Sears 2007 Annual Report Download - page 85

Download and view the complete annual report

Please find page 85 of the 2007 Sears 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 110

  • 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

SEARS HOLDINGS CORPORATION
Notes to Consolidated Financial Statements—(Continued)
We have granted restricted stock awards to certain associates. These restricted stock awards typically vest in
full three years from the date of grant, provided the grantee remains employed by us as of the vesting date. The
fair value of these awards is equal to the market price of our common stock on the date of grant. We do not
currently have a program that provides for restricted stock awards on an annual basis. Changes in restricted stock
awards for fiscal 2007, fiscal 2006, and fiscal 2005 were as follows:
(Shares in thousands)
2007 2006 2005
Shares
Weighted-
Average
Fair Value
on Date
of Grant Shares
Weighted-
Average
Fair Value
on Date
of Grant Shares
Weighted-
Average
Fair Value
on Date
of Grant
Beginning of year balance ...................... 273 $133.79 242 $112.48 147 $ 48.66
Converted from Sears to Sears Holdings ........... — — — — 250 124.83
Granted .................................... 549 159.69 209 149.11 83 124.83
Vested ..................................... (94) 105.15 (132) 119.05 (141) 90.84
Forfeited .................................... (135) 165.60 (46) 136.37 (97) 94.93
End of year balance ....................... 593 $155.05 273 $133.79 242 $112.48
millions 2007 2006 2005
Aggregate fair value of shares converted to Sears Holdings from Sears based on weighted
average fair value at date of Merger ........................................... $— $— $32
Aggregate fair value of shares granted based on weighted average fair value at date of
grant ................................................................... 88 31 11
Aggregate fair value of shares vesting during period ................................ 13 20 18
Aggregate fair value of shares forfeited during period ............................... 16 7 13
Common Share Repurchase Program
From time to time we repurchase shares of our common stock under a common share repurchase program
authorized by our Board of Directors. The common share repurchase program was initially announced in 2005
with a total authorization by our Board of Directors of up to $1.0 billion. During fiscal 2006 and fiscal 2007, the
Board of Directors authorized the repurchase of up to an additional $1.0 billion and $2.5 billion of common
stock, respectively, for a total authorization since inception of the program of $4.5 billion. During fiscal 2007, we
repurchased approximately 21.7 million of our common shares at a total cost of approximately $2.9 billion, or an
average price of $134.65 per share. During fiscal 2006, we repurchased approximately 6 million of our common
shares at a total cost of approximately $806 million, or an average price of $132.94 per share. As of February 2,
2008, we had approximately $183 million of remaining authorization under this program.
The share repurchase program has no stated expiration date and share repurchases may be implemented
using a variety of methods, which may include open market purchases, privately negotiated transactions, block
trades, accelerated share repurchase transactions, the purchase of call options, the sale of put options or
otherwise, or by any combination of such methods.
Other Transactions
As discussed in Note 7, on January 31, 2005, ESL affiliates converted outstanding Notes and six month
accrued interest into an aggregate of 6.3 million shares of Kmart common stock. During fiscal 2005, ESL
affiliates and other investors exercised options to purchase approximately 6.7 million shares of Holdings’
common stock for approximately $86 million.
85