FAIR VALUE

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The inputs used to measure fair value are prioritized based on a three-level hierarchy. The three levels of inputs to measure fair value are as follows:


•	Level 1—inputs are unadjusted quoted prices for identical assets or liabilities that are available in active markets.


•	Level 2—inputs are other than quoted market prices included within Level 1 that are observable for assets or liabilities, directly or indirectly.


•	Level 3—inputs to the valuation methodology are unobservable.

The lowest level of significant input determines the placement of the entire fair value measurement in the hierarchy. The three levels of the hierarchy and the distribution of the Company’s assets and liabilities, measured at fair value, within it were as follows:



	Assets and Liabilities at Fair Value as of November 1, 2014
(in thousands)	Level 1		Level 2		Level 3		Total
ASSETS:
Money market funds	$	19,820	$	—	$	—	$	19,820
Derivative financial instruments	—		8,095		—		8,095
Total assets measured at fair value	$	19,820	$	8,095	$	—	$	27,915
LIABILITIES:
Derivative financial instruments	—		133		—		133
Total liabilities measured at fair value	$	—	$	133	$	—	$	133



	Assets and Liabilities at Fair Value as of February 1, 2014
(in thousands)	Level 1		Level 2		Level 3		Total
ASSETS:
Money market funds	$	148,024	$	—	$	—	$	148,024
Derivative financial instruments	—		969		—		969
Total assets measured at fair value	$	148,024	$	969	$	—	$	148,993
LIABILITIES:
Derivative financial instruments	—		2,555		—		2,555
Total liabilities measured at fair value	$	—	$	2,555	$	—	$	2,555

The level 2 assets and liabilities consist of derivative financial instruments, primarily forward foreign currency exchange contracts. The fair value of forward foreign currency exchange contracts is determined by using quoted market prices of the same or similar instruments, adjusted for counterparty risk.

Disclosures of Fair Value of Other Assets and Liabilities:

The Company’s borrowings under the 2014 Credit Facilities and the 2011 and 2012 Credit Agreements are carried at historical cost in the accompanying Consolidated Balance Sheets. For disclosure purposes, the Company estimated the fair value of borrowings outstanding using discounted cash flow analysis based on market rates obtained from independent third parties for similar types of debt. The inputs used to value the borrowings outstanding are considered to be Level 2 instruments.

The carrying amount of gross borrowings outstanding under the Term Loan Facility was $300.0 million and the fair value of such borrowings was $296.6 million as of November 1, 2014. The carrying amount of borrowings outstanding under the 2012 Term Loan Agreement approximated fair value and was $135.0 million as of February 1, 2014. No borrowings were outstanding under the ABL Facility and the 2011 Credit Agreement as of November 1, 2014 and February 1, 2014, respectively. See Note 12, "BORROWINGS," for further discussion of the Credit Facilities.