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16. COMMITMENTS AND CONTINGENCIES
The Company leases retail stores, warehouse facilities,
offi ce space and equipment. Substantially all of the B&N
Retail stores are leased under noncancelable agreements
which expire at various dates through  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.
B&N College’s contracts are typically for fi ve to ten years,
although some extend beyond ten years. Many contracts
have a  to  day cancellation right by B&N College, or
by the college or university, without penalty.
Rental expense under operating leases is as follows:
Fiscal 2012 Fiscal 2011 Fiscal 2010
Minimum rentals $ 382,386 394,199 363,373
Percentage rentals 107,127 102,735 40,324
$ 489,513 496,934 403,697
Future minimum annual rentals, excluding percentage
rentals, required under B&N Retail leases that had initial,
noncancelable lease terms greater than one year, and under
B&N College leases as of April ,  are:
Fiscal Year a
2013 $ 405,484
2014 357,907
2015 287,659
2016 238,840
2017 193,447
After 2017 464,397
$ 1,947,734
a Includes B&N College capital lease obligations of $1,005, $1,000,
$744, $234, $20 and $0 for 2013, 2014, 2015, 2016, 2017 and after 2017,
respectively.
The Company provides for minimum rent expense over the
lease terms (including the build-out period) on a straight-
line basis. The excess of such rent expense over actual lease
payments (net of tenant allowances) is refl ected primarily
in other long-term liabilities in the accompanying balance
sheets.
On June , , the Company exercised its purchase
option under a lease on one of its distribution facilities
located in South Brunswick, New Jersey from the New
Jersey Economic Development Authority. Under the terms
of the lease expiring in June , the Company purchased
the distribution facility and equipment for approxi-
mately ,. Subsequently, on December , , the
Company sold the distribution facility in South Brunswick,
New Jersey for ,, which resulted in a loss of ,.
17. SEGMENT REPORTING
Prior to year-end, the Company reported an operating
segment titled B&N.com which included both its digital
business and eCommerce operations. Due to the increased
focus on the digital business and the Company’s recently
developed ability to review the digital business separate
from its eCommerce business, the Company performed an
evaluation on the eff ect of its impact on the identifi cation
of operating segments. The assessment considered the way
the business is managed (focusing on the fi nancial infor-
mation distributed) and the manner in which the chief
operating decision maker interacts with other members
of management. As a result of this assessment, during the
fourth quarter of fi scal  the Company has determined
that the segment previously referred to as B&N.com is no
longer applicable and has created a new segment titled
NOOK to report upon its digital business, moving the
eCommerce business (i.e., sales of physical merchandise
over the Internet) into the B&N Retail segment. Also as
a result of this assessment, certain corporate offi ce and
other costs have been allocated to all three segments. The
Company’s three operating segments are: B&N Retail, B&N
College and NOOK.
B&N Retail
This segment includes  bookstores as of April , ,
primarily under the Barnes & Noble Booksellers trade
name. The  Barnes & Noble stores generally off er a
NOOK® department/Boutique/Counter, a comprehensive
trade book title base, a café, a Children’s department, a Toys
& Games department, a DVDs/BluRay department, a music
department, a magazine department, and bargain depart-
ment and a calendar of ongoing events, including author
appearances and children’s activities. The B&N Retail
segment also includes the Company’s eCommerce web-
site, barnesandnoble.com, and the publishing operation,
Sterling Publishing.
2012 Annual Report 51