Fair Value Of Financial Instruments

6 Months Ended

Jun. 30, 2011

Fair Value Of Financial Instruments

Fair Value Of Financial Instruments

Note 3—Fair Value of Financial Instruments

The Company categorizes its financial instruments into a three-level fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used to measure fair value fall within different levels of the hierarchy, the category level is based on the lowest priority level input that is significant to the fair value measurement of the instrument.

Financial assets recorded at fair value on the Company's consolidated balance sheets are categorized as follows:

Level 1: Unadjusted quoted prices for identical assets in an active market.

Level 2: Quoted prices in markets that are not active or inputs that are observable either directly or indirectly for substantially the full-term of the asset. Level 2 inputs include the following:

• quoted prices for similar assets in active markets,

• quoted prices for identical or similar assets in non-active markets,

• inputs other than quoted market prices that are observable, and

• inputs that are derived principally from or corroborated by observable market data through correlation or other means.

Level 3: Prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. They reflect management's own assumptions about the assumptions a market participant would use in pricing the asset.

The following table presents the Company's cash and cash equivalents, and investments and including the hierarchy for its financial instruments measured at fair value on a recurring basis as of June 30, 2011:

	Carrying Amount		Estimated Fair Value		Assets and Liabilities Measured at Fair Value		Level 1		Level 2		Level 3
	(In thousands)
Assets:
Cash and cash equivalents:
Cash	$	4,315	$	4,315	$	4,315	$	4,315	$	—	$	—
Certificates of deposit		1,307		1,307		—		—		—		—
Money market funds		193,026		193,026		193,026		193,026		—		—
Total cash and cash equivalents		198,648		198,648		197,341		197,341		—		—
Short-term investments (available-for-sale):
Equity securities		—		—		—		—		—		—
Short-term investments (held-to-maturity):
Certificates of deposit		41,698		41,698		—		—		—		—
Total short-term investments		41,698		41,698		—		—		—		—
Total cash and cash equivalents and short-term investments		240,346		240,346		197,341		197,341		—		—
Long-term investments (held-to-maturity)
Certificates of deposit		1,280		1,280		—		—		—		—
Total long-term investments		1,280		1,280		—		—		—		—
Total	$	241,626	$	241,626	$	197,341	$	197,341	$	—	$	—

The $169.8 million debt component of the 2018 Convertible Notes was recorded at fair value as of the issuance date of February 4, 2011 based on a Level 3 input. The carrying value of the notes is subsequently accreted back to its principal. The $173.3 million carrying amount of the notes as of June 30, 2011 includes accretion of the discount on the convertible notes subsequent to the issuance date of $3.6 million. See Note 14 to the consolidated financial statements for more details.