Fair Value Measures

12 Months Ended

Dec. 31, 2025

Fair Value Disclosures [Abstract]

Fair Value Measures

Fair Value Measures

Fair value is defined as an exit price, or 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. The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels as follows:

• Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities.

• Level 2 - Inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the asset or liability.

• Level 3 - Inputs that are unobservable for the asset or liability based on our own assumptions about the assumptions market participants would use in pricing the asset or liability.

Refer to Note 24, Hedging Activities, for a description of the Company’s derivative instruments including the valuation techniques used to determine fair value and support for their classification within Level 2 of the fair value hierarchy.

The Company values its long-term debt at fair value based quoted market prices for the same or similar issues, or on current rates offered to the company for debt of the same remaining maturities and terms. Due to the infrequency of trades, these inputs are considered to be Level 2 inputs. Based on the variable interest rates associated with the Credit Facility, as of December 31, 2025 and 2024, the amounts at which the Company’s total debt were recorded are not materially different from their fair market value.

The Company values its company-owned life insurance policies at fair value based on quotes for like instruments with similar credit ratings and terms. As a result, the Company owns an immaterial remaining amount of company-owned life insurance policies as of the year ended December 31, 2025.

Items Measured at Fair Value on Nonrecurring Basis

The Company is also required to measure certain items, including intangible assets and goodwill, at fair value on a nonrecurring basis. For non-observable market values, the Company determines fair value using acceptable valuation principles, including the excess earnings, relief from royalty, lost profit, or cost methods. The determination of the estimated fair values of intangible assets and goodwill requires management’s judgment and involves the use of significant estimates and assumptions, including revenue growth rates, gross margin levels, operating expenses, the weighted average cost of capital (“WACC”), and royalty rates, among other items. See Note 15, Goodwill and Other Intangible Assets, for additional information.