Restoration Hardware 2012 Annual Report Download - page 121

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(a) Includes fees and expenses paid in accordance with our management services agreement with Home Holdings,
as well as fees and expense reimbursements paid to our board of directors prior to the initial public offering.
(b) The fourth quarter of fiscal 2012 includes a $92.0 million non-cash compensation charge related to
equity grants at the time of the Reorganization, as well as a non-cash compensation charge of $23.1
million related to the performance-based vesting of certain shares granted to Mr. Alberini and
Mr. Friedman. The third quarter of fiscal 2011 includes a $6.4 million compensation charge related to
the repayment of loans owed to Home Holdings by Gary Friedman, through the reclassification by
Home Holdings of Mr. Friedman’s Class A and Class A-1 ownership units into an equal number of
Class A Prime and Class A-1 Prime ownership units. Mr. Friedman served as our Chairman and Co-
Chief Executive Officer at the time of such loan repayment. In addition, amounts include stock-based
compensation expense incurred prior to the initial public offering.
(c) Includes costs related to the restructuring of our Shanghai office location.
(d) Generally includes executive severance and other related costs.
(e) Includes lease termination costs for retail stores that were closed prior to their respective lease
termination dates. The lease termination amounts in the third quarter of fiscal 2011 and the first and
second quarters of fiscal 2012 include changes in estimates regarding liabilities for future lease
payments for closed stores.
(f) Represents legal and other professional fees incurred in connection with the investigation conducted by
the special committee of the board of directors relating to our former Chairman and Co-Chief
Executive Officer, Gary Friedman, and our subsequent remedial actions.
(g) Represents costs incurred in connection with our initial public offering, including a fee of $7.0 million to
Catterton, Tower Three and Glenhill in accordance with our management services agreement, payments
of $2.2 million to certain former executives and bonus payments to employees of $1.3 million.
(h) Represents expense incurred as a result of increased tariff obligations of one of our foreign suppliers
following the U.S. Department of Commerce’s review of the anti-dumping duty order on wooden
bedroom furniture from China for the period from January 1, 2011 through December 31, 2011.
(i) Represents items which management believes are not indicative of our ongoing operating performance.
The second quarter of fiscal 2011 adjustments include consulting fees related to organizational matters.
The fourth quarter of fiscal 2010 and the first quarter of fiscal 2011 include state franchise tax amounts.
All periods include foreign exchange gains and losses.
65
Form 10-K