Pier 1 2016 Annual Report Download - page 51

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 2 — PROPERTIES AND EQUIPMENT, NET
Properties and equipment, net are summarized as follows at February 27, 2016 and February 28, 2015 (in thousands):
2016 2015
Land $ 535 $ 535
Buildings 8,087 8,087
Equipment, furniture, fixtures and other 355,561 342,407
Leasehold improvements 210,546 213,148
Computer software 101,391 89,271
Projects in progress 13,271 6,837
689,391 660,285
Less accumulated depreciation 481,758 446,237
Properties and equipment, net $207,633 $214,048
NOTE 3 — OTHER ACCRUED LIABILITIES AND NONCURRENT LIABILITIES
The following is a summary of other accrued liabilities and noncurrent liabilities at February 27, 2016 and February 28, 2015 (in
thousands):
2016 2015
Accrued payroll and other employee-related liabilities $ 54,034 $ 59,422
Accrued taxes, other than income 23,718 23,160
Rent-related liabilities 7,966 7,854
Other 15,994 16,345
Other accrued liabilities $101,712 $106,781
Rent-related liabilities $ 29,467 $ 26,263
Deferred gains 4,594 5,666
Retirement benefits 42,634 41,791
Other 10,797 6,421
Other noncurrent liabilities $ 87,492 $ 80,141
NOTE 4 — LONG-TERM DEBT AND AVAILABLE CREDIT
Industrial Revenue Bonds — The Company has industrial revenue bonds outstanding totaling $9,500,000 at February 27,
2016 and February 28, 2015. The Company’s industrial revenue bonds have been outstanding since fiscal 1987. Proceeds
were used to construct warehouse/distribution facilities. The loan agreements and related tax-exempt bonds mature in the year
2026. The Company’s interest rates on the loans are based on the bond interest rates, which are market driven, reset weekly
and are similar to other tax-exempt municipal debt issues. The Company’s weighted average effective interest rate, including
standby letter of credit fees, was 1.7%, 1.7% and 1.9% for fiscal 2016, 2015 and 2014, respectively.
Revolving Credit Facility — The Company has a $350,000,000 secured revolving credit facility with a $100,000,000
accordion feature (“Revolving Credit Facility”). The Company completed a second amendment to its Revolving Credit Facility in
April of 2014, in order to allow additional borrowings under a senior secured term loan facility (“Term Loan Facility”) which closed
at the same time. Substantially all other material terms and conditions applicable under the Revolving Credit Facility remain
unchanged. Provided that there is no default and no default would occur as a result thereof, the Company may request that the
Revolving Credit Facility be increased to an amount not to exceed $450,000,000. The Revolving Credit Facility matures in June
2018 and is secured primarily by the Company’s eligible merchandise inventory and third-party credit card receivables and
certain related assets on a first priority basis and on a second lien basis by substantially all other assets of certain of the
Company’s subsidiaries, subject to certain exceptions. At the Company’s option, borrowings will bear interest, payable quarterly
PIER 1 IMPORTS, INC. 2016 Form 10-K 45