Fair Value Measurements

3 Months Ended

Mar. 31, 2017

7. FAIR VALUE MEASUREMENTS:

As required by FASB ASC 820, the Company defines fair value as 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 and establishes a three level hierarchy for measuring fair value. Fair value measurements are classified and disclosed in one of the following categories:

Level 1: Quoted prices (unadjusted) in active markets for identical assets and liabilities that the Company has the ability to access at the measurement date.

Level 2: Inputs other than quoted prices included within Level 1 that are either directly or indirectly observable for the asset or liability, including quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in inactive markets, inputs other than quoted prices that are observable for the asset or liability, and inputs that are derived from observable market data by correlation or other means. Instruments categorized in Level 2 include non-exchange traded derivatives such as over-the-counter forwards and swaps.

Level 3: Unobservable inputs for the asset or liability, including situations where there is little, if any, market activity for the asset or liability.

		Level 1		Level 2		Level 3		Total
Assets:
Current derivative asset	$	-	$	14	$	-	$	14

Liabilities:
Current derivative liability	$	-	$	13,232	$	-	$	13,232

Fair Value of Financial Instruments

The estimated fair value of financial instruments is the estimated amount at which the instrument could be exchanged currently between willing parties. The carrying amounts reported in the Consolidated Balance Sheets for cash and cash equivalents, restricted cash, accounts receivable, and accounts payable approximate fair value due to the immediate or short-term maturity of these financial instruments. The Company uses available market data and valuation methodologies to estimate the fair value of its debt. The valuation assumptions utilized to measure the fair value of the Company’s debt are considered Level 2 inputs. This disclosure is presented in accordance with FASB ASC Topic 825, Financial Instruments, and does not impact the Company’s financial position, results of operations or cash flows.

		March 31, 2017(1)				December 31, 2016
		Carrying		Estimated		Carrying		Estimated
		Amount		Fair Value		Amount		Fair Value

7.31% Notes due March 2016, issued 2009		62,000		62,000		62,000		64,266
4.98% Notes due January 2017, issued 2010		116,000		116,000		116,000		123,967
5.92% Notes due March 2018, issued 2008		200,000		200,000		200,000		224,025
5.75% Notes due December 2018, issued 2013		450,000		450,000		450,000		465,630
7.77% Notes due March 2019, issued 2009		173,000		173,000		173,000		204,854
5.50% Notes due January 2020, issued 2010		207,000		207,000		207,000		233,932
4.51% Notes due October 2020, issued 2010		315,000		315,000		315,000		337,528
5.60% Notes due January 2022, issued 2010		87,000		87,000		87,000		99,983
4.66% Notes due October 2022, issued 2010		35,000		35,000		35,000		38,225
6.125% Notes due October 2024, issued 2014		850,000		850,000		850,000		893,325
5.85% Notes due January 2025, issued 2010		90,000		90,000		90,000		106,299
4.91% Notes due October 2025, issued 2010		175,000		175,000		175,000		193,665
Credit Facility due October 2016		999,000		999,000		999,000		999,000
	$	3,759,000	$	3,759,000	$	3,759,000	$	3,984,699

⁽¹⁾At March 31, 2017, the debt included in the table above is a component of liabilities subject to compromise in our Consolidated Balance Sheets. See Note 1. The carrying amounts of debt securities at March 31, 2017 are considered reasonable estimates of their fair values due to the short-term maturity of these financial instruments as described in our Plan of Reorganization confirmed by the Court on March 14, 2017 and subsequently executed upon on April 12, 2017.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

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