Whole Foods 2009 Annual Report Download - page 59

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53
The following summarizes the fair values of the assets acquired and liabilities assumed at the acquisition date, including
purchase price adjustments since the purchase price allocation as previously disclosed as of September 28, 2008 (in
thousands):
Purchase Price Purchase Purchase Price
Allocation Price Allocation
September 28, 2008 Adjustments September 27, 2009
Current assets $ 52,039 $ - $ 52,039
Property and equipment 64,471 - 64,471
Goodwill 546,066 (1,305) 544,761
Intangible assets 33,353 - 33,353
Deferred income taxes 71,886 437 72,323
Other assets 339 - 339
Assets held for sale 171,115 - 171,115
Total assets acquired 939,269 (868) 938,401
Current liabilities 142,999 - 142,999
Long-term debt 134,126 - 134,126
Other liabilities 53,224 (868) 52,356
Liabilities held for sale 7,202 - 7,202
Total liabilities assumed 337,551 (868) 336,683
Net assets acquired $ 601,718 $ - $ 601,718
The purchase price allocation was substantially completed during fiscal year 2008, with the exception of an additional
reserve of approximately $2.4 million related to income tax uncertainties and the reduction of certain restructuring reserves
of approximately $3.7 million.
Estimated fair values of intangible assets acquired are as follows (in thousands):
Weighted Average
Estimated Useful Lives
Fair Value (Years)
Non-amortizing:
Liquor licenses $ 1,165
Amortizing:
Trade and brand names 6,579 1
Favorable operating leases 25,609 18
Total amortizing 32,188 14
Total $ 33,353
Amortizing intangible assets are amortized on a straight-line basis over their remaining expected useful lives of
approximately one to 32 years.
In connection with the acquisition, the Company recognized liabilities totaling approximately $8.4 million for estimated costs
associated with plans to involuntarily terminate certain team members of Wild Oats, contract termination fees and other legal
reserves totaling approximately $11.4 million, and estimated costs to close certain store locations totaling approximately
$61.3 million. As of September 27, 2009, all team member termination liabilities have been distributed and contract
termination fees and other legal reserves were $6.3 million as a result of adjustments and payments made since acquisition.
Store closure reserves are discussed further in Note 7 to the consolidated financial statements, “Reserves for Closed
Properties.”
The Company assumed debt totaling approximately $148 million in the acquisition consisting primarily of convertible
subordinated debentures and capital lease obligations. The estimated fair value of the debt assumed by the Company was
approximately $134 million. Excluding capital lease obligations, all debt assumed as part of the Wild Oats acquisition was
fully repaid during fiscal year 2008. Debt is discussed further in Note 8 to the consolidated financial statements, “Long-
Term Debt.”
The estimated values of operating leases with unfavorable terms compared with current market conditions totaled
approximately $1.2 million. These leases have an estimated weighted average life of approximately 14 years and are
included in other liabilities.