##### Table of Contents



SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10 - Q
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended May 2, 2009
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For
the transition period from ___ to ___.
 Commission file number 1-13740
 BORDERS GROUP, INC.
  MICHIGAN
    
    38-3294588(State or other jurisdiction of
    
    (I.R.S. Employerincorporation or organization)
    
    Identification No.)
 100 Phoenix Drive, Ann Arbor, Michigan 48108
 (734) 477-1100
 þ o
 o o
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 o þ




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##### 



BORDERS GROUP, INC.
 INDEX
 PagePart I  Financial InformationItem 1. Financial Statements
    
    
    1Item 2. Managements Discussion and Analysis of
Financial Condition and Results of
Operations
    
    
    12Item 3. Quantitative and Qualitative Disclosures about
Market Risk
    
    
    23Item 4. Controls and Procedures
    
    
    23Part II  Other informationItem 1. Legal Proceedings
    
    
    24Item 1A. Risk Factors
    
    
    24Item 2. Unregistered Sales of Equity Securities and Use of
Proceeds
    
    
    24Item 3. Defaults Upon Senior Securities
    
    
    N/AItem 4. Submission of Matters to a Vote of Security holders
    
    
    24Item 4T. Controls and Procedures
    
    
    N/AItem 5. Other Information
    
    
    N/AItem 6. Exhibits
    
    
    25Signatures
    
    
    26EX-10.66EX-31.1EX-31.2EX-32.1EX-32.2
  ii




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BORDERS GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(dollars in millions except per share data)
(UNAUDITED)
 13 Weeks EndedMay 2,
    
    May 3,2009
    
    2008Sales
    
    $
    641.5
    
    
    $
    729.5Other revenue
    
    
    8.7
    
    
    
    6.3Total revenue
    
    
    650.2
    
    
    
    735.8Cost of merchandise sold, including occupancy costs
    
    
    506.8
    
    
    
    567.6Gross margin
    
    
    143.4
    
    
    
    168.2Selling, general and administrative expenses
    
    
    172.4
    
    
    
    213.1Asset impairments and other writedowns
    
    
    0.1
    
    
    
    Operating loss
    
    
    (29.1
    )
    
    
    (44.9
    )Interest expense
    
    
    6.5
    
    
    
    9.5Warrant / put expense (income)
    
    
    49.1
    
    
    
    (3.6
    )Total interest expense
    
    
    55.6
    
    
    
    5.9Loss before income taxes
    
    
    (84.7
    )
    
    
    (50.8
    )Income taxes (benefit)
    
    
    1.3
    
    
    
    (20.7
    )Loss from continuing operations
    
    $
    (86.0
    )
    
    $
    (30.1
    )Loss from operations of discontinued operations (net of income
tax benefit of $- and $0.7)
    
    
    
    
    
    
    (1.2
    )Loss from disposal of discontinued operations (net of income
tax benefit of $- and $0.3)
    
    
    
    
    
    
    (0.4
    )Loss from discontinued operations (net of income tax benefit
of $- and $1.0)
    
    
    
    
    
    
    (1.6
    )Net loss
    
    $
    (86.0
    )
    
    $
    (31.7
    )Loss per common share dataDiluted:Loss from continuing operations per common share
    
    $
    (1.44
    )
    
    $
    (0.50
    )Loss from discontinued operations per common share
    
    $
    
    
    
    $
    (0.03
    )Net loss per common share
    
    $
    (1.44
    )
    
    $
    (0.53
    )Weighted average common shares outstanding (in millions)
    
    
    59.9
    
    
    
    59.4Basic:Loss from continuing operations per common share
    
    $
    (1.44
    )
    
    $
    (0.50
    )Loss from discontinued operations per common share
    
    $
    
    
    
    $
    (0.03
    )Net loss per common share
    
    $
    (1.44
    )
    
    $
    (0.53
    )Weighted average common shares outstanding (in millions)
    
    
    59.9
    
    
    
    59.4Dividends declared per common share
    
    $
    
    
    
    $
    
  1




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BORDERS GROUP, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(dollars in millions except per share data)
(UNAUDITED)
 May 2,
    
    May 3,
    
    January 31,2009
    
    2008
    
    2009AssetsCurrent assets:Cash and cash equivalents
    
    $
    45.7
    
    
    $
    35.0
    
    
    $
    53.6Merchandise inventories
    
    
    893.0
    
    
    
