XML 44 R11.htm IDEA: XBRL DOCUMENT
v2.4.0.8

Financial Instruments and Derivative Instruments | 9 Months Ended
--- | ---
Sep. 28, 2014
Financial Instruments and Derivative Instruments |
Financial Instruments and Derivative Instruments | 4. Financial Instruments and Derivative Instruments The Company measures certain financial assets and liabilities at fair value on a recurring basis, including deferred compensation plan assets and related liability, and contingent consideration. The fair values of these certain financial assets and liabilities were determined using the following inputs at September 28, 2014 and December 31, 2013:
|  | Fair Value Measurements at September 28, 2014 Using: |
|  |  |  | Quoted Prices in Active Markets for Identical Assets |  | Significant Other Observable Inputs |  | Significant Unobservable Inputs |
|  | Total |  | (Level 1) |  | (Level 2) |  | (Level 3) |
|  | (in millions) |
Assets |  |  |  |  |  |  |  |  |
Plan asset for deferred compensation(1) |  | $ | 4.1 |  | $ | 4.1 |  | $ | — |  | $ | — |
Total assets |  | $ | 4.1 |  | $ | 4.1 |  | $ | — |  | $ | — |
Liabilities |  |  |  |  |  |  |  |  |
Plan liability for deferred compensation(2) |  | $ | 4.1 |  | $ | 4.1 |  | $ | — |  | $ | — |
Contingent consideration(3) |  | 2.2 |  | — |  | — |  | 2.2 |
Total liabilities |  | $ | 6.3 |  | $ | 4.1 |  | $ | — |  | $ | 2.2 |
|  | Fair Value Measurements at December 31, 2013 Using: |
|  |  |  | Quoted Prices in Active Markets for Identical Assets |  | Significant Other Observable Inputs |  | Significant Unobservable Inputs |
|  | Total |  | (Level 1) |  | (Level 2) |  | (Level 3) |
|  | (in millions) |
Assets |  |  |  |  |  |  |  |  |
Plan asset for deferred compensation(1) |  | $ | 4.6 |  | $ | 4.6 |  | $ | — |  | $ | — |
Total assets |  | $ | 4.6 |  | $ | 4.6 |  | $ | — |  | $ | — |
Liabilities |  |  |  |  |  |  |  |  |
Plan liability for deferred compensation(2) |  | $ | 4.6 |  | $ | 4.6 |  | $ | — |  | $ | — |
Contingent consideration(3) |  | 4.4 |  | — |  | — |  | 4.4 |
Total liabilities |  | $ | 9.0 |  | $ | 4.6 |  | $ | — |  | $ | 4.4 |
(1) Included on the Company’s consolidated balance sheet in other assets (other, net). (2) Included on the Company’s consolidated balance sheet in accrued compensation and benefits. (3) Included on the Company’s consolidated balance sheet in accrued expenses and other liabilities as of September 28, 2014 and in other noncurrent liabilities and accrued expenses and other liabilities as of December 31, 2013. The table below provides a summary of the changes in fair value of all financial assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the period December 31, 2013 to September 28, 2014.
|  | Balance |  |  |  | Total realized and unrealized (gains) losses included in: |  | Balance |
|  | December 31, 2013 |  | Settlements |  | Net earnings adjustments |  | Comprehensive income |  | September 28, 2014 |
|  | (in millions) |
Contingent consideration |  | $ | 4.4 |  | $ | (2.2 | ) | $ | 0.1 |  | $ | (0.1 | ) | $ | 2.2 |
On January 31, 2012, the Company completed the acquisition of tekmar Control Systems (tekmar) in a share purchase transaction. The initial purchase price paid was CAD $18.0 million, with post-closing adjustments related to working capital and an earnout based on the attainment of certain future earnings levels. A contingent liability of $5.1 million was recognized as the estimate of the acquisition date fair value of the contingent consideration. This liability was classified as Level 3 under the fair value hierarchy as it was based on the probability of achievement of a future performance metric as of the date of the acquisition, which was not observable in the market. The contingent liability was increased by $0.1 million in the third quarter of 2014 and by $1.0 million during 2013 based on revised estimates of the fair value of the contingent consideration. Portions of the contingent consideration were paid out during the first quarter of 2014 and the second quarter of 2013, in the amount of $2.2 million and $1.2 million, respectively, based on performance metrics achieved. The earnout will be completed based on fiscal year 2014 earnings and final payment made in 2015. Cash equivalents consist of instruments with remaining maturities of three months or less at the date of purchase and consist primarily of money market funds, for which the carrying amount is a reasonable estimate of fair value. The Company uses financial instruments from time to time to enhance its ability to manage risk, including foreign currency and commodity pricing exposures, which exist as part of its ongoing business operations. The use of derivatives exposes the Company to counterparty credit risk for nonperformance and to market risk related to changes in currency exchange rates and commodity prices. The Company manages its exposure to counterparty credit risk through diversification of counterparties. The Company’s counterparties in derivative transactions are substantial commercial banks with significant experience using such derivative instruments. The impact of market risk on the fair value and cash flows of the Company’s derivative instruments is monitored and the Company restricts the use of derivative financial instruments to hedging activities. The Company does not enter into contracts for trading purposes nor does the Company enter into any contracts for speculative purposes. The use of derivative instruments is approved by senior management under written guidelines. The Company has elected not to designate its derivative instruments as hedging instruments and the change in the fair value of the derivative instruments are recognized in the statement of operations. The Company has exposure to a number of foreign currency rates, including the Canadian dollar, the euro, the Chinese yuan and the British pound sterling. To manage this risk, the Company has in the past used a layering methodology and entered into forward exchange contracts which hedged approximately 50% of the projected intercompany purchase transactions for the next twelve months. The Company presently does not have any open forward exchange contracts. Fair Value The carrying amounts of cash and cash equivalents, trade receivables and trade payables approximate fair value because of the short maturity of these financial instruments. The fair values of the Company’s 5.85% senior notes due 2016, and 5.05% senior notes due 2020, are based on a discounted cash flow model using comparable industrial companies, the Company’s credit metrics, the Company’s size, as well as current market interest rates quoted in active markets and are classified within Level 2 of the valuation hierarchy. The fair value of the Company’s variable rate debt approximates its carrying value. The carrying amount and the estimated fair market value of the Company’s long-term debt, including the current portion, are as follows:
|  | September 28, |  | December 31, |
|  | 2014 |  | 2013 |
|  | (in millions) |
Carrying amount |  | $ | 305.7 |  | $ | 307.7 |
Estimated fair value |  | $ | 328.6 |  | $ | 333.4 |

X
- Definition The entire disclosure for financial instruments. This disclosure includes, but is not limited to, fair value measurements of short and long term marketable securities, international currencies forward contracts, and auction rate securities. Financial instruments may include hedging and non-hedging currency exchange instruments, derivatives, securitizations and securities available for sale at fair value. Also included are investment results, realized and unrealized gains and losses as well as impairments and risk management disclosures. + References No definition available. + Details
Name: | us-gaap_FinancialInstrumentsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Details
Name: | us-gaap_InvestmentsAllOtherInvestmentsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration