Ulta 2014 Annual Report Download - page 31

Download and view the complete annual report

Please find page 31 of the 2014 Ulta 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 82

  • 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

As of January 31, 2015, we operated three distribution facilities located in Romeoville, Illinois, Phoenix, Arizona
and Chambersburg, Pennsylvania. The Romeoville warehouse contains approximately 317,000 square feet,
including an overflow facility. The lease for the Romeoville warehouse expires on April 30, 2017. The Phoenix
warehouse contains approximately 437,000 square feet. The lease for the Phoenix warehouse expires on
March 31, 2019 and has three renewal options with terms of five years each. The Chambersburg warehouse
contains approximately 373,000 square feet. The lease for the Chambersburg warehouse expires on March 31,
2027 and has three renewal options with terms of five years each.
We have embarked on a multi-year supply chain project beginning in 2014, which will include adding additional
capacity, including two additional distribution centers expected to open in 2015 and 2016, and system
improvements to support expanded omni-channel capabilities.
In April 2014, we entered into a lease for a distribution center located in Greenwood, Indiana. The Greenwood
warehouse contains approximately 671,000 square feet and is expected to open in fiscal 2015. The lease expires
on July 31, 2025 and has four renewal options with terms of five years each.
In December 2014, we entered into a lease for a distribution center located in Dallas, Texas. The Dallas
warehouse contains approximately 671,000 square feet and is expected to open in fiscal 2016. The lease expires
on July 31, 2026 and has four renewal options with terms of five years each.
Our principal executive office is in Bolingbrook, Illinois. The lease for the Bolingbrook office expires on
August 31, 2018. In 2013, the Company expanded its office space with an additional 42,000 square feet located
at its current headquarters. This additional office space has a lease that will expire September 30, 2016 with an
option to extend to August 31, 2018.
Item 3. Legal Proceedings
General litigation — On March 2, 2012, a putative employment class action lawsuit was filed against us and
certain unnamed defendants in state court in Los Angeles County, California. On April 12, 2012, the Company
removed the case to the United States District Court for the Central District of California. On August 8, 2013, the
plaintiff asked the court to certify the proposed class and the Company opposed the plaintiff’s request and is
waiting for the court to issue a decision. The plaintiff and members of the proposed class are alleged to be (or to
have been) non-exempt hourly employees. The suit alleges that Ulta violated various provisions of the California
labor laws and failed to provide plaintiff and members of the proposed class with full meal periods, paid rest
breaks, certain wages, overtime compensation and premium pay. The suit seeks to recover damages and penalties
as a result of these alleged practices. The Company denies plaintiff’s allegations and is vigorously defending the
matter.
We are also involved in various legal proceedings that are incidental to the conduct of our business. In the
opinion of management, the amount of any liability with respect to these proceedings, either individually or in
the aggregate, will not be material.
27