DSW 2008 Annual Report Download - page 65

8. LONG-TERM OBLIGATION
S
Lon
g
-term o
blig
at
i
ons cons
i
st o
f
t
h
e
f
o
ll
ow
i
n
g:
Januar
y
31,
2009
F
ebruar
y
2
,
2008
(In thousands
)
Letters of credit outstandin
g
...................................
$
17,709 $15,71
1
D
SW $150 Million Credit Facilit
y
— The Company has a $150 million secured revolving credit facility with
a
t
erm of five
y
ears that will expire on Jul
y
5, 2010. Under this facilit
y
, the Compan
y
and its subsidiaries are named a
s
c
o-
b
orrowers. T
h
e
f
ac
ili
t
yh
as
b
orrow
i
n
gb
ase restr
i
ct
i
ons an
d
prov
id
es
f
or
b
orrow
i
n
g
satvar
i
a
bl
e
i
nterest rates
b
ased on LIBOR, the prime rate and the Federal Funds effective rate, plus a mar
g
in. The Compan
y
’s obli
g
ation
s
un
d
er t
hi
s
f
ac
ili
ty are secure
db
ya
li
en on su
b
stant
i
a
ll
ya
ll
o
fi
ts an
di
ts su
b
s
idi
ary’s persona
l
property an
d
ap
l
e
d
ge
o
fi
ts s
h
ares o
f
DSW S
h
oe Ware
h
ouse, Inc. (“DSWSW”). In a
ddi
t
i
on, t
h
e secure
d
revo
l
v
i
ng cre
di
t
f
ac
ili
ty conta
i
ns
usual and customar
y
restrictive covenants relatin
g
to the mana
g
ement and the operation of the business. Thes
e
c
ovenants, among ot
h
er t
hi
ngs, restr
i
ct t
h
e Company’s a
bili
ty to grant
li
ens on
i
ts assets,
i
ncur a
ddi
t
i
ona
l
i
n
d
e
b
te
d
ness, open or c
l
ose stores, pay cas
hdi
v
id
en
d
san
d
re
d
eem
i
ts stoc
k
, enter
i
nto transact
i
ons w
i
t
h
a
ffili
ate
s
and mer
g
e or consolidate with another entit
y
. In addition, if at an
y
time the Compan
y
utilizes over 90% of it
s
b
orrow
i
ng capac
i
ty un
d
er t
h
e
f
ac
ili
ty, t
h
e Company must comp
l
yw
i
t
h
a
fi
xe
d
c
h
arge coverage rat
i
o test set
f
ort
hi
n
th
e
f
ac
ili
t
yd
ocuments. At Januar
y
31, 2009 an
d
Fe
b
ruar
y
2, 2008, t
h
e Compan
yh
a
d
no outstan
di
n
gb
orrow
i
n
g
san
d
had availabilit
y
under the facilit
y
of $132.3 million and $134.3 million, respectivel
y.
T
otal interest expense was $0.8 million, $1.2 million and $0.6 million for fiscal
y
ears 2008, 2007 and 2006,
r
espectively, and included fees, such as commitment and line of credit fees, of
$
0.5 million,
$
0.4 million an
d
$0.5 million, respectivel
y.
9. EARNIN
GS
PER
S
HARE
B
asic earnings per share are based on net income and a simple weighted average of Class A and Class
B
c
ommon shares and directors stock units outstanding. Diluted earnings per share are calculated using the treasur
y
s
toc
k
met
h
o
d
an
d
re
fl
ect t
h
e potent
i
a
l dil
ut
i
on o
f
C
l
ass A common s
h
ares re
l
ate
d
to outstan
di
n
g
stoc
k
opt
i
ons an
d
r
estricted stock units. The numerator for the diluted earnin
g
s per share calculation is net income. The denominator
i
s the weighted average diluted shares outstanding.
Januar
y31
,
2009
F
ebruar
y2,
2008
F
ebruar
y3
,
200
7
F
i
scal Years Ended
(
In thousands
)
Weighted average shares outstanding
.
.................. 43
,
998 43
,
9
5
343
,
91
4
Assumed exercise of dilutive stock o
p
tions
.
............. 170 170
Rest
ri
cted stoc
k
u
ni
ts
.
............................. 220 1
5
0 138
Num
b
er o
f
s
h
ares
f
or computat
i
on o
f dil
ut
i
ve earn
i
n
g
spe
r
s
h
ar
e
........................................
44
,
218 44
,
2
7
344
,
222
O
ptions to purchase 2.1 million and 0.8 million common shares were outstandin
g
at Januar
y
31, 2009 and
F
ebruary 2, 2008, respectively, but were not included in the computation of diluted earnings per share because th
e
opt
i
ons’ exerc
i
se pr
i
ces were
g
reater t
h
an t
h
e avera
g
e mar
k
et pr
i
ce o
f
t
h
e common s
h
ares
f
or t
h
e per
i
o
d
an
d
,
th
ere
f
ore, t
h
ee
ff
ect wou
ld b
e ant
i
-
dil
ut
i
ve. For t
h
e
fi
sca
ly
ear en
d
e
d
Fe
b
ruar
y
3, 2007, a
ll
potent
i
a
lly i
ssua
bl
es
h
ares
from the exercise of stock o
p
tions and restricted stock units were dilutive
.
F-
19
D
S
W INC
.
N
OTES TO CONSOLIDATED FINANCIAL STATEMENTS —
(
Continued
)