Gap (GPS)

In fiscal 2006, the Board of Directors authorized share repurchases of $1.3 billion, which were fully utilized in fiscal 2006
and 2007. In August 2007, the Board of Directors authorized $1.5 billion for share repurchases which was fully utilized in fiscal 2007. In February 2008, the Board of Directors authorized $1 billion for additional share repurchases, of which $745
million was utilized through January 31, 2009. In connection with the fiscal 2007 and 2008 authorizations, we also entered into purchase agreements with individual members of the Fisher family. The Fisher family shares are purchased (related
party transactions) at the same weighted average market price that we pay for share repurchases in the open market. The purchase agreements may be terminated upon 15 business days notice by the Company or individual Fisher family members. During
fiscal 2008 and 2007, approximately 7 million and 13 million shares, respectively, were repurchased for $117 million and $249 million, respectively, from the Fisher family subject to these agreements. In total, we expect that approximately
$158 million, or 16%, of the $1 billion share repurchase authorization will be purchased from the Fisher family under these agreements.

All except $40 million of
total share repurchases were paid for as of January 31, 2009. Of the $40 million accrual, $21 million was payable to Fisher family members as of January 31, 2009.

FACE="Times New Roman" SIZE="3">Note 10. Share-Based Compensation

Total share-based compensation expense recognized in the Consolidated Statements of
Earnings, primarily in operating expenses, is as follows:

No share-based compensation expense was capitalized in fiscal 2008, 2007, and 2006.