GameStop 2014 Annual Report Download - page 43

Despite currentindebtedness levels, we and oursubsidiaries may still be abletoincur additional debt. This could further
increase the risks associatedwithour leverage.
We areable to incur additional indebtedness. Although our senior credit facility and the indenture for our Senior Notes contain
restrictions on the incurrence of additional indebtedness, these restrictions are subject to anumberofqualifications and exceptions,
and the additional indebtedness incurred in compliance with these restrictions could be substantial. These restrictions also will
not prevent us from incurring obligations that do not constitute indebtedness. Such future indebtedness or obligations may have
restrictions similar to, or more restrictive than, those included in the indenture for our Senior Notes or our senior credit facility.
The incurrence of additional indebtedness could impact our financial condition and results of operations.
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Item 1B. Unresolved Staff Comments
None.
Item 2. Properties
All of our stores are leased. Store leases typically provide for an initial lease term of three to five years, plus renewal options.
This arrangement gives us the flexibility to pursue extension or relocation opportunities that arise from changing market conditions.
We believe that, as current leases expire, we will be able to obtain either renewals at present locations, leases for equivalent
locations in the same area, or be able to close the stores with expiring leases and transfer enough of the sales to other nearby stores
to improve, if not at least maintain, profitability.Weexpecttoopenoracquire approximately 400-600 new stores in fiscal 2015,
including 50 VideoGame Brands stores and 350-550 Technology Brands stores. We also plan to close approximately 200-300
Video Game Brands stores worldwide in fiscal 2015.
The terms of the store leases for the 6,690leased stores open as of January 31, 2015 expire as follows:
Lease Terms to ExpireDuring
(12 Months Ending on or About January 30)
Number
of Stores
2016........................................................................................................................................................................ 1,984
2017........................................................................................................................................................................ 1,589
2018........................................................................................................................................................................ 1,199
2019........................................................................................................................................................................ 764
2020 and later ......................................................................................................................................................... 1,154
Total........................................................................................................................................................................ 6,690
As of January 31, 2015, we owned eight and leased 13 office and distribution facilities, totaling approximately 1.8 million
square feet. The lease expiration dates for the leased facilities range from 2015 to 2024, with an average remaining lease life of
approximately five years. Ourprincipal facilities are as follows:
Location
Square
Footage
Owned or
Leased Use
Grapevine, Texas, USA ................................... 519,000Owned................... Distribution and administration
Grapevine, Texas, USA ................................... 182,000Owned................... Manufacturing and distribution
Louisville, Kentucky, USA.............................. 260,000Leased ................... Distribution
Brampton, Ontario, Canada............................. 119,000Owned................... Distribution and administration
Eagle Farm, Queensland, Australia ................. 185,000Owned................... Distribution and administration
Milan, Italy ...................................................... 123,000Owned................... Distribution and administration
Additional information regarding our properties can be found in “Item 1. Business -Store Operations” and “Item 1.
Business -Site Selection and Locations” elsewhere in this Form 10-K.
Item 3. Legal Proceedings
In the ordinary course of business, we are, from time to time, subject to various legal proceedings, including matters involving
wage and hour employee class actions and consumer class actions. We mayenter into discussions regarding settlement of these
and other types of lawsuits, and may enter into settlement agreements, if we believe settlement is in the best interest of our
stockholders. We do notbelieve that any such existing legal proceedings or settlements, individually or in the aggregate, will have
amaterial adverse effect on our financial condition, results of operations or cashflows.