    1,147.9
    
    
    
    915.2Accounts receivable and other current assets
    
    
    74.3
    
    
    
    128.8
    
    
    
    102.4Taxes, including income taxes
    
    
    
    
    
    
    13.1
    
    
    
    Current assets of discontinued operations
    
    
    
    
    
    
    108.3
    
    
    
    Total current assets
    
    
    1,013.0
    
    
    
    1,433.1
    
    
    
    1,071.2Property and equipment, net of accumulated depreciation of
$1,128.6, $1,031.7 and $1,108.3 at May 2, 2009, May 3, 2008
and January 31, 2009, respectively
    
    
    469.0
    
    
    
    589.9
    
    
    
    494.2Other assets
    
    
    37.2
    
    
    
    67.6
    
    
    
    39.4Deferred income taxes
    
    
    3.5
    
    
    
    42.5
    
    
    
    4.0Goodwill
    
    
    0.2
    
    
    
    40.5
    
    
    
    0.2Noncurrent assets of discontinued operations
    
    
    
    
    
    
    54.0
    
    
    
    Total assets
    
    $
    1,522.9
    
    
    $
    2,227.6
    
    
    $
    1,609.0Liabilities and Stockholders EquityCurrent liabilities:Short-term borrowings and current portion of long-term debt
    
    $
    319.1
    
    
    $
    585.5
    
    
    $
    329.8Trade accounts payable
    
    
    372.9
    
    
    
    462.5
    
    
    
    350.0Accrued payroll and other liabilities
    
    
    236.1
    
    
    
    271.4
    
    
    
    279.8Taxes, including income taxes
    
    
    32.9
    
    
    
    
    
    
    
    30.1Deferred income taxes
    
    
    3.5
    
    
    
    12.6
    
    
    
    4.0Current liabilities of discontinued operations
    
    
    
    
    
    
    43.2
    
    
    
    Total current liabilities
    
    
    964.5
    
    
    
    1,375.2
    
    
    
    993.7Long-term debt
    
    
    6.8
    
    
    
    6.4
    
    
    
    6.4Other long-term liabilities
    
    
    374.0
    
    
    
    368.1
    
    
    
    345.8Noncurrent liabilities of discontinued operations
    
    
    
    
    
    
    26.7
    
    
    
    Total liabilities
    
    
    1,345.3
    
    
    
    1,776.4
    
    
    
    1,345.9Stockholders equity:Common stock; 300,000,000 shares authorized;
60,051,041, 60,489,390 and 59,903,232 shares issued
and outstanding at May 2, 2009, May 3, 2008 and
January 31, 2009, respectively
    
    
    186.5
    
    
    
    188.4
    
    
    
    187.4Accumulated other comprehensive income
    
    
    13.3
    
    
    
    44.0
    
    
    
    11.9Retained earnings (deficit)
    
    
    (22.2
    )
    
    
    218.8
    
    
    
    63.8Total stockholders equity
    
    
    177.6
    
    
    
    451.2
    
    
    
    263.1Total liabilities and stockholders equity
    
    $
    1,522.9
    
    
    $
    2,227.6
    
    
    $
    1,609.0
  2




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BORDERS GROUP, INC.
CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS EQUITY
FOR THE 13 WEEKS ENDED MAY 2, 2009
(dollars in millions except share amounts)
(UNAUDITED)
 AccumulatedOther
    
    RetainedCommon Stock
    
    Comprehensive
    
    EarningsShares
    
    Amount
    
    Income
    
    (Deficit)
    
    TotalBalance at January 31, 2009
    
    
    59,903,232
    
    
    $
    187.4
    
    
    $
    11.9
    
    
    $
    63.8
    
    
    $
    263.1Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (86.0
    )
    
    
    (86.0
    )Currency translation adjustment
    
    
    
    
    
    
    
    
    
    
    1.4
    
    
    
    
    
    
    
    1.4Comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (84.6
    )Issuance of common stock
    
    
    550,000
    
    
    
    1.2
    
    
    
    
    
    
    
    
    
    
    
    1.2Repurchase and retirement of
common stock
    
    
    (402,191
    )
    
    
    (2.1
    )
    
    
    
    
    
    
    
    
    
    
    (2.1
    )Balance at May 2, 2009
    
    
    60,051,041
    
    
    $
    186.5
    
    
    $
    13.3
    
    
    $
    (22.2
    )
    
