Columbia Sportswear 2009 Annual Report Download - page 65

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COLUMBIA SPORTSWEAR COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Approximate future minimum payments, including rent escalation clauses and stores that are not yet open,
on all lease obligations at December 31, 2009, are as follows (in thousands). Future minimum payments listed
below do not include percentage rent or operating costs for which the Company is obligated.
Non-related
Parties
Related
Party Total
2010 ............................................ $ 28,379 $ 625 $ 29,004
2011 ............................................ 27,534 625 28,159
2012 ............................................ 26,137 72 26,209
2013 ............................................ 25,678 72 25,750
2014 ............................................ 23,869 54 23,923
Thereafter ....................................... 128,672 — 128,672
$260,269 $1,448 $261,717
Inventory Purchase Obligations
Inventory purchase obligations consist of open production purchase orders for sourced apparel, footwear,
accessories and equipment, and materials used to manufacture apparel. At December 31, 2009 and 2008
inventory purchase obligations were $258,069,000 and $157,774,000, respectively. To support certain inventory
purchase obligations, the Company maintains unsecured and uncommitted lines of credit available for issuing
import letters of credit. At December 31, 2009, the Company had letters of credit of $7,771,000 outstanding for
inventory purchase obligations. See Off-Balance Sheet Arrangements in Note 5 for further disclosure.
Litigation
The Company is a party to various legal claims, actions and complaints from time to time. Although the
ultimate resolution of legal proceedings cannot be predicted with certainty, management believes that disposition
of these matters will not have a material adverse effect on the Company’s consolidated financial statements.
Indemnities and Guarantees
During its normal course of business, the Company has made certain indemnities, commitments and
guarantees under which it may be required to make payments in relation to certain transactions. These include
(i) intellectual property indemnities to the Company’s customers and licensees in connection with the use, sale
and/or license of Company products, (ii) indemnities to various lessors in connection with facility leases for
certain claims arising from such facility or lease, (iii) indemnities to vendors and service providers pertaining to
claims based on the negligence or willful misconduct of the Company, (iv) executive severance arrangements
and (v) indemnities involving the accuracy of representations and warranties in certain contracts. The duration of
these indemnities, commitments and guarantees varies, and in certain cases, may be indefinite. The majority of
these indemnities, commitments and guarantees do not provide for any limitation of the maximum potential for
future payments the Company could be obligated to make. The Company has not recorded any liability for these
indemnities, commitments and guarantees in the accompanying Consolidated Balance Sheets.
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