Quarterly report pursuant to Section 13 or 15(d)

Derivative Contracts

v3.4.0.3
Derivative Contracts
3 Months Ended
Mar. 31, 2016
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
DERIVATIVE CONTRACTS
DERIVATIVE CONTRACTS
The following table summarizes the fair values and the presentation of our derivative financial instruments in the Condensed Consolidated Balance Sheets:
(In thousands)
Balance Sheet Component
 
March 31,
2016
 
December 31,
2015
Derivative financial instruments:
 
 
 
 
 
Common Stock options/warrants
Investments, net
 
$
4,615

 
$
5,338

Embedded conversion option
2033 Senior Notes, net of discount and estimated fair value of embedded derivatives
 
$
23,875

 
$
23,737

Forward contracts
Unrealized gains on forward contracts are recorded in Prepaid expenses and other current assets. Unrealized losses on forward contracts are recorded in Accrued expenses.
 
$
(296
)
 
$
9


We enter into foreign currency forward exchange contracts to cover the risk of exposure to exchange rate differences arising from inventory purchases on letters of credit. Under these forward contracts, for any rate above or below the fixed rate, we receive or pay the difference between the spot rate and the fixed rate for the given amount at the settlement date.
To qualify the derivative instrument as a hedge, we are required to meet strict hedge effectiveness and contemporaneous documentation requirements at the initiation of the hedge and assess the hedge effectiveness on an ongoing basis over the life of the hedge. At March 31, 2016 and December 31, 2015, our derivative financial instruments do not meet the documentation requirements to be designated as hedges. Accordingly, we recognize the changes in Fair value of derivative instruments, net in our Condensed Consolidated Statements of Operations. The following table summarizes the losses and gains recorded for the three months ended March 31, 2016 and 2015:
 
Three months ended March 31,
(In thousands)
2016
 
2015
Derivative gain (loss):
 
 
 
Common Stock options/warrants
$
(986
)
 
$
3,871

2033 Senior Notes
(138
)
 
(53,730
)
Forward contracts
(299
)
 
71

Total
$
(1,423
)
 
$
(49,788
)