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Subsequent Events
12 Months Ended
Feb. 02, 2013
Subsequent Events
NOTE 15. Subsequent Events
 
On March 6, 2013, we entered into an Agreement and Plan of Merger, or the Merger Agreement, providing for the acquisition of the company by an affiliate of Sycamore Partners Management, L.L.C., or Sycamore. Under the terms of the Merger Agreement, which was unanimously approved by the our Board of Directors, Sycamore will acquire all of the outstanding shares of our common stock for $14.00 per share in cash. The transaction, which is structured as a one-step merger with the company as the surviving corporation, or the Merger, is subject to customary closing conditions, including receipt of regulatory approvals and the approval of the holders of a majority of our outstanding shares. If the Merger is approved and is consummated, we will no longer be a publicly-traded company, and our shares will cease to be traded on Nasdaq. We will account for the merger by applying the acquistion method as described in ASC 805, Business Combinations.
 
Prior to and effective as of the effective time of the proposed Merger, referred to as the Effective Time, we will take all necessary action to accelerate the vesting of each outstanding option under our 1996 Plan, 1996 NEDSOP, 2006 Plan and 2012 Plan,  collectively referred to as the Stock Plans. At the Effective Time, each outstanding option under a Stock Plan will vest and be cancelled and converted into the right to receive the excess, if any, of the per share Merger consideration over the exercise price of the option, multiplied by the number of shares subject to such option, less all applicable tax withholdings. Prior to the Effective Time, we will take all necessary action to accelerate the vesting of each share of restricted stock granted and outstanding under the Stock Plans, and each such share of restricted stock will be treated as a share of common stock for purposes of the Merger Agreement. We will terminate our Employee Stock Purchase Plan prior to the Effective Time and will not permit any new offering period to begin prior to the Effective Time.
 
In March 2013, we were named as a defendant in class action lawsuits challenging the plan of merger with Sycamore described above.  These lawsuits allege general various wrongdoings such as breach of our fiduciary duty to our shareholders. We may be named as a defendant in other similar lawsuits in the future. While we believe that all of the allegations are without merit and that we have valid defenses to all potential claims, our litigation exposure could have a material adverse effect on our financial condition and results of operations in the event the claims are not settled in our favor.