DSW 2008 Annual Report Download - page 30

F
isc
al
Ye
a
r
We follow a 52/53-week fiscal year that ends on the Saturday nearest to January 31 in each year. Fiscal year
s
2008 and 2007 each consisted of 52 weeks. Fiscal year 2006 consisted of 53 weeks.
S
e
p
aration Agreements
I
n connection with the completion of our initial public offerin
g
in Jul
y
200
5
, we entered into several
agreements w
i
t
h
Reta
il
Ventures
i
n connect
i
on w
i
t
h
t
h
e separat
i
on o
f
our
b
us
i
ness
f
rom t
h
e Reta
il
Ventures group
.
A
fter the transfer of shared services in fiscal 2008, we amended the shared services a
g
reement and the ta
x
s
eparat
i
on agreement
.
M
aster Separation
Ag
reement
.
The master separation a
g
reement contains ke
y
provisions relatin
g
to th
e
s
eparation of our business from Retail Ventures. The master separation a
g
reement requires us to exchan
g
e
i
n
f
ormat
i
on w
i
t
h
Reta
il
Ventures,
f
o
ll
ow certa
i
n account
i
ng pract
i
ces an
d
reso
l
ve
di
sputes w
i
t
h
Reta
il
Ventures
i
n a particular manner. We also have a
g
reed to maintain the confidentialit
y
of certain information and preserv
e
available legal privileges. The separation agreement also contains provisions relating to the allocation of the costs o
f
our
i
n
i
t
i
a
l
pu
bli
co
ff
er
i
ng,
i
n
d
emn
ifi
cat
i
on, non-so
li
c
i
tat
i
on o
f
emp
l
oyees an
d
emp
l
oyee
b
ene
fi
t matters.
Under the master separation a
g
reement, we a
g
reed to effect up to one demand re
g
istration per calendar
y
ear o
f
our Common S
h
ares, w
h
et
h
er C
l
ass A or C
l
ass B,
h
e
ld b
y Reta
il
Ventures,
if
requeste
db
y Reta
il
Ventures. We
h
av
e
a
l
so
g
rante
d
Reta
il
Ventures t
h
er
igh
tto
i
nc
l
u
d
e
i
ts Common S
h
ares o
f
DSW
i
nanun
li
m
i
te
d
num
b
er o
f
ot
h
er
r
egistrations of such shares initiated by us or on behalf of our other shareholders.
A
men
d
e
d
an
d
Restate
d
S
h
are
d
Services Agreement
.
Eff
ect
i
ve Marc
h
17, 2008, we entere
di
nto an Amen
d
e
d
and Restated Shared Services Agreement with RVI and Filene’s Basement. Pursuant to the terms of the Amende
d
and Restated Shared Services Agreement, DSW provides RVI and Filene’s Basement with key services relating t
o
ri
s
k
mana
g
ement, tax,
fi
nanc
i
a
l
serv
i
ces,
b
ene
fi
ts a
d
m
i
n
i
strat
i
on, pa
y
ro
ll
,an
di
n
f
ormat
i
on tec
h
no
l
o
gy
.T
h
e current
term of the Amended and Restated Shared Services A
g
reement will expire at the end of fiscal 2009 and will b
e
e
xtended automatically for additional one-year terms unless terminated by one of the parties. With respect to eac
h
sh
are
d
serv
i
ce, we cannot reasona
bl
y ant
i
c
i
pate w
h
et
h
er t
h
e serv
i
ces w
ill b
es
h
are
df
or a per
i
o
d
s
h
orter or
l
onge
r
than the initial term
.
T
h
e costs assoc
i
ate
d
w
i
t
h
many o
f
t
h
ese s
h
are
d
serv
i
ces are a
ll
ocate
d
among t
h
e part
i
es
b
ase
d
upon usage. In
Januar
y
2008, RVI announced the disposition of an 81% ownership interest in Value Cit
y
. As a part of this
transaction, RVI a
g
reed to provide certain transition services to Value Cit
y
. On October 26, 2008, Value Cit
y
file
d
f
or
b
an
k
ruptcy protect
i
on an
d
announce
d
t
h
at
i
t wou
ld
c
l
ose
i
ts rema
i
n
i
ng stores. We negot
i
ate
d
an agreement w
i
t
h
V
alue Cit
y
to continue to provide services post bankruptc
y
filin
g
until the liquidation is complete, includin
g
ris
k
m
ana
g
ement, financial services, benefits administration, pa
y
roll and information technolo
gy
services, in exchan
ge
f
or a wee
kl
y payment
.
Tax Separation
Ag
reement. Until the completion of our initial public offerin
g
in Jul
y
200
5
, we wer
e
hi
stor
i
ca
ll
y
i
nc
l
u
d
e
di
n Reta
il
Ventures’ conso
lid
ate
d
group, or t
h
e Conso
lid
ate
d
Group,
f
or U.S.
f
e
d
era
li
ncome tax
p
urposes as we
ll
as
i
n certa
i
n conso
lid
ate
d
, com
bi
ne
d
or un
i
tar
yg
roups w
hi
c
hi
nc
l
u
d
e Reta
il
Ventures an
d
/o
r
c
ertain of its subsidiaries, or a Combined Grou
p
, for state and local income tax
p
ur
p
oses. We entered into a tax
s
eparation agreement with Retail Ventures that became effective upon consummation of our initial public offering
an
d
amen
d
e
d
t
hi
sa
g
reement e
ff
ect
i
ve Marc
h
17, 2008. Pursuant to t
h
e tax separat
i
on a
g
reement, we an
d
Reta
il
V
entures
g
enera
lly
ma
k
epa
y
ments to eac
h
ot
h
er suc
h
t
h
at, w
i
t
h
respect to tax returns
f
or an
y
taxa
bl
e per
i
o
din
which we or any of our subsidiaries are included in the Consolidated Group or any Combined Group, the amount of
taxes to
b
epa
id b
yusw
ill b
e
d
eterm
i
ne
d
,su
bj
ect to certa
i
na
dj
ustments, as
if
we an
d
eac
h
o
f
our su
b
s
idi
ar
i
e
s
i
nc
l
u
d
e
di
nt
h
e Conso
lid
ate
d
Group or Com
bi
ne
d
Group
fil
e
d
our own conso
lid
ate
d
, com
bi
ne
d
or un
i
tar
y
tax return
.
D
SW will prepare pro forma tax returns for RVI with respect to an
y
tax return filed with respect to the Consolidate
d
G
roup or any Com
bi
ne
d
Group
i
nor
d
er to
d
eterm
i
ne t
h
e amount o
f
tax separat
i
on payments un
d
er t
h
e tax
s
eparat
i
on agreement. RVI
h
as t
h
er
i
g
h
ttorev
i
ew an
d
comment on suc
h
pro
f
orma tax returns. We are respons
ible
for an
y
taxes with respect to tax returns that include onl
y
us and our subsidiaries.
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