v3.26.1
Fair Value Measurements
 3 Months Ended
Apr. 04, 2026
Fair Value Measurements  
Fair Value Measurements

(7)

Fair Value Measurements

The authoritative accounting literature relating to fair value measurements 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 (an exit price). The accounting literature outlines a valuation framework and creates a fair value hierarchy in order to increase the consistency and comparability of fair value measurements and the related disclosures. Under GAAP, certain assets and liabilities must be measured at fair value, and the accounting literature details the disclosures that are required for items measured at fair value. Financial assets and liabilities are measured using inputs from the three levels of the fair value hierarchy under the accounting literature. The three levels are as follows:

Level 1—Inputs are unadjusted quoted prices in active markets for identical assets or liabilities.

Level 2—Observable inputs other than Level 1 quoted prices, such as quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value driver is observable for the asset or liability, either directly or indirectly.

Level 3—Unobservable inputs that reflect our assumptions about the assumptions that market participants would use in pricing the asset or liability.

Cash and cash equivalents, trade accounts receivable, income tax receivable, trade accounts payable, accrued expenses, income tax payable and dividends payable are reflected in the consolidated balance sheets at carrying value, which approximates fair value due to the short-term nature of these instruments.

The carrying values and fair values of our revolving credit loans, term loans, senior notes and senior secured notes as of April 4, 2026 and January 3, 2026 were as follows (in thousands):

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April 4, 2026

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January 3, 2026

 

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Carrying Value

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Fair Value

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Carrying Value

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Fair Value

 

Revolving credit loans

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$

270,000

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$

270,000

(1)  

$

215,000

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$

215,000

(1)  

Tranche B term loans due 2029

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439,806

(2)  

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409,020

(3)  

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440,726

(2)  

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424,199

(3)  

5.25% senior notes due 2027

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509,310

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494,667

(3)  

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509,310

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495,941

(3)  

8.00% senior secured notes due 2028

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$

798,591

(4)  

$

787,610

(3)  

$

798,526

(4)  

$

786,548

(3)  

(1)Fair values are estimated based on Level 2 inputs, which were quoted prices for identical or similar instruments in markets that are not active.
(2)The carrying value of the tranche B term loans includes a discount. At April 4, 2026 and January 3, 2026, the face amount of the tranche B term loans was $443.3 million and $444.4 million, respectively.
(3)Fair values are estimated based on quoted market prices.
(4)The carrying value of the 8.00% senior secured notes due 2028 includes a discount. At April 4, 2026 and January 3, 2026, the face amount of the 8.00% senior secured notes due 2028 was $799.3 million.

There was no Level 3 activity for recurring fair value measurements during the first quarter of 2026 or 2025.

For information about non-recurring fair value measurements, see Note 5, “Goodwill and Other Intangible Assets,” which describes our impairment analysis for goodwill and indefinite-lived intangible assets.