INCOME TAXES

12 Months Ended

Mar. 02, 2013

Income Tax Disclosure [Abstract]

INCOME TAXES

NOTE 4 - INCOME TAXES

The provision (benefit) for income taxes was as follows:

	Thirty-Five		Fiscal Year
	Weeks Ended		Ended
	October 29, 2011		February 26, 2011
	(in thousands)
Current:
Federal	$	-	$	3,368
State		138		62
	$	138	$	3,430
Deferred:
Federal	$	30,318	$	(20,107	)
State		15,948		(2,212	)
	$	46,266	$	(22,319	)
Provision (benefit) for income taxes	$	46,404	$	(18,889	)

	Thirty-Five			Fiscal Year
	Weeks Ended			Ended
	October 29, 2011			February 26, 2011
Statutory Federal income tax rate		35.0	%		35.0	%
State taxes		-0.3	%		5.6	%
Change in valuation allowance		-191.2	%		-2.1	%
Effect on deferred taxes for change in state tax rate		0.0	%		0.6	%
Other		-0.2	%		-2.6	%
Effective income tax rate		-156.7	%		36.5	%

The composition of the Company’s deferred tax assets and liabilities is as follows:

	Fiscal Year Ended
	March 2, 2013			February 25, 2012
	(in thousands)
Deferred tax assets:
Pension costs	$	4,004		$	5,901
Reserves not currently deductible for tax purposes		69			1,954
Net operating loss carry forwards		70,746			51,173
Depreciation		13,124			12,197
Deferred rent		-			2,238
AMT credit		3,182			3,182
Accrued expenses		4,086			2,331
Other		81			83
Wind-down expenses		8,752			13,227
Air right		3,641			3,757
Lease claim		14,439			21,875
Store closing cost		2,650			2,733
Total deferred tax assets	$	124,774		$	120,651
Valuation Allowance		(83,676	)		(85,117	)
Deferred tax asset after valuation allowance	$	41,098		$	35,534
Deferred tax liabilities:
Intangibles	$	(356	)	$	(364	)
Write up of owned real estate		(40,742	)		(35,170	)
Total deferred tax liabilities	$	(41,098	)	$	(35,534	)
Net deferred tax assets	$	-		$	-
Current deferred tax assets	$	-		$	-
Long term deferred tax assets		-			-
Total deferred tax assets	$	-		$	-

At March 2, 2013, the Company had state net operating loss carry forwards of approximately $215.8 million. These net operating losses expire in years through fiscal 2031. The Company also had federal net operating loss carry forwards of approximately $173.6 million. These net operating losses will expire in years through fiscal 2031.

Since under liquidation basis accounting all future estimated taxes are accrued as of the reporting date net of the benefit expected to be derived from available NOLs, it is not appropriate to record a separate deferred tax asset on the same NOLs. Accordingly, a valuation allowance of approximately $85.1 million was recorded through February 25, 2012. The valuation allowance was reduced by approximately $1.4 million during the fiscal year ended March 2, 2013.