Napa Auto Parts 2010 Annual Report Download - page 48

Table of Contents


dilutive effect of stock options, stock appreciation rights and non-vested restricted stock awards options. Options to purchase
approximately 4,500,000, 5,400,000 and 4,400,000 shares of common stock ranging from $37 — $49 per share were outstanding at
December 31, 2010, 2009 and 2008, respectively. These options were not included in the computation of diluted net income per common
share because the options’ exercise price was greater than the average market price of common stock.
Recently Issued Accounting Pronouncements
In June 2009, the FASB issued new guidance that addresses the elimination of the concept of a qualifying special purpose entity. It
also replaces the quantitative-based risks and rewards calculation for determining which enterprise has a controlling financial interest in a
variable interest entity with an approach focused on identifying which enterprise has the power to direct the activities of a variable interest
entity and the obligation to absorb losses of the entity or the right to receive benefits from the entity. Additionally, the guidance requires an
ongoing assessment of whether a company is the primary beneficiary of the entity. The Company adopted the new guidance on January 1,
2010 and concluded that certain independently controlled automotive parts stores for which the Company guarantees debt are variable
interest entities; however, the Company is not the primary beneficiary. These entities are discussed further in Note 8.
 
The changes in the carrying amount of goodwill during the years ended December 31, 2010, 2009, and 2008 by reportable segment,
as well as other identifiable intangible assets, consisting primarily of customer relationship intangible assets, non-compete agreements,
and trademarks, are summarized as follows (in thousands):

 
  
     
Balance as of January 1, 2008 $ 24,187 $ 45,002 $ 2,131 $ — $ 11,133 $ 82,453
Additions 19,767 25,834 8,423 2,870 27,548 84,442
Amortization — — — — (2,861) (2,861)
Foreign currency translation (3,742) — — — (1,467) (5,209)
Balance as of December 31, 2008 40,212 70,836 10,554 2,870 34,353 158,825
Additions 2 5,518 — — 6,679 12,199
Amortization — — — — (3,644) (3,644)
Foreign currency translation 2,900 — — — 1,252 4,152
Balance as of December 31, 2009 43,114 76,354 10,554 2,870 38,640 171,532
Additions      
Amortization      
Foreign currency translation      
Balance as of December 31, 2010      
 
There were no amounts subject to variable rates at December 31, 2010 and 2009. The weighted average interest rate on the
Company’s outstanding borrowings was approximately 5.45% at December 31, 2010 and 2009.
The Company maintains a $350,000,000 unsecured revolving line of credit with a consortium of financial institutions that matures
in December 2012 and bears interest at LIBOR plus 0.30% (0.56% at December 31, 2010).
F-13