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Fair Value of Financial Instruments
 12 Months Ended
Dec. 31, 2015
Fair Value Disclosures [Abstract]  
Fair Value of Financial Instruments
Note 15. Fair Value of Financial Instruments
Certain of the Company’s financial assets and liabilities are measured at fair value on a recurring and nonrecurring basis. Fair value is defined as the price that would be received to sell an asset or the price paid to transfer a liability (the exit price) in the principal and most advantageous market for the asset or liability in an orderly transaction between market participants. Assets and liabilities carried at fair value are classified using the three-tier hierarchy (see Note 2). The following table summarizes the valuation of the Company’s foreign currency forward contracts (see Note 16) that are measured at fair value on a recurring basis as of December 31, 2015 and 2014 (in thousands):
 
Fair
Value
 
Level 1
 
Level 2
 
Level 3
2015
 
 
 
 
 
 
 
Foreign currency forward contracts —asset position
$
680

 
$
—

 
$
680

 
$
—

Foreign currency forward contracts —liability position
(342
)
 
—

 
(342
)
 
—

 
$
338

 
$
—

 
$
338

 
$
—

2014
 
 
 
 
 
 
 
Foreign currency forward contracts —asset position
$
40

 
$
—

 
$
40

 
$
—

Foreign currency forward contracts —liability position
(246
)
 
—

 
(246
)
 
—

 
$
(206
)
 
$
—

 
$
(206
)
 
$
—


The fair value of the Company’s foreign currency forward contracts is based on observable inputs that are corroborated by market data. Gains and losses from the remeasurement of qualifying hedges are recorded as a component of other comprehensive income and released into earnings as a component of cost of goods sold during the period in which the hedged transaction takes place. Gains and losses on the ineffective portion of hedges (hedges that do not meet accounting requirements due to ineffectiveness) and derivatives that are not elected for hedge accounting treatment are immediately recorded in earnings as a component of other income (expense).
Nonrecurring Fair Value Measurements
The Company measures certain assets at fair value on a nonrecurring basis at least annually or when certain indicators are present. These assets include long-lived assets, goodwill and non-amortizing intangible assets that are written down to fair value when they are held for sale or determined to be impaired. In 2015, 2014 and 2013, the Company did not recognize any impairment losses on these assets.
Disclosures about the Fair Value of Financial Instruments
The carrying values of cash and cash equivalents, accounts receivable, trade payables and accrued expenses at December 31, 2015 and 2014 are reasonable estimates of fair value due to the short-term nature of these balances and are therefore classified as Level 1. The table below illustrates information about fair value relating to the Company’s financial assets and liabilities that are recognized on the accompanying consolidated balance sheets as of December 31, 2015 and 2014, as well as the fair value of contingent contracts that represent financial instruments (in thousands):
 
December 31, 2015
 
December 31, 2014
 
Carrying
Value
 
Fair Value
 
Carrying
Value
 
Fair Value
Convertible notes(1)
$
—

 
$
—

 
$
108,574

 
$
126,222

ABL Facility(2)
$
—

 
$
—

 
$
15,235

 
$
15,235

Japan ABL Facility(2)
$
14,969

 
$
14,969

 
$
—

 
$
—

Standby letters of credit(3)
$
1,030

 
$
1,030

 
$
1,142

 
$
1,142

 
(1) In 2015, the convertible notes were eliminated pursuant to certain exchange transactions and shareholder conversions, which resulted, among other things, in the issuance of shares of the Company's common stock (see Note 3). The carrying value of the convertible notes at December 31, 2014 is net of the unamortized discount of $3,926,000. The fair value of the convertible notes was determined based on secondary quoted market prices, and as such is classified as Level 2 in the fair value hierarchy.
(2) The carrying value of amounts outstanding under the Company's ABL Facility and Japan ABL Facility approximates the fair value due to the short term nature of this obligation. The fair value of this debt is categorized within Level 2 of the fair value hierarchy. See Note 3 for information on the ABL Facility, including certain risks and uncertainties.
(3) The carrying value of the Company's standby letters of credit approximates the fair value as they represent the Company’s contingent obligation to perform in accordance with the underlying contracts. There were no amounts outstanding under these letters of credit at December 31, 2015 or 2014. The fair value of this contingent obligation is categorized within Level 2 of the fair value hierarchy.