Staples 2002 Annual Report Download - page 87

STAPLES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE J Employee Benefit Plans (Continued)
Plan is available to all United States based employees of Staples who meet minimum age and length of service
requirements. Company contributions are based upon a matching formula applied to employee contributions with
additional contributions made at the discretion of the Board. The SERP Plan, which is similar in many respects to the
401(k) Plan, is available to certain Company executives, whose contributions to the 401(k) Plan are limited, and allows
such executives to supplement their contributions to the 401(k) Plan by making pre-tax contributions to the SERP Plan.
In connection with these plans, Staples included approximately $6.1 million, $6.0 million and $5.0 million in expense for
fiscal years ended February 1, 2003, February 2, 2002 and February 3, 2001, respectively.
NOTE K Stockholders’ Equity
From November 1999 through August 27, 2001, the Company’s Certificate of Incorporation included two series of
common stock, one designated as Staples.com common stock (‘‘Staples.com Stock’’) and intended to track the
performance of Staples.com, the Company’s e-commerce business, and the other designated as Staples Retail and
Delivery common stock (‘‘Staples RD Stock’’) and intended to track the performance of Staples Retail and Delivery
(‘‘Staples RD’’), which consisted of all of the Company’s non internet businesses and a retained interest in Staples.com.
On August 27, 2001, the Company’s stockholders approved a proposal to amend the Company’s Certificate of
Incorporation to effect a recapitalization by reclassifying each share of Staples.com Stock into 0.4396 shares of Staples
common stock (‘‘Staples, Inc. Stock’’) and by reclassifying each share of Staples RD Stock into one share of Staples, Inc.
Stock (the ‘‘Recapitalization’’).
On March 7, 2000, the Board approved a recapitalization effected through a one-for-two reverse stock split of
Staples.com Stock, effective on April 5, 2000. The financial statements for fiscal years 2000 and 1999 have been
retroactively restated to give the effect of the reverse stock split.
Staples repurchased approximately $17.7 million of Staples, Inc. Stock during fiscal year 2001. Staples repurchased
approximately $182.7 million of Staples, Inc. Stock during fiscal year 2000, including the purchase of 2.6 million shares
for approximately $78.7 million to settle an equity forward purchase agreement entered into on July 2, 1999 to hedge
against price fluctuations for the repurchase of Staples, Inc. Stock.
At February 1, 2003, 71.1 million shares of common stock were reserved for issuance under Staples’ stock option,
401(k), employee stock purchase and director stock option plans.
NOTE L Computation of Earnings per Common Share
Subsequent to the Recapitalization and prior to November 1999, the Company calculates earnings per share for a
single class of stock, Staples, Inc. Stock. Accordingly, earnings per share has been presented for Staples, Inc. Stock for
the fiscal year ended February 1, 2003 and the six months ended February 2, 2002. Prior to the Recapitalization and
subsequent to October 1999, the Company had calculated earnings per share under the two class method for Staples RD
Stock and Staples.com Stock. Therefore, earnings per share has been presented for Staples RD Stock and Staples.com
C-24