JCPenney 2015 Annual Report Download

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Table of Contents




(Mark
One)
x
For the fiscal year ended January 30, 2016
or
o
For the transition period from ______________ to ________________
Commission File Number: 001-15274

(Exact name of registrant as specified in its charter)
 
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)

(Address of principal executive offices)
(Zip Code)

(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which registered


 
Securities registered pursuant to Section 12(g) of the Act:

(Title of class)
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes x No o
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes o No x
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12
months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted
pursuant to Rule 405 of Regulation S-T 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such
files). Yes x No o
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the
best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. x
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large
accelerated filer,” “accelerated filer” andsmaller reporting company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer xAccelerated filer oNon-accelerated filer oSmaller reporting company o
(Do not check if a smaller reporting company)
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x
State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or
the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter (August 1, 2015). $2,512,275,429
Indicate the number of shares outstanding of each of the registrant's classes of common stock, as of the latest practicable date.
306,624,828 shares of Common Stock of 50 cents par value, as of March 11, 2016.

 
J. C. Penney Company, Inc. 2016 Proxy Statement Part III

Table of contents

  • Page 1
    ... are incorporated by reference J. C. Penney Company, Inc. 2016 Proxy Statement Parts of the Form 10-K into which incorporated Part III Smaller reporting company o Name of each exchange on which registered New York Stock Exchange New York Stock Exchange 26-0037077 (I.R.S. Employer Identification No.)

  • Page 2
    ... about Market Risk Item 8. Financial Statements and Supplementary Data Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure Item 9A. Controls and Procedures Item 9B. Other Information Part III Item 10. Directors, Executive Officers and Corporate Governance...

  • Page 3
    ... 31, 2015; and fiscal year 2013 ended on February 1, 2014. Each consisted of 52 weeks. Our business consists of selling merchandise and services to consumers through our department stores and our website at jcpenney.com, which utilizes fully optimized applications for desktop, mobile and tablet...

  • Page 4
    ...accelerating the growth of our Sephora inside JCPenney locations. Competition and Seasonality The business of selling merchandise and services is highly competitive. We are one of the largest department store and e-commerce retailers in the United States, and we have numerous competitors, as further...

  • Page 5
    ... environmental reserves as new information becomes available and known conditions are further delineated. If we were to incur losses at the upper end of the estimated range, we do not believe that such losses would have a material effect on our financial condition, results of operations or liquidity...

  • Page 6
    ... Counsel Executive Vice President, Chief Information Officer Senior Vice President, Chief Accounting Officer and Controller Tge 69 51 47 46 46 43 45 Mr. Ullman has served as Chairman of the Board of Directors since August 2015, and as a director of the Company and a director of JCP since 2013. He...

  • Page 7
    ... are made in this Annual Report on Form 10-K. Our ability to return to profitable growth is subject to both the risks affecting our business generally and the inherent difficulties associated with implementing our strategic plan. As we position the Company for long-term growth, it may take longer...

  • Page 8
    ... as changes in their pricing and promotional policies, marketing activities, customer loyalty programs, new store openings, store renovations, launches of Internet websites or mobile platforms, brand launches and other merchandise and operational strategies could cause us to have lower sales, lower...

  • Page 9
    ... mix and level of inventory in stores and online, adjusting our merchandise mix between our private and exclusive brands and national brands, appropriately changing the allocation of floor space of stores among product categories to respond to customer demand and effectively managing pricing...

  • Page 10
    ... new systems and platforms; liability for online and mobile content; violations of state or federal laws, including those relating to online and mobile privacy and intellectual property rights; credit card fraud; problems associated with the operation and security of our website, mobile applications...

  • Page 11
    ... rating agencies periodically review our capital structure and the quality and stability of our earnings. Any future downgrades to our long-term credit ratings could result in reduced access to the credit and capital markets and higher interest costs on future financings. The future availability...

  • Page 12
    ... projects, working capital requirements, capital expenditures, debt service, and other general corporate or other obligations, as well as increase the risks to our business associated with general adverse economic and industry conditions. Our level of indebtedness may also place us at a competitive...

  • Page 13
    ... affect our operating results and cash flows. Synchrony Financial ("Synchrony") owns and services our private label credit card and co-branded MasterCard® programs. Our agreement with Synchrony provides for certain payments to be made by Synchrony to the Company, including a share of revenues from...

  • Page 14
    ...customer payment-related risks that could increase operating costs, expose us to fraud or theft, subject us to potential liability and potentially disrupt our business. We accept payments using a variety of methods, including cash, checks, credit and debit cards (including private label credit cards...

  • Page 15
    ...ports in the United States could result in increased lead times and transportation costs. Disruptions at ports through which we import our goods could also result in unanticipated inventory shortages, which could adversely impact our reputation and our results of operations. Our Company's growth and...

  • Page 16
    ... income or expense for the year are the expected long-term rate of return on plan assets and the discount rate. In addition, at the measurement date, we must also reflect the funded status of the plan (assets and liabilities) on the balance sheet, which may result in a significant change to equity...

  • Page 17
    ... by a pre-change loss is subject to an annual limitation that is cumulative to the extent it is not all utilized in a year. This limitation is derived by multiplying the fair market value of the Company stock as of the ownership change by the applicable federal long-term tax-exempt rate, which was...

  • Page 18
    ... At January 30, 2016, we operated 1,021 department stores throughout the continental United States, Alaska and Puerto Rico, of which 418 were owned, including 118 stores located on ground leases. The following table lists the number of stores operating by state as of January 30, 2016: Alabama Alaska...

  • Page 19
    ..., 2016, our supply chain network operated 13 facilities with multiple types of distribution activities, including store merchandise distribution centers (stores), regional warehouses (regional), jcpenney.com fulfillment centers (direct to customers) and furniture distribution centers (furniture) as...

  • Page 20
    Table of Contents Item 3. Legal Proceedings The matters under the caption "Litigation" in Note 21 of the Notes to Consolidated Financial Statements attached to this Form 10-K are incorporated herein by reference. Item 4. Mine Safety Disclosures Not applicable. 20

  • Page 21
    ...27 Fourth Quarter 9.34 6.00 7.26 Since May 2012, the Company has not paid a dividend. Under our 2013 senior secured term loan and 2014 senior secured asset-based credit facility, we are subject to restrictive covenants regarding our ability to pay cash dividends. Additional information relating to...

