Barnes and Noble 2008 Annual Report Download - page 36

Author contracts, distribution contracts and D&O
insurance are generally being amortized over 10 years,
10 years and 6 years, respectively.
AGGREGATE AMORTIZATION EXPENSE:
For the 52 weeks ended January 31, 2009 $ 4,563
Estimated Amortization Expense:
(12 months ending on or about January 31)
2010 $ 3,009
2011 $ 2,650
2012 $ 2,473
2013 $ 2,473
2014 $ 2,456
The changes in the carrying amount of goodwill for the
52 weeks ended January 31, 2009 are as follows:
Balance as of February 2, 2008
(as previously reported) $ 255,290
Discontinued operations (See Note 2) (12,657)
Balance as of February 2, 2008 $ 242,633
Goodwill acquired (See Note 12) 1,803
Benefi t of excess tax amortizationa(4,428)
Balance as of January 31, 2009 $ 240,008
a The tax basis of goodwill arising from an acquisition in fi scal 2004
exceeded the related basis for fi nancial reporting purposes by
approximately $96,576. In accordance with SFAS 109, the Company is
recognizing the tax benefi ts of amortizing such excess as a reduction
of goodwill as it is realized on the Company’s income tax return.
12. OTHER ACQUISITIONS
Sterling Publishing entered into a joint venture in Begin
Smart LLC, acquiring a 50% interest to develop, sell,
and distribute books for infants, toddlers, and chil-
dren under the brand name BEGIN SMART™. In fi scal
2008, the Company determined that Begin Smart LLC
should be consolidated under the provisions of FASB
Interpretation No. 46, Consolidation of Variable Interest
Entities, an Interpretation of ARB No. 51, as revised and,
accordingly, the results of operations for the period
subsequent to the acquisition are included in the con-
solidated fi nancial statements. The operating results of
Begin Smart LLC are immaterial to the Company.
13. SHAREHOLDERS’ EQUITY
On September 15, 2005, the Company’s Board of
Directors authorized a stock repurchase program for the
purchase of up to $200,000 of the Company’s common
stock. The Company completed this $200,000 repur-
chase program during the third quarter of fi scal 2007.
On May 15, 2007, the Company’s Board of Directors
authorized a new stock repurchase program for the
purchase of up to $400,000 of the Company’s common
stock. The maximum dollar value of common stock
that may yet be purchased under the current program
is approximately $2,471 as of January 31, 2009. Stock
repurchases under this program may be made through
open market and privately negotiated transactions from
time to time and in such amounts as management deems
appropriate. As of January 31, 2009, the Company has
repurchased 33,065,712 shares at a cost of approximately
$1,047,529 under its stock repurchase programs. The
repurchased shares are held in treasury.
14. COMMITMENTS AND CONTINGENCIES
The Company leases retail stores, warehouse facilities,
offi ce space and equipment. Substantially all of the
retail stores are leased under noncancelable agreements
which expire at various dates through 2036 with various
renewal options for additional periods. The agreements,
which have been classifi ed as operating leases, generally
provide for both minimum and percentage rentals and
require the Company to pay insurance, taxes and other
maintenance costs. Percentage rentals are based on
sales performance in excess of specifi ed minimums at
various stores.
Rental expense under operating leases is as follows:
FISCAL YEAR 2008 2007 2006
Minimum rentals $ 310,967 302,060 299,022
Percentage rentals 4,380 6,932 7,171
$ 315,347 308,992 306,193
Future minimum annual rentals, excluding percentage
rentals, required under leases that had initial, noncan-
celable lease terms greater than one year, as of January
31, 2009 are:
FISCAL YEARa
2009 $ 362,714
2010 332,304
2011 279,293
2012 231,226
2013 190,087
After 2013 566,221
$ 1,961,845
a Excludes future minimum annual rentals for Calendar Club of $2,754,
$2,339, $2,387, $1,909, $1,438 and $488 for fi scal years 2009, 2010, 2011,
2012, 2013 and after 2013, respectively.
2008 Annual Report 35