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Note 11 - Derivatives and Fair Value Disclosures
 9 Months Ended
Sep. 30, 2012
Fair Value Disclosures [Text Block]
11.     Derivatives and Fair Value Disclosures

The Company uses interest rate swaps for the management of interest rate risk exposure. The interest rate swaps effectively convert a portion of the Company’s debt from a floating to a fixed rate. The Company is a party to six floating-to-fixed interest rate swaps with various major financial institutions covering notional amounts aggregating approximately $126,937,757 at September 30, 2012 pursuant to which it pays fixed rates ranging from 2.77% to 4.73% and receives floating rates based on the London Interbank Offered Rate (“LIBOR”) (approximately 0.50% at September 30, 2012). These agreements contain no leverage features and have maturity dates ranging from February 2013 to March 2016.

The Company did not have any derivative instruments that qualified for hedge accounting as of December 31, 2011 and September 30, 2012 and for the nine-month periods ended September 30, 2011 and September 30, 2012.

The following tables present information on the location and amounts of derivatives’ fair values reflected in the unaudited condensed consolidated balance sheet and with respect to gains and losses on derivative positions reflected in the unaudited condensed consolidated statements of income or in the unaudited condensed consolidated balance sheets, as a component of accumulated other comprehensive income/(loss).

Tabular disclosure of financial instruments is as follows:

                     
     
  
December 31, 2011
 
  
September 30, 2012
 
 
Derivatives not designated as hedging instruments
 
Balance Sheet Location
  
Liability
Derivatives
 
  
Liability
Derivatives
 
Interest Rate Swap Agreements
 
Current liabilities - Fair value of derivatives
  
 
—  
  
  
 
1,026,410
  
Interest Rate Swap Agreements
 
Non current liabilities - Fair value of derivatives
  
 
9,401,798
  
  
 
5,913,326
  
Total derivatives not designated as hedging instruments
   
  
 
9,401,798
  
  
 
6,939,736
  
Total derivatives
   
  
 
9,401,798
  
  
 
6,939,736
  

The effect of derivative instruments on the unaudited condensed consolidated statements of income for the nine- month periods ended September 30, 2011 and 2012 is as follows:

                     
 
Derivatives not designated as hedging instruments
   
  
Nine-month periods
ended September 30,
 
 
Location of Gain / (Loss) Recognized
  
2011
   
2012
 
Interest Rate Swap - Reclassification from OCI
 
Loss on derivatives
  
 
(369,045
) 
   
(11,830
) 
Interest Rate Swap - Change in fair value
 
Loss on derivatives
  
 
931,949
  
   
2,462,062
  
Interest Rate Swap - Realized loss
 
Loss on derivatives
  
 
(4,318,849
) 
   
(3,603,541
) 
Foreign Currency Contract - Change in Fair Value
 
Loss on derivatives
  
 
(3,241,345
) 
   
—  
  
Foreign Currency Contract - Realized gain
 
Loss on derivatives
  
 
4,236,454
  
   
—  
  
Total loss on derivatives
   
  
 
(2,760,836
) 
   
(1,153,309
) 

During the nine-month periods ended September 30, 2011 and 2012, the losses transferred from other comprehensive income to the unaudited condensed consolidated statements of income were $369,045 and $11,830, respectively. The estimated net amount of existing gains at September 30, 2012, that will be reclassified into earnings within the next twelve months relating to previously designated cash flow hedges is $43,233.

Fair Value of Financial Instruments and Concentration of Credit Risk: Financial instruments, which potentially subject the Company to significant concentrations of credit risk, consist principally of trade accounts receivable, cash and cash equivalents, time deposits and derivative instruments. The Company limits its credit risk with respect to accounts receivable by performing ongoing credit evaluations of its customers’ financial condition and generally does not require collateral for its trade accounts receivable. The Company places its cash and cash equivalents, time deposits and other investments with high credit quality financial institutions. The Company performs periodic evaluations of the relative credit standing of those financial institutions. The Company is exposed to credit risk in the event of non-performance by its counterparties to derivative instruments; however, the Company limits its exposure by transacting with counterparties with high credit ratings. The carrying values of cash, accounts receivable and accounts payable are reasonable estimates of their fair value due to the short term nature of these financial instruments. The fair value of long term bank loans bearing interest at variable interest rates approximates the recorded values. Additionally, the Company considers the creditworthiness of each counterparty when determining the fair value of the credit facilities. The Company’s interest rate swap agreements are recorded at fair value. The fair value of the interest rate swaps is determined using a discounted cash flow method based on market-based LIBOR swap yield curves. LIBOR swap rates are observable at commonly quoted intervals for the full terms of the swap and therefore are considered Level 2 items.

Fair Value Disclosures: The Company has categorized assets and liabilities recorded at fair value based upon the fair value hierarchy specified by the guidance. The levels of fair value hierarchy are as follows:

Level 1: Quoted market prices in active markets for identical assets or liabilities.

Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data.

Level 3: Unobservable inputs that are not corroborated by market data.

The following table presents the fair values for assets and liabilities measured on a recurring basis categorized into a Level based upon the lowest level of significant input to the valuations as of December 31, 2011:

                                 
 
  
   
  
Fair Value Measurements Using
 
 
Description
  
Fair Value as
of  December 31,
2011
 
  
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
 
  
Significant Other
Observable
Inputs
(Level 2)
 
  
Significant
Unobservable
Inputs
(Level 3)
 
Liabilities
  
     
  
     
  
     
  
     
Interest Rate Swap Agreements
  
 
9,401,798
  
  
 
—  
  
  
 
9,401,798
  
  
     
Total
  
 
9,401,798
  
  
 
—  
  
  
 
9,401,798
  
  
 
—  
  

The following table presents the fair values for assets and liabilities measured on a recurring basis categorized into a Level based upon the lowest level of significant input to the valuations as of September 30, 2012:

                                 
 
  
   
  
Fair Value Measurements Using
 
 
Description
  
Fair Value as
of September 30,
2012
 
  
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
 
  
Significant Other
Observable
Inputs
(Level 2)
 
  
Significant
Unobservable
Inputs
(Level 3)
 
Liabilities
  
     
  
     
  
     
  
     
Interest Rate Swap Agreements
  
 
6,939,736
  
  
 
—  
  
  
 
6,939,736
  
  
     
Total
  
 
6,939,736
  
  
 
—  
  
  
 
6,939,736
  
  
 
—