  • Page 22
    ...Department Stores over the same period. A list of these companies follows the graph below. The graph assumes $100 invested at the closing price of our common stock on the NYSE and each index as of the last trading day of our fiscal year 2010 and assumes that all dividends were reinvested on the date...

  • Page 23
    ... and stock warrant. (6) We discontinued the quarterny $0.20 per share dividend fonnowing the May 1, 2012 payment. (7) Totan debt incnudes nong-term debt, net of unamortized debt issuance costs, incnuding current maturities, capitan neases, note payabne and any borrowings under our revonving credit...

  • Page 24
    ... of the change in our cnassification of debt issue costs reduced Totan assets by and decreased Totan debt by $22 minnion. Five-Year Operations Summary 2015 Number of department stores: Beginning of year Openings Closings End of year Gross selling space (square feet in minnions) Sales per gross...

  • Page 25
    ... EBITDA (non-GAAP) Add: Markdowns - inventory strategy alignment Add: Restructuring and management transition charges Add: Primary pension plan expense/(income) Less: Net gain on the sale of non-operating assets Less: Proportional share of net income from home office land joint venture Less: Certain...

  • Page 26
    ...: Net gain on sale or redemption of non-operating assets, net of tax of $-, $-, $1, $146 and $Less: Proportional share of net income from home office land joint venture, net of tax of and $Less: Certain net gains, net of tax of $-, $2, $-, $- and $Less: Tax impact resulting from other comprehensive...

  • Page 27
    ...Net cash provided by/(used in) operating activities (GAAP) Less: Capital expenditures Dividends paid, common stock Plus: Proceeds from sale of operating assets Free cash fnow (non-GAAP) 2015 $ 440 (320) - 11 $ 131 $ $ 2014 239 (252) - 70 57 $ $ 2013 (1,814) (951) - 19 (2,746) $ $ 2012 (10) (810) (86...

  • Page 28
    ...growth of Sephora inside JCPenney locations. In 2015, we opened 28 additional Sephora locations, bringing our total number of locations to 518, and introduced a selection of Sephora makeup, skincare and fragrance products to jcpenney.com. We plan to add approximately 60 new Sephora locations in 2016...

  • Page 29
    ..., III as CEO of the Company. At that time, Mr. Ullman became Executive Chairman of the Board of Directors. On December 10, 2015, J. C. Penney Company, Inc., JCP and J. C. Penney Purchasing Corporation (Purchasing) amended the Company's senior secured asset-based credit facility (2014 Credit Facility...

  • Page 30
    ... Consonidated Financian Statements for a discussion of the change and the impact of the change for the years 2014 and 2013. (2) Incnudes the effect of the 53rd week in 2012. Excnuding sanes of $163 minnion for the 53rd week in 2012, totan net sanes decreased 7.5% in 2013. (3) Comparabne store sanes...

  • Page 31
    ... stores or they can shop our website from the JCPenney app while inside the store. Customers who utilize our mobile application can receive mobile coupons to use when they check out both online or in our stores. Internet orders can be shipped from a dedicated jcpenney.com fulfillment center, a store...

  • Page 32
    ... in 2015 compared to $3,993 million in 2014. As a percent of sales, SG&A expenses were 29.9% compared to 32.6% in the prior year. The net 270 basis point decrease primarily resulted from lower store controllable costs, more efficient advertising spend and improved private label credit card revenue...

  • Page 33
    ... former furniture store location, payments received from landlords to terminate two leases prior to the original expiration date and the sale of excess property. In 2014, the net gain from the sale of operating assets related to the sale of three department store locations. Store impairments totaled...

  • Page 34
    ... sales, achieve higher margins and reduce our operating costs. Net Income/(Loss) and Adjusted Net Income/(Loss) In 2015, we reported a loss of $513 million, or $1.68 per share, compared with a loss of $717 million, or $2.35 per share, last year. Excluding the impact of restructuring and management...

  • Page 35
    ... in 2013. As a percent of sales, SG&A expenses were 32.6% compared to 34.7% in the prior year. The net 210 basis point decrease primarily resulted from lower store expenses, advertising costs and corporate overhead throughout the period and higher income from the JCPenney private label credit card...

  • Page 36
    ...to 19 and 25 underperforming department stores, respectively, that continued to operate. In addition, in 2013, we recorded a $9 million impairment charge for our ownership of the U.S. and Puerto Rico rights of the monet® trade name. See "Restructuring and Management Transition" below for additional...

  • Page 37
    ...and shops strategy. The charges in 2013 included a non-cash charge of $36 million related to the return of shares of Martha Stewart Living Omnimedia, Inc. previously acquired by the Company, which was accounted for as a cost investment. Operating Income/(Loss) For 2014, we reported an operating loss...

  • Page 38
    ... sales, achieve higher margins and reduce our operating costs. Net Income/(Loss) and Adjusted Net Income/(Loss) In 2014, we reported a loss of $717 million, or $2.35 per share, compared with a loss of $1,278 million, or $5.13 per share, in 2013. Excluding the impact of restructuring and management...

  • Page 39
    ...last year. Our net loss as of the end of 2015 of $513 million included significant charges and credits that did not impact operating cash flow, including depreciation and amortization, certain restructuring and management transition charges, loss on extinguishment of debt, benefit plans, the sale of...

  • Page 40
    ..., which were paid in 2015. The capital expenditures for 2014 related primarily to the opening of 46 Sephora inside JCPenney stores, the opening of a new department store in the third quarter of 2014, investments in information technology in both our home office and stores and investments in our...

  • Page 41
    ... store sales, the economic environment, conditions in the retail industry, financial leverage and changes in our business strategy in their rating decisions. Downgrades to our long-term credit ratings could result in reduced access to the credit and capital markets and higher interest costs...

  • Page 42
    ... non-qualified supplemental retirement and postretirement medical plans(2) Unrecorded contractual obligations: Interest payments on long-term debt(3) Operating leases(5) Standby and import letters of credit(6) Surety bonds(7) Contractual obligations(8) Purchase orders(9) Guarantees(10) Total $ 4,803...

