Fair Value

12 Months Ended

Dec. 31, 2024

Fair Value Disclosures [Abstract]

Fair Value

18.Fair Value

The authoritative guidance on fair value measurement defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (referred to as an “exit price”). At December 31, 2024 and December 31, 2023 the Company’s financial instruments include cash, cash equivalents, accounts receivable, accounts payable, and other liabilities. The fair values of these financial instruments approximate their carrying values due to their short-term maturities.

Investments measured at fair value are based on one or more of the following three valuation techniques:

•Market approach—Prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities;

•Cost approach—Amount that would be required to replace the service capacity of an asset (i.e., replacement cost); and

•Income approach—Techniques to convert future amounts to a single present amount based on market expectations (including present value techniques, option-pricing models and lattice models).

In addition, the guidance establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted market prices in active markets for identical assets and liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are:

Level 1	Unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets and liabilities;
Level 2	Pricing inputs that include quoted prices for similar assets and liabilities in active markets and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the derivative instrument; and
Level 3	Prices or valuations that require inputs that are both significant to the fair value measurements and unobservable.

The methods described above may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while the Company believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date.

Financial assets and liabilities measured at fair value on a recurring basis are as follows:

Fair value as of December 31, 2024 (in thousands):

	Level 1		Level 2		Level 3		Total
Assets related to defined contribution plan
Mutual funds	$	875	$	—	$	—	$	875
Fixed income		—		6,627		—		6,627
Cash and cash equivalents		349		—		—		349
Total assets at fair value	$	1,224	$	6,627	$	—	$	7,851

Fair value as of December 31, 2023 (in thousands):

	Level 1		Level 2		Level 3		Total
Assets related to defined contribution plan
Mutual funds	$	1,840	$	—	$	—		1,840
Fixed income		—		6,568		—		6,568
Cash and cash equivalents		355		—		—		355
Total assets at fair value	$	2,195	$	6,568		—	$	8,763
Contingent consideration
Earnout liability	$	-	$	-	$	2,300	$	2,300
Total liabilities at fair value	$	-	$	-	$	2,300	$	2,300

As described in “Note 15—Retirement and Other Benefits Plans”, the Company acquired a defined contribution pension plan, a defined benefit pension plan, and supplemental retirement plans. At December 31, 2024 and December 31, 2023, the Company measured the mutual funds held within the defined benefit pension plan at fair value using unadjusted quoted prices in active markets that are accessible for identical assets. The Company measured the fixed income securities using market bid and ask prices. The inputs that are significant to the valuation of fixed income securities are generally observable, and therefore have been classified as Level 2.

In determining the fair value of acquired intangible assets from our business acquisitions, the Company uses the multi-period excess earnings method to value customer relationships and backlog and values developed technologies using the relief-from royalty method. These valuation methods use significant unobservable inputs classified within Level 3 of the fair value hierarchy. See "Note 2—Summary of Significant Accounting Policies."

We measure contingent consideration at fair value on a recurring basis using significant unobservable inputs classified within Level 3 of the fair value hierarchy. See "Note 2—Summary of Significant Accounting Policies" and "Note 3—Acquisitions" for further information.

With respect to equity-based compensation, for restricted stock units containing service conditions or service and performance conditions, the grant date fair value is based on the closing stock price of a share of the Company’s common stock on the NYSE on the grant date. For awards that include market conditions, the grant date fair value is determined using a Monte Carlo simulation.

The carrying values and estimated fair values of our financial instruments that are not required to be recorded at fair value in our consolidated balance sheets, on the basis of Level 1 inputs for the Company's convertible notes and Level 2 inputs for the delayed draw term loan, were as follows (in thousands):

	December 31, 2024				December 31, 2023
	Carrying Value		Fair Value		Carrying Value		Fair Value
Liabilities:
Convertible senior notes due 2025	$	113,405	$	233,206	$	400,000	$	568,000
Convertible senior notes due 2029		800,000		939,280		-		-
Delayed draw term loan		350,000		350,000		350,000		350,000
Total	$	1,263,405	$	1,522,486	$	750,000	$	918,000