2.2.0.25falsefalse0212 - Disclosure - Derivative Financial Instrumentstruefalsefalse1falsefalseUSDfalsefalse1/1/2010 - 12/31/2010 USD ($) USD ($) / shares $Jan-01-2010_Dec-31-2010http://www.sec.gov/CIK0001030749duration2010-01-01T00:00:002010-12-31T00:00:00USDStandardhttp://www.xbrl.org/2003/iso4217USDiso42170SharesStandardhttp://www.xbrl.org/2003/instancesharesxbrli0USDEPSDividehttp://www.xbrl.org/2003/iso4217USDiso4217http://www.xbrl.org/2003/instancesharesxbrli0USDUSD$2true0us-gaap_DerivativeInstrumentsAndHedgesAbstractus-gaaptruenadurationNo definition available.falsefalsefalsefalsefalsefalsefalsefalsefalsefalse1falsefalsefalse00falsefalsefalsefalsefalseOtherxbrli:stringItemTypestringNo definition available.falsefalseDerivative Financial Instruments [Abstract]3false0us-gaap_DerivativeInstrumentsAndHedgingActivitiesDisclosureTextBlockus-gaaptruenadurationNo definition available.falsefalsefalsefalsefalsefalsefalsefalsefalsefalseverboselabel1falsefalsefalse00  <div style="font-family: 'Times New Roman',Times,serif"> <div align="left" style="font-size: 10pt; margin-top: 12pt"><b>(12) DERIVATIVE FINANCIAL INSTRUMENTS</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">     Derivative instruments are accounted for at fair value. The accounting for changes in the fair value of a derivative depends on the intended use and designation of the derivative instrument. For a derivative instrument designated as a fair value hedge, the gain or loss on the derivative is recognized in earnings in the period of change in fair value together with the offsetting gain or loss on the hedged item. For a derivative instrument designated as a cash flow hedge, the effective portion of the derivative’s gain or loss is initially reported as a component of Other Comprehensive Income (“OCI”) and is subsequently recognized in earnings when the hedged exposure affects earnings. The ineffective portion of the gain or loss is recognized in earnings. Gains and losses from changes in fair values of derivatives that are not designated as hedges for accounting purposes are recognized in earnings. </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">     Using derivative instruments means assuming counterparty credit risk. Counterparty credit risk relates to the loss we could incur if a counterparty were to default on a derivative contract. We deal with investment grade counterparties and monitor the overall credit risk and exposure to individual counterparties. We do not anticipate nonperformance by any counterparties. The amount of counterparty credit exposure is the unrealized gains, if any, on such derivative contracts. We do not require, nor do we post, collateral or security on such contracts. </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Hedging Strategy</i> </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">     We are exposed to certain risks relating to our ongoing business operations. As a result, we enter into derivative transactions to manage certain of these exposures that arise in the normal course of business. The primary risks managed by using derivative instruments are foreign currency exchange rate and interest rate risks. Fluctuations in these rates and prices can affect our operating results and financial condition. We manage the exposure to these market risks through operating and financing activities and through the use of derivative financial instruments. We do not enter into derivative financial instruments for trading or speculative purposes. </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">     We enter into forward foreign currency contracts which are designated as fair value hedges and are highly effective, as the terms of the forward contracts are the same as the purchase commitments under the related new build contract. Any gains or losses resulting from changes in fair value were recognized in income with an offsetting adjustment to income for changes in the fair value of the hedged item such that there was no net impact in the consolidated statements of operations. As of December 31, 2010, we have no open foreign currency contracts. </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">     We entered into an interest rate swap with the objective of reducing our exposure to interest rate risk for $100.0 million of our $200.0 million Facility Agreement variable-rate debt. At December 31, 2010, our interest rate derivative instruments have an outstanding notional amount of $100.0 million and have been designated as cash flow hedges. The critical terms of these swaps, including reset dates and floating rate indices match those of our underlying variable-rate debt and no ineffectiveness has been recorded. </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Early Hedge Settlement</i> </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">     During December 2009, we cash settled certain interest rate swap contracts prior to their scheduled settlement dates. As a result of these transactions, we paid $6.4 million in cash, which represented the fair value of these contracts at the date of settlement. Unrecognized losses of $1.8 million are recorded as of December 31, 2010 in accumulated OCI related to these interest rate swaps. This balance will be amortized into interest expense through December 31, 2012 based on forecasted payments as of the settlement date. </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="justify" style="font-size: 10pt; margin-top: 10pt">     The following table quantifies the fair values, on a gross basis, of all our derivative contracts and identifies the consolidated balance sheet location as of December 31 (dollars in thousands): </div> <div align="right"> <table style="font-size: 8pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="98%">  <tr valign="bottom" style="font-size: 20pt"> <td width="20%"> </td> <td width="2%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="6%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="6%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="2%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="6%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="2%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="6%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="2%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="14" style="border-bottom: 1px solid #000000">Asset Derivatives</td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="14" style="border-bottom: 1px solid #000000">Liability Derivatives</td> <td> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000">2010</td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000">2009</td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000">2010</td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000">2009</td> <td> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"> </td> <td> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td nowrap="nowrap" align="left"><b>Derivaties designated as</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="2">Balance Sheet</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2">Balance Sheet</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2">Balance Sheet</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2">Balance Sheet</td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"> </td> <td> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td nowrap="nowrap" align="left"><b>hedging