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10-K
Interest Rate Swaps
From time to time, we use interest rate swaps to minimize the risk of adverse changes in interest
rates. These swaps are intended to reduce risk by hedging an underlying economic exposure. Because
of high correlation between the derivative financial instrument and the underlying exposure being
hedged, fluctuations in the value of the financial instruments are generally offset by reciprocal changes
in the value of the underlying economic exposure. Our principal interest rate exposure relates to
outstanding amounts under our Facilities. On May 31, 2015, interest rate swaps with a total notional
amount of $875.0 million expired, and at January 29, 2016, we had no outstanding interest rate swaps.
For more information see Item 7A, ‘‘Quantitative and Qualitative Disclosures about Market Risk’’
below.
Contractual Obligations
The following table summarizes our significant contractual obligations and commercial
commitments as of January 29, 2016 (in thousands):
Payments Due by Period
Contractual obligations Total < 1 year 1 - 3 years 3 - 5 years 5+ years
Long-term debt obligations ........ $ 2,986,590 $ 215 $ 900,770 $ 677,080 $1,408,525
Capital lease obligations .......... 4,806 1,164 1,412 920 1,310
Interest(a) .................... 513,562 89,626 141,340 119,576 163,020
Self-insurance liabilities(b) ........ 221,796 83,293 89,438 30,388 18,677
Operating lease obligations(c) ...... 7,229,243 866,444 1,614,931 1,353,567 3,394,301
Subtotal .................... $10,955,997 $1,040,742 $2,747,891 $2,181,531 $4,985,833
Commitments Expiring by Period
Commercial commitments(d) Total < 1 year 1 - 3 years 3 - 5 years 5+ years
Letters of credit ................ $ 11,680 $ 11,680 $ — $ — $ —
Purchase obligations(e) .......... 722,630 722,630———
Subtotal .................... $ 734,310 $ 734,310 $ — $ — $ —
Total contractual obligations and
commercial commitments(f) ..... $11,690,307 $1,775,052 $2,747,891 $2,181,531 $4,985,833
(a) Represents obligations for interest payments on long-term debt and capital lease obligations, and
includes projected interest on variable rate long-term debt, using 2015 year end rates and balances.
Variable rate long-term debt includes the balance of the senior revolving credit facility (which had
a balance of $251 million as of January 29, 2016), the balance of our tax increment financing of
$10.6 million, and the balance of the senior term loan facility of $425 million.
(b) We retain a significant portion of the risk for our workers’ compensation, employee health
insurance, general liability, property loss and automobile insurance. As these obligations do not
have scheduled maturities, these amounts represent undiscounted estimates based upon actuarial
assumptions. Reserves for workers’ compensation and general liability which existed as of the date
of a merger transaction in 2007 were discounted in order to arrive at estimated fair value. All
other amounts are reflected on an undiscounted basis in our consolidated balance sheets.
(c) Operating lease obligations are inclusive of amounts included in deferred rent in our consolidated
balance sheets.
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