Neiman Marcus 2002 Annual Report Download - page 24

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The estimated significant contractual cash obligations and other commercial commitments at August 2, 2003 are summarized in the
following table:
Payments Due By Period
(in thousands) Total
Fiscal Year
2004
Fiscal Years
2005 - 2006
Fiscal Years
2007 - 2008
Fiscal Year
2009 and
Beyond
Contractual obligations
Senior notes $ 125,000 $ — $ — $ 125,000 $ —
Senior debentures 125,000 — — — 125,000
Capital lease obligations 1,700 1,100 600 — —
Operating lease obligations 780,300 44,600 84,500 72,100 579,100
Construction commitments 8,600 7,800 800 — —
NMG Credit Card Master Trust Class A
Certificates 225,000 — 225,000 — —
$ 1,265,600 $ 53,500 $ 310,900 $ 197,100 $ 704,100
Amount of Commitment Expiration Period
Total
Fiscal Year
2004
Fiscal Years
2005 - 2006
Fiscal Years
2007 - 2008
Fiscal Year
2009 and
Beyond
Other commercial commitments
Revolving credit facility:
Outstanding commitment at August 2,
2003 $ 300,000 $ — $ 300,000 $ — $ —
Money market lending facility 25,000 — 25,000 — —
Letters of credit 8,500 8,400 100 — —
Surety bonds 2,700 2,100 600 — —
$ 336,200 $ 10,500 $ 325,700 $ — $ —
The Company's other principal commercial commitments are comprised of Pension Plan funding obligations, short-term merchandise
purchase commitments, common area maintenance costs, tax and insurance obligations and contingent rent payments. Substantially
all of the Company's merchandise purchase commitments are cancelable up to 30 days prior to the vendor's scheduled shipment date.
At August 1, 2003 (the most recent measurement date), the Company's actuarially calculated projected benefit obligation was $245.0
million and the fair value of the assets was $183.0 million resulting in an underfunded status of $62.0 million. In addition, the
Company was required to record an additional minimum pension liability of $39.3 million and reduce shareholders' equity, net of
taxes, by $23.8 million during 2003. These adjustments did not affect the Company's reported earnings or Pension Plan funding
requirements.
When funding is required, the Company's policy is to contribute amounts that are deductible for federal income tax purposes. In the
third quarter of 2003, the Company made a required contribution of $11.5 million and a voluntary contribution of $13.5 million to the
Pension Plan for the plan year ended July 31, 2002. In addition, the Company made contributions of $5.8 million in 2003 for the plan
year ending July 31, 2003. Based upon currently available information, the Company will not be required to make an additional
contribution to the Pension Plan for the plan year ending July 31, 2003.
While the Company's contributions to the Pension Plan exceed the minimum funding requirements under ERISA and IRS rules and
regulations, the significant decrease in the U.S. equity and bond markets during recent years contributed substantially to the
underfunded status. To the extent the U.S. equity and bond markets do not recover or continue to deteriorate, the Company's cash
funding requirements will increase. The Company expects to generate adequate cash flows from operating activities to meet the
Pension Plan funding requirements. The
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