    $
    177.6
  3




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##### Table of Contents



BORDERS GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(dollars in millions)
(UNAUDITED)
 13 weeks EndedMay 2,
    
    May 3,2009
    
    2008Cash provided by (used for):Net loss
    
    $
    (86.0
    )
    
    $
    (31.7
    )Net loss from discontinued operations
    
    
    
    
    
    
    (1.6
    )Net loss from continuing operations
    
    
    (86.0
    )
    
    
    (30.1
    )OperationsAdjustments to reconcile loss from continuing operations to
operating cash flows:Depreciation
    
    
    27.6
    
    
    
    26.9Loss on disposal of assets
    
    
    
    
    
    
    0.1Stock-based compensation cost
    
    
    (0.6
    )
    
    
    1.9Decrease (increase) in deferred income taxes
    
    
    
    
    
    
    (8.0
    )Decrease (increase) in other long-term assets
    
    
    2.4
    
    
    
    (2.8
    )Increase in other long-term liabilities
    
    
    24.0
    
    
    
    4.7Write-off of intangible asset
    
    
    16.2
    
    
    
    Asset impairments and other writedowns
    
    
    0.1
    
    
    
    Cash provided by (used for) current assets and current liabilities:Decrease in inventories
    
    
    22.9
    
    
    
    94.0Decrease in accounts receivable
    
    
    16.6
    
    
    
    17.9Increase in prepaid expenses
    
    
    (3.3
    )
    
    
    (10.6
    )Increase (decrease) in trade accounts payable
    
    
    22.7
    
    
    
    (49.4
    )Increase (decrease) in taxes payable
    
    
    2.6
    
    
    
    (18.3
    )Decrease in accrued payroll and other liabilities
    
    
    (42.8
    )
    
    
    (43.4
    )Net cash provided by (used for) operating activities of
continuing operations
    
    
    2.4
    
    
    
    (17.1
    )InvestingCapital expenditures
    
    
    (2.4
    )
    
    
    (27.0
    )Net cash used for investing activities of continuing operations
    
    
    (2.4
    )
    
    
    (27.0
    )FinancingNet (repayment of) funding from credit facility
    
    
    (7.5
    )
    
    
    2.7Funding from term note financing
    
    
    
    
    
    
    42.5Issuance of long-term debt
    
    
    
    
    
    
    1.1Repayment of long-term capital lease obligations
    
    
    (0.1
    )
    
    
    Issuance of common stock
    
    
    (0.3
    )
    
    
    0.2Payment of cash dividends
    
    
    
    
    
    
    (6.5
    )Net cash provided by (used for) financing activities of
continuing operations
    
    
    (7.9
    )
    
    
    40.0Net cash used for operating activities of discontinued operations
    
    
    
    
    
    
    (16.7
    )Net cash used for investing activities of discontinued operations
    
    
    
    
    
    
    (2.6
    )Effect of exchange rates on cash and cash equivalents of
discontinued operations
    
    
    
    
    
    
    (0.1
    )Net cash used for discontinued operations
    
    
    
    
    
    
    (19.4
    )Net decrease in cash and cash equivalents
    
    
    (7.9
    )
    
    
    (23.5
    )Cash and cash equivalents at beginning of period
    
    
    53.6
    
    
    
    58.5Cash and cash equivalents at end of period
    
    $
    45.7
    
    
    $
    35.0
  4




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BORDERS GROUP, INC.
NOTES TO UNAUDITED CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
(dollars in millions except per share data)
 NOTE 1  BASIS OF PRESENTATION
      NOTE 2  CONTINGENCIES
 Litigation:
  5




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BORDERS GROUP, INC.
NOTES TO UNAUDITED CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
(dollars in millions except per share data)
   NOTE 3  FINANCING
 Credit Facility:
   Term Loan:
  Debt of Consolidated VIEs:
  6




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BORDERS GROUP, INC.
NOTES TO UNAUDITED CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
(dollars in millions except per share data)
  NOTE 4  INCOME TAXES
      NOTE 5  FACILITY CLOSURE RESERVES
  7




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BORDERS GROUP, INC.
NOTES TO UNAUDITED CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
(dollars in millions except per share data)
  13 Weeks EndedMay 2,
    
    May 3,2009
    
    2008Beginning reserve balance
    
    $
    25.6
    
    
    $
    13.2Current period charge
    
    
    0.2
    
    
    
