Derivative Financial Instruments

12 Months Ended

Dec. 31, 2011

Summary of Derivative Instruments [Abstract]

Derivative Financial Instruments

DERIVATIVE FINANCIAL INSTRUMENTS

In prior years the Company was actively engaged in purchasing manufacturing equipment internationally and was exposed to foreign currency risk. In July 2008 and March 2009, the Company entered into fair value hedges utilizing forward contracts designed to match scheduled contractual payments to equipment suppliers which are denominated in Euros and Yen.

Although the hedging activity is designed to fix the dollar amount to be expended, the asset purchased is recorded at the spot rate in effect as of the date of the payment to the supplier. The difference between the spot rate and the forward rate has been reported as Realized gain (loss) on forward contracts. From time to time the Company holds foreign currency options to hedge against equipment payments to be remitted in foreign currencies. Derivative financial instruments are not used for speculative or trading purposes.

At December 31, 2011, approximately $1.4 million included in Restricted cash was held in Euros. Accounts denominated in foreign currencies are held in the Company’s bank account for future payments to equipment suppliers. Changes in exchange rates related to foreign currencies on deposit in the Company’s bank accounts are reflected as Foreign currency transaction gain (loss) in the Statements of Operations.