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FAIR VALUE HIERARCHY
 6 Months Ended
Jun. 30, 2025
FAIR VALUE HIERARCHY  
FAIR VALUE HIERARCHY

(5) FAIR VALUE HIERARCHY

The carrying amounts of the Company’s cash equivalents, accounts receivable, accounts payable and borrowings under a revolving credit facility in the condensed consolidated balance sheets approximate fair value due to the immediate or short-term nature of these financial instruments. Ribbon’s term debt balance as of June 30, 2025 and December 31, 2024 of $346.5 million and $348.3 million, respectively, had a fair value of approximately $350.8 million and $350.4 million, respectively. The Company’s Warrant liability had a fair value of $6.3 million and $8.1 million as of June 30, 2025 and December 31, 2024, respectively.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. The three-tier fair value hierarchy is based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The fair value hierarchy is as follows:

●Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. The Company had no assets or liabilities fair valued using Level 1 input at June 30, 2025 or December 31, 2024.
●Level 2 applies to assets or liabilities for which there are inputs that are directly or indirectly observable in the marketplace, such as quoted prices for similar assets or liabilities in active markets or quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets). At December 31, 2024, the Company determined the fair value of its defined benefit plans’ assets using Level 2 input. There were no significant changes to the Company’s defined benefit plans’ assets during the six months ended June 30, 2025 that required the calculation of their fair value as of June 30, 2025.
●Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. Level 3 input was used to determine the fair value of the Company’s Warrants at June 30, 2025 and December 31, 2024.

The Company had no transfers between Level 2 and Level 3 fair value measurements during the three and six months ended June 30, 2025 or 2024.