As part of this plan, the company eliminated approximately 1,700 staff positions in its stores and its headquarters. In addition, these plans include the cost of consolidating five of the company's store support center facilities into its new headquarters in Wayne, New Jersey in 2003.

The costs associated with the facilities consolidation, elimination of positions, and other actions designed to improve efficiency in support functions were $79, of which $15 related to severance. The costs associated with store closings were $73 for Kids"R"Us and $85 for Toys"R"Us, of which $27 was recorded in cost of sales. The fair value of the facilities to be consolidated and store closings were obtained from third party appraisals. The company also reversed $24 of previously accrued charges ($11 from the 1998 charge and $13 from the 1995 charge) that the company determined to be no longer needed. Accordingly, based on these actions, the company recorded $213 million of pre-tax ($126 after-tax) restructuring and other charges in the fourth quarter of its fiscal year ending February 2, 2002. Details on the components of the charges are as follows:

In 2000, Toysrus.com, the company's internet subsidiary, recorded $118 in non-recurring charges as a result of the transition to its co-branded on-line store with Amazon.com, of which $10 were included in cost of sales and $108 were included in selling, general and administrative expenses. These costs and charges related primarily to the closure of three distribution centers, as well as web-site asset write-offs and other costs. The company had remaining lease commitment reserves of $3 at February 1, 2003, that will be utilized in 2003 and thereafter.

The company previously announced strategic initiatives to reposition its worldwide business and recorded related restructuring and other charges of $698 in 1998 and $396 in 1995 to complete these initiatives. As of February 1, 2003, the company had substantially

completed all announced initiatives. The company reversed unused reserves of $10 in the fourth quarter of 2002, and also reversed unused reserves of $29 in 2001, $24 of which were reversed in the fourth quarter of 2001 and are discussed above, and $11 in 2000, as these reserves were concluded to be no longer necessary. The company had $42 of reserves remaining at February 1, 2003, primarily for long-term lease commitments that will be utilized in 2003 and thereafter. The company believes that remaining reserves at February 1, 2003 are reasonable estimates of what is required to complete all remaining initiatives.

The company recorded a pre-tax non-operating gain of $315 ($200 net of taxes) in the first quarter of fiscal 2000 resulting from the initial public offering of shares of Toys - Japan. Of this gain, $91 resulted from an adjustment to the basis of the company's investment in Toys - Japan and $224 was related to the sale of a portion of the company-owned common stock of Toys - Japan, for which the company received net cash proceeds of $267. In connection with this transaction, the company recorded a provision for current income taxes of $82 and a provision for deferred income taxes of $33, respectively. As a result of this transaction, the company's ownership percentage in the common stock of Toys - Japan was reduced from 80% to 48%. Toys - Japan is a licensee of the company.

On March 24, 2003, the company filed a "shelf" registration statement with the Securities and Exchange Commission, giving the company the capability to sell up to $800 of debt securities that would be used to repay outstanding debt and for general corporate purposes. In April 2003, the company sold and issued $400 million in notes bearing interest at a coupon rate of 7.875%, maturing on April 15, 2013. The notes were sold at a price of 98.305%, resulting in an effective yield of 8.125%. Simultaneously with the sale of the notes, we entered into interest rate swap agreements. As a result of these swap agreements, interest will accrue at the rate of LIBOR plus 3.622%. Interest is payable semi-annually commencing on October 15, 2003. The company plans to use the proceeds from these notes for the repayment of indebtedness maturing in the 2004 calendar year, and pending such repayment, for working capital needs and other general corporate purposes.

On March 5, 2003 the company announced that it would be eliminating approximately 200 positions in its store support facilities in 2003, representing approximately 10% of total headquarters staff.

In August 2000, eleven purported class action lawsuits were filed (six in the United States District Court for the District of New Jersey, three in the United States District Court for the Northern District of California, one in the United States District Court for the Western District of Texas and one in the Superior Court of the State of California, County of San Bernardino), against the company and our affiliates Toysrus.com, Inc. and Toysrus.com, LLC. In September 2000, three additional purported class action lawsuits were filed (two in the United