In 2020, the Company entered into an interest rate swap with a notional amount of $500.0 million to reduce a portion of the exposure to fluctuations in LIBOR interest rates associated with our variable-rate term loan. The interest rate swap has a fixed rate of 0.2025% and a maturity date of December 31, 2022.

The interest rate swap is designated as an effective cash flow hedge involving the receipt of variable amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreement without exchange of the underlying notional amount.

The Company performed a regression analysis at inception of the hedging relationship in which it compared the historical monthly changes in the termination clean price of the actual designated interest rate swap to the historical monthly changes in the termination clean price of a hypothetically perfect interest rate swap with terms that exactly match the hedged transactions and a fair value of zero at its inception using 37 different forward curves. Based on the regression results, the Company determined that the hedging instrument was highly effective at inception. On an ongoing basis, the Company assesses hedge effectiveness prospectively and retrospectively. The hedge continued to be highly effective for the quarter ended June 30, 2022.

The interest rate swap is recognized at fair value in the consolidated balance sheets. The table below presents the fair value of the interest rate swap and its classification on the unaudited condensed consolidated balance sheets as of June 30, 2022 and December 31, 2021, respectively:


	June 30, 2022
	Balance Sheet		Fair Value
	Location		(In thousands)

Interest Rate Swap - current portion	Other current assets	$	6,192

	December 31, 2021
	Balance Sheet		Fair Value
	Location		(In thousands)

Interest Rate Swap - current portion	Other current assets	$	1,297

Since the Company designated the swap as an effective cash flow hedge that qualifies for hedge accounting, unrealized gains or losses resulting from adjusting the swap to fair value is recorded as a component of other comprehensive (loss) income and subsequently reclassified into interest expense in the same period during which the hedged transaction affects earnings. Cash flows resulting from settlements are presented as a component of cash flows from operating activities within the unaudited condensed consolidated statements of cash flows.

The table below presents the effect of hedge accounting on accumulated other comprehensive loss for the three and six months ended June 30, 2022 and 2021:


	Three Months Ended June 30,		Six Months Ended June 30,		Three Months Ended June 30,		Six Months Ended June 30,
	2022				2021

	(In thousands)
Beginning accumulated derivative gain (loss) in accumulated other comprehensive loss	$	4,927	$	1,297	$	(88)	$	(533)
Derivative gain (loss) recognized in the current period in accumulated other comprehensive loss		1,995		5,557		(143)		214
Less: Derivative gain (loss) reclassified from accumulated other comprehensive loss to interest expense		730		662		(118)		(206)
Ending accumulated derivative gain (loss) in accumulated other comprehensive loss	$	6,192	$	6,192	$	(113)	$	(113)

The table below presents the effect of hedge accounting on the unaudited condensed consolidated statements of operations and comprehensive (loss) income for the three and six months ended June 30, 2022 and 2021:


	Three Months Ended June 30,		Six Months Ended June 30,		Three Months Ended June 30,		Six Months Ended June 30,
	2022				2021

	(In thousands)
Total interest expense including the effects of cash flow hedges	$	(4,120)	$	(8,374)	$	(6,061)	$	(12,159)
Derivative gain (loss) reclassified from accumulated other comprehensive loss into interest expense	$	730	$	662	$	(118)	$	(206)

The Company estimates that an additional $6.2 million will be reclassified as a decrease to interest expense over the remaining months through expiration.

In April 2022, the Company entered into a float-to-float cross currency swap to hedge the risk of fluctuations in the exchange rate related to a net investment in a foreign subsidiary. The Company will deliver a notional amount of $26.2 million and receive a notional amount of EUR 25.0 million on the initial exchange date of November 15, 2022 and will deliver EUR 25.0 million and receive $26.2 million on the maturity date of November 15, 2027.

The cross currency swap is designated as a net investment hedge involving the receipt of functional currency floating rate amounts from a counterparty in exchange for the Company making foreign currency floating rate payments over the life of the agreement. The loss on the swap prior to designation was recorded in current-period earnings.

The cross currency swap is recognized at fair value in the consolidated balance sheets. The table below presents the fair value of the cross currency swap and its classification on the unaudited condensed consolidated balance sheets as of June 30, 2022:


	June 30, 2022
	Balance Sheet		Fair Value
	Location		(In thousands)

Cross Currency Swap - current portion	Other current assets	$	335
Cross Currency Swap - long-term portion	Other long-term liabilities	$	(8)

The Company recognized in earnings the initial value of the component excluded from the assessment of effectiveness using a systematic and rational method over the life of the hedging instrument. Any changes in the fair value of a net investment hedge are recorded in accumulated other comprehensive loss and reclassified into earnings when the hedged net investment is sold or substantially liquidated.

The table below presents the effect of the Company’s net investment hedge on accumulated other comprehensive loss for the three and six months ended June 30, 2022 and 2021:


		Amount of Gain (Loss) Recognized in OCI	Location of Gain (Loss) Reclassified from AOCI into Income		Amount of Gain (Loss) Reclassified from AOCI into Income
	Three and Six Months Ended June 30, 2022
	(In thousands)

Cross Currency Swap	$	653	Interest expense	$	—

In April 2022, the Company entered into a forward contract to mitigate exposure to fluctuations in foreign currency exchange rates related to certain foreign intercompany balances. The terms of the contract provide for an exchange of a notional amount of GBP 34.5 million for MXN 960.1 million, calculated using the contract rate as applicable at the settlement date.

In June 2021, the Company entered into a foreign currency swap and window forward contracts with notional amounts of approximately $31.0 million and $67.8 million, respectively, to mitigate exposure to fluctuations in foreign currency exchange rates related to certain foreign intercompany balances. Each of the foreign currency swap and the window forward contracts were settled during the third quarter in 2021.

The forward contract is recognized at fair value in the consolidated balance sheets. The table below presents the fair value of the forward contract and its classification on the unaudited condensed consolidated balance sheets as of June 30, 2022:


		June 30, 2022
	Settlement	Balance Sheet		Fair Value
	Date	Location		(In thousands)

Forward Contract	April 13, 2023	Other current assets	$	2,768

The Company did not designate the forward contract, foreign currency swap, and window forward contracts as an accounting hedge. Any unrealized gains or losses resulting from adjusting the swap and forwards to fair value are recorded as a component of other income (expense), to offset the unrealized gains or losses recorded within other income (expense) from the remeasurement of the intercompany balance being hedged. Cash flows resulting from the settlements will be presented as a component of cash flows from operating activities within the unaudited condensed consolidated statements of cash flows.

The table below presents the unrealized gains (losses) on the unaudited condensed consolidated statements of operations and comprehensive (loss) income for the three and six months ended June 30, 2022:


	Location of Unrealized		Three Months Ended June 30,		Six Months Ended June 30,		Three Months Ended June 30,		Six Months Ended June 30,
	Gain or (Loss)	2022				2021

		(In thousands)
Forward Contract	Other income	$	2,768	$	2,768	$	—	$	—
Foreign Currency Swap	Other expense		—		—		(163)		(163)
Window Forwards	Other income		—		—		1,804		1,804