Petsmart 2008 Annual Report Download - page 26

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We lease substantially all of our stores, distribution centers, and corporate offices under non-cancelable leases.
The terms of the store leases generally range from 10 to 15 years and typically allow us to renew for two to three
additional five-year terms. Store leases, excluding renewal options, expire at various dates through 2025. Certain
leases require payment of property taxes, utilities, common area maintenance, and insurance and, if annual sales at
certain stores exceed specified amounts, provide for additional rent. We have paid minimal additional rent under
these provisions during 2008, 2007 and 2006.
Our corporate offices currently contain approximately 250,000 square feet. In July 2006, we entered into
15 year lease agreements to expand our corporate offices and renovate the existing offices. The project is expected
to be completed in April 2009 and add approximately 115,000 square feet.
Our distribution centers and respective lease expirations as of February 1, 2009, were as follows:
Location
Square
Footage Date Opened Distribution Type Lease Expiration
(In thousands)
Ennis, Texas . . ......... 230 May1996 Combination distribution center 2012
Phoenix, Arizona ....... 620 November 1999 Forward distribution center 2021
Columbus, Ohio ........ 613 September 2000 Combination distribution center 2010
Gahanna, Ohio ......... 276 October 2000 Forward distribution center 2010
Hagerstown, Maryland . . . 252 October 2000 Forward distribution center 2010
Ottawa, Illinois ......... 1,000 August 2005 Combination distribution center 2015
Newnan, Georgia ....... 878 July 2007 Combination distribution center 2022
Reno, Nevada . ......... 873 April 2008 Combination distribution center 2023
Total ................ 4,742
We opened our 878,000 square foot combination distribution center in Newnan, Georgia in July 2007,
replacing the 200,000 square foot forward distribution center previously leased in Newnan, Georgia. In April 2008,
we replaced a 199,000 square foot forward distribution center in Reno, Nevada with an 873,000 square foot
combination distribution center in Reno, Nevada.
In February 2007, we decided to exit the State Line Tack equine product line and closed our e-commerce
fulfillment, equine catalog fulfillment and equine distribution center in Brockport, New York during 2007. See
Note 18 in the Notes to Consolidated Financial Statements for additional information.
Item 3. Legal Proceedings
In October 2006, two lawsuits were filed against us in California State Court on behalf of putative classes of
current and former California employees. The first suit, Sorenson v. PetSmart, was filed on October 3, 2006. The
plaintiff, a former dog groomer, alleges that she and other non-exempt employees failed to receive their meal and
rest breaks as required by law. The second suit, Enabnit v. PetSmart, was filed on October 12, 2006, and alleges meal
and rest period violations and that employee paychecks were not compliant with the California Labor Code. The
plaintiff seeks compensatory damages, penalties under the California Labor Code, restitution, attorney’s fees, costs
and prejudgment interest. In November 2006, we removed both actions to the United States District Court for the
Eastern District of California. The parties have reached an agreement in principle to settle both of these matters for
an amount that will not be material to our consolidated financial statements and has been accrued. The Sorenson
settlement was preliminarily approved by the court on August 5, 2008, while the Enabnit settlement was
preliminarily approved on December 8, 2008.
On January 12, 2009, a former groomer filed a lawsuit on behalf of herself and a putative class of current and
former groomers in California State Court entitled Langton v. PetSmart. The plaintiff alleges that she and other non-
exempt groomers did not receive payment for all hours worked, did not receive meal and rest breaks, did not receive
all wages due upon termination, did not receive accurate wage statements as required by law, and were not provided
with necessary tools and equipment. The plaintiff seeks compensatory damages, penalties under the California
20