Pep Boys 2008 Annual Report Download - page 121

Download and view the complete annual report

Please find page 121 of the 2008 Pep Boys annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 168

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154
  • 155
  • 156
  • 157
  • 158
  • 159
  • 160
  • 161
  • 162
  • 163
  • 164
  • 165
  • 166
  • 167
  • 168

THE PEP BOYS—MANNY, MOE & JACK AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Years ended January 31, 2009, February 2, 2008 and February 3, 2007
(dollar amounts in thousands, except share data)
The aggregate minimum rental payments for such leases having initial terms of more than one year
are as follows:
Operating Capital Lease Financing
Year Leases Leases Obligations
2009 ........................................ $ 77,103 $129 $ 412
2010 ........................................ 74,294 — 413
2011 ........................................ 72,063 — 415
2012 ........................................ 69,992 — 416
2013 ........................................ 65,948 — 418
Thereafter ................................... 418,557 — 3,720
Aggregate minimum lease payments ................. $777,957 $129 $ 5,794
Less: interest on capital leases ..................... — (1,279)
Present Value of Net Minimum Lease Payments ........ $129 $ 4,515
Rental expenses incurred for operating leases in fiscal years 2008, 2007, and 2006 were $77,150;
$69,255 and $59,313, respectively.
Our open purchase orders are based on current inventory or operational needs and are fulfilled by
our vendors within short periods of time. We currently do not have minimum purchase commitments
under our vendor supply agreements, except for a contract to purchase bulk oil for use in the
Company’s service bays which expires in 2011, and generally our open purchase orders (orders that
have not been shipped) are not binding agreements. Those purchase obligations that are in transit from
our vendors at January 31, 2009 are considered to be a contractual obligation.
NOTE 6—STOCKHOLDERS’ EQUITY
SHARE REPURCHASE—TREASURY STOCK On September 7, 2006, the Company renewed its
share repurchase program and reset the authority back to $100,000 for repurchases to be made from
time to time in the open market or in privately negotiated transactions through September 30, 2007.
During the first quarter of fiscal 2007, the Company repurchased 2,702,460 shares of Common Stock
for $50,841. The Company also disbursed $7,311 for 494,800 shares of Common Stock repurchased
during the fourth quarter of 2006. This program expired on September 30, 2007.
All of these repurchased shares were placed into the Company’s treasury. A portion of the treasury
shares will be used by the Company to provide benefits to employees under its compensation plans and
in conjunction with the Company’s dividend reinvestment program.
BENEFITS TRUST On April 29, 1994, the Company established a flexible employee benefits
trust with the intention of purchasing up to $75,000 worth of the Company’s common shares. The
repurchased shares will be held in the trust and will be used to fund the Company’s existing benefit
plan obligations including healthcare programs, savings and retirement plans and other benefit
obligations. The trust will allocate or sell the repurchased shares through 2023 to fund these benefit
programs. As shares are released from the trust, the Company will charge or credit additional paid-in
capital for the difference between the fair value of shares released and the original cost of the shares to
57