GameStop 2003 Annual Report Download - page 37

Table of Contents
facility in Grapevine, Texas which the Company acquired in March 2004. We expect that the total cost to purchase, improve and equip this facility will be
approximately $29 million. The distribution systems in this facility are expected to be ready for testing in late 2004 and the facility is expected to be fully-operational in
2005 and all headquarters and distribution functions will be relocated at that time.
In March 2003, the Board of Directors authorized a common stock repurchase program for the purchase of up to $50.0 million of the Company’s Class A common
shares. The Company may repurchase shares from time to time in the open market or through privately negotiated transactions, depending on prevailing market
conditions and other factors. The repurchased shares will be held in treasury. During fiscal 2003, the Company repurchased 2,304,100 shares at an average share price
of $15.19.
In February 2002, the Company entered into a $75.0 million senior secured revolving credit facility which expires in February 2005. The revolving credit facility is
governed by an eligible inventory borrowing base agreement, defined as 50% of non-defective inventory. Loans incurred under the credit facility will be maintained
from time to time, at the Company’s option, as: (1) base rate loans which bear interest at the base rate (defined in the credit facility as the higher of (a) the
administrative agent’s announced base rate, or (b) 1/2 of 1% in excess of the federal funds effective rate, each as in effect from time to time); or (2) LIBOR loans
bearing interest at the LIBOR rate for the applicable interest period, in each case plus an applicable interest margin. In addition, the Company is required to pay a
commitment fee of 0.375% for any unused amounts of the revolving credit facility. Any borrowings under the revolving credit facility are secured by the assets of the
Company. The revolving credit facility generally restricts our ability to pay dividends and requires the Company to maintain certain financial ratios. There have been no
borrowings under the revolving credit facility.
Based on our current operating plans, we believe that available cash balances and cash generated from our operating activities will be sufficient to fund our
operations, store expansion and remodeling activities and corporate capital expenditure programs for at least the next 12 months.
Contractual Obligations
The following table sets forth our contractual obligations as of January 31, 2004:
Payments Due by Period
Less Than More Than
Contractual Obligations Total 1 Year 1-3 Years 3-5 Years 5 Years
Long-Term Debt $
—
$
—
$
—
$
—
$
—
Capital Lease Obligations $
—
$
—
$
—
$
—
$
—
Operating Leases $272.3 $59.5 $94.0 $ 61.6 $57.2
Purchase Obligations $
—
$
—
$
—
$
—
$
—
Other Long-Term Liabilities Reflected on the Company’s
Balance Sheet Under GAAP $
—
$
—
$
—
$
—
$
—
Total $ 272.3 $ 59.5 $ 94.0 $ 61.6 $ 57.2
In addition to minimum rentals, the operating leases generally require the Company to pay all insurance, taxes and other maintenance costs and may provide for
percentage rentals. Percentage rentals are based on sales performance in excess of specified minimums at various stores.
As of January 31, 2004, we had no other commercial commitments such as standby letters of credit, guarantees, or standby repurchase obligations outstanding.
Off-Balance Sheet Arrangements
As of January 31, 2004, the Company had no off-balance sheet arrangements as defined in Item 303 of Regulation S-K.
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