National Vision Holdings, Inc.

5. Fair Value Measurement

Recurring fair value measurements

Convertible Promissory Note

On December 17, 2024, the Company purchased $1.3 million principal amount of a convertible promissory note issued by a private company. As of March 29, 2025, given the short time from the execution of the note until the end of our fiscal period and lack of material underlying changes we determined the fair value of the convertible promissory note approximated its carrying value of 1.3 million; this investment is included in Other assets on the Condensed Consolidated Balance Sheets.

Non-recurring fair value measurements

We recognized impairments of $0.5 million and $0.5 million during the three months ended March 29, 2025 and March 30, 2024, respectively, primarily related to our long-lived tangible store assets and ROU assets. A decrease in the estimated cash flows would lead to a lower fair value measurement, as would an increase in the discount rate. These non-recurring fair value measurements are classified as Level 3 measurements in the fair value hierarchy.

Long-lived Store and ROU Store Assets

The cash flows used in estimating fair value were discounted using a market rate of 10.5%. The estimated remaining fair value of the store assets impaired during the three months ended March 29, 2025 and March 30, 2024 was $0.5 million and $0.4 million, respectively. Substantially all of the remaining fair value of the impaired store assets represents the fair value of ROU assets.

Additional fair value information

Term Loan A and Revolving Loans

Since the borrowings under the $250.9 million outstanding principal first lien term loan (“Term Loan A”) and revolving credit loans in an aggregate principal amount of $300.0 million (the “Revolving Loans”) utilize variable interest rate setting mechanisms such as Term SOFR, the fair values of these borrowings are deemed to approximate the carrying values. We also considered the effect of our own credit risk on the fair values of Term Loan A and Revolving Loans. Refer to Note 6. “Debt” for more information on these borrowings.

2025 Notes

The Company has $84.8 million in aggregate principal amount of 2.50% convertible senior notes due on May 15, 2025 (the “2025 Notes”) issued and outstanding as of March 29, 2025. The estimated fair value of the 2025 Notes was approximately $84.4 millionand $83.3 million as of March 29, 2025 and December 28, 2024, respectively. The estimated fair value of the 2025 Notes is based on the prices the 2025 Notes have traded in the market as well as overall market conditions on the date of valuation, stated coupon rates, the number of coupon payments each year and the maturity dates, and represents a Level 2 measurement in the fair value hierarchy. Refer to Note 6. “Debt” for more information on the 2025 Notes.