Foot Locker 2012 Annual Report Download - page 72

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FOOT LOCKER, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
12. Revolving Credit Facility − (continued)
The 2011 Restated Credit Agreement provides for a security interest in certain of the Company’s domestic
assets, including certain inventory assets, but excluding intellectual property. The Company is not required
to comply with any financial covenants as long as there are no outstanding borrowings. With regard to the
payment of dividends and share repurchases, there are no restrictions if the Company is not borrowing
and the payments are funded through cash on hand. If the Company is borrowing, Availability as of the end
of each fiscal month during the subsequent projected six fiscal months following the payment must be at
least 20 percent of the lesser of the Aggregate Commitments and the Borrowing Base (all terms as defined
in the 2011 Restated Credit Agreement). The Company’s management does not currently expect to borrow
under the facility in 2013, other than amounts used to support standby letters of credit.
At February 2, 2013, the Company had unused domestic lines of credit of $199 million, while $1 million
was committed to support standby letters of credit. The letters of credit are primarily used for
insurance programs.
Deferred financing fees are amortized over the life of the facility on a straight-line basis, which is
comparable to the interest method. The unamortized balance at February 2, 2013 is $3 million.
The quarterly facility fees paid on the unused portion was 0.25 percent and 0.75 percent for 2012 and
2011, respectively. There were no short-term borrowings during 2012 or 2011. Interest expense, including
facility fees, related to the revolving credit facility was $1 million for 2012 and $4 million for both 2011
and 2010.
13. Long-Term Debt
The Company’s long-term debt reflects the Company’s 8.50 percent debentures payable in 2022, and was
$133 million and $135 million for the years ended February 2, 2013 and January 28, 2012, respectively.
Excluding the unamortized gain of the interest rate swaps of $15 million, the principal outstanding is
$118 million. The gain is being amortized as part of interest expense over the remaining term of the debt,
using the effective-yield method.
Interest expense related to long-term debt, including the effect of the interest rate swaps and the
amortization of the associated debt issuance costs, was $9 million for all years presented.
14. Other Liabilities
2012 2011
(in millions)
Straight-line rent liability $ 109 $ 103
Pension benefits 37 70
Income taxes 21 31
Postretirement benefits 14 14
Workers’ compensation and general liability reserves 10 11
Deferred taxes 5 5
Other 25 23
$ 221 $ 257
52