  • Page 43
    ... cost (using the first-in, first-out or "FIFO" method) or market, determined under the Retail Inventory Method (RIM) for department stores, store distribution centers and regional warehouses and standard cost, representing average vendor cost, for merchandise we sell through the Internet at jcpenney...

  • Page 44
    ... the midpoint of the actuarial range, and total estimated claim liability amounts are discounted using a risk-free rate. We do not anticipate any significant change in loss trends, settlements or other costs that would cause a significant fluctuation in net income. However, a 10% variance in the...

  • Page 45
    ... for more information regarding income taxes and also Risk Factors, Item 1A. Environmentan Reserves In establishing our reserves for liabilities associated with underground storage tanks, we maintain and periodically update an inventory listing of potentially impacted sites. The estimated cost of...

  • Page 46
    ... return on plan assets is based on the plan's long-term asset allocation policy, historical returns for plan assets and overall capital market returns, taking into account current and expected market conditions. The expected return assumption for 2015 was reduced from 7.00% to 6.75% given our new...

  • Page 47
    ... and conduct its operations, a systems failure and/or security breach that results in the theft, transfer or unauthorized disclosure of customer, employee or Company information, legal and regulatory proceedings and the Company's ability to access the debt or equity markets on favorable terms or at...

  • Page 48
    ... C. Penney Purchasing Corporation (Purchasing) entered into a $2,350 million senior secured asset-based credit facility (2014 Credit Facility), comprised of a $1,850 million revolving line of credit (Revolving Facility) and a $500 million term loan (2014 Term Loan). During 2015, the Company amended...

  • Page 49
    ...or submit under the Exchange Act (i) is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms and (ii) is accumulated and communicated to management, including our principal executive officer and principal financial...

  • Page 50
    ...of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of J. C. Penney Company, Inc. and subsidiaries as of January 30, 2016 and January 31, 2015, and the related consolidated statements of operations, comprehensive income/ (loss), stockholders' equity, and...

  • Page 51
    .... The Statement of Business Ethics and Corporate Governance Guidelines are available on our website at www.jcpenney.com. Additionally, we will provide copies of these documents without charge upon request made to: J. C. Penney Company, Inc. Office of Investor Relations 6501 Legacy Drive Plano, Texas...

  • Page 52
    ... Fees and Services The information required by Item 14 is included under the captions "Audit and Other Fees" and "Audit Committee's Pre-Approval Policies and Procedures" in our Company's definitive proxy statement for 2016, which will be filed with the Securities and Exchange Commission pursuant...

  • Page 53
    ...of Contents PTRT IV Item 15. Exhibits, Financial Statement Schedules (a) Documents filed as part of this report: 1. Consolidated Financial Statements: The Consolidated Financial Statements of J. C. Penney Company, Inc. and subsidiaries are listed in the accompanying "Index to Consolidated Financial...

  • Page 54
    ... C. PENNEY COMPANY, INC. (Registrant) By /s/ Andrew S. Drexler Andrew S. Drexler Senior Vice President, Chief Accounting Officer and Controller (principal accounting officer) Date: March 16, 2016 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below...

  • Page 55
    ... of Contents Signatures Title Date Stephen I. Sadove* Stephen I. Sadove Javier G. Teruel* Javier G. Teruel R. Gerald Turner* R. Gerald Turner Ronald W. Tysoe* Ronald W. Tysoe Director March 16, 2016 Director March 16, 2016 Director March 16, 2016 Director March 16, 2016 *By: /s/ Andrew...

  • Page 56
    ...30, 2016, January 31, 2015 and February 1, 2014 Notes to Consolidated Financial Statements 1. Basis of Presentation and Consolidation 2. Significant Accounting Policies 3. Change in Accounting for Retirement-Related Benefits 4. Effect of New Accounting Standards 5. Earnings/(Loss) per Share 6. Other...

  • Page 57
    ... Board of Directors and Stockholders J. C. Penney Company, Inc.: We have audited the accompanying consolidated balance sheets of J. C. Penney Company, Inc. and subsidiaries as of January 30, 2016 and January 31, 2015, and the related consolidated statements of operations, comprehensive income/ (loss...

  • Page 58
    ... per share data) Total net sales Cost of goods sold Gross margin Operating expenses/(income): Selling, general and administrative (SG&A) Pension Depreciation and amortization Real estate and other, net Restructuring and management transition Total operating expenses Operating income/(loss) Loss on...

  • Page 59
    ... Foreign currency translation Unrealized gain/(loss) (3) Retirement benefit plans Net actuarial gain/(loss) arising during the period (4) Prior service credit/(cost) arising during the period (5) Reclassification of net actuarial (gain)/loss from a settlement (6) Reclassification for net actuarial...

  • Page 60
    ...-term debt Deferred taxes Other liabilities Total Liabilities Stockholders' Equity Common stock (1) Additional paid-in capital Reinvested earnings/(accumulated deficit) Accumulated other comprehensive income/(loss) Total Stockholders' Equity Total Liabilities and Stockholders' Equity $ $ 2015 2014...

  • Page 61
    ... Total Stockholders' Equity $ 3,171 (1,278) 380 786 28 3,087 (717) (491) 35 1,914 (513) (141) 49 1,309 (in minnions) February 2, 2013 - as adjusted Net income/(loss) Other comprehensive income/(loss) Common stock issued Stock-based compensation February 1, 2014 - as adjusted Net income/(loss) Other...

  • Page 62
    ... non-operating assets Net gain on sale of operating assets Loss on extinguishment of debt Depreciation and amortization Benefit plans Stock-based compensation Other comprehensive income tax benefits Deferred taxes Change in cash from: Inventory Prepaid expenses and other assets Merchandise accounts...

  • Page 63
    ... Our Company was founded by James Cash Penney in 1902 and has grown to be a major national retailer, operating 1,021 department stores in 49 states and Puerto Rico, as well as through our Internet website at jcpenney.com. We sell family apparel and footwear, accessories, fine and fashion jewelry...

  • Page 64
    ...using our private label card or registered third party credit cards receive JCP Rewards® certificates, redeemable for merchandise or services in our stores the following two months. We estimate the net cost of the rewards that will be redeemed and record this as cost of goods sold as rewards points...

