Cabela's 2012 Annual Report Download - page 110

100
CABELA’S INCORPORATED AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands Except Share and Per Share Amounts)
18. COMMITMENTS AND CONTINGENCIES
The Company leases various buildings, computer and other equipment, and storage space under operating
leases which expire on various dates through January 2037. Rent expense on these leases as well as other month to
month rentals was $13,605, $9,541, and $7,506, for 2012, the 2011, and 2010, respectively.
The following is a schedule of future minimum rental payments under operating leases at December 29, 2012:
For the fiscal years ending:
2013 $ 11,896
2014 12,392
2015 11,924
2016 11,191
2017 11,038
Thereafter 150,961
$ 209,402
The Company leases certain retail store locations. Certain of these leases include tenant allowances that are
amortized over the life of the lease. In 2012 and 2011, no tenant allowances were received. The Company expects
to receive $4,200 in tenant allowances under leases during 2013. Certain leases require the Company to pay
contingent rental amounts based on a percentage of sales, in addition to real estates taxes, insurance, maintenance,
and other operating expenses associated with the leased premises. These leases have terms which include renewal
options ranging from 10 to 70 years.
The Company has entered into real estate purchase, construction, and/or economic development agreements
for various new retail store site locations. At December 29, 2012, the Company had total estimated cash
commitments of approximately $201,800 outstanding for projected expenditures connected with the development,
construction, and completion of new retail stores. This does not include any amounts for contractual obligations
associated with retail store locations where the Company is in the process of certain negotiations.
Under various grant programs, state or local governments provide funding for certain costs associated
with developing and opening a new retail store. The Company generally receives grant funding in exchange for
commitments, such as assurance of agreed employment and wage levels at the retail store or that the retail store
will remain open, made by the Company to the state or local government providing the funding. The commitments
typically phase out over approximately five to 10 years. If the Company failed to maintain the commitments during
the applicable period, the funds received may have to be repaid or other adverse consequences may arise, which
could affect the Company’s cash flows and profitability. At December 29, 2012, and December 31, 2011, the total
amount of grant funding subject to a specific contractual remedy was $7,257 and $9,930, respectively.
The Company operates an open account document instructions program, which provides for Cabela’s-
issued letters of credit. The Company had obligations to pay participating vendors $55,455 and $40,074, at
December 29, 2012, and December 31, 2011, respectively.
The Financial Services segment enters into financial instruments with off-balance sheet risk in the
normal course of business through the origination of unsecured credit card loans. Unsecured credit card
accounts are commitments to extend credit and totaled $20,976,000 and $20,235,000 at December 29, 2012, and
December 31, 2011, respectively. These commitments are in addition to any current outstanding balances of a
cardholder. Unsecured credit card loans involve, to varying degrees, elements of credit risk in excess of the amount
recognized in the consolidated balance sheets. The principal amounts of these instruments reflect the Financial