Fair Value Hierarchy as of March 31, 2020

Aggregate

Level 1

Level 2

Level 3

Fair Value

Assets:

Certificates of deposit (1)

$

—

$

3,079

$

—

$

3,079

Total Assets

$

—

$

3,079

$

—

$

3,079

Liabilities:

Interest Rate Swap (2)

$

—

$

73

$

—

$

73

Preference shares (3)

—

—

2

2

Debt for forward share purchase agreements (4)

—

31,530

—

31,530

Total Liabilities

$

—

$

31,603

$

2

$

31,605

(1)

Included in the condensed consolidated balance sheet line item “Short-term investments”, with maturity terms between 4 and 12 months held in India.

(2)

Included in the condensed consolidated balance sheet line item “Other long-term liabilities”.

(3)

The preference shares liability was previously estimated on the basis of present value of the expected future cash flows contractually due in connection with the achievement of specified levels of EBITDA of Solutions Infini for the year ended March 31, 2020.  On March 9, 2020, the Company signed a modification of the 2018 Solutions Infini Purchase Agreement to reduce the price of the preference shares to be purchased from the eligible employees of Solutions Infini in July 2020 to their face value, amounting to Indian Rupee 10.0 per each preference share.

(4)

Based on the information available at the reporting date, debts for forward share purchase agreements have been determined as the present value to be paid at settlement in case the counterparty exercises the put option.

Fair Value Hierarchy as of December 31, 2019

Aggregate

Level 1

Level 2

Level 3

Fair Value

Assets:

Mutual funds (1)

$

5,124

$

—

$

—

$

5,124

Total Assets

$

5,124

$

—

$

—

$

5,124

Liabilities

Interest Rate Swap (2)

$

—

$

80

$

—

$

80

Preference shares (3)

—

—

2,530

2,530

Debt for forward share purchase agreements (4)

—

34,013

—

34,013

Total Liabilities

$

—

$

34,093

$

2,530

$

36,623

(1)

Included in the condensed consolidated balance sheet line item “Short-term investments”.

(2)

Included in the condensed consolidated balance sheet line item “Other long-term liabilities”.

(3)

Based on the information available at the reporting date, the preference shares liability was estimated on the basis of present value of the expected future cash flows contractually due in connection with the achievement of specified levels of EBITDA of Solutions Infini for the year ended March 31, 2020. Such cash flows are contractually predetermined and the maximum pay-out was assumed in determining the estimate which is primarily based on the expected EBITDA sourced from the most updated business plan, which represents management best estimates and is significantly above the targeted EBITDA. Changes in the liability during the period are due to (i) compensation expense accrued on a straight-line basis during period; (ii) accrued interest expense due to the fact that the obligation will be settled in 2020; and (iii) exchange rate differences. No fair value changes were recognized during the period. If the actual EBITDA of Solutions Infini for the year ended March 31, 2020 was materially below its expected level, this would have resulted in a change of the preference shares liability.

(4)

Based on the information available at the reporting date, debt for forward share purchase agreements have been determined as the present value to be paid at settlement in case the counterparty exercises the put option.

As of March 31,

As of December 31,

2020

2019

Cost

Unrealized

gains

Unrealized

losses

Fair value

Cost

Unrealized

gains

Unrealized

losses

Fair value

Mutual funds

$

—

$

—

$

—

$

—

$

5,129

$

1

$

(6

)

$

5,124

Certificates of deposit

3,079

—

—

3,079

—

—

—

—

Fair

Value

Beginning

of Period

Net

Realized

and

Unrealized

(Gains)

Losses

Included

in Income

Other

Comprehensive

(Income)

Loss

Purchases,

Sales,

Issuances and

Settlements,

Net

Change in

scope of

consolidation

Gross

Transfers

In

Fair

Value

End of

Period

March 31, 2020

Liabilities:

Preference shares

$

2,530

$

(2,486

)

$

(42

)

$

—

$

—

$

—

$

2

Research

and

development

Sales

and

marketing

General

and

administrative

Financial income

(expense), net

Foreign

currency

Income (loss)

Total

Three months ended March 31, 2020

Liabilities:

Preference shares

$

(941

)

$

(372

)

$

(756

)

$

(417

)

$

—

$

(2,486

)

Three months ended March 31, 2019

Liabilities:

Preference shares

117

46

94

58

—

315