Foreign Currency Contracts. Borrower shall not enter into foreign currency exchange contracts involving an aggregate notional amount in excess of an amount equal to 50% of the Net Worth of Borrower on a Consolidated Basis as of the end of the most recent fiscal quarter, provided that Borrower shall not enter into any foreign currency contract (i) following the occurrence and during the continuation of an Event of Default, or (ii) to the extent they are speculative or not for a normal business purpose;
Foreign Currency Contracts. The Company transacts business in various foreign countries and is therefore exposed to foreign currency exchange rate risk inherent in forecasted sales, cost of sales, and monetary assets and liabilities denominated in non-functional currencies. The Company has established risk management programs to protect against volatility in the value of non-functional currency denominated monetary assets and liabilities, and of future cash flows caused by changes in foreign currency exchange rates. The Company tries to maintain a partial or fully hedged position for certain transaction exposures, which are primarily, but not limited to, revenues, customer and vendor payments and inter-company balances in currencies other than the functional currency unit of the operating entity. The Company enters into short-term foreign currency derivatives contracts, including forward, swap, and options contracts to hedge only those currency exposures associated with certain assets and liabilities, primarily accounts receivable and accounts payable, and cash flows denominated in non-functional currencies. Gains and losses on the Company’s derivative contracts are designed to offset losses and gains on the assets, liabilities and transactions hedged, and accordingly, generally do not subject the Company to risk of significant accounting losses. The Company xxxxxx committed exposures and does not engage in speculative transactions. The credit risk of these derivative contracts is minimized since the contracts are with large financial institutions and accordingly, fair value adjustments related to the credit risk of the counterparty financial institution were not material. As of March 31, 2018, the aggregate notional amount of the Company’s outstanding foreign currency derivative contracts was $7.6 billion as summarized below: Notional Contract Value Foreign Currency Amount in USD Currency Buy Sell Buy Sell (In thousands) Cash Flow HedgesCNY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,472,000 — $ 392,493 $ — EUR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74,696 102,508 92,292 123,347 HUF . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,482,360 — 80,961 — ILS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104,570 17,325 29,853 4,946 MXN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,820,600 — 208,688 — MYR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 235,400 78,000 60,277 19,973 XXX . ....
