310,549 
Notes payable, fixed rate (1) (3)
Level 347,673 47,344 49,115 48,715 
(1) Excludes any discount or issuance costs.
(2)The fair value was determined based on market rates at valuation.
(3) The fair value was determined using the discounted cash flow method.