Quarterly report pursuant to Section 13 or 15(d)

Fair Value Measurements

v2.4.0.8
Fair Value Measurements
 3 Months Ended
Dec. 31, 2013
Fair Value Measurements  
Fair Value Measurements

14.       Fair Value Measurements

 

Fair value is defined as the exit price, or the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date.  The authoritative guidance establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available.  Observable inputs are from sources independent of the Company.  Unobservable inputs reflect the Company’s assumptions about the factors market participants would use in valuing the asset or liability developed based upon the best information available in the circumstances.  The categorization of financial assets and liabilities within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.  The hierarchy is broken down into three levels:

 

Level 1:

Inputs are quoted prices in active markets for identical assets or liabilities.

Level 2:

Inputs include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, and inputs (other than quoted prices) that are observable for the asset or liability, either directly or indirectly.

Level 3:

Inputs are unobservable for the asset or liability.

 

 

 

Carrying

 

 

 

 

 

 

 

 

 

Value at

 

Fair Value at December 31, 2013

 

 

 

December 31,

 

Using Inputs Considered as:

 

 

 

2013

 

Level 1

 

Level 2

 

Level 3

 

Assets:

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

62.3

 

$

62.3

 

$

—

 

$

—

 

Equity investments

 

1.0

 

—

 

—

 

6.2

 

Investments in rabbi trust

 

6.0

 

6.0

 

—

 

—

 

Derivative instruments

 

1.8

 

—

 

1.8

 

—

 

 

 

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

 

$150 senior unsecured notes

 

148.8

 

159.1

 

—

 

—

 

Revolving credit facility

 

315.4

 

—

 

315.4

 

—

 

Term loan

 

187.5

 

—

 

187.5

 

—

 

Derivative instruments

 

0.6

 

—

 

0.6

 

—

 

 

The equity investments include $1.0 of warrants to purchase the common stock of a privately held company that was acquired by a third-party on January 2, 2014.  The warrants were exercised as described in Note 17, and had a fair value of $6.2 at December 31, 2013.

 

The fair values of the revolving credit facility and term loan approximated book value at December 31, 2013.  The fair values of the revolving credit facility and term loan are estimated based on internally developed models, using current market interest rate data for similar issues as there is no active market for our revolving credit facility and term loan.

 

The fair values of the Company’s derivative instruments are based upon pricing models using inputs derived from third-party pricing services or observable market data such as currency spot and forward rates. These values are periodically validated by comparing to third-party broker quotes.  The aggregate notional value of these derivatives was $165.1 at December 31, 2013.