Rue 21 2010 Annual Report Download - page 62

Note 3 — Property and Equipment
Property and equipment consisted of the following:
January 29,
2011
January 30,
2010
Furniture and fixtures ........................................ $ 73,635 $ 58,518
Leasehold improvements ...................................... 75,445 54,715
Computer equipment, software and other .......................... 18,044 15,937
167,124 129,170
Less accumulated depreciation and amortization .................... (75,753) (56,023)
$ 91,371 $ 73,147
Depreciation and amortization expense was $21,852, $16,898, and $11,532 for the fiscal years ended
January 29, 2011, January 30, 2010 and January 31, 2009, respectively.
Note 4 — Long-Term Debt
Effective April 10, 2008, the Company established a five-year $60,000 senior secured revolving credit facility
(the Senior Secured Credit Facility) with Bank of America N.A. The ceiling is expandable at the Company’s option
in increments of $5,000 up to a limit of $85,000 under certain defined conditions. The Senior Secured Credit
Facility initial borrowing was $27,217. Proceeds from the initial borrowing were used for the extinguishment of all
of the Company’s existing long-term debt facilities and the Bank of America N.A. commitment fee. Availability
under the Senior Secured Credit Facility is collateralized by a first priority interest in all the Company’s assets. On
November 24, 2009, the Company amended its Senior Secured Credit Facility with Bank of America, N.A. An
amendment fee of $125 was paid on the effective date of the amendment. Key provisions of the amendment include
an increase in the borrowing ceiling to $85,000 from $60,000, which is further expandable at the Company’s option
in increments of $5,000 up to a limit of $100,000 under certain defined conditions. Interest accrues at the higher of
the Federal Funds rate plus 0.50%, the prime rate or the adjusted LIBOR rate plus the applicable margin which
ranges from 1.25% to 3.00% set quarterly dependent upon average net availability on the facility during the
previous quarter. The weighted-average interest rate under the Senior Secured Credit Facility was 0.00% and 2.75%
for the fiscal years ended January 29, 2011 and January 30, 2010, respectively. The Senior Secured Credit Facility
includes a fixed charge covenant applicable only if net availability falls below thresholds of 10%. The Company is
in compliance with all covenants under the Senior Secured Credit Facility at January 29, 2011. The Senior Secured
Credit Facility matures in April 2013. As of January 29, 2011 and January 30, 2010, $0 was outstanding under the
Senior Secured Credit Facility.
Note 5 — Stock-Based Compensation
In November 2009, the Company adopted the 2009 Omnibus Incentive Plan (the 2009 Plan) in connection with
the Company’s initial public offering, pursuant to which key employees, officers, and directors shall be eligible to
receive grants of stock options, stock appreciation rights, restricted stock or restricted stock units to purchase or
receive, as applicable, up to an aggregate of 3,626,000 shares of common stock based on eligibility, vesting, and
performance standards established by the board of directors. Stock options granted are generally exercisable ratably
over 3 or 4 years, subject to certain employment terms and conditions. The stock options generally expire ten years
from the date of issuance. To date, 478,878 stock options have been granted, 24,598 restricted stock units have been
granted and no stock appreciation rights or restricted stock have been issued under the 2009 Plan.
Effective May 15, 2003, the Company adopted the 2003 Ownership Incentive Plan (the 2003 Plan) pursuant to
which key employees, officers, and directors were eligible to receive options to purchase common stock for an
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rue21, inc. and subsidiary
Notes to Consolidated Financial Statements — (continued)