DERIVATIVES AND HEDGING

12 Months Ended

Dec. 31, 2011

DERIVATIVES AND HEDGING

11 — DERIVATIVES AND HEDGING

The Company enters into a limited number of derivative contracts to offset the potentially negative economic effects of interest rate and foreign exchange movements. The Company accounts for its outstanding derivative contracts in accordance with FASB ASC Topic 815, which requires all derivatives, to include derivatives designated as accounting hedges, to be recorded on the balance sheet at fair value.

The following tables provide information regarding the Company’s outstanding derivatives contracts as of, and for, the years ended (in thousands, except for number of outstanding contracts):

December 31, 2011

Derivative Contract Type	Number of Outstanding Contracts		Contract Notional Amount		Fair Value Asset (Liability) (4)			Balance Sheet Line Item		OCI Unrealized (Loss), Net Of Tax
Interest rate swap (1)		1	$	200,000	$	(9,891	)		Other liabilities	$	(5,934	)
Interest rate swaps (2)		2		30,750		(98	)		Accrued liabilities		—
Foreign currency forwards (3)		60		99,585		272			Other current assets		—
Total		63	$	330,335	$	(9,717	)			$	(5,934	)
December 31, 2010
Derivative Contract Type	Number of Outstanding Contracts		Contract Notional Amount		Fair Value Asset (Liability) (4)			Balance Sheet Line Item		OCI Unrealized (Loss), Net Of Tax
Interest rate swap (1)		1	$	200,000	$	(2,101	)		Other liabilities	$	(1,261	)
Interest rate swaps (2)		2		147,750		(3,966	)		Other liabilities		—
Foreign currency forwards (3)		63		250,220		618			Other current assets		—
Total		66	$	597,970	$	(5,449	)			$	(1,261	)

(1)	The Company designates and accounts for this swap as a cash flow hedge of the forecasted interest payments on borrowings. As a result, changes in fair value of this swap are deferred and are recorded in OCI, net of tax effect. The Company entered into this swap in December 2010 (see Note 5 — Debt).
(2)	Changes in the fair value of these swaps are recognized in earnings. Both swaps matured in January 2012.
(3)	The Company has foreign exchange transaction risk since it typically enters into transactions in the normal course of business that are denominated in foreign currencies that differ from the local functional currency. The Company enters into short-term foreign currency forward exchange contracts to offset the economic effects of these foreign currency transaction risks. These contracts are accounted for at fair value with realized and unrealized gains and losses recognized in Other income (expense), net since the Company does not designate these contracts as hedges for accounting purposes. All of the outstanding contracts at December 31, 2011 matured by the end of January 2012.
(4)	See Note 12 — Fair Value Disclosures for the determination of the fair value of these instruments.

At December 31, 2011 the Company’s derivative counterparties were all large investment grade financial institutions. The Company did not have any collateral arrangements with its derivative counterparties, and none of the derivative contracts contained credit-risk related contingent features.

The following table provides information regarding derivative gains and losses that have been recognized in the Consolidated Statements of Operations for the years ended December 31 (in thousands):

Amount recorded in:	2011		2010			2009
Interest expense, net (1)	$	4.1	$	10.7		$	9.6
Other expense (income), net (2)		1.2		(2.8	)		(0.7	)
Total expense, net	$	5.3	$	7.9		$	8.9

(1)	Consists of interest expense from interest rate swap contracts.
(2)	Consists of realized and unrealized gains and losses on foreign currency forward contracts.