Opening of Proposals - WWTP Solar Guaranteed Energy Savings Contract Proj. No. 124-015 - Ameresco

Home Browse Search

Table of Contents AMERESCO, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In thousands, except per share amounts) Estimated amortization expense for existing debt discount and debt issuance costs for the next five succeeding fiscal years is as follows Estimated Amortization 2024 $ 5,801 2025 $ 3,158 2026 $ 2,363 2027 $ 1,378 2028 $ 1,245 18. FAIR VALUE MEASUREMENT We recognize certain financial assets and liabilities at fair value on a recurring basis (at least annually). Fair value is defined as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Three levels of inputs that may be used to measure fair value are as follows: Level 1: Inputs are based on unadjusted quoted prices for identical instruments traded in active markets. Level 2: Inputs are based on quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model - based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3: Inputs are generally unobservable and typically reflect management's estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model -based techniques that include option pricing models, discounted cash flow models, and similar techniques. The following table presents the input level used to determine the fair values of our financial instruments measured at fair value on a recurring basis: Assets Interest rate swap instruments Liabilities Interest rate swap instruments Make -whole provisions Contingent consideration Total liabilities Fair Value as of December 31, Level 2023 2022 2 $ 3,970 $ 5,202 2 $ 629 $ 9 2 6,012 5,348 3 1,465 4,158 $ 8,106 $ 9,515 The fair value of our interest rate swaps was determined using cash flow analysis on the expected cash flow of the contract in combination with observable market -based inputs, including interest rate curves and implied volatility. As part of this valuation, we considered the credit ratings of the counterparties to the interest rate swaps to determine if a credit risk adjustment was required. The fair value of our make -whole provisions was determined by comparing them against the rates of similar debt instruments under similar terms without a make -whole provision obtained from various highly rated third -party pricing sources. The fair value of our contingent consideration liabilities was determined by evaluating the acquired asset's future financial forecasts and evaluating which, if any, of the cumulative revenue targets, financial metrics and/or milestones are likely to be met. We classified contingent consideration related to certain acquisitions within level 3 of the fair value hierarchy because the fair value is derived using significant unobservable inputs, which include discount rates, probability -weighted cash flows, and volatility. We determined the fair value of our contingent consideration obligations based on a probability -weighted income approach derived from financial performance estimates and probability assessments of the attainment of certain targets for some 98