Sears 2015 Annual Report Download - page 48

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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 3-5€Years
After€5
Years Other
millions
Operating leases . . . . . . . . . . . . . . . . . . . . . $4,502 $708 $1,152 $805 $1,837 $—
Short-term debt . . . . . . . . . . . . . . . . . . . . . . 797 797 — — — —
Capital lease obligations . . . . . . . . . . . . . . . 265 75 89 32 69 —
Royalty license fees(1) . . . . . . . . . . . . . . . . . 105 47 38 20 — —
Purchase obligations . . . . . . . . . . . . . . . . . . 27 13 14 — — —
Pension funding obligations . . . . . . . . . . . . 2,174 318 818 537 501 —
Long-term debt including current portion
and interest . . . . . . . . . . . . . . . . . . . . . . 2,997 150 1,580 714 553 —
Liability and interest related to uncertain
tax positions(2) . . . . . . . . . . . . . . . . . . . . 193 — — — — 193
Total contractual obligations. . . . . . . . . . . . $11,060 $2,108 $3,691 $2,108 $2,960 $193
(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 January€30, 2016, our uncertain tax position liability and gross interest payable were $137 million and $56
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 January€30, 2016: €
millions
Bank
Issued
SRAC
Issued€Other Total
Standby letters of credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 652 $ 11 $ — $ 663
Commercial letters of credit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 104 — 104
Secondary lease obligations and performance guarantee. . . . . . . . . . . . . . . . . — — 128 128
The secondary lease obligations related to certain store leases that have been assigned and previously divested
Sears businesses. The secondary lease obligations represent the maximum potential amount of future payments,
including renewal option periods pursuant to the lease agreements. We remain secondarily liable if the primary
obligor defaults.
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