instruments</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="2">Location</td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2">Fair Value</td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2">Location</td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2">Fair Value</td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2">Location</td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2">Fair Value</td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2">Location</td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2">Fair Value</td> <td> </td> </tr>   <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Foreign exchange contracts </div></td> <td> </td> <td colspan="3" align="left">Fair value hedges</td> <td> </td> <td align="left" nowrap="nowrap">  $</td> <td align="right" nowrap="nowrap">-   </td> <td> </td> <td> </td> <td colspan="3" align="left">Fair value hedges</td> <td> </td> <td align="left" nowrap="nowrap">  $</td> <td align="right">6,886</td> <td> </td> <td> </td> <td colspan="3" align="left">Fair value hedges</td> <td> </td> <td align="left" nowrap="nowrap">  $</td> <td align="right" nowrap="nowrap">-   </td> <td> </td> <td> </td> <td colspan="3" align="left">Fair value hedges</td> <td> </td> <td align="left" nowrap="nowrap">  $</td> <td align="right">6,886</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Interest Rate Swaps </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td align="right" nowrap="nowrap">-   </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td align="right" nowrap="nowrap">-   </td> <td> </td> <td> </td> <td colspan="3" align="left">Cash flow hedges</td> <td> </td> <td> </td> <td align="right">6,807</td> <td> </td> <td> </td> <td colspan="3" align="left">Cash flow hedges</td> <td> </td> <td> </td> <td align="right">6,422</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td align="left" nowrap="nowrap">  $</td> <td align="right" nowrap="nowrap">-   </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td align="left" nowrap="nowrap">  $</td> <td align="right">6,886</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td align="left" nowrap="nowrap">  $</td> <td align="right">6,807</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td align="left" nowrap="nowrap">  $</td> <td align="right">13,308</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">     The following tables quantify the amount of gain or loss recognized during the year ended December 31 and identify the consolidated statement of operations location: </div> <div align="left" style="margin-left: 2%"> <table style="font-size: 8pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="85%">  <tr valign="bottom" style="font-size: 20pt"> <td width="33%"> </td> <td width="10%"> </td> <td width="3%"> </td> <td width="3%"> </td> <td width="3%"> </td> <td width="10%"> </td> <td width="1%"> </td> <td width="9%"> </td> <td width="1%"> </td> <td width="10%"> </td> <td width="1%"> </td> <td width="9%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Location of Gain or Loss</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="6"><b>Amount of Gain or Loss</b></td> <td> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td nowrap="nowrap" align="left"><b>Derivatives in fair value</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Recognized in Income on</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="6"><b>Recognized in Income on</b></td> <td> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td nowrap="nowrap" align="left" style="border-bottom: 1px solid #000000">  <b>hedging relationships</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="1" style="border-bottom: 1px solid #000000"><b>Derivative</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>Derivative</b></td> <td> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">2010</td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">2009</td> <td> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="6">(in thousands)</td> <td> </td> </tr>   <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Foreign exchange contracts </div></td> <td> </td> <td colspan="3" align="center">See note.</td> <td> </td> <td align="left" nowrap="nowrap">  $</td> <td align="right" nowrap="nowrap">-   </td> <td> </td> <td> </td> <td align="left" nowrap="nowrap">  $</td> <td align="right" nowrap="nowrap">-   </td> <td> </td> </tr>  </table> </div> <div align="left" style="margin-left: 2%"> <table style="font-size: 8pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="90%">  <tr valign="bottom" style="font-size: 20pt"> <td width="24%"> </td> <td width="3%"> </td> <td width="4%"> </td> <td width="3%"> </td> <td width="4%"> </td> <td width="3%"> </td> <td width="4%"> </td> <td width="3%"> </td> <td width="4%"> </td> <td width="3%"> </td> <td width="9%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="4%"> </td> <td width="3%"> </td> <td width="4%"> </td> <td width="3%"> </td> <td width="4%"> </td> <td width="3%"> </td> <td width="4%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>Location of Gain or (Loss)</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="6"><b>Amount of Gain or (Loss)</b></td> <td> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="6"><b>Amount of Gain or (Loss)</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>Reclassified from</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="6"><b>Reclassified from</b></td> <td> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td nowrap="nowrap" align="left"><b>Derivatives in cash flow</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="6"><b>Recognized in OCI on</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>Accumulated OCI into</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="6"><b>Accumulated OCI into</b></td> <td> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td nowrap="nowrap" align="left" style="border-bottom: 1px solid #000000">  <b>hedging relationships</b></td> <td style="border-bottom: 1px solid #000000"> </td> <td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>Derivative</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"> <font style="border-bottom: 1px solid #000000; width: 1%"><b>  Income  </b></font></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>Income</b></td> <td> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">2010</td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">2009</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">2010</td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">2009</td> <td> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="6">(in thousands)</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="6">(in thousands)</td> <td> </td> </tr>   <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Interest rate contracts </div></td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(4,351</td> <td nowrap="nowrap">)</td> <td> </td> <td align="left" nowrap="nowrap">  $</td> <td align="right">1,448</td> <td> </td> <td> </td> <td colspan="3" align="center">Interest expense</td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(2,716</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(3,976</td> <td nowrap="nowrap">)</td> </tr>  </table> </div> </div>  <!-- Begin Block Tagged NotefalsefalsefalsefalsefalseOtherus-types:textBlockItemTypestringThis element can be used to disclose the entity's entire derivative instruments and hedging activities disclosure as a single block of text. 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