Annual report pursuant to Section 13 and 15(d)

Fair Value Disclosures

v2.4.0.6
Fair Value Disclosures
 12 Months Ended
Dec. 31, 2012
Fair Value Disclosures [Abstract]  
FAIR VALUE DISCLOSURES
NOTE 6 — FAIR VALUE DISCLOSURES
We account for non-recurring fair value measurements of our non-financial assets and liabilities in accordance with ASC 820-10 Fair Value Measurement and Disclosures. This guidance defines fair value, establishes a framework for measuring fair value and addresses required disclosures about fair value measurements. This standard establishes a three-level hierarchy for fair value measurements based upon the significant inputs used to determine fair value. Observable inputs are those which are obtained from market participants external to the company while unobservable inputs are generally developed internally, utilizing management’s estimates, assumptions and specific knowledge of the assets/liabilities and related markets. The three levels are defined as follows:
 
•
Level 1 — Valuation is based on quoted prices in active markets for identical assets and liabilities.
•
Level 2 —Valuation is determined from quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar instruments in markets that are not active, or by model-based techniques in which all significant inputs are observable in the market.
•
Level 3 — Valuation is derived from model-based techniques in which at least one significant input is unobservable and based on the company’s own estimates about the assumptions that market participants would use to value the asset or liability.
If the only observable inputs are from inactive markets or for transactions which the company evaluates as “distressed”, the use of Level 1 inputs should be modified by the company to properly address these factors, or the reliance of such inputs may be limited, with a greater weight attributed to Level 3 inputs. Refer to Notes 1 and 2 for additional information regarding the valuation of our non-financial assets.


A summary of our non-financial assets re-measured at fair value on December 31, 2012 and 2011 is as follows (in thousands):
 
 
 
 
 
Year Ended
December 31,
 
 
 
Hierarchy
 
2012
 
2011
 
Description:
 
 
 
 
 
 
 
Adjusted Basis of Long-Lived Real Estate Assets (1)
 
Level 3
 
$
12,013

 
$
68,179

(2)
Impairments
 
 
 
2,009

 
15,324

 
Initial Basis of Long-Lived Real Estate Assets
 
 
 
$
14,022

 
$
83,503

 
 
 
 
 
 
 
 
 
Adjusted Basis of Long-Term Other Assets
 
Level 2
 
N/A

 
$
952

 
Impairments
 
 
 
N/A

 
848

 
Initial Basis of Other Assets
 
 
 
N/A

 
$
1,800

 
 
(1)
The fair values in the table above represent only those real estate assets whose carrying values were adjusted in the respective period.
(2)
The carrying values for these real-estate assets may have subsequently increased or decreased from the fair value reported due to activities that have occurred since the measurement date.
Financial Instruments: The fair value of our fixed-rate debt is derived from quoted market prices by independent dealers (level 2 inputs as per the discussion above) and is as follows (in thousands):
 
 
 
 
December 31, 2012
 
December 31, 2011
 
 
 
Aggregate
Principal
 
Estimated  Fair
Value
 
Aggregate
Principal
 
Estimated  Fair
Value
Financial Liabilities
 
 
 
 
 
 
 
 
 
6.25% senior notes
 
 
N/A

 
N/A

 
$
285,000

 
$
278,588

7.731% senior subordinated notes
 
 
$
99,825

 
$
102,950

 
$
125,875

 
$
110,770

7.15% senior notes
 
 
$
200,000

 
$
220,760

 
$
200,000

 
$
190,000

7.00% senior notes
 
 
$
300,000

 
$
328,500

 
N/A

 
N/A

1.875% convertible senior notes
 
 
$
126,500

 
$
127,449

 
N/A

 
N/A


Due to the short-term nature of other financial assets and liabilities, we consider the carrying amounts of our other short-term financial instruments to approximate fair value.