Buffalo Wild Wings 2007 Annual Report Download - page 27

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purchase of our nine Las Vegas franchised locations. In 2007, we purchased $158.2 million of marketable securities and
received proceeds of $144.8 million as investments in marketable securities matured. In 2006, we purchased $108.3 million
of marketable securities and received proceeds of $105.3 million as investments in marketable securities matured or were
sold. In 2005, we purchased $91.5 million of marketable securities and received proceeds of $79.5 million as investments in
marketable securities matured or were sold.
Net cash provided by financing activities for 2007, 2006 and 2005 was $873,000, $1.6 million, and $730,000,
respectively. Net cash provided by financing activities for 2007 resulted primarily from the issuance of common stock for
options exercised and employee stock purchases of $1.4 million and excess tax benefits for restricted stock issuances of
$1.0 million partially offset by tax payments for restricted stock of $1.6 million. Net cash provided by financing activities for
2006 resulted primarily from the issuance of common stock for options exercised and employee stock purchases of $1.1
million and excess tax benefits for restricted stock issuances of $1.2 million partially offset by tax payments for restricted
stock of $686,000. Net cash provided by financing activities for 2005 resulted from the issuance of common stock for options
exercised and employee stock purchases of $1.0 million partially offset by tax payments for restricted stock of $284,000.
No additional funding from the issuance of common stock (other than from the exercise of options and employee stock
purchases) is anticipated in 2008.
Our liquidity is impacted by minimum cash payment commitments resulting from operating lease obligations for our
restaurants and our corporate offices. Lease terms are generally 10 to 15 years with renewal options and generally require us
to pay a proportionate share of real estate taxes, insurance, common area maintenance and other operating costs. Some
restaurant leases provide for contingent rental payments based on sales thresholds. Except for one restaurant building, we do
not currently own any of the land or buildings in which our restaurants operate and therefore do not have the ability to enter
into sale-leaseback transactions as a potential source of cash.
The following table presents a summary of our contractual operating lease obligations and commitments as of
December 30, 2007:
Payments Due By Period
(in thousands)
Total
Less than
one year
1-3 years 3-5 years
After 5
years
Operating lease obligations $ 152,577 18,588 34,590 30,972 68,427
Commitments for restaurants under
development 17,456 1,034 3,458 3,311 9,653
Total $ 170,033 19,622 38,048 34,283 78,080
We believe the cash flows from our operating activities and our balance of cash and marketable securities will be
sufficient to fund our operations and building commitments and meet our obligations for the foreseeable future. Our future
cash outflows related to income tax uncertainties amounts to $241,000. These amounts are excluded from the contractual
obligations table due to the high degree of uncertainty regarding the timing of these liabilities.
Recent Accounting Pronouncements
In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements” (“SFAS 157”), which defines fair
value, establishes a framework for measuring fair value in GAAP, and expands disclosures about fair value measurements.
SFAS 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods
within those fiscal years. Early adoption is permitted. We believe the adoption of SFAS 157 will not have a significant
impact on our financial statements.
In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial
Liabilities – Including an amendment of FASB Statement No. 115” (“SFAS 159”). SFAS 159 permits entities to choose to
measure many financial instruments and certain warranty and insurance contracts at fair value on a contract-by-contract basis.
A business entity is required to report unrealized gains and losses on items for which the fair value option has been elected in
earnings at each subsequent reporting date. The objective of this Statement is to improve financial reporting by providing
entities with the opportunity to mitigate volatility in reported earnings caused by measuring related assets and liabilities
differently without having to apply complex hedge accounting provisions. SFAS 159 is effective for financial statements
issued for fiscal years beginning after November 15, 2007. We believe the adoption of SFAS 159 will not have a significant
impact on our financial statements.