  • Page 65
    ... 2015, a change in certain cooperative advertising programs resulted in more vendor reimbursements being recognized as a reduction of our advertising expense rather than offsetting cost of goods sold. Income Taxes We account for income taxes using the asset and liability method. Deferred tax assets...

  • Page 66
    ...We capitalize major replacements and improvements. We remove the cost of assets sold or retired and the related accumulated depreciation or amortization from the accounts and include any resulting gain or loss in net income/(loss). We recognize a liability for the fair value of our conditional asset...

  • Page 67
    ... our defined benefit pension and postretirement plans directly on the Consolidated Balance Sheet. Each overfunded plan is recognized as an asset and each underfunded plan is recognized as a liability. We adjust other comprehensive income/(loss) to reflect prior service cost or credits and actuarial...

  • Page 68
    ... Company's new accounting method, the Company recognizes changes in net actuarial gains or losses in excess of the corridor annually in the fourth quarter each year (MTM Adjustment). The remaining components of pension expense, primarily service and interest costs and assumed return on plan assets...

  • Page 69
    ... income/(loss) Ending balance Consolidated Statements of Cash Flows 2014 ($ in minnions) Cash flows from operating activities: Net income/(loss) Benefit plans Other comprehensive income tax benefits Deferred taxes $ Previously Reported (771) (24) - 3 $ Ts Tdjusted (717) (78) - 3 Effect of Change...

  • Page 70
    ... condition, results of operations or cash flows. In April 2015, the FASB Issued ASU 2015-4, Compensation-Retirement Benefits, to provide a practical expedient related to the measurement date of defined benefit plan assets and obligations. The practical expedient allows employers with fiscal year...

  • Page 71
    ... a reduction in Long-term debt in the Consolidated Balance Sheets. Adoption of this standard did not impact results of operations, retained earnings, or cash flows in the current or previous interim and annual reporting periods. In August 2014, the Financial Accounting Standards Board (FASB) issued...

  • Page 72
    ...and bonus Customer gift cards Taxes other than income taxes Occupancy and rent-related Interest Advertising Current portion of workers' compensation and general liability self-insurance Restructuring and management transition (Note 17) Current portion of retirement plan liabilities (Note 16) Capital...

  • Page 73
    ... as hedging instruments: Balance Sheet Location Liability Derivatives at Fair Value 2015 2014 Balance Sheet Location 2015 2014 Interest rate swaps Interest rate swaps Total derivatives designated as hedging instruments N/A N/A $ - - $ - - - 73 Other accounts payable and accrued expenses...

  • Page 74
    ...Balance Sheets are as follows: Ts of January 30, 2016 ($ in minnions) Total debt, excluding unamortized debt issuance costs, capital leases and notes payable Carrying Tmount $ 4,830 $ Fair Value 4,248 $ Ts of January 31, 2015 Carrying Tmount 5,350 $ Fair Value 4,834 The fair value of long-term debt...

  • Page 75
    Table of Contents 11. Credit Facility The Company has a $2,350 million senior secured asset-based credit facility (2014 Credit Facility), comprised of a $2,350 million revolving line of credit (Revolving Facility). During 2015, the Company amended the 2014 Credit Facility to increase the Revolving ...

  • Page 76
    ... 8.125% Senior Notes Due 2019 (6) 2013 Term Loan Facility (7) 2014 Term Loan (8) Total debt, excluding unamortized debt issuance costs, capital leases and note payable Unamortized debt issuance costs Total debt, excluding capital leases and note payable Less: current maturities Total long-term debt...

  • Page 77
    ... 5.0%. We are required to make quarterly repayments in a principal amount equal to $5.625 million during the five-year term, subject to certain reductions for mandatory and optional prepayments. Scheduled Annual Principal Payments on Long-Term Debt, Excluding Capital Leases and Note Payable ($ in...

  • Page 78
    ... period change January 30, 2016 Common Stock On a combined basis, our 401(k) savings plan, including our employee stock ownership plan (ESOP), held approximately 14 million shares, or approximately 4.7% of outstanding Company common stock, at January 30, 2016. Under our 2013 senior secured term...

  • Page 79
    ... We grant stock-based compensation awards to employees and non-employee directors under our equity compensation plan. On May 16, 2014, our stockholders approved the J. C. Penney Company, Inc. 2014 Long-Term Incentive Plan (2014 Plan), which has a fungible share design in which each stock option will...

  • Page 80
    ...free interest rate Weighted-average expected dividend yield (1) Expected dividend yield range (1) (1) 2014 4.1 years 60.00% 1.60% -% -% 2013 4.3 years 62.00% 0.64% -% -% 4.6 years 51.46% 1.50% -% -% Fonnowing the May 1, 2012 payment, we discontinued the quarterny $0.20 per share dividend. Stock...

  • Page 81
    ... employee stock awards, which will be recognized over the remaining weighted-average vesting period of approximately two years. The aggregate market value of shares vested during 2015, 2014 and 2013 was $16 million, $4 million and $25 million, respectively, compared to an aggregate grant date...

  • Page 82
    Table of Contents Capital Leases and Note Payable $ 27 10 - - - - - 37 (1) $ 82 36 ($ in minnions) 2016 2017 2018 2019 2020 Thereafter Less: sublease income Total minimum lease payments Less: amounts representing interest Present value of net minimum lease obligations

  • Page 83
    ... rate until it is phased out at age 70. Employee-paid term life insurance through age 65 is continued under a separate plan (Supplemental Term Life Insurance Plan for Management Profit-Sharing Employees). Primary Pension Plan Lump-Sum Payment Offer and Annuity Contract Purchase In August 2015...

  • Page 84
    ... Plans Total Service cost Interest cost Expected return on plan assets Amortization of actuarial loss/(gain) Amortization of prior service cost/(credit) Settlement expense Other Loss/(gain) on transfer of benefits Net periodic benefit expense/(income) $ 2015 69 196 (357) 52 8 180 6 - 154 $ 2014...

