Sears 2012 Annual Report Download - page 47

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47
Contractual Obligations and Off-Balance Sheet Arrangements
Information concerning our obligations and commitments to make future payments under contracts such as
debt and lease agreements, and under contingent commitments, is aggregated in the following tables.
Total
Payments Due by Period
Contractual Obligations Within 1
Year 1-3 Years 4-5 Years After 5
Years Other
millions
Operating leases. . . . . . . . . . . . . . . . . . . . . . . . $ 4,535 $ 720 $ 1,148 $ 739 $ 1,928 $ —
Short-term debt . . . . . . . . . . . . . . . . . . . . . . . . 1,094 1,094 — — — —
Capital lease obligations . . . . . . . . . . . . . . . . . 643 113 201 125 204 —
Royalty license fees(1) . . . . . . . . . . . . . . . . . . . 91 59 30 2 — —
Purchase obligations . . . . . . . . . . . . . . . . . . . . 102 19 41 40 2 —
Pension funding obligations . . . . . . . . . . . . . . 2,475 381 928 660 506 —
Long-term debt including current portion and
interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,095 47 71 116 1,861 —
Liability and interest related to uncertain tax
positions(2) . . . . . . . . . . . . . . . . . . . . . . . . . 218 — — — — 218
Total contractual obligations. . . . . . . . . . . . . . $ 11,253 $ 2,433 $ 2,419 $ 1,682 $ 4,501 $ 218
__________________
(1) We pay royalties under various merchandise license agreements, which are generally based on sales of
products covered under these agreements. We currently have license agreements for which we pay royalties,
including those to use American Greetings and Joe Boxer. Royalty license fees represent the minimum the
Company is obligated to pay, regardless of sales, as guaranteed royalties under these license agreements.
(2) At February 2, 2013, our uncertain tax position liability and gross interest payable were $161 million and $57
million, respectively. We are unable to reasonably estimate the timing of liabilities and interest payments
arising from uncertain tax positions in individual years due to the uncertainties in the timing of the effective
settlement of tax positions.
Other Commercial Commitments
We issue various types of guarantees in the normal course of business. We had the following guarantees
outstanding at February 2, 2013:
millions Bank
Issued SRAC
Issued Other Total
Standby letters of credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 774 $ 47 $ — $ 821
Commercial letters of credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 133 — 141
Secondary lease obligations and performance guarantee. . . . . . . . — — 77 77
The secondary lease obligations relate to certain store leases of previously divested Sears businesses. We
remain secondarily liable if the primary obligor defaults.