    0.3Current period reserve adjustment
    
    
    (2.4
    )
    
    
    Current period cash payments
    
    
    (2.3
    )
    
    
    (0.6
    )Ending reserve balance
    
    $
    21.1
    
    
    $
    12.9
  NOTE 6  SEGMENT INFORMATION
  13 Weeks EndedMay 2,
    
    May 3,2009
    
    2008SalesBorders Superstores
    
    $
    536.7
    
    
    $
    600.7Waldenbooks Specialty Retail
    
    
    76.9
    
    
    
    96.0International
    
    
    27.9
    
    
    
    32.8Total sales
    
    $
    641.5
    
    
    $
    729.5Depreciation expenseBorders Superstores
    
    $
    24.4
    
    
    $
    23.0Waldenbooks Specialty Retail
    
    
    1.9
    
    
    
    2.4International
    
    
    1.3
    
    
    
    1.5Total depreciation expense
    
    $
    27.6
    
    
    $
    26.9Operating income (loss)Borders Superstores
    
    $
    (16.5
    )
    
    $
    (30.0
    )Waldenbooks Specialty Retail
    
    
    (6.8
    )
    
    
    (13.6
    )International
    
    
    0.1
    
    
    
    1.4Corporate
    
    
    (5.9
    )
    
    
    (2.7
    )Total operating loss
    
    $
    (29.1
    )
    
    $
    (44.9
    )Total assetsBorders Superstores
    
    $
    1,249.5
    
    
    $
    1,617.8Waldenbooks Specialty Retail
    
    
    176.0
    
    
    
    205.1International
    
    
    76.7
    
    
    
    81.3Corporate
    
    
    20.7
    
    
    
    161.1Total assets of continuing operations
    
    $
    1,522.9
    
    
    $
    2,065.3Discontinued operations
    
    
    
    
    
    
    162.3Total assets
    
    $
    1,522.9
    
    
    $
    2,227.6
 8




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BORDERS GROUP, INC.
NOTES TO UNAUDITED CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
(dollars in millions except per share data)
  13 Weeks EndedMay 2,
    
    May 3,2009
    
    2008Borders Superstores
    
    $
    1.9
    
    
    $
    1.8Waldenbooks Specialty Retail
    
    
    0.3
    
    
    
    0.4Total
    
    $
    2.2
    
    
    $
    2.2
 NOTE 7  DISCONTINUED OPERATIONS
      13 Weeks EndedMay 3, 2008Total revenue
    
    $
    55.2Loss from operations of discontinued operations before income tax
    
    
    (1.9
    )Loss from operations of discontinued operations (net of income tax benefit of $0.7)
    
    
    (1.2
    )Loss on disposal of discontinued operations (net of income tax benefit of $0.3)
    
    
    (0.4
    )Loss from discontinued operations (net of income tax benefit of $1.0)
    
    
    (1.6
    )
 9




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BORDERS GROUP, INC.
NOTES TO UNAUDITED CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
(dollars in millions except per share data)
 May 3,2008Cash and cash equivalents
    
    $
    5.4Merchandise inventories
    
    
    93.3Accounts receivable and other current assets
    
    
    16.2Taxes, including income taxes
    
    
    (6.6
    )Current assets of discontinued operations
    
    
    108.3Property and equipment (net of accumulated depreciation)
    
    
    46.3Other assets
    
    
    7.7Noncurrent assets of discontinued operations
    
    
    54.0Accounts payable
    
    
    32.6Accrued payroll and other liabilities
    
    
    14.6Deferred income taxes
    
    
    (4.0
    )Current liabilities of discontinued operations
    
    
    43.2Long-term liabilities
    
    
    26.7Noncurrent liabilities of discontinued operations
    
    $
    26.7
   NOTE 8  PERSHING SQUARE FINANCING ARRANGEMENT
    10




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BORDERS GROUP, INC.
NOTES TO UNAUDITED CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
(dollars in millions except per share data)
   Before re-pricing
    
    After re-pricingWarrant fair value:
    
    $1.8 million
    
    $6.1 millionWarrant exercise price:
    
    $7.00 per warrant(1)
    
    $0.65 per warrant(1)Stock price:
    
    $0.65 per share
    
    $0.65 per shareStock volatility:
    
    74.26%(2)
    
    74.26%(2)Risk-free interest rate:
    
    1.82%(3)
    
    1.82%(3)Annual dividend yield:
    