  • Page 85
    ...-term asset allocation policy, historical returns for plan assets and overall capital market returns, taking into account current and expected market conditions. The discount rate used to measure pension expense each year is the rate as of the beginning of the year (i.e., the prior measurement date...

  • Page 86
    ... income/(loss) in the Consolidated Balance Sheets as of the end of 2015 and 2014: Primary Pension Plan ($ in minnions) Net actuarial loss/(gain) Prior service cost/(credit) Total $ 2015 $ 333 57 390 (1) Supplemental Plans 2015 213 65 278 $ $ 13 (4) 9 $ $ 2014 17 (4) 13 2014 $ $ (1) In 2016...

  • Page 87
    ...securities and other asset classes to maintain an efficient risk/return diversification profile. The risk of loss in the plan's equity portfolio is mitigated by investing in a broad range of equity types. Equity diversification includes large-capitalization and small-capitalization companies, growth...

  • Page 88
    ... Plan's assets as of the end of 2015 and 2014, by major class of asset. Investments at Fair Value at January 30, 2016 ($ in minnions) Tssets Cash Common collective trusts Cash and cash equivalents total Common collective trusts - domestic Common collective trusts - international Equity securities...

  • Page 89
    ... the underlying assets. The underlying assets are valued at net asset value (NAV) and are classified as level 2 of the fair value hierarchy. Equity Securities - Equity securities are common stocks and preferred stocks valued based on the price of the security as listed on an open active exchange and...

  • Page 90
    ... market transactions for comparable assets, (2) the income approach using the discounted cash flow model, or (3) cost method. Private equity funds also provide audited financial statements. Private equity investments are classified as level 3 of the fair value hierarchy. Corporate Bonds - Corporate...

  • Page 91
    ... Statements of Operations. The postretirement medical and dental plan has no assets and an accumulated postretirement benefit obligation (APBO) of $8 million at January 30, 2016 and $11 million at January 31, 2015. Defined Contribution Plans The Savings, Profit-Sharing and Stock Ownership Plan...

  • Page 92
    ... participants' annual pay. This Company contribution is in lieu of the primary pension benefit that was closed to employees hired or rehired on or after that date. Participating employees are fully vested after three years. In addition to the Savings Plan, we sponsor the Mirror Savings Plan, which...

  • Page 93
    ...) Home office and stores Store fixtures Management transition Other Total $ 2015 42 - 28 14 84 $ 2014 45 - 16 26 87 $ 2013 $ $ $ $ Activity for the restructuring and management transition liability for 2015 and 2014 was as follows: ($ in minnions) February 1, 2014 Charges Cash payments Non...

  • Page 94
    ...expense/(income) $ 2015 (9) (41) (9) 20 42 3 $ 2014 (25) (53) (92) 30 (8) (148) $ 2013 (132) - (17) 27 (33) (155) $ $ $ Net Gain from Sale of Non-operating Assets - Sale or Redemption of REIT Assets In 2013, we sold 205,000 REIT units at an average price of $151.97 per share for a total price of...

  • Page 95
    ... at statutory rate State and local income tax, less federal income tax benefit Increase in valuation allowance federal and state Tax benefit resulting from OCI allocation Other, including permanent differences and credits Effective tax rate 2015 (35.0)% (4.2) 36.7 - 4.3 1.8 % 2014 (35.0)% (4.2) 41...

  • Page 96
    ... vacation pay Gift cards Stock-based compensation Deferred equity adjustment State taxes Workers' compensation/general liability Accrued rent Litigation exposure Mirror savings plan Pension and other retiree obligations Net operating loss and tax credit carryforwards Other Total deferred tax assets...

  • Page 97
    ... the ownership change, multiplied by the long-term tax-exempt interest rate in effect for the month of the ownership change. As discussed in Note 13, on January 27, 2014, the Board adopted the Amended Rights Agreement to help prevent acquisitions of the Company's common stock that could result in an...

  • Page 98
    ... of long-term debt Purchase of property and equipment and software through capital leases and a note payable Issuance costs withheld from proceeds of common stock issued Return of shares of Martha Stewart Living Omnimedia, Inc. previously acquired by the Company $ 2015 (5) (369) - 1 - 1 - $ 2014 (30...

  • Page 99
    ... 2014 in the U.S. District Court, Eastern District of Texas, Tyler Division. The suit alleges that the defendants violated Section 502 of the Employee Retirement Income Security Act (ERISA) by breaching fiduciary duties relating to the J. C. Penney Corporation, Inc. Savings, Profit-Sharing and Stock...

  • Page 100
    ... 31, 2012, made purchases in California of JCP private or exclusive label apparel or accessories advertised at a discount of at least 30% off the stated original or regular price (excluding those who only received such discount by using coupon(s)), and who have not received a refund or credit for...

  • Page 101
    ...quarterly unaudited consolidated results of operations for 2015 and 2014: 2015 ($ in minnions, except EPS) Total net sales Gross margin SG&A expenses Restructuring and management transition (1) Net income/(loss)(2) Diluted earnings/(loss) per share(3) 2014 ($ in minnions, except EPS) Total net sales...

  • Page 102
    ... Trust of California, National Association, as Successor Trustee to Bank of America National Trust and Savings Association) to Indenture dated as of October 1, 1982 Sixth Supplemental Indenture, dated as of May 20, 2013, among J. C. Penney Corporation, Inc., J. C. Penney Company, Inc., as co-obligor...

  • Page 103
    ...1 to Credit Agreement dated as of December 10, 2015 among J. C. Penney Company, Inc., J. C. Penney Corporation, Inc., J. C. Penney Purchasing Corporation, the guarantors party thereto, Wells Fargo Bank, National Association, as Administrative Agent and Revolving Agent, Bank of America, N.A., as Term...

  • Page 104
    ... dated October 11, 2013, the Fourth Amendment thereto dated February 25, 2014, and the Fifth Amendment thereto dated April 6, 2015 J. C. Penney Company, Inc. Directors' Equity Program Tandem Restricted Stock Award/Stock Option Plan J. C. Penney Company, Inc. 1993 Non-Associate Directors' Equity Plan...

  • Page 105
    ... Penney Company, Inc. 2012 Long-Term Incentive Plan J. C. Penney Company, Inc. 2014 Long-Term Incentive Plan JCP Supplemental Term Life Insurance Plan for Management ProfitSharing Associates, as amended and restated effective July 1, 2007 Form of Director's election to receive all/portion of annual...

