Nordstrom 2000 Annual Report Download - page 32

Cyan Mag Yelo Blk
20100444 Nordstrom
2001 Annual Report • 44pgs. + 4 covers pg. 30
8.375 x 10.875 • PDF • 150 lpi
PMS
5773
PMS
5503
30
NORDSTROM, INC. AND SUBSIDIARIES
Note 11: Long-Term Debt
A summary of long-term debt is as follows:
January 31, 2001 2000
Senior debentures, 6.95%,
due 2028 $300,000 $300,000
Senior notes, 5.625%,
due 2009 250,000 250,000
Senior notes, 8.950%,
due 2005 300,000 —
Medium-term notes, payable by
Nordstrom Credit, Inc.,
7.25%-8.67%, due 2001-2002 87,750 145,350
Notes payable, of
Nordstrom Credit, Inc.,
6.7%, due 2005 100,000 100,000
Other 74,546 9,632
Total long-term debt 1,112,296 804,982
Less current portion (12,586) (58,191)
Total due beyond one year $1,099,710 $746,791
Aggregate principal payments on long-term debt are as
follows: 2001-$12,586; 2002-$131,150; 2003-$1,157;
2004-$1,224; 2005-$400,208 and thereafter-$565,971.
The Company owns a 49% interest in a limited partnership
which is constructing a new corporate office building in
which the Company will be the primary occupant. In
accordance with Emerging Issues Task Force Issue No. 97-
10 “The Effect of Lessee Involvement in Asset
Construction”, the Company is considered to be the owner of
the property. Construction in progress includes capitalized
costs related to this building of $57,270, which includes
noncash amounts of $41,883, as of January 31, 2001. The
corresponding finance obligation of $53,060 as of January
31, 2001 is included in other long-term debt. This finance
obligation will be amortized as rental payments are made by
the Company to the limited partnership over the life of
permanent financing, expected to be 20-25 years. The
amortization will begin once construction is complete,
estimated to be July 2001. The Company is a guarantor of a
$93,000 credit facility of the limited partnership. The
credit facility provides for interest at either the LIBOR rate
plus .75%, or the greater of the Federal Funds rate plus .5%
and the prime rate, and matures in August 2002 (6.36% at
January 31, 2001).
Note 12: Leases
The Company leases land, buildings and equipment under
noncancelable lease agreements with expiration dates
ranging from 2001 to 2080. Certain leases include renewal
provisions at the Company’s option. Most of the leases
provide for additional rent payments based upon specific
percentages of sales and require the Company to pay for
certain common area maintenance and other costs.
Future minimum lease payments as of January 31, 2001 are
as follows: 2001-$59,434; 2002-$52,741; 2003-$51,305;
2004-$49,866; 2005-$47,396 and thereafter-$362,567.
The following is a schedule of rent expense:
Year ended January 31, 2001 2000 1999
Minimum rent:
Store locations $16,907 $18,794 $19,167
Offices, warehouses
and equipment 21,070 19,926 19,208
Percentage rent:
Store locations 9,241 7,441 8,603
Total rent expense $47,218 $46,161 $46,978
Note 13: Stock-Based Compensation
Stock Option Plan
The Company has a stock option plan (the “Plan”)
administered by the Compensation Committee of the Board
of Directors (the “Committee”) under which stock options,
performance share units and restricted stock may be granted
to key employees of the Company. Stock options are issued
at the fair market value of the stock at the date of grant.
Options vest over periods ranging from four to eight years,