Fair Value Measurements |
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| Fair Value Measurements | 2. Fair Value Measurements Fair value measurements are estimated based on valuation techniques and inputs categorized as follows:
The following tables present the components and classification of our assets and liabilities that are measured at fair value on a recurring basis (in thousands):
The following table presents a reconciliation of the beginning and ending amounts of the fair value of the acquisition-related contingent consideration and compensation liabilities categorized as Level 3 (in thousands):
The fair value of the acquisition-related contingent consideration and compensation liabilities was determined utilizing a Monte Carlo model based on estimated future revenues, margins and volatility factors, among other variables and estimates and has no minimum or maximum payment. The undiscounted range of outcomes per the Monte Carlo model utilized to determine the fair value of the acquisition-related contingent consideration and compensation liabilities on April 1, 2025 was $0.0 million to $142.4 million. Results could change materially if different estimates and assumptions were used. During the first three months of fiscal 2025 and 2024, we did not make any payments, pursuant to the Fox Restaurant Concept LLC (“FRC”) acquisition agreement. The fair values of our cash and cash equivalents, accounts and other receivables, income taxes receivable, prepaid expenses, accounts payable, income taxes payable and other accrued liabilities approximate their carrying amounts due to their short duration. The fair value of our Revolver Facility (as defined below) approximates carrying value due to the variable interest rate. As of April 1, 2025, we had $69.0 million aggregate principal amount of convertible senior notes due 2026 (“2026 Notes”) outstanding. The estimated fair value of the 2026 Notes based on a market approach as of April 1, 2025 was approximately $67.6 million and was determined based on the estimated or actual bids and offers of the 2026 Notes in an over-the-counter market on the last business day of the reporting period. The decrease in the fair value of the 2026 Notes was primarily due to a decline in our stock price from the date of the issuance of the 2026 Notes. As of April 1, 2025, we had $575.0 million aggregate principal amount of convertible senior notes due 2030 (“2030 Notes”) outstanding. The estimated fair value of the 2030 Notes based on a market approach as of April 1, 2025 was approximately $550.9 million and was determined based on the estimated or actual bids and offers of the 2030 Notes in an over-the-counter market on the last business day of the reporting period. The decrease in the fair value of the 2030 Notes was primarily due to a decline in our stock price from the date of the issuance of the 2030 Notes. See Note 5 for further discussion of the 2026 Notes and 2030 Notes. |
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