GameStop 2011 Annual Report Download - page 63

For fiscal 2010, the number of shares repurchased was 17.1 million for an average price per share of $19.84. Of
these shares, $22.0 million of treasury share purchases were settled at the beginning of fiscal 2011. In
February 2011, the Board of Directors of the Company authorized a $500 million repurchase fund to be used for
share repurchases of its common stock and/or to retire the Company’s Senior Notes. This plan replaced the
September 2010 $300 million stock repurchase plan which had $138.4 million remaining. In November 2011, the
Board of Directors authorized the Company to use $500 million to repurchase shares of the Company’s common
stock and/or retire the Company’s Senior Notes, replacing the remaining $180.1 million authorization. For fiscal
2011, the number of shares repurchased was 11.2 million for an average price per share of $21.38. As of
March 22, 2012, the Company has purchased an additional 3.3 million shares for an average price per share of
$22.97. On March 20, 2012, the Board of Directors authorized the Company to use $500 million to repurchase
shares of the Company’s common stock, replacing the remaining $253.4 million of the November 2011
authorization.
On February 8, 2012, the Board of Directors of the Company announced the initiation of a quarterly cash
dividend to its stockholders of $0.15 per Class A common share. The first quarterly cash dividend was paid on
March 12, 2012 to all stockholders of record as of February 21, 2012. Future dividends will be subject to
approval by the Board of Directors of the Company.
Based on our current operating plans, we believe that available cash balances, cash generated from our
operating activities and funds available under the Revolver will be sufficient to fund our operations, digital
initiatives, 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 28, 2012:
Payments Due by Period
Contractual Obligations Total
Less Than
1 Year 1-3 Years 3-5 Years
More Than
5 Years
(In millions)
Operating Leases ................... $1,124.8 $ 344.0 $421.5 $189.2 $170.1
Purchase Obligations(1) ............. 690.9 690.9 — — —
Total ............................. $1,815.7 $1,034.9 $421.5 $189.2 $170.1
(1) Purchase obligations represent outstanding purchase orders for merchandise from vendors. These purchase
orders are generally cancelable until shipment of the products.
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. Leases with step rent provisions, escalation
clauses or other lease concessions are accounted for on a straight-line basis over the lease term, including
renewal options for those leases in which it is reasonably assured that the Company will exercise the renewal
option. The Company does not have leases with capital improvement funding.
The Company has entered into employment agreements with Daniel A. DeMatteo, Executive Chairman; R.
Richard Fontaine, Chairman International; J. Paul Raines, Chief Executive Officer; Tony D. Bartel, President;
and Robert A. Lloyd, Executive Vice President and Chief Financial Officer. The term of the employment
agreement with Mr. DeMatteo commenced on April 11, 2005, when he was Chief Operating Officer of the
Company, and was renewed in April 2010 with an expiration date of March 3, 2013. The term of the employment
agreement with Mr. Fontaine commenced on April 11, 2005, when he was Chairman and Chief Executive Officer
of the Company, and was renewed in April 2010 with an expiration date of March 3, 2013. The term of the
employment agreement for Mr. Raines commenced on September 7, 2008 and was amended on June 2, 2010
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