Famous Footwear 2013 Annual Report Download - page 41

2013 BROWN SHOE COMPANY, INC. FORM 10-K 39
CONTRACTUAL OBLIGATIONS
The table below sets forth our significant future obligations by time period. Further information on certain of these
commitments is provided in the notes to our consolidated financial statements, which are cross-referenced in this table.
Our obligations outstanding as of February 1, 2014, include the following:
Payments Due by Period
Less Than 1-3 3-5 More Than
($ millions) Total 1 Year Years Years 5 Years
Borrowings under Credit Agreement(1) . . . . . . . . . . . . . . . . . . . . . . . $ 7.0 $ 7.0 $ – $ – $ –
Long-term debt(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 200.0 – – – 200.0
Interest on long-term debt(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78.4 14.3 28.5 28.5 7.1
Operating lease commitments(3) . . . . . . . . . . . . . . . . . . . . . . . . . . 631.1 149.8 230.4 125.6 125.3
Minimum license commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.7 7.7 – – –
Purchase obligations(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 660.4 653.3 6.6 0.5 –
Obligations related to restructuring initiatives(5). . . . . . . . . . . . . . . . . . 1.0 1.0 – – –
Other(6) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.5 1.1 3.1 4.6 7.7
Total(7) (8) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,602.1 $ 834.2 $ 268.6 $ 159.2 $ 340.1
(1) Interest on borrowings is at variable rates based on LIBOR or the prime rate, as defined in the Credit Agreement, plus a spread. The interest
rate and fees for letters of credit varies based upon the level of excess availability under the Credit Agreement. There is an unused line fee
payable on the excess availability under the facility and a letter of credit fee payable on the outstanding exposure under letters of credit.
Interest obligations, which are variable in nature, are not included in the table above. See Note 10 to the consolidated financial statements.
(2) Interest obligations in future periods have been reflected based on our $200.0 million principal value of Senior Notes and a fixed interest rate
of 7.125% as of fiscal year ended February 1, 2014. See Note 10 to the consolidated financial statements.
(3) A majority of our retail operating leases contain provisions that allow us to modify amounts payable under the lease or terminate the lease
in certain circumstances, such as experiencing actual sales volume below a defined threshold and/or co-tenancy provisions associated with
the facility. The contractual obligations presented in the table above reflect the total lease obligation, irrespective of our ability to reduce or
terminate rental payments in the future, as noted. See Note 11 to the consolidated financial statements.
(4) Purchase obligations include agreements to purchase goods or services that specify all significant terms, including quantity and price provisions.
(5) See Note 4 to the consolidated financial statements for further information related to these obligations.
(6) Includes obligations for our supplemental executive retirement plan and other postretirement benefits. See Note 5 to the consolidated
financial statements.
(7) Excludes liabilities of $1.0 million, established pursuant to the provisions of ASC 740, Income Taxes, due to their uncertain nature in timing of
payments. See Note 6 to the consolidated financial statements.
(8) Excludes liabilities of $2.2 million, $1.7 million and $7.8 million for our non-qualified deferred compensation plan, deferred compensation
plan for non-employee directors and restricted stock units for non-employee directors, respectively, due to the uncertain nature in timing of
payments. See Note 5, Note 13, and Note 15 to the consolidated financial statements.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
AND FORWARD-LOOKING STATEMENTS
This Management’s Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results could dier materially
from those projected as they are subject to various risks and uncertainties. These risks and uncertainties include, without
limitation, the risks detailed in Item 1A, Risk Factors, and those described in other documents and reports filed from time to
time with the SEC, press releases, and other communications. We do not undertake any obligation or plan to update these
forward-looking statements, even though our situation may change.
ITEM 7A QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
FOREIGN CURRENCY EXCHANGE RATES
The market risk inherent in our financial instruments and positions represents the potential loss arising from adverse changes
in foreign currency exchange rates and interest rates. To address these risks, we enter into various hedging transactions to
the extent described below. All decisions on hedging transactions are authorized and executed pursuant to our policies and
procedures, which do not allow the use of financial instruments for trading purposes. We also are exposed to credit-related
losses in the event of nonperformance by counterparties to these financial instruments. Counterparties to these agreements,
however, are major international financial institutions, and we believe the risk of loss due to nonperformance is minimal.
A description of our accounting policies for derivative financial instruments is included in Notes 1 and 12 to the consolidated
financial statements.