Family Dollar 2011 Annual Report Download - page 58

Download and view the complete annual report

Please find page 58 of the 2011 Family Dollar annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 80

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80

9. Employee Benefit Plans:
Incentive compensation plan
The Company has an incentive profit-sharing plan which allows for payments to certain employees and officers
at an aggregate annual amount not to exceed 7% of the Company’s consolidated income before income taxes and
certain incentive compensation. Expenses under the profit-sharing plan were $17.8 million in fiscal 2011, $28.8
million in fiscal 2010 and $34.3 million in fiscal 2009.
Compensation deferral plans
The Company has a voluntary compensation deferral plan, under Section 401(k) of the Internal Revenue Code,
available to eligible employees. At the discretion of the Board of Directors, the Company makes contributions to
the plan which are allocated to participants, and in which they become vested, in accordance with formulas and
schedules defined by the plan. Company expenses for contributions to the plan were $4.0 million in fiscal 2011,
$4.2 million in fiscal 2010 and $3.2 million in fiscal 2009, and are included in SG&A on the Consolidated
Statements of Income.
The Company has a deferred compensation plan to provide certain key management employees the ability to
defer a portion of their base compensation and bonuses. The plan is an unfunded nonqualified plan. The deferred
amounts and earnings thereon are payable to participants, or designated beneficiaries, at either specified future
dates, or upon separation from service or death. The Company does not make contributions to this plan or
guarantee earnings.
10. Commitments and Contingencies:
Operating leases and other contractual obligations
The majority of the rental expense incurred by the Company relates to its stores and the majority of its stores are
leased under agreements that generally have an initial term of five or ten years and provide for fixed rentals.
Additionally, most of the Company’s leases require additional payments based upon a percentage of sales,
property taxes, insurance premiums, or common area maintenance charges. Rental expenses on all operating
leases, both cancelable and non-cancelable, for fiscal 2011, fiscal 2010 and fiscal 2009 were as follows:
(in thousands) Fiscal 2011 Fiscal 2010 Fiscal 2009
Minimum rentals, net of minor sublease rentals ............. $429,942 $399,319 $382,530
Contingent rentals .................................... 7,862 7,590 5,444
$437,804 $406,909 $387,974
Aggregate minimum annual rentals under operating leases as of August 27, 2011 are as follows:
(in thousands)
Minimum
Rentals
Fiscal 2012 ..................................................... $ 364,228
Fiscal 2013 ..................................................... 323,424
Fiscal 2014 ..................................................... 273,778
Fiscal 2015 ..................................................... 220,029
Fiscal 2016 ..................................................... 164,854
Thereafter ...................................................... 80,446
Total minimum rentals ........................................ $1,426,759
54