Restoration Hardware 2015 Annual Report Download - page 51

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48
For fiscal 2015, net cash used in investing activities was $227.4 million and consisted of investments of $133.5 million related
to new galleries, supply chain, renovations to our corporate headquarters, information technology and systems infrastructure. During
fiscal 2015, we made payments of $20.0 million to escrow accounts for future construction of next generation Design Galleries. In
addition, we made investments in available-for-sale securities of $217.4 million, partially offset by maturities of such investments of
$143.8 million.
For fiscal 2014, net cash used in investing activities was $200.5 million and consisted of investments of $110.4 million related
to new galleries, supply chain, information technology and systems infrastructure. During fiscal 2014, we made payments of $9.3
million to escrow accounts for future construction of certain next generation Design Galleries. In addition, we made investments in
available-for-sale securities of $91.6 million, partially offset by maturities of such investments of $11.1 million.
For fiscal 2013, net cash used in investing activities was $93.9 million and consisted of investments in new galleries, investment
in supply chain and systems infrastructure, renovations to our corporate headquarters and investment in information technology.
Net Cash Provided By Financing Activities
Financing activities consist primarily of borrowings related to the convertible senior notes offering, borrowings and repayments
related to the revolving line of credit and capital contributions.
For fiscal 2015, net cash provided by financing activities was $286.8 million primarily due to the $300 million convertible
senior notes issued in June 2015, which provided net proceeds of $256.0 million after taking into consideration the convertible note
hedge and warrant transactions, as well as discounts upon original issuance and offering costs. Net proceeds and excess tax benefits
from the exercise of stock options provided $25.6 million and $10.4 million, respectively. The cash provided by these financing
activities was partially offset by cash paid for employee taxes related to net settlement of equity awards of $5.0 million.
For fiscal 2014, net cash provided by financing activities was $253.8 million primarily due to the $350 million convertible
senior notes issued in June 2014, which provided net proceeds of $311.7 million after taking into consideration the convertible note
hedge and warrant transactions, as well as the debt issuance costs. Net proceeds and excess tax benefits from the exercise of stock
options each provided $16.4 million and borrowings under build-to-suit lease transactions provided $1.8 million. The cash provided
by these financing activities was partially offset by net repayments on the revolving line of credit of $85.4 million.
For fiscal 2013, net cash provided by financing activities was $11.5 million primarily due to net proceeds and excess tax
benefits from the exercise of stock options of $7.6 million and $3.7 million, respectively, and net borrowings under the revolving line
of credit of $2.9 million.
Non-Cash Transactions
Non-cash transactions consists of non-cash additions of property and equipment and the issuance of notes payable related to
share repurchases from former employees.
Build-to-Suit Lease Transactions
The non-cash additions of property and equipment due to build-to-suit lease transactions are the result of the accounting
requirements of Accounting Standards Codification (“ASC”) 840—Leases (“ASC 840”) for those construction projects for which we
are the “deemed owner” of the construction project given the extent to which we are involved in constructing the leased asset. If we
are the “deemed owner” for accounting purposes, upon commencement of the construction project, we are required to capitalize
contributions by the landlord toward construction as property and equipment on our consolidated balance sheets. The contributions by
the landlord toward construction, including the building, existing site improvements at construction commencement and any amounts
paid by the landlord to those responsible for construction, are included as property and equipment additions due to build-to-suit lease
transactions within the non-cash section of our consolidated statements of cash flows.
However, over the lease term, these non-cash additions to property and equipment due to build-to-suit lease transactions do not
impact our cash outflows, nor do they impact net income within our consolidated statements of income.