  • Page 106
    ... Director Restricted Stock Unit Award under the J. C. Penney Company, Inc. 2009 Long-Term Incentive Plan J. C. Penney Corporation, Inc., Management Incentive Compensation Program, effective January 30, 2011 Notice of Restricted Stock Unit Grant for Edward J. Record Form of Executive Termination Pay...

  • Page 107
    ... Form of Notice of Performance Unit Grant under the J. C. Penney Company, Inc. 2014 Long-Term Incentive Plan Letter Agreement dated May 15, 2015 between J. C. Penney Company, Inc. and Andrew S. Drexler Notice of Restricted Stock Unit Grant for Andrew Drexler Notice of Stock Option Grant for Andrew...

  • Page 108
    ... 30, 2013, October 11, 2013, February 25, 2014, and April 6, 2015 by and between J. C. PENNEY CORPORATION, INC., formerly known as J. C. Penney Company, Inc., a Delaware corporation, with its principal place of business at Plano, Texas, and SYNCHRONY BANK, assignee of Monogram Credit Card Bank of...

  • Page 109
    ... full force and effect. In the event of any conflict between the Agreement and this Amendment Number Six, the terms and conditions of this Amendment Number Six shall govern. C. The parties hereto agree to execute such other documents and instruments and to do such other and further things as may be...

  • Page 110
    IN WITNESS WHEREOF, the parties hereto have executed and delivered this Amendment Number Six as of the date set forth above. J. C. PENNEY CORPORATION, INC. SYNCHRONY BANK By: /s/ Michael D. Porter Title: VP, Treasurer By: /s/ Tom Quindlen Title: EVP Retail Card

  • Page 111
    ...INSERT NAME OF EXECUTIVE OFFICER] This Executive Termination Pay Agreement (the "Agreement"), dated as of _____, 20___ is between J.C. Penney Corporation, Inc. ("Corporation") and the undersigned member of the Corporation's executive team (the "Executive"). WHEREAS, in order to achieve its long-term...

  • Page 112
    ... Period severance pay equal to the Executive's monthly Base Salary, plus the Executive's target annual incentive (at $1.00 per unit) under the Corporation's Management Incentive Compensation Program for the fiscal year in which the Executive experiences an Involuntary Separation from Service...

  • Page 113
    ... Plan at active associate rates if (i) the Executive is enrolled in a full-time medical and/or dental option, as applicable, under the Health and Welfare Plan on the effective date of the Executive's Involuntary Separation from Service other than for Cause and the Corporation currently is paying...

  • Page 114
    ... those under the Corporation's Separation Pay Plan, or any successor plan or program offered by the Corporation, which the Executive hereby waives. If the Executive receives benefits under the Corporation's Change in Control Plan (the "CIC Plan"), in the event of Employment Termination (as defined...

  • Page 115
    ... from self-employment, as a common law employee, or otherwise, shall reduce the amount of any payment or benefit under any provision of this Agreement. 1.10 Resignations. Except to the extent requested by the Corporation, upon termination of the Executive's service with the Corporation for any...

  • Page 116
    ... the date an Executive retires, dies or otherwise has a termination of employment with the Service Recipient. In accordance with Treasury Regulation section 1.409A-1(h) or any successor thereto, if an Executive is on a period of leave that exceeds six months and the Executive does not retain a right...

  • Page 117
    ... at the time of termination of the Executive's employment with the Corporation: Title Severance Period 2.19 2.20 Executive Vice Presidents and above 18 months Senior Vice President 12 months 2.21 "Voluntary Separation from Service " shall mean a Separation from Service other than as a result of...

  • Page 118
    ...limited to information, plans and strategies regarding suppliers, pricing, marketing, customers, hiring and terminations, employee performance and evaluations, internal reviews and investigations, short term and long range plans, acquisitions and divestitures, advertising, information systems, sales...

  • Page 119
    ... provides buying office or sourcing services to any business of the types referred to in this Section 3.4(b). (b) (iii) (c) For purposes of this section, the restrictions on working for a Competing Business shall include working at any location within the United States or Puerto Rico. Executive...

  • Page 120
    ...except as provided below) through informal binding mandatory arbitration by an arbitrator selected under the rules of the American Arbitration Association for arbitration of employment disputes (located in the city in which the Corporation's principal executive offices are based) and the arbitration...

  • Page 121
    ... by the Executive (except by will or by operation of the laws of intestate succession) or by the Corporation except that the Corporation may assign this Agreement to any successor (whether by merger, purchase or otherwise) to all or substantially all of the stock, assets or businesses of the...

  • Page 122
    ... or five business days after having been mailed by United States registered or certified mail, return receipt requested, postage prepaid, or three business days after having been sent by a nationally recognized overnight courier service, addressed to the Corporation at its principal executive office...

  • Page 123
    .... The Corporation shall be entitled to withhold from payment any amount of withholding required by law. 5.11 5.12 5.13 IN WITNESS WHEREOF, the parties have executed this Agreement as of the date and year first above written. J. C. Penney Corporation, .nc. By: Name: Title: Executive _____

  • Page 124
    ...Restricted etock Unit Grant Name Employee ID Andrew Drexler Date of Grant Number of Performance Units Granted June 11, 2015 31,437 Restricted etock Unit Grant Subject to the terms of this Notice of Restricted Stock Unit Grant ("Notice"), the J. C. Penney Company, Inc. (the "Company") hereby grants...

  • Page 125
    ... 12-month period 30 percent of the total voting power of the stock of the Company, or (ii) a majority of the Board is replaced within a 12-month period by directors whose appointment or election is not approved by a majority of the members of the Board before the appointment or election. A change in...

  • Page 126
    ... and total disability within the meaning of section 22(e) (3) of the Code. "Fair Market Value" of the Common Stock on any date will be the closing price on such date as reported in the composite transaction table covering transactions of New York Stock Exchange ("Exchange") listed securities, or...

  • Page 127
    ... the Corporation's Management Incentive Compensation Program or any successor program then in effect); or (b) failure by the Company to pay You a material portion of Your current base salary, or incentive compensation within seven days of its due date; or (c) a material adverse change in reporting...

