Petsmart 2007 Annual Report Download - page 70

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Note 7 — Earnings Per Common Share
The following table presents a reconciliation of the denominators used in the earnings per common share
calculation:
February 3,
2008
January 28,
2007
January 29,
2006
Year Ended
(53 weeks) (52 weeks) (52 weeks)
Weighted average shares outstanding — Basic ............ 129,851 135,836 140,791
Effect of dilutive securities:
Stock options, ESPP and restricted stock .............. 3,103 3,701 4,786
Weighted average shares outstanding — Diluted .......... 132,954 139,537 145,577
Certain stock-based compensation awards representing 1.1 million, 1.8 million and 1.1 million shares of
common stock in 2007, 2006 and 2005, respectively, were outstanding but not included in the calculation of diluted
earnings per common share because the inclusion of the shares would have been antidilutive for the periods
presented.
Note 8 — Stockholders’ Equity
Share Purchase Programs
In September 2004, the Board of Directors approved a program authorizing the purchase of up to $150.0 million
of our common stock through 2005. During the first quarter of 2005, we purchased approximately 3.6 million shares of
our common stock for $105.0 million, which completed the authorized purchase of $150.0 million of our common
stock under the September 2004 program.
In June 2005, the Board of Directors approved a program authorizing the purchase of up to $270.0 million of
our common stock through 2006. In August 2006, the Board of Directors increased the amount remaining under the
June 2005 share purchase program by $141.7 million to bring the share purchase capacity under the June 2005 share
purchase program to $250.0 million and extended the term of the June 2005 share purchase program to August 9,
2007. During 2006, we purchased approximately 6.3 million shares of our common stock for $161.9 million. At
January 28, 2007, the amount remaining under the June 2005 share purchase program was $89.9 million. From
January 29, 2007 through June 4, 2007, we purchased 2.8 million shares of our common stock for $89.9 million
under our $250.0 million share purchase program, completing the program.
In August 2007, the Board of Directors approved a new share purchase program authorizing the purchase of up
to $300.0 million of our common stock through August 2, 2009. On August 19, 2007, we entered into a
$225.0 million fixed dollar accelerated share repurchase, or ASR, agreement. The ASR agreement contained
provisions that established the minimum and maximum number of shares that were purchased during its term.
Pursuant to the terms of the ASR agreement, on August 20, 2007, we paid $225.0 million to the ASR counterparty
for the purchase of shares and $0.2 million in related fees. The ASR agreement was funded with $125.0 million in
existing cash and cash equivalents and $100.0 million in borrowings under our $350.0 million revolving credit
facility. We received 7.0 million shares of common stock under the ASR agreement which was completed on
January 31, 2008. At February 3, 2008, the amount remaining under the August 2007 share purchase authorization
was $75.0 million.
Stockholder Rights Plan
Our Stockholder Rights Plan expired on August 28, 2007.
F-20
PetSmart, Inc. and Subsidiaries
Notes to Consolidated Financial Statements — (Continued)