    0%
    
    0%Expected life:
    
    5.5 years(4)
    
    5.5 years(4)
 
 (1)
    
    Represents contractual value.(2)
    
    Represents volatility over the period matching the warrants expected life.(3)
    
    Represents the five-year treasury note rate.(4)
    
    Assumes that the warrants will be held the duration of their contractual lives.  May 2, 2009
    
    May 3, 2008Warrant fair value:
    
    $38.0 million
    
    $37.2 millionWarrant exercise price:
    
    $0.65 per warrant(1)
    
    $7.00 per warrant(1)Stock price at balance sheet date:
    
    $2.97 per share
    
    $6.23 per shareStock volatility:
    
    79.78%(2)
    
    39.00%(2)Risk-free interest rate:
    
    1.82%(3)
    
    3.19%(3)Annual dividend yield:
    
    0%
    
    0%Expected life:
    
    5.4 years(4)
    
    6.4 years(4)
 
 (1)
    
    Represents contractual value.(2)
    
    Represents volatility over the period matching the warrants expected life.(3)
    
    Represents the five-year treasury note rate.(4)
    
    Assumes that the warrants will be held the duration of their contractual lives.   11




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BORDERS GROUP, INC.
NOTES TO UNAUDITED CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
(dollars in millions except per share data)
 NOTE 9  NEW ACCOUNTING GUIDANCE
     
 Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
 General
    12




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Business Strategy
      Get our financial house in order.
 Reengage with our customers and reclaim our status as a bookseller for serious readers.
   Improve execution.
 Address disintermediation in the music and movie categories.
 13




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Other Information
     Discontinued Operations
    14




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##### Table of Contents



Results of Operations
  13 Weeks EndedMay 2, 2009
    
    May 3, 2008Sales
    
    
    100.0
    %
    
    
    100.0
    %Other revenue
    
    
    1.4
    
    
    
    0.9Total revenue
    
    
    101.4
    
    
    
    100.9Cost of merchandise sold (including occupancy costs)
    
    
    79.0
    
    
    
    77.8Gross margin
    
    
    22.4
    
    
    
    23.1Selling, general and administrative expenses
    
    
    26.9
    
    
    
    29.3Asset impairments and other writedowns
    
    
    
    
    
    
    Operating loss
    
    
    (4.5
    )
    
    
    (6.2
    )Interest expense
    
    
    1.0
    
    
    
    1.3Warrant/put expense (income)
    
    
    7.7
    
    
    
    (0.5
    )Total interest expense
    
    
    8.7
    
    
    
    0.8Loss before income tax
    
    
    (13.2
    )
    
    
    (7.0
    )Income taxes (benefit)
    
    
    0.2
    
    
    
    (2.9
    )Loss from continuing operations
    
    
    (13.4
    )%
    
    
    (4.1
    )%
 Consolidated Results  Comparison of the 13 weeks ended May 2, 2009 to the 13 weeks ended May 3,
2008
 Sales
     15




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Other revenue
   Gross margin
   Selling, general and administrative expenses
   Interest expense
  16




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Warrant/put expense
  Taxes
  Loss from continuing operations
  Segment Results
  Domestic Borders Superstores
 13 Weeks Ended(dollar amounts in millions)
    
    May 2, 2009
    
    May 3, 2008Sales
    
    $
    536.7
    
    
    $
    600.7Other revenue
    
    $
    7.1
    
    
    $
    5.0Operating loss
    
    $
    (16.5
    )
    
    $
    (30.0
    )Operating loss as % of sales
    
    
    (3.1
    )%
    
    
    (5.0
    )%Store openings
    
    
    
    
    
    
    5Store closings
    
    
    
    
    
    
    Store count
    
    
    515
    
    
    
    514
 Domestic Borders Superstores  Comparison of the 13 weeks ended May 2, 2009 to the 13 weeks ended
May 3, 2008
 Sales
  Other revenue
  Gross margin
  17




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Selling, general and administrative expenses
   Operating loss
  Waldenbooks Specialty Retail
 13 Weeks Ended(dollar amounts in millions)
    
    May 2, 2009
    
    May 3, 2008Sales
    
    $
    76.9
    
    
    $
    96.0Other revenue
    
    $
    0.4
    
    
    $
    0.4Operating loss
    
    $
    (6.8
    )
    
