Fair Value Measurements

9 Months Ended

Sep. 30, 2011

Fair Value Measurements [Abstract]

Fair Value Measurements

NOTE G-FAIR VALUE MEASUREMENTS

Authoritative guidance on fair value measurements provides a framework for measuring fair value and establishes a fair value hierarchy that prioritizes the inputs used to measure fair value, giving the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 inputs) and the lowest priority to unobservable inputs (Level 3 inputs).

The Company uses valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. In measuring the fair value of the Company's assets and liabilities, market data or assumptions are used that the Company believes market participants would use in pricing an asset or liability, including assumptions about risk when appropriate. The Company's assets that are measured at fair value on a recurring basis include the following (in thousands):

			Fair Value Measurements Using
	Total		Quoted Prices in Active Markets (Level 1)		Significant  Other Observable Inputs (Level 2)		Unobservable Inputs (Level 3)
At September 30, 2011:
Cash equivalents	$	37,515	$	37,515	$	—	$	—
Investment in stock options related to equity securities		174		—		174		—
At December 31, 2010:
Cash equivalents	$	89,581		89,581	$	—	$	—
Investment in equity securities		2,232		2,232		—		—
Investment in stock options related to equity securities		870		—		870		—

The Company had no transfers of assets between any of the above levels during the nine months ended September 30, 2011 or September 30, 2010.

Cash equivalents include treasury bills and money market funds that invest in United States government obligations and a Canadian dollar investment account, all with original maturities of six months or less. The original costs of these assets approximate fair value due to their short-term maturity.

Investment in equity securities are measured at fair value using closing stock prices from an active international market and are classified within Level 1 of the valuation hierarchy. Investment in stock options related to equity securities are measured at fair value using the Black-Scholes option pricing model based on observable market inputs such as stock prices, interest rates and expected volatility assumptions. Based on these inputs, these assets are classified within Level 2 of the valuation hierarchy.

During the nine months ended September 30, 2011 and 2010, the Company sold a portion of its investment in equity securities for proceeds totaling $2.5 million and $52,000, respectively. Total realized gains were equal to proceeds received.

Other Financial Instruments:

• Debt – Based upon the rates available to the Company, the fair value of the 9.75% Senior Notes and the note payable to a former executive approximated $253.5 million as of September 30, 2011, compared to the book value of $275.1 million. The quoted market price of the 9.75% Senior Notes was $253.4 million at September 30, 2011. The fair value of the 9.75% Senior Notes, the 11.75% Senior Notes and the note payable to a former executive approximated $386.1 million as of December 31, 2010, compared to the book value of $402.2 million. The quoted market price of the 9.75% Senior Notes was $384.0 million at December 31, 2010.

• Accounts Receivable and Accounts Payable – The fair values of accounts receivable and accounts payable approximated carrying value due to the short-term maturity of these instruments.