Albertsons 2007 Annual Report Download - page 98

SU
PERVAL
U
IN
C
. and
S
ubsidiaries
N
OTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
C
orporate Unit, includin
g
accrued interest. In Januar
y
2007, the Compan
y
purchased approximatel
y
4,000,00
0
C
orporate Units at a purchase price of
$
25.52 per Corporate Unit, including accrued interest. The Company pai
d
a
n aggregate amount of approximately
$
979, including accrued interest, and recognized a gain of approximatel
y
$
1 related to these
p
urchases
.
I
nFe
b
ruary 2007, pursuant to t
h
e terms o
f
t
h
e Corporate Un
i
ts, t
h
e sen
i
or notes
h
e
ld
as components o
f
Corporat
e
Units (the “Pled
g
ed Senior Notes”) were remarketed b
y
the remarketin
g
a
g
ent. Throu
g
h the remarketin
g
, the
C
ompany purchased all of the remarketed senior notes for approximately
$
180 and recognized a gain of less than
$
1. The proceeds of the remarketing of the Pledged Senior Notes (net of remarketing fee) were delivered to th
e
collateral a
g
ent and used to purchase U.S. treasur
y
securities, maturin
g
on or about the purchase contrac
t
settlement date of May 16, 2007 (the “Purchase Contract Settlement Date”). The treasury securities will serve a
s
co
ll
atera
lf
or t
h
e
h
o
ld
ers’ o
bli
gat
i
ons un
d
er t
h
e purc
h
ase contracts assoc
i
ate
d
w
i
t
h
t
h
e Corporate Un
i
ts
.
As of February 24, 2007, under the terms of the purchase contracts, the Company would be required to issue a
m
i
n
i
mum o
f
1.1 s
h
ares an
d
a max
i
mum o
f
1.4 s
h
ares o
fi
ts common stoc
kf
or t
h
e rema
i
n
i
ng purc
h
ase contracts
.
I
f the purchase contracts had been settled at Februar
y
24, 2007, the Compan
y
would have received approximatel
y
$
45 of net cash and would have issued approximately 1.2 shares of its common stock. Upon settlement of each
purc
h
ase contract, t
h
e Company w
ill
rece
i
ve t
h
e state
d
amount o
f
twenty-
fi
ve
d
o
ll
ars on t
h
e purc
h
ase contract
a
nd will issue the re
q
uisite amount of Ac
q
uisition Consideration ($20.35 in cash and 0.182 SUPERVALU shares
per share of Albertsons common stock subject to the settlement rate). The net amount of cash received will be
recor
d
e
d
as an
i
ncrease to stoc
kh
o
ld
ers’ equ
i
ty
.
Upon settlement of the purchase contracts on May 16, 2007, the Company will receive approximately
$
45 of net
cas
h
an
di
ssue 1.2 s
h
ares.
B
efore the issuance of common stock u
p
on settlement of the
p
urchase contracts, the Cor
p
orate Units will b
e
re
fl
ecte
di
nt
h
e
dil
ute
d
earn
i
ngs per s
h
are ca
l
cu
l
at
i
ons us
i
ng t
h
e treasury stoc
k
met
h
o
d
as
d
e
fi
ne
db
y SFA
S
N
o. 128, “Earnin
g
s Per Share.” Under this method, the number of shares of common stock used in calculatin
g
d
iluted earnings per share (based on the settlement formula applied at the end of the reporting period) is deeme
d
to
b
e
i
ncrease
db
yt
h
e excess,
if
any, o
f
t
h
e num
b
er o
f
s
h
ares t
h
at wou
ld b
e
i
ssue
d
upon sett
l
ement o
f
t
he
purchase contracts less the number of shares that could be purchased b
y
the Compan
y
in the market at th
e
a
verage market price during the period using the proceeds to be received upon settlement. Therefore, dilution
will
occur
f
or per
i
o
d
sw
h
en t
h
e average mar
k
et pr
i
ce o
f
t
h
e Company’s common stoc
kf
or t
h
e 20-
d
ay tra
di
ng
period precedin
g
the end of the reportin
g
period is above $46.54, and will potentiall
y
occur when the avera
g
e
market price of the Company’s common stock for the 20-day trading period preceding the end of the reporting
per
i
o
di
s
l
ower t
h
an t
h
e average pr
i
ce o
f
t
h
e Company’s common stoc
kf
or t
h
e
f
u
ll
report
i
ng per
i
o
d
. For t
h
e yea
r
ended Februar
y
24, 2007, the Corporate Units were dilutive b
y
approximatel
y
0.09 shares.
F-
32