Company: HEI-A
Filing Date: 2025-12-22
Form Type: 10-K
Source: 0000046619-25-000082
Chunk: 121

Company: HEICO CORP
Filing Date: 2025-12-22
Form: 10-K
Item: Item 8
Chunk 121
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 basis using unobservable inputs (Level 3) during fiscal 2025 and 2024 are as follows (in thousands):LiabilitiesBalance as of October 31, 2023$71,136 Payment of contingent consideration(31,000)Decrease in accrued contingent consideration, net(9,884)Foreign currency transaction adjustments(45)Balance as of October 31, 202430,207 Increase in accrued contingent consideration12,920 Contingent consideration related to an acquisition11,509 Payment of contingent consideration(8,144)Foreign currency transaction adjustments (294)Balance as of October 31, 2025$46,198     As of October 31, 2025, the Company's contingent consideration balance is included within other long-term liabilities in its Consolidated Balance Sheet.  The Company records changes in accrued contingent consideration and foreign currency transaction adjustments within SG&A expenses in its Consolidated Statements of Operations.The carrying amounts of the Company’s cash and cash equivalents, accounts receivable, trade accounts payable and accrued expenses and other current liabilities approximate fair value as of October 31, 2025 due to the relatively short maturity of the respective instruments.  The 

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carrying amount of borrowings under the Company's credit facility approximates fair value due to its variable interest rate.  See Note 5, Long-Term Debt, for the estimated fair value of the Company's senior unsecured notes.    During fiscal 2024, two non-amortizing trade names within the ETG were measured at fair value on a nonrecurring basis, resulting in the recognition of impairment losses aggregating $7.5 million (see Note 4, Goodwill and Other Intangible Assets, for additional information).  The aggregate fair value of these nonfinancial assets, which are classified within Level 3, and the related impairment loss recognized in fiscal 2024 are as follows (in thousands):Carrying AmountImpairment LossFair Value (Level 3)Asset:Trade names$11,500 ($7,500)$4,000 The fair value of each trade name was determined using the relief from royalty method, which is an income approach.  This method involves applying an asset-specific discount rate to a forecast of cash flows specific to the asset.  The following unobservable inputs were used to derive the estimated fair value of the Level 3 trade names as of July 31, 2024 and October 31, 2024:Unobservable