  • Page 128
    ... promise by the Company to issue a share of Common Stock to You subject to restrictions or a substantial risk of forfeiture "Retirement" will mean Your termination of employment with the Company other than for Cause on or after the date You attain age 55 with at least 15 years of service, or on or...

  • Page 129
    ... respect to the number of Restricted Stock Units in Your account by the Fair Market Value of the Common Stock on the dividend record date. The additional Restricted Stock Units credited to Your account are subject to all of the terms and conditions of this Restricted Stock Unit award and You will...

  • Page 130
    ...effective date of Your employment termination and a result of the Involuntary Separation from Service for Cause or Your resignation. Recoupment Equity awards are subject to the Company's currently effective recoupment policy, as that policy may be amended from time to time by the Board or applicable...

  • Page 131
    ... be resolved (except as provided below) through informal arbitration by an arbitrator selected under the rules of the American Arbitration Association for arbitration of employment disputes (located in the city in which the Company's principal executive offices are based) and the arbitration will be...

  • Page 132
    ... to You. Shares of Common Stock will be deemed issued on the date on which they are issued in Your name. (d) Indemnification. Each person who is or will have been a member of the Board or any committee of the Board will be indemnified and held harmless by the Company against and from any loss, cost...

  • Page 133
    ... to a partnership, limited liability company or corporation in which You or the persons referred to in clause (i) are the only partners, members or shareholders, or (iv) for charitable donations; provided that any such assignee shall be bound by and subject to all of the terms and conditions of this...

  • Page 134
    ...been mailed by United States registered or certified mail, return receipt requested, postage prepaid, or three business days after having been sent by a nationally recognized overnight courier service, addressed to the Company at its principal executive office, c/o the Company's General Counsel, and...

  • Page 135
    ... or inter-dealer quotation system or other forum in which shares of Common Stock are quoted or traded (including without limitation Section 16 of the Securities Exchange Act of 1934); and, as a condition of any sale or issuance of shares of Common Stock under this Notice, the Board or its designee...

  • Page 136
    obligation of the Company to sell and deliver shares of Common Stock, will be subject to all applicable federal and state laws, rules and regulations and to such approvals by any government or regulatory agency as may be required.

  • Page 137
    ... of Stock Option Grant Employee ID Andrew Drexler Option Grant Price Per Share Number of NSO Shares Granted June 11, 2015 $8.35 78,358 Non-Qualified Stock Option Grant Subject to the terms of this Notice of Stock Option Grant ("Notice"), the J. C. Penney Company, Inc. (the "Company") hereby...

  • Page 138
    change of ownership, a change of effective control occurs (i) when a person or persons acting as a group acquires within a 12-month period 30 percent of the total

  • Page 139
    ... assets, or similar business transaction with the Company. "Code" will mean the Internal Revenue Code of 1986, as amended. "Company" will mean J. C. Penney Company, Inc., the Corporation or any successor thereto, for whom the services are performed and with respect to whom the legally binding right...

  • Page 140
    ...11, 2015. "Fair Market Value" of the Common Stock on any date will be the closing price on such date as reported in the composite transaction table covering transactions of New York Stock Exchange ("Exchange") listed securities, or if such Exchange is closed, or if the Common Stock does not trade on...

  • Page 141
    ... of employment with the Company other than for Cause on or after the date You attain age 55 with at least 15 years of service, or on or after You attain age 60 with at least 10 years of service. "Trading Date" shall mean a day on which the Company's Common Stock trades on the New York Stock Exchange...

  • Page 142
    ...-Qualified Stock Option will generally become exercisable ("Vest") in three (3) equal installments over a three (3) year period on the first, second, and third anniversaries of the Date of Grant (the "Vest Date"), according to the schedule below. YOU MUST REMAIN CONTINUOUSLY EMPLOYED BY THE COMPANY...

  • Page 143
    ... If Your employment terminates due to Retirement, Disability, or death or you experience an Involuntary Separation from Service other than for Cause as a result of a, job restructuring, reduction in force, or unit closing before any applicable Vest date of your Non-Qualified Stock Option, your...

  • Page 144
    ... to receive any shares of Common Stock in which You may vest if Your employment is terminated as a result of Your death by completing a beneficiary designation form in such form as may be prescribed from time to time by the Company. The beneficiary listed on Your beneficiary designation form will...

  • Page 145
    ... Order or the like, the date on which such sell order is actually executed, or (ii) in connection with an "Exercise and Hold" (cash exercise) transaction, the date the requisite funds are received by the Company at its home office in Plano, Texas or such other location as the Company may designate...

  • Page 146
    ... shares of Common Stock shall, however, be subject to the condition that if at any time the Company shall determine in its discretion that the listing, registration or qualification of the Non-Qualified Stock Option or the Common Stock upon any securities exchange or inter-dealer quotation system...

  • Page 147
    ... following the effective elimination, job restructuring or reduction in force date of termination Separation from Service as a result of Five years following the effective Retirement, death, or Disability date of termination Once the applicable post-termination exercise period described in the table...

  • Page 148
    ... be resolved (except as provided below) through informal arbitration by an arbitrator selected under the rules of the American Arbitration Association for arbitration of employment disputes (located in the city in which the Company's principal executive offices are based) and the arbitration will be...

  • Page 149
    ... to You. Shares of Common Stock will be deemed issued on the date on which they are issued in Your name. (d) Indemnification. Each person who is or will have been a member of the Board or any committee of the Board will be indemnified and held harmless by the Company against and from any loss, cost...

  • Page 150
    ... performance under this Notice. (g) Effect on Other Benefits. The value of the shares of Common Stock covered by this Non-Qualified Stock Option award will not be included as compensation or earnings for purposes of any other compensation, Retirement, or benefit plan offered to Company associates.

  • Page 151
    ...been mailed by United States registered or certified mail, return receipt requested, postage prepaid, or three business days after having been sent by a nationally recognized overnight courier service, addressed to the Company at its principal executive office, c/o the Company's General Counsel, and...

