Related Party Transactions

9 Months Ended

Oct. 29, 2011

Related Party Transactions [Abstract]

Related Party Transactions

4. Related Party Transactions

Charles C. Anderson, Chairman Emeritus and a former director of the Company, Terry C. Anderson, a director of the Company, and Clyde B. Anderson, a director and officer of the Company, have controlling ownership interests in other entities with which the Company conducts business. Significant transactions between the Company and these various other entities (“related parties”) are summarized in the following paragraphs.

The Company purchases a substantial portion of its magazines, as well as certain of its seasonal music, from a subsidiary of Anderson Media Corporation (“Anderson Media”), an affiliate of the Company through common ownership. During the thirty-nine weeks ended October 29, 2011 and October 30, 2010, purchases of these items from Anderson Media totaled $14.4 million and $15.9 million, respectively. Amounts payable to Anderson Media at October 29, 2011 and January 29, 2011 were $3.7 million and $5.7 million, respectively. Amounts receivable from Anderson Media as of October 29, 2011 and January 29, 2011 were $0.1 million and $0.3 million, respectively. The Company purchases certain of its collectibles, gifts and books from Anderson Press, Inc. (“Anderson Press”), an affiliate of the Company through common ownership. During each of the thirty-nine weeks ended October 29, 2011 and October 30, 2010, such purchases from Anderson Press totaled $0.5 and $1.5 million, respectively. The Company utilizes import sourcing and consolidation services from Anco Far East Importers, LTD (“Anco Far East”), an affiliate of the Company through common ownership. The total amount paid to Anco Far East was $1.2 million and $2.7 million during the thirty-nine weeks ended October 29, 2011 and October 30, 2010, respectively. These amounts paid to Anco Far East included the actual cost of the product, as well as fees for sourcing and consolidation services. All costs other than the sourcing and consolidation service fees were passed through from other vendors. Anco Far East fees, net of the passed-through costs, were $0.1 million and $0.2 million during the thirty-nine weeks ended October 29, 2011 and October 30, 2010, respectively.

The Company leases its principal executive offices from a trust, which was established for the benefit of the grandchildren of Charles C. Anderson. The Company’s lease on the building expires in February 2013. During each of the thirty-nine week periods ended October 29, 2011 and October 30, 2010, the Company paid rent of $0.1 million to the trust under this lease. Anderson & Anderson LLC (“A&A”), an affiliate of the Company through common ownership, also leases two buildings to the Company. During each of the thirty-nine week periods ended October 29, 2011 and October 30, 2010, the Company paid A&A a total of $0.3 million in connection with such leases. Total minimum future rental payments under all of these leases are $1.8 million at October 29, 2011.

The Company subleases certain property to Hibbett Sports, Inc. (“Hibbett”), a sporting goods retailer in the United States. The Company’s sublease on the property with Hibbett expires in October 2016. One of the Company’s directors, Albert C. Johnson, and Terry Finley, President and Chief Operating Officer of Books-A-Million, Inc., are members of Hibbett’s Board of Directors. During each of the thirty-nine week periods ended October 29, 2011 and October 30, 2010, the Company received $0.1 million in rent payments from Hibbett. Total minimum future rental payments under this lease are $0.6 million at October 29, 2011.

The Company, A&A, Anderson Promotional Events, Inc. and Anderson Press (collectively the “Co-ownership Group”) co-own two airplanes that are used by the Company in its business. The Company owns a 26.0% interest in each of these airplanes. During the thirty-nine week periods ended October 29, 2011 and October 30, 2010, the Company was billed $0.6 million and $0.5 million, respectively, by the Co-Ownership Group under a cost sharing arrangement for the Company’s use of the two airplanes. The expenses the Company pays for airplane use cover all of the variable costs attributable to the Company’s use of the planes and a portion of the fixed costs.

The Company and Anderson Private Capital Partners I, L.P. (“APCP”) each have an equity interest in Yogurt Mountain Holding, LLC (“Yogurt Mountain”). The Company also participates with APCP in a line of credit agreement with Yogurt Mountain in connection with its investment. See Note 13, Equity Method Investment, for additional information regarding the Company’s investment in Yogurt Mountain. As of October 29, 2011 and January 29, 2011, Yogurt Mountain had $1.0 million and $0.8 million, respectively, in borrowings outstanding and due to the Company. For the thirty-nine week period ended October 29, 2011, the Company paid $0.6 million in franchise fees, royalty fees and other costs associated with our franchise of seventeen Yogurt Mountain stores within our stores. For the thirty-nine week period ended October 29, 2011, the Company received $0.3 million from Yogurt Mountain for interest, monitoring fees, professional fees and rent.