Saks Fifth Avenue 2008 Annual Report Download - page 16

The following table sets forth information about the Company’s stores as of January 31, 2009. The majority
of the SFA stores are owned, while all of the OFF 5th stores are leased. Store leases generally require the
Company to pay a fixed minimum rent and a variable amount based on a percentage of annual sales at that
location. Generally, the Company is responsible under its store leases for a portion of mall promotion and
common area maintenance expenses and for certain utility, property tax, and insurance expenses. Generally, store
leases have initial terms ranging from 20 to 30 years and include renewal options ranging from 5 to 20 years.
OFF 5th leases typically have shorter terms.
Owned Locations Leased Locations Total
Store Name
Number
Of Units
Gross Square
Feet (in mil.)
Number
Of Units
Gross Square
Feet (in mil.)
Number
Of Units
Gross Square
Feet (in mil.)
Primary
Locations
SFA.................... 29 3.9 24 2.0 53 5.9 National
OFF 5th ................. — 0.0 51 1.4 51 1.4 National
Total ................... 29 3.9 75 3.4 104 7.3
Item 3. Legal Proceedings.
Vendor Litigation
On December 8, 2005 Adamson Apparel, Inc. filed a purported class action lawsuit against the Company in
the United States District Court for the Northern District of Alabama. In its complaint the plaintiff asserted
breach of contract claims and alleged that the Company improperly assessed chargebacks, timely payment
discounts, and deductions for merchandise returns against members of the plaintiff class. The lawsuit sought
compensatory and incidental damages and restitution. On June 8, 2008, the parties entered into a settlement
agreement which was approved by the United States Bankruptcy Court for the Central District of California on
July 30, 2008. Pursuant to the settlement, on August 18, 2008 the Company paid the plaintiff $.4 million in
settlement of the claims (of which the Company was reimbursed approximately $.1 million from an unrelated
third party), at which time the lawsuit was formally dismissed.
Other
The Company is involved in legal proceedings arising from its normal business activities and has accruals
for losses where appropriate. Management believes that none of these legal proceedings will have a material
adverse effect on the Company’s consolidated financial position, results of operations, or liquidity.
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