    $
    (13.6
    )Operating loss as % of sales
    
    
    (8.8
    )%
    
    
    (14.2
    )%Store openings
    
    
    1
    
    
    
    Store closings
    
    
    11
    
    
    
    14Store count
    
    
    376
    
    
    
    476
 Waldenbooks Specialty Retail  Comparison of the 13 weeks ended May 2, 2009 to the 13 weeks ended
May 3, 2008
 Sales
  Other revenue
  Gross margin
   18




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Selling, general and administrative expenses
   Operating loss
  International
 13 Weeks Ended(dollar amounts in millions)
    
    May 2, 2009
    
    May 3, 2008Operating income
    
    $
    0.1
    
    
    $
    1.4
 International  Comparison of the 13 weeks ended May 2, 2009 to the 13 weeks ended May 3, 2008
  Corporate
 13 Weeks Ended(dollar amounts in millions)
    
    May 2, 2009
    
    May 3, 2008Operating loss
    
    $
    (5.9
    )
    
    $
    (2.7
    )
  Corporate  Comparison of the 13 weeks ended May 2, 2009 to the 13 weeks ended May 3, 2008
  Liquidity and Capital Resources
 Operating Activities
   19




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##### Table of Contents



Investing Activities
  Financing Activities
  Capital Expenditures
  Dividends
  Sources of Liquidity
     20




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##### Table of Contents



Warrants
  Off-Balance Sheet Arrangements
     21




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##### Table of Contents



New Accounting Guidance
     Related Party Transactions
  Forward Looking Statements
  22




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##### Table of Contents



Item 3. Quantitative and Qualitative Disclosures About Market Risk
   
 Item 4. Controls and Procedures
 Controls and Procedures:
 Changes in Internal Control:
 23




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##### Table of Contents



Part II  Other Information
 
 Item 1. Legal Proceedings
  
 Item 1A. Risk Factors
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  
 Item 4. Submission of Matters to a Vote of Security Holders
  24




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##### Table of Contents



Item 6. Exhibits
  3.1(1)
    
    Restated Articles of Incorporation of Borders Group, Inc.3.2(2)
    
    Amendment to the Restated Articles of Incorporation of Borders Group, Inc.3.3(3)
    
    Restated bylaws of Borders Group, Inc.3.4(4)
    
    First Amendment to the Restated By laws of Borders Group, Inc.3.5(2)
    
    Second Amendment to the Restated By laws of Borders Group, Inc.3.6(5)
    
    Third Amendment to the Restated By laws of Borders Group, Inc.3.7(6)
    
    Fourth Amendment to the Restated By laws of Borders Group, Inc.10.66
    
    First Amendment to the Amended and Restated Borders Group, Inc. 2004 Long-Term Incentive Plan31.1
    
    Statement of Ron Marshall, President and Chief Executive Officer of Borders Group, Inc.
pursuant to Section 302 of the Sarbanes-Oxley Act of 200231.2
    
    Statement of Mark R. Bierley, Executive Vice President and Chief Financial Officer of
Borders Group, Inc. pursuant to Section 302 of the Sarbanes-Oxley Act of 200232.1
    
    Statement of Ron Marshall, President and Chief Executive Officer of Borders Group, Inc.
pursuant to Section 906 of the Sarbanes-Oxley Act of 200232.2
    
    Statement of Mark R. Bierley, Executive Vice President and Chief Financial Officer of
Borders Group, Inc. pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
 
 (1)
    
    Incorporated by reference from the Companys Annual Report on Form 10-K dated January 24,
1999 (File No. 1-13740).(2)
    
    Incorporated by reference from the Companys Current Report on Form 8-K dated May 25, 2007
(File No. 1-13740).(3)
    
    Incorporated by reference from the Companys Annual Report on Form 10-K dated January 24,
2001 (File No. 1-13740).(4)
    
    Incorporated by reference from the Companys Current Report on Form 8-K dated July 13, 2006
(File No. 1-13740).(5)
    
    Incorporated by reference from the Companys Current Report on Form 8-K dated October 2,
2007 (File No. 1-13740).(6)
    
    Incorporated by reference from the Companys Current Report on Form 8-K dated January 17,
2008 (File No. 1-13740).
 25




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SIGNATURES
  BORDERS GROUP, INC.
 Date: June 4, 2009
    By:
    /s/ Mark R. BierleyMark R. BierleyExecutive Vice President and
Chief Financial Officer
(Principal Financial and
Accounting Officer) 26