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Table of Contents
GAMESTOP CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
New Accounting Pronouncements
In January 2010, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") ASU 2010-6, Improving
Disclosures About Fair Value Measurements. On January 31, 2010, the Company adopted ASU 2010-6, which requires reporting entities to make
new disclosures about recurring or nonrecurring fair-value measurements, including significant transfers into and out of the standard's Level 1 and
Level 2 fair-value measurements and information on purchases, sales, issuances, and settlements on a gross basis for Level 3 fair-value
measurements. ASU 2010-6 is effective for annual reporting periods beginning after December 15, 2009, except for Level 3 reconciliation
disclosures which are effective for annual periods beginning after December 15, 2010. The adoption of ASU 2010-6 did not have a material impact
on the Company's consolidated financial statements.
On January 31, 2010, the Company adopted ASU 2010-09, Subsequent Events — Amendments to Certain Recognition and Disclosure
Requirements, which amends Accounting Standards Codification ("ASC") Topic 855, Subsequent Events, so that Securities and Exchange
Commission filers no longer are required to disclose the date through which subsequent events have been evaluated in originally issued and revised
financial statements. The adoption of ASU 2010-09 did not have a material impact on the Company's consolidated financial statements.
In December 2010, the FASB issued ASU 2010-28, Intangibles — Goodwill and Other. ASU 2010-28 modifies step one of the goodwill
impairment test for reporting units with zero or negative carrying amounts and offers guidance on when to perform step two of the testing. For those
reporting units, an entity is required to perform step two of the goodwill impairment test if it is more likely than not that a goodwill impairment
exists based upon factors such as unanticipated competition, the loss of key personnel and adverse regulatory changes. ASU 2010-28 is effective for
fiscal years, and interim periods within those years, beginning after December 15, 2010. The adoption of ASU 2010-28 is not expected to have a
material effect on the Company's consolidated financial statements.
In December 2010, the FASB issued ASU 2010-29, which updates the guidance in ASC 805, Business Combinations, to clarify that pro forma
disclosures should be presented as if a business combination occurred at the beginning of the prior annual period for purposes of preparing both the
current reporting period and the prior reporting period pro forma financial information. These disclosures should be accompanied by a narrative
description about the nature and amount of material, nonrecurring pro forma adjustments. ASU 2010-29 is effective for business combinations
consummated in periods beginning after December 15, 2010, and is required to be applied prospectively as of the date of adoption. The adoption of
ASU 2010-29 is not expected to have a material effect on the Company's consolidated financial statements.
2. Acquisitions
On November 17, 2008, GameStop France SAS, a wholly-owned subsidiary of the Company, completed the acquisition of substantially all of
the outstanding capital stock of Micromania for $580.4 million, net of cash acquired. Micromania is a leading retailer of video and computer games
in France with 379 locations, 328 of which were operating upon acquisition. The Company funded the transaction with cash on hand, funds drawn
against its then existing $400 million revolving credit agreement totaling $275 million, and term loans totaling $150 million under a junior term loan
facility (the "Term Loans"). As of January 31, 2009, all of the borrowings against the revolving credit agreement and the Term Loans had been
repaid. The purpose of the acquisition was to expand the Company's presence in Europe. The impact of the acquisition on the Company's results of
operations, as if the acquisition had been completed as of the beginning of the periods presented, is not significant.
F-14