Neiman Marcus 2009 Annual Report Download - page 44

Table of Contents
Contractual Obligations and Commitments
The following table summarizes our estimated significant contractual cash obligations at July 31, 2010:
Payments Due By Period
(in thousands) Total
Fiscal
Year
2011
Friscal
Years
2012-2013
Fiscal
Years
2014-2015
Fiscal Year
2016 and
Beyond
Contractual obligations:
Senior Secured Term Loan Facility (1) $ 1,513,383 $ 7,648 $ 1,505,735 $ — $ —
Senior Notes 752,445 — — — 752,445
Senior Subordinated Notes 500,000 — — — 500,000
2028 Debentures 125,000 — — — 125,000
Interest requirements (2) 897,400 181,200 320,000 257,000 139,200
Lease obligations 874,100 55,700 108,300 92,100 618,000
Minimum pension funding obligation (3) 109,100 — 68,700 34,700 5,700
Other long-term liabilities (4) 70,300 5,600 12,300 13,700 38,700
Construction and purchase commitments (5) 1,011,800 993,200 18,600 — —
$ 5,853,528 $ 1,243,348 $ 2,033,635 $ 397,500 $ 2,179,045
(1) Pursuant to the terms of our Senior Secured Term Loan Facility, NMG was required to prepay $92.6 million of our
outstanding term loans pursuant to the annual excess cash flow requirements. Of such amount, NMG paid $85.0 million in the fourth
quarter of fiscal year 2010 and will make the remaining $7.6 million payment in the first quarter of fiscal year 2011. The above table
does not reflect future excess cash flow prepayments, if any, that may be required under the term loan facility.
(2) The cash obligations for interest requirements reflect 1) interest requirements on our fixed-rate debt obligations at their
contractual rates, 2) interest requirements on floating rate debt obligations not subject to interest rate swaps or interest rate caps at
rates in effect at July 31, 2010 and 3) interest requirements on floating rate debt obligations subject to interest rate swaps at the fixed
rates provided through the swap agreements prior to their expiration in December 2010. We estimate that a 1% increase in interest
rates related to the portion of our floating rate debt outstanding at July 31, 2010 not subject to interest rate swaps would increase
annual interest rate requirements by approximately $12 million during fiscal year 2011.
(3) At July 31, 2010 (the most recent measurement date), our actuarially calculated projected benefit obligation for our Pension
Plan was $476.2 million and the fair value of the assets was $314.5 million. Our policy is to fund the Pension Plan at or above the
minimum amount required by law. Our scheduled obligations with respect to our Pension Plan consist of expected benefit payments
through 2016, as currently estimated using information provided by our actuaries. We made voluntary contributions to our Pension
Plan of $30.0 million in fiscal year 2010 and $15.0 million in fiscal year 2009. As of July 31, 2010, we do not anticipate any
requirement to make contributions to the Pension Plan for fiscal year 2011.
(4) Included in other long-term liabilities at July 31, 2010 are our liabilities for our Pension, SERP and Postretirement Plans
aggregating $270.5 million. Our scheduled obligations with respect to our SERP and Postretirement Plan liabilities consist of
expected benefit payments through 2020, as currently estimated using information provided by our actuaries. Also included in other
long-term liabilities at July 31, 2010 are our liabilities related to 1) uncertain tax positions (including related accruals for interest and
penalties) of $12.7 million and 2) other obligations aggregating $16.8 million, primarily for employee benefits. Future cash
obligations related to these liabilities are not currently estimable.
(5) Construction commitments relate primarily to obligations pursuant to contracts for the construction of new stores and the
renovation of existing stores expected as of July 31, 2010. These amounts represent the gross construction costs and exclude
developer contributions of approximately $25 million, which we expect to receive pursuant to the terms of the construction contracts.
In the normal course of our business, we issue purchase orders to vendors/suppliers for merchandise. Our purchase orders
are not unconditional commitments but, rather represent executory contracts requiring performance by the vendors/suppliers,
including the delivery of the merchandise prior to a specified cancellation date and the compliance with product specifications, quality
standards and other requirements. In the event of the vendor's failure to meet the agreed upon terms and conditions, we may cancel
the order.
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