Barnes and Noble 1998 Annual Report Download - page 56

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The following table summarizes information as of January 30, 1999 concerning outstanding and exercisable options:
Options Outstanding Options Exercisable
Range of Number Weighted- Weighted- Number Weighted-
Exercise Outstanding Average Remaining Average Exercisable Average
Prices (000s) Contractural Life Exercise Price (000s) Exercise Price
$ 3.21 -$ 3.77 818 4.38 $ 3.59 818 $ 3.59
$10.00 -$ 15.00 5,384 4.98 $ 12.11 5,275 $ 12.08
$ 17.13 -$24.25 2,870 8.42 $ 19.93 665 $ 18.67
$26.50 -$34.75 1,206 9.07 $34.30 22 $ 28.92
$ 3.21-$34.75 10,278 6.37 $16.22 6,780 $ 11.76
11. Leases
The Company leases retail stores, warehouse facilities,
office space and equipment. Substantially all of the retail stores
are leased under noncancelable agreements which expire at
various dates through 2028 with various renewal options for
additional periods. The agreements, which have been classified
as operating leases, generally provide for both minimum and
p e rcentage rentals and re q u i re the Company to pay all
insurance, taxes and other maintenance costs. Pe rc e n t a g e
rentals are based on sales performance in excess of specified
minimums at various stores.
Rental expense under operating leases are as follows:
Fiscal Year 1998 1997 1996
Minimum rentals $ 271,201 253,472 222,700
Percentage rentals 3,183 3,216 2,750
$274,384 256,688 225,450
Future minimum annual rentals, excluding percentage
rentals, required under leases that had initial, noncancelable
lease terms greater than one year, as of January 30, 1999 are:
Fiscal Year
1999 $ 2 71,769
2000 2 6 4 , 0 2 7
2001 261,090
2002 2 47,7 81
2003 228,481
After 2003 1, 5 7 7,713
$2,850,861
Future minimum annual rentals for stores scheduled for
closing pursuant to the Company’s restructuring plan are
included in the preceding table. Fu t u re rental payments
representing the exit costs associated with these store closings
were included in the Company’s non-cash restructuring charge
of $123,768 recorded during fiscal 1995 and, therefore, do not
represent future operating expenses.
12. Litigation
In March 1998, the American Booksellers Association
(ABA) and 26 independent bookstores filed a lawsuit in the
United States District Court for the Northern District of
California against the Company and Borders Group Inc.
(Borders) alleging violations of the Robinson-Patman Act, the
California Unfair Trade Practice Act and the California Unfair
Competition Law. The Complaint seeks injunctive and
declaratory relief; treble damages on behalf of each of the book-
store plaintiffs, and, with respect to the California bookstore
plaintiffs, any other damages permitted by California law;
disgorgement of money, property and gains wro n g f u l l y
obtained in connection with the purchase of books for resale, or
offered for resale, in California from March 18, 1994 until the
action is completed and pre-judgment interest on any amounts
awarded in the action, as well as attorney fees and costs. In
November 1998, six other independent booksellers instituted an
action in the same court against the same defendants asserting
similar claims and seeking similar relief. The Company intends
to vigorously defend both actions.
In August 1998, The Intimate Bookshop, Inc. and its
owner, W allace Kuralt, filed a lawsuit in the United States
District Court for the Southern District of New York against the
Company, Borders, Amazon.com, Inc., certain publishers and
others alleging violation of the Robinson-Patman Act and other
federal law, New York statutes governing trade practices and
common law. The Complaint seeks certification of a class
consisting of all retail booksellers in the United States, whether
or not currently in business, which were in business and were
members of the ABA at any time during the four year period
preceding the filing of the Complaint. The Complaint alleges
that the named plaintiffs have suffered damages of $11. 25 million
or more and requests treble damages on behalf of the named
plaintiffs and each of the purported class members, as well as of
i n j u n c t i ve and declaratory relief (including an injunction
requiring the closure of all of defendants’ stores within 10 miles
of any location where plaintiff either has or had a retail book-
s t o re during the four years preceding the filing of the
Complaint, and prohibiting the opening by defendants of any
bookstore in such areas for the next 10 years), disgorgement of
alleged discriminatory discounts, rebates, deductions and