Big Lots 2013 Annual Report Download - page 176

34
Contractual Obligations
The following table summarizes payments due under our contractual obligations at February 1, 2014:
Payments Due by Period (1)
Less than More than
(In thousands) Total 1 year 1 to 3 years 3 to 5 years 5 years
Obligations under bank credit facility (2) $ 77,095 $95 $
—
$ 77,000
$
—
Operating lease obligations (3) (4) 1,295,004 338,237 499,523 285,556
171,688
Capital lease obligations (4) 1,018 930 88
—
—
Purchase obligations (4) (5) 628,909 546,236 69,735 12,938
—
Other long-term liabilities (6) 35,474 7,172 7,190 7,200
13,912
Total contractual obligations $ 2,037,500 $892,670 $576,536 $ 382,694
$185,600
(1) The disclosure of contractual obligations in this table is based on assumptions and estimates that we believe to be
reasonable as of the date of this report. Those assumptions and estimates may prove to be inaccurate; consequently,
the amounts provided in the table may differ materially from those amounts that we ultimately incur. Variables that
may cause the stated amounts to vary from the amounts actually incurred include, but are not limited to: the
termination of a contractual obligation prior to its stated or anticipated expiration; fees or damages incurred as a result
of the premature termination or breach of a contractual obligation; the acquisition of more or less services or goods
under a contractual obligation than are anticipated by us as of the date of this report; fluctuations in third party fees,
governmental charges, or market rates that we are obligated to pay under contracts we have with certain vendors; and
the exercise of renewal options under, or the automatic renewal of, contracts that provide for the same.
(2) Obligations under the bank credit facility consist of the borrowings outstanding under the 2011 Credit Agreement, and
the associated accrued interest of $0.1 million. In addition, we had outstanding letters of credit totaling $64.4 million
at February 1, 2014. Approximately $61.8 million of the outstanding letters of credit represent stand-by letters of
credit and we do not expect to meet the conditions requiring significant cash payments on these letters of credit;
accordingly, they have been excluded from this table. The remaining $2.6 million of outstanding letters of credit
represent commercial letters of credit whereby the related obligation is included in the purchase obligations. For a
further discussion, see note 3 to the accompanying consolidated financial statements.
(3) Operating lease obligations include, among other items, leases for retail stores, warehouse space, offices, and certain
computer and other business equipment. The future minimum commitments for retail store, office, and warehouse
space operating leases are $1,003.1 million. For a further discussion of leases, see note 5 to the accompanying
consolidated financial statements. Many of the store lease obligations require us to pay for our applicable portion of
CAM, real estate taxes, and property insurance. In connection with our store lease obligations, we estimated that
future obligations for CAM, real estate taxes, and property insurance were $284.8 million at February 1, 2014. We
have made certain assumptions and estimates in order to account for our contractual obligations relative to CAM, real
estate taxes, and property insurance. Those assumptions and estimates include, but are not limited to: use of historical
data to estimate our future obligations; calculation of our obligations based on comparable store averages where no
historical data is available for a particular leasehold; and assumptions related to average expected increases over
historical data. The remaining lease obligation of $7.1 million relates primarily to operating leases for computer and
other business equipment, including data center related costs. For our Canadian segment, we valued our operating
lease obligations at their contractual amounts as of February 1, 2014. Since February 1, 2014, we have agreed to buy-
outs with many of our landlords at amounts that were lower than our contractual obligation.
(4) For purposes of the lease and purchase obligation disclosures, we have assumed that we will make all payments
scheduled or reasonably estimated to be made under those obligations that have a determinable expiration date, and we
disregarded the possibility that such obligations may be prematurely terminated or extended, whether automatically by
the terms of the obligation or by agreement between us and the counterparty, due to the speculative nature of
premature termination or extension. Where an operating lease or purchase obligation is subject to a month-to-month
term or another automatically renewing term, we included in the table our minimum commitment under such
obligation, such as one month in the case of a month-to-month obligation and the then-current term in the case of
another automatically renewing term, due to the uncertainty of future decisions to exercise options to extend or
terminate any existing leases.