Rue 21 2012 Annual Report Download - page 60

rue21, inc.
Notes to Consolidated Financial Statements — Continued
Commission Wage Orders and the California Business and Professions Code. The complaint seeks, among other
things, an order awarding compensatory and liquidated damages, including unpaid wages; an award of restitution;
an order imposing civil penalties; an order enjoining us from committing future violations of the laws allegedly
violated; and interest, attorney’s fees and costs. The Company denied the allegations made by the Plaintiff and
asserted various defenses. On June 6, 2012, the Court certified a class of all individuals employed in our California
locations as hourly store managers, assistant store managers and sales clerks from June 11, 2006 to pursue claims
related to meal breaks, meal premium pay, work-related travel claims, travel expense claims, bag check claims, and
pay record claims. On October 4, 2012, the parties to the litigation agreed to a settlement under which we agreed to
pay $2,750,000 as a gross settlement amount, which will, among other things, be used to provide payments to
employees participating in the certified class and to pay for fees and expenses of class counsel. The plaintiff, on
behalf of herself and the employees participating in the certified class, will provide a general release, releasing us
from all claims, from June 11, 2006 until the date the Court preliminarily approves the settlement agreement, that
were pled or could have been pled based on the factual allegations set forth in the complaint. The Court granted
final approval of the settlement on March 22, 2013 and the Company has paid the full settlement amount.
Note 10 — Related Party Transactions
At February 2, 2013, funds advised by Apax owned approximately 30% of the Company’s outstanding
common stock.
We reimburse Apax for reasonable expenses incurred to attend Board of Director meetings. Amounts paid to
Apax totaled $11,000, $9,000 and $35,000 for fiscal years 2012, 2011, and 2010, respectively.
Note 11 — Subsequent Events
On March 19, 2013, the board of directors authorized an additional $25 million under its stock repurchase
program. Under the stock repurchase program, the Company may repurchase shares in the open market at current
market prices at the time of purchase or in privately negotiated transactions. The timing and actual number of shares
repurchased under the program will depend on a variety of factors including price, corporate and regulatory
requirements, and other market and business conditions. The Company may suspend or discontinue the program at
any time, and may thereafter reinstitute purchases, all without prior announcement.
Note 12 — Selected Quarterly Financial Data (Unaudited)
The following table sets forth certain unaudited quarterly financial information (in thousands, except share and
per share amounts):
Thirteen Weeks Ended
April 28,
2012
July 28,
2012
October 27,
2012
February 2,
2013
Fiscal Year 2012
Net Sales .................................. $205,615 $202,059 $225,158 $269,054
Gross profit ................................ 79,681 79,531 85,106 101,200
Net income ................................. 11,602 9,090 8,165 15,044
Basic income per common share ................ 0.47 0.37 0.34 0.63
Diluted income per common share .............. 0.46 0.36 0.33 0.62
Weighted average basic common shares
outstanding ............................... 24,480 24,420 23,939 23,783
Weighted average diluted common shares
outstanding ............................... 25,119 25,022 24,555 24,393
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