  • Page 152
    ... issuance of stock certificates to reflect the issuance of shares of Common Stock in connection with this award, the issuance may be effected on a non-certificate basis, to the extent not prohibited by applicable law or the applicable rules of any stock exchange on which the Common Stock is traded.

  • Page 153
    ... or inter-dealer quotation system or other forum in which shares of Common Stock are quoted or traded (including without limitation Section 16 of the Securities Exchange Act of 1934); and, as a condition of any sale or issuance of shares of Common Stock under this Notice, the Board or its designee...

  • Page 154
    ... the total number of shares of Common Stock of 50 par value ("Common Stock") of J. C. Penney Company, Inc. ("Company") at the Option Grant Price Per Share shown above. This grant is subject to all the terms, rules, and conditions of the 2014 J. C. Penney Company, Inc. Long-Term Incentive Plan ("Plan...

  • Page 155
    Please see the Plan for all terms, rules, and conditions, including the post-termination of Employment exercise period applicable to this NSO. Covenants and Representations By accepting this award you hereby acknowledge that your duties to the Company require access to and creation of the Company's ...

  • Page 156
    ...limited to information, plans and strategies regarding suppliers, pricing, marketing, customers, hiring and terminations, employee performance and evaluations, internal reviews and investigations, short term and long range plans, acquisitions and divestitures, advertising, information systems, sales...

  • Page 157
    ... other than for cause and receive benefits under your termination agreement, that for a period equal to (x) 18 months, if you are an Executive Vice President on the date of your separation from service, or (y) 12 months, if you are a Senior Vice President, thereafter, you shall not, without the...

  • Page 158
    ... buying office or sourcing services to any business of the types referred to in this section (b). (c) For purposes of this section, the restrictions on working for a Competing Business shall include working at any location within the United States or Puerto Rico. You acknowledge that the Company...

  • Page 159
    any award under the Plan, or any plan or program that is a successor to the Plan, that (i) vested within the 12 months prior to the date of your voluntary separation from service or your involuntary separation from service other than for cause, each under and as defined in your termination agreement...

  • Page 160
    ... this Award is subject to any compensation recoupment policy adopted by the Board or the Committee prior to or after the effective date of the Plan, and as such policy may be amended from time to time after its adoption. This stock option grant does not constitute an employment contract. It does not...

  • Page 161
    ...all the terms, rules, and conditions of the 2014 J. C. Penney Company, Inc. Long-Term Incentive Plan ("Plan") and the implementing resolutions ("Resolutions") approved by the Human Resources and Compensation Committee ("Committee") of the Company's Board of Directors ("Board"). Capitalized terms not...

  • Page 162
    ... Restricted Stock Units in your account by the closing price of the Common Stock on the New York Stock Exchange on the dividend payment date. The additional Restricted Stock Units credited to your account are subject to all of the terms and conditions of this Restricted Stock Unit award and the Plan...

  • Page 163
    ...limited to information, plans and strategies regarding suppliers, pricing, marketing, customers, hiring and terminations, employee performance and evaluations, internal reviews and investigations, short term and long range plans, acquisitions and divestitures, advertising, information systems, sales...

  • Page 164
    ... other than for cause and receive benefits under your termination agreement, that for a period equal to (x) 18 months, if you are an Executive Vice President on the date of your separation from service, or (y) 12 months, if you are a Senior Vice President, thereafter, you shall not, without the...

  • Page 165
    ... buying office or sourcing services to any business of the types referred to in this section (b). (c) For purposes of this section, the restrictions on working for a Competing Business shall include working at any location within the United States or Puerto Rico. You acknowledge that the Company...

  • Page 166
    ...this Agreement, above, the Company shall have a right to seek recoupment of the portion of any award under the Plan, or any plan or program that is a successor to the Plan, that (i) vested within the 12 months prior to the date of your voluntary separation from service or your involuntary separation...

  • Page 167
    ... this Award is subject to any compensation recoupment policy adopted by the Board or the Committee prior to or after the effective date of the Plan, and as such policy may be amended from time to time after its adoption. This Restricted Stock Unit grant does not constitute an employment contract. It...

  • Page 168
    ...) Income/(loss) from continuing operations before income taxes Fixed charges: Net interest expense Interest income included in net interest Loss on extinguishment of debt, bond premiums and unamortized costs Estimated interest within rental expense Total fixed charges Total earnings available for...

  • Page 169
    ...'s annual report on Form 10K for the year ended January 30, 2016. As stated in Note 3 to the consolidated financial statements, in 2015 the Company changed its method of accounting for pension and postretirement benefits to immediately recognize actuarial gains and losses in its operating results in...

  • Page 170
    ... SUBSIDIARIES OF THE REGISTRANT Set forth below is a direct subsidiary of the Company as of March 16, 2016. All of the voting securities of this subsidiary are owned by the Company. Subsidiaries J. C. Penney Corporation, Inc. (Delaware) The names of other subsidiaries have been omitted because these...

  • Page 171
    ... 30, 2016 annual report on Form 10 â€'K of J. C. Penney Company, Inc. Our report dated March 16, 2016, on the consolidated balance sheets of J. C. Penney Company, Inc. as of January 30, 2016 and January 31, 2015, and the related consolidated statements of operations, comprehensive income/ (loss...

  • Page 172
    ... directors and officers of J. C. PENNEY COMPANY, INC., a Delaware corporation, which will file with the Securities and Exchange Commission, Washington, D.C. ("Commission"), under the provisions of the Securities Exchange Act of 1934, as amended, its Annual Report on Form 10-K for the fiscal year...

  • Page 173
    ... financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. 3. 4. 5. Date: March 16, 2016 /s/ Marvin R. Ellison Marvin R. Ellison Chief Executive Officer

  • Page 174
    ... information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. 3. 4. 5. Date: March 16, 2016 /s/ Edward J. Record Edward J. Record Executive Vice President and Chief...

  • Page 175
    ...(d) of the Securities Exchange Act of 1934; and (2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. DATED this 16th day of March 2016. /s/ Marvin R. Ellison Marvin R. Ellison Chief Executive Officer

  • Page 176
    ... Act of 1934; and (2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. DATED this 16th day of March 2016. /s/ Edward J. Record Edward J. Record Executive Vice President and Chief Financial Officer

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