Fair Value of Financial Instruments

12 Months Ended

Dec. 31, 2012

Fair Value of Financial Instruments

Fair Value of Financial Instruments

Note 4—Fair Value of Financial Instruments

        The Company measures the following financial assets and liabilities at fair value on a recurring basis. The following tables set forth the Company's financial instruments and presents them within the fair value hierarchy using the lowest level of input that is significant to the fair value measurement at December 31, 2012 and 2011 (in millions):

December 31, 2012	Total		Quoted Prices in Active Markets Available (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents	$	8.2	$	8.2	$	—	$	—
Restricted cash		3.7		3.7		—		—
Foreign exchange contracts		1.8		—		1.8		—
Embedded derivatives in purchase and delivery contracts		0.3		—		0.3		—
Long-term restricted cash		3.9		3.9		—		—
Total assets recorded at fair value	$	17.9	$	15.8	$	2.1	$	—
Liabilities:
Contingent consideration	$	3.7	$	—	$	—	$	3.7
Embedded derivatives in purchase and delivery contracts		0.3		—		0.3		—
Fixed price commodity contracts		0.2		—		0.2		—
Total liabilities recorded at fair value	$	4.2	$	—	$	0.5	$	3.7

December 31, 2011	Total		Quoted Prices in Active Markets Available (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents	$	26.3	$	26.3	$	—	$	—
Restricted cash		2.2		2.2		—		—
Embedded derivatives in purchase and delivery contracts		0.6		—		0.6		—
Fixed price commodity contracts		0.5		—		0.5		—
Long-term restricted cash		3.9		3.9		—		—
Total assets recorded at fair value	$	33.5	$	32.4	$	1.1	$	—
Liabilities:
Interest rate swap contract	$	1.1	$	—	$	1.1	$	—
Foreign exchange contracts		4.2		—		4.2		—
Embedded derivatives in purchase and delivery contracts		0.4		—		0.4		—
Fixed price commodity contracts		0.5		—		0.5		—
Total liabilities recorded at fair value	$	6.2	$	—	$	6.2	$	—

        Derivative financial instruments are classified within level 2 because there is not an active market for each derivative contract, however, the inputs used to calculate the value of the instruments are obtained from active markets.

        The interest rate swap matured at December 31, 2012.

        The fair value of the long-term fixed interest rate debt, which has been classified as Level 2, was $255.6 million at December 31, 2012 based on market and observable sources with similar maturity dates.

        The Company measures assets and liabilities at fair value with changes in fair value recognized in earnings. Fair value treatment may be elected either upon initial recognition of an eligible asset or liability or, for an existing asset or liability, if an event triggers a new basis of accounting. The Company did not elect to remeasure any of its existing financial assets or liabilities during the year ended December 31, 2012. During 2012, as part of the Company's acquisition of the SkyScan business, the Company recorded a contingent consideration liability that has been classified as a Level 3 in the fair value hierarchy. The contingent consideration represents the estimated fair value of future payments to the former shareholders of the SkyScan business based on achieving annual revenue targets for the years 2012-2014. The Company initially valued the contingent consideration by using the discounted cash flow method. Changes to the fair value of the contingent consideration as of December 31, 2012 have not been material.