Saks Fifth Avenue 2008 Annual Report Download - page 85

SAKS INCORPORATED & SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
(In thousands, except per share amounts)
The plan’s target allocation is determined taking into consideration the amounts and timing of projected
liabilities, the Company’s funding policies and expected returns on various asset categories. For the years ended
January 31, 2009 and February 2, 2008, the plan’s target asset allocation was approximately 65% equity, 30%
fixed income and 5% real estate.
At January 31, 2009, the following benefit payments, which reflect expected future service, as appropriate,
are expected to be paid:
Year
Benefit
Payments
2009 ............................................................ $ 18,354
2010 ............................................................ 16,911
2011 ............................................................ 16,095
2012 ............................................................ 15,121
2013 ............................................................ 14,945
2014 - 2018 ....................................................... 51,486
$132,912
NOTE 9 — SHAREHOLDERS’ EQUITY
On October 3, 2006 the Company’s Board of Directors declared a cash dividend of $4.00 per common share
totaling $558,587, and the Company reduced shareholders’ equity by that amount. Approximately $552,000 of
the dividend was paid on November 30, 2006 to shareholders of record as of November 15, 2006. The remaining
portion of the dividend payable will be paid prospectively as, and to the extent, awards of restricted stock vest.
As a result of the November 30, 2006 $4.00 per common share dividend payment, the Human Resources
and Compensation Committee of the Company’s Board of Directors exercised its discretion under anti-dilution
provisions of the Company’s long-term incentive plan to adjust the exercise price and number of stock options to
reflect the change in the share price on the December 1, 2006 ex-dividend date. In accordance with the provisions
of SFAS No. 123R, the discretionary nature of the anti-dilution provisions resulted in a modification of the
options. Accordingly, the measurement of the fair value of the options both before and after the ex-dividend date
was required resulting in a pre-tax non-cash charge of $13,729.
The effect of this anti-dilution adjustment is presented below:
As of the ex-dividend date
Prior to
Adjustment
After
Adjustment
Options outstanding .................................... 4,547 5,645
Options exercisable ..................................... 4,489 5,573
Weighted average exercise price:
Options outstanding ................................ $14.49 $11.67
Options exercisable ................................. $14.57 $11.74
On March 6, 2006, the Company’s Board of Directors declared a cash dividend of $4.00 per common share
totaling $547,537, and the Company reduced shareholders’ equity by that amount. $538,964 of the dividend was
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