GameStop 2006 Annual Report Download - page 88

balance sheet. The total weighted-average amortization period for the intangible assets, excluding goodwill, is
approximately four years. The intangible assets are being amortized based upon the pattern in which the economic
benefits of the intangible assets are being utilized, with no expected residual value. Note 2 provides additional
information regarding intangible assets.
The deferred financing fees associated with the Company’s revolving credit facility and the senior floating rate
notes and senior notes issued in connection with the financing of the mergers are separately shown in the
consolidated balance sheet. The deferred financing fees are being amortized over five, six and seven years to match
the terms of the revolving credit facility, the senior floating rate notes and the senior notes, respectively. The
changes in the carrying amount of deferred financing fees and intangible assets for the 52 weeks ended January 28,
2006 and the 53 weeks ended February 3, 2007 were as follows:
Deferred
Financing Fees
Intangible
Assets
(In thousands)
Balance at January 29, 2005 .................................. $ 566 $ —
Addition for the acquisition of Electronics Boutique, including senior
notes payable and senior floating rate notes payable issued and
revolving credit facility entered into in October 2005 ............ 19,617 20,731
Write-off of deferred financing fees remaining on June 2004 revolving
credit facility .......................................... (393) —
Amortization for the 52 weeks ended January 28, 2006 ............ (1,229) (1,212)
Balance at January 28, 2006 .................................. 18,561 19,519
Addition for the exchange offer in May 2006 .................... 409 —
Write-off of deferred financing fees remaining on repurchased senior
notes and senior floating rate notes (see Note 8) ................ (1,445) —
Amortization for the 53 weeks ended February 3, 2007 ............ (3,150) (4,974)
Balance at February 3, 2007 .................................. $14,375 $14,545
The gross carrying value and accumulated amortization of deferred financing fees as of February 3, 2007 were
$20,061 and $5,686, respectively. The estimated aggregate amortization expenses for deferred financing fees and
other intangible assets for the next five fiscal years are approximately:
Year Ended
Amortization
of Deferred
Financing Fees
Amortization of
Intangible
Assets
(In thousands)
January 2008 .......................................... $ 2,959 $ 4,494
January 2009 .......................................... 2,959 3,582
January 2010 .......................................... 2,956 2,689
January 2011 .......................................... 2,699 2,019
January 2012 .......................................... 1,959 820
$13,532 $13,604
8. Debt
In October 2005, in connection with the mergers, the Company entered into a five-year, $400,000 Credit
Agreement (the “Revolver”), including a $50,000 letter of credit sub-limit, secured by the assets of the Company
and its U.S. subsidiaries. The Revolver places certain restrictions on the Company and the borrower subsidiaries,
including limitations on asset sales, additional liens, and the incurrence of additional indebtedness.
F-20
GAMESTOP CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)