Interest Rate Cap

On April 7, 2022, the Company entered into an interest rate cap agreement to manage its exposure to interest rate fluctuations related to the Company’s Term Loan in the amount of $25.5 million. The interest rate cap has a $1,000.0 million notional amount, 2.75% strike, and terminates on December 31, 2025. The fair value of the interest rate cap was $47.0 million and $45.9 million as of June 30, 2023 and December 31, 2022, respectively, and was included in Other non-current assets on the Consolidated Balance Sheets. At inception, the Company formally designated the interest rate cap as a cash flow hedge. As of June 30, 2023, the interest rate cap continued to be an effective hedge. As of June 30, 2023 and December 31, 2022, the balance of Accumulated other comprehensive income related to the interest rate cap was $26.3 million and $22.2 million, respectively.

The Company elected to exclude the change in the time value of the interest rate cap from the assessment of hedge effectiveness and will amortize the initial value of the premium over the life of the instrument through Interest expense, net on the Consolidated

Statements of Income and Other comprehensive income (loss). Premium amortization of $1.7 million and $1.2 million was recognized during the three months ended June 30, 2023 and 2022, respectively, and $3.5 million and $1.2 million was recognized during the six months ended June 30, 2023 and 2022, respectively.

For the three months ended June 30, 2023 and 2022, the $9.8 million and $0.9 million, respectively, changes in the fair value of the interest rate cap were recognized in Other comprehensive income (loss). For the six months ended June 30, 2023 and 2022, the $1.1 million and $0.9 million, respectively, changes in the fair value of the interest rate cap were recognized in Other comprehensive income (loss). During the three and six months ended June 30, 2023, $5.6 million and $10.0 million, respectively, related to payments received were reclassified out of Other comprehensive income (loss) into earnings as an offset to interest expense in Interest expense, net on the Consolidated Statements of Income. As of June 30, 2023, the Company expects $25.3 million of unrealized gains from the interest rate cap to be reclassified into earnings over the next twelve months.