Build-A-Bear Workshop 2013 Annual Report Download - page 23

Fluctuations in our operating results could reduce our cash flow and
we may be unable to repurchase shares at all or at the times or in the
amounts we desire or the results of the share repurchase program
may not be as beneficial as we would like.
Our Board of Directors has implemented a $50 million share
repurchase program. The program does not require the Company to
repurchase any specific number of shares of our common stock, and
may be modified, suspended or terminated at any time without prior
notice. Shares repurchased under the program will be subsequently
retired. If our cash flow decreases as a result of decreased sales,
increased expenses or capital expenditures or other uses of cash, we
may not be able to repurchase shares of our common stock at all or at
times or in the amounts we desire. As a result, the results of the share
repurchase program may not be as beneficial as we would like.
Our certificate of incorporation and bylaws and Delaware law
contain provisions that may prevent or frustrate attempts to replace
or remove our current management by our stockholders, even if such
replacement or removal may be in our stockholders’ best interests.
Our basic corporate documents and Delaware law contain provisions
that might enable our management to resist a takeover. These
provisions:
• restrict various types of business combinations with significant
stockholders;
• provide for a classified board of directors;
• limit the right of stockholders to remove directors or change the
size of the board of directors;
• limit the right of stockholders to fill vacancies on the board of
directors;
• limit the right of stockholders to act by written consent and to call a
special meeting of stockholders or propose other actions;
• require a higher percentage of stockholders than would otherwise
be required to amend, alter, change or repeal our bylaws and
certain provisions of our certificate of incorporation; and
• authorize the issuance of preferred stock with any voting rights,
dividend rights, conversion privileges, redemption rights and
liquidation rights and other rights, preferences, privileges, powers,
qualifications, limitations or restrictions as may be specified by our
board of directors.
• These provisions may:
• discourage, delay or prevent a change in the control of our
company or a change in our management, even if such change may
be in the best interests of our stockholders;
• adversely affect the voting power of holders of common stock; and
• limit the price that investors might be willing to pay in the future
for shares of our common stock.
ITEM 1B. UNRESOLVED STAFF COMMENTS
Not applicable.
ITEM 2. PROPERTIES
Stores
We lease all of our store locations. As of December 28, 2013,
we operated 263 retail stores located primarily in major malls
throughout the United States, Canada and Puerto Rico, 58 stores
located in the United Kingdom and two stores in Ireland in our Retail
segment. Our leases in the United Kingdom and Ireland typically
have rent reviews every five years in which the base rental rate is
adjusted to current market rates if they are higher than the original
rent agreed.
Non-Store Properties
In addition to leasing all of our store locations, we own a warehouse
and distribution center, or Bearhouse, in Groveport, Ohio, which is
utilized primarily by our Retail segment. The facility is approximately
350,000 square feet and includes our web fulfillment site. We
also lease approximately 59,000 square feet for our corporate
headquarters, or World Bearquarters, in St. Louis, Missouri which
houses our corporate staff, our call center and our on-site training
facilities. The lease was amended, effective January 1, 2014 with
a five-year term. In the United Kingdom, we lease approximately
2,500 square feet for our regional headquarters in Windsor, England.
The lease commenced in August 2003 and can be terminated at any
time by either party giving notice of termination six months prior to
cancellation.
ITEM 3. LEGAL PROCEEDINGS
From time to time we are involved in ordinary routine litigation
typical for companies engaged in our line of business. We are
involved in several court actions seeking to enforce our intellectual
property rights or to determine the validity and scope of the
proprietary rights of others. As of the date of this Annual Report on
Form 10-K, we are not involved in any pending legal proceedings
that we believe would be likely, individually or in the aggregate, to
have a material adverse effect on our financial condition or results of
operations.
ITEM 4. MINE SAFETY DISCLOSURE
Not applicable
BUILD- A-BEAR WORKSHOP, INC. 2013 FORM 10 -K 13