Company: DXPE
Filing Date: 2025-04-30
Form Type: ARS
Source: 0001020710-25-000081
Chunk: 80

Company: DXP ENTERPRISES INC
Filing Date: 2025-04-30
Form: ARS
Chunk 80
---
: Changes in fair value recorded in other (income) expense, net 1,738 Balance at December 31, 2023(1) $ 8,753 Acquisitions and settlements: Acquisitions (Note 16) 11,932 Settlements (5,108) Total remeasurement adjustments: Changes in fair value recorded in other (income) expense, net 745 Balance at December 31, 2024(1) $ 16,322 (1) Amounts included in other current liabilities were $8.0 million and $5.4 million for the periods ending December 31, 2024 and December 31, 2023, respectively. Amounts included in other long-term liabilities were $8.3 million and $3.4 million for the periods ending December 31, 2024 and December 31, 2023, respectively. Quantitative Information about Level 3 Fair Value Measurements The significant unobservable inputs used in the fair value measurement of the Company's contingent consideration liabilities designated as Level 3 are as follows: Fair Value at December 31, 2024 Valuation Technique Significant Unobservable Inputs $ 16,322 Discounted cash flow Annualized EBITDA and probability of achievement Sensitivity to Changes in Significant Unobservable Inputs The significant Level 3 unobservable inputs used in the fair value measurement of contingent consideration related to the acquisitions are annualized EBITDA forecasts developed by the Company's management and the probability of achievement of those EBITDA results. The discount rate used in the calculation was 9.8%. A decrease in discount rates would increase the contingent consideration liability, whereas an increase or decrease in EBITDA forecasts would increase or decrease the contingent liability. Changes in our unobservable inputs in isolation would result in a change to our fair value measurement. As of December 31, 2024, the maximum amount of contingent consideration payable under these arrangements is $18.7 million over three years. Other financial instruments not measured at fair value on the Company's consolidated balance sheets at December 31, 2024 and December 31, 2023, but which require disclosure of their fair values include: cash, restricted cash, accounts receivable, trade accounts payable and accrued expenses. The Company believes that the estimated fair value of such instruments at December 31, 2024 and December 31, 2023 approximates their carrying value as reported on the consolidated balance sheets due to the relative short maturity of these instruments. Table of Contents