Available-For-Sale Securities

The Company’s portfolio of available-for-sale securities consists of the following:


			Gross		Gross
	Amortized		Unrealized		Unrealized			Estimated
	Cost		Gains		Losses			Fair Value
	(In thousands)

April 3, 2011
U.S. government and agency securities	$	55,875	$	94	$	(216	)	$	55,753
Corporate debt obligations		137,706		1,012		(282	)		138,436
Asset and mortgage-backed securities		22,249		293		(52	)		22,490
Municipal bonds		17,941		10		(10	)		17,941
Non-U.S. government and agency securities		1,676		—		—			1,676

	$	235,447	$	1,409	$	(560	)	$	236,296

March 28, 2010
U.S. government and agency securities	$	37,677	$	326	$	(27	)	$	37,976
Corporate debt obligations		81,424		1,600		(21	)		83,003
Asset and mortgage-backed securities		18,721		410		(16	)		19,115
Municipal bonds		5,923		3		(3	)		5,923

Total debt securities		143,745		2,339		(67	)		146,017
Certificates of deposit		15,592		—		—			15,592

	$	159,337	$	2,339	$	(67	)	$	161,609

The amortized cost and estimated fair value of debt securities included in available-for-sale securities as of April 3, 2011, by contractual maturity, are presented below. Expected maturities will differ from contractual maturities because the issuers of securities may have the right to repay obligations without prepayment penalties. Certain debt instruments, although possessing a contractual maturity greater than one year, are classified as short-term investment securities based on their ability to be traded on active markets and availability for current operations.


	Amortized		Estimated
	Cost		Fair Value
	(In thousands)

Due in one year or less	$	68,432	$	68,771
Due after one year through three years		113,561		113,912
Due after three years through five years		18,639		18,559
Due after five years		34,815		35,054

	$	235,447	$	236,296

As of April 3, 2011 and March 28, 2010, the fair value of certain of the Company’s available-for-sale securities was less than their cost basis. Management reviewed various factors in determining whether to recognize an impairment charge related to these unrealized losses, including the current financial and credit market environment, the financial condition and near-term prospects of the issuer of the investment security, the magnitude of the unrealized loss compared to the cost of the investment, the length of time the investment had been in a loss position and the Company’s intent and ability to hold the investment for a period of time sufficient to allow for any anticipated recovery of market value. As of April 3, 2011 and March 28, 2010, the Company determined that the unrealized losses were temporary in nature and recorded them as a component of accumulated other comprehensive income.

During fiscal 2009 the Company determined that a portion of the unrealized losses associated with the Company’s portfolio of available-for-sale securities were other-than-temporary and recorded an impairment charge of $11.3 million, which is included in interest and other income, net.

The following table presents the Company’s investments with unrealized losses by investment category and length of time that individual securities have been in a continuous unrealized loss position as of April 3, 2011 and March 28, 2010.


	Less Than 12 Months					12 Months or Greater				Total
	Fair		Unrealized			Fair		Unrealized		Fair		Unrealized
Description of Securities	Value		Losses			Value		Losses		Value		Losses
						(In thousands)

April 3, 2011
U.S. government and agency securities	$	25,712	$	(216	)	$	—	$	—	$	25,712	$	(216	)
Corporate debt obligations		60,595		(282	)		—		—		60,595		(282	)
Asset and mortgage-backed securities		7,991		(52	)		—		—		7,991		(52	)
Municipal bonds		1,866		(10	)		—		—		1,866		(10	)

	$	96,164	$	(560	)	$	—	$	—	$	96,164	$	(560	)

March 28, 2010
U.S. government and agency securities	$	6,661	$	(27	)	$	—	$	—	$	6,661	$	(27	)
Corporate debt obligations		11,337		(21	)		—		—		11,337		(21	)
Asset and mortgage-backed securities		3,557		(16	)		—		—		3,557		(16	)
Municipal bonds		317		(3	)		—		—		317		(3	)

	$	21,872	$	(67	)	$	—	$	—	$	21,872	$	(67	)

Trading Securities

The Company’s portfolio of trading securities consists of the following:


	April 3,		March 28,
	2011		2010
	(In thousands)

Auction rate debt securities	$	—	$	17,951
Auction rate preferred securities		—		4,366
Put options related to auction rate securities		—		1,439

	$	—	$	23,756

The Company’s trading securities included investments in auction rate securities (ARS). During late fiscal 2008, the market auctions of many ARS began to fail, including auctions for the ARS held by the Company. In November 2008, the Company entered into an agreement with the broker for all of the ARS held by the Company, which provided the Company with certain rights (ARS Rights), in exchange for the release of potential claims and damages against the broker. The ARS Rights entitled the Company to sell the related ARS back to the broker for a price equal to the liquidation preference of the ARS plus accrued but unpaid dividends or interest, if any, which price is referred to as “par.” The ARS Rights agreement resulted in put options that were recognized as free standing assets separate from the ARS. The Company elected to measure the put options at fair value. In connection with the election to measure the put options at fair value, the Company classified these financial instruments as trading securities.

During fiscal 2011, the Company received $9.3 million of proceeds in connection with the redemption of certain ARS by the respective issuers. In addition during fiscal 2011, the Company exercised the ARS Rights and sold all of its remaining ARS investments to the broker at par for cash totaling $14.5 million.

Other Investment Securities

The Company’s other investment securities are comprised of a money market fund and an enhanced cash fund sponsored by The Reserve (an asset management company), which suspended trading and redemptions in September 2008. These funds do not have readily determinable fair values and thus have been accounted for under the cost method. As of April 3, 2011 and March 28, 2010, the carrying value of the Company’s other investment securities is zero.

During fiscal 2009, the Company reclassified $57.2 million of investments in the funds sponsored by The Reserve from cash equivalents to short-term investments. This reclassification has been presented separately as an investing activity in the consolidated statement of cash flows for fiscal 2009. In addition, the Company recorded a $5.1 million impairment charge related to these investments during fiscal 2009 based on the Company’s estimate of the amount that would be recovered from The Reserve, which charge is included in interest and other income, net.

During fiscal 2011, 2010 and 2009, the Company received distributions upon the partial liquidation of these funds totaling $0.3 million, $5.5 million and $48.9 million, respectively. Distributions received by the Company in fiscal 2011 and 2010 were in excess of the carrying value of these investment securities and, accordingly, the Company recorded gains of $0.3 million and $1.8 million, respectively, which are included in interest and other income, net.