Barnes and Noble 2012 Annual Report Download - page 45

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Company had the following long-term liabilities at April
, , April ,  and May , :
April 28, 2012 April 30, 2011
Deferred Rent $ 220,875 271,451
Junior Seller Note (see Note
14 and Note 19) 150,000 150,000
Other 34,190 27,196
Total long-term liabilities $ 405,065 448,647
6. FAIR VALUES OF FINANCIAL INSTRUMENTS
In accordance with ASC , Fair Value Measurements and
Disclosures, the fair value of an asset is considered to be
the price at which the asset could be sold in an orderly
transaction between unrelated knowledgeable and willing
parties. A liability’s fair value is defi ned as the amount that
would be paid to transfer the liability to a new obligor, not
the amount that would be paid to settle the liability with
the creditor. Assets and liabilities recorded at fair value
are measured using a three-tier fair value hierarchy, which
prioritizes the inputs used in measuring fair value. These
tiers include:
Level  – Observable inputs that refl ect quoted prices in
active markets
Level  – Inputs other than quoted prices in active markets
that are either directly or indirectly observable
Level  – Unobservable inputs in which little or no market
data exists, therefore requiring the Company to develop its
own assumptions
The following table presents the changes in Level  contin-
gent consideration liability:
Acquisition of Fictionwise
Beginning balance,
May 2, 2009 $ 8,165
Payments (2,612)
Losses 1,712
Balance, May 1, 2010 $ 7,265
Payments (7,508)
Losses 243
Balance, April 30, 2011 and
April 28, 2012 $ —
The Company’s fi nancial instruments, other than those
presented in the disclosures above, include cash, receiv-
ables, other investments and accounts payable. The
fair values of cash, receivables, and accounts payable
approximated carrying values because of the short-term
nature of these instruments. The Company believes that
its  Amended Credit Facility approximates fair value
since interest rates are adjusted to refl ect current rates.
The Company believes that the terms and conditions of
the remaining Seller Notes is consistent with comparable
market debt issues.
7. NET EARNINGS (LOSS) PER SHARE
In accordance with ASC --, Share-Based Payment
Arrangements and Participating Securities and the Two-
Class Method, the Company’s unvested restricted shares,
unvested restricted stock units and shares issuable under
the Company’s deferred compensation plan are considered
participating securities. During periods of net income,
the calculation of earnings per share for common stock
are reclassifi ed to exclude the income attributable to the
unvested restricted shares, unvested restricted stock units
and shares issuable under the Company’s deferred com-
pensation plan from the numerator and exclude the dilutive
impact of those shares from the denominator.
During periods of net loss, no eff ect is given to the partici-
pating securities because they do not share in the losses
of the Company. Due to the net loss during fi scal  and
, participating securities in the amounts of , and
,, respectively, were excluded in the calculation of loss
per share using the two-class method because the eff ect
would be antidilutive. The Company’s outstanding stock
options and accretion/payments of dividends on preferred
shares were also excluded from the calculation of loss per
share using the two-class method because the eff ect would
be antidilutive.
2012 Annual Report 43