Foot Locker 2014 Annual Report Download - page 74

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FOOT LOCKER, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
11. Accrued and Other Liabilities
2014 2013
(in millions)
Taxes other than income taxes $56 $56
Other payroll and payroll related costs, excluding taxes 54 54
Incentive bonuses 51 41
Property and equipment
(1)
49 39
Current deferred tax liabilities 48 46
Customer deposits
(2)
44 38
Income taxes payable 10 5
Other 81 81
$393 $360
(1) Accruals for property and equipment are properly excluded from the statements of cash flows for all years presented.
(2) Customer deposits include unredeemed gift cards and certificates, merchandise credits, and deferred revenue related to undelivered
merchandise, including layaway sales.
12. Revolving Credit Facility
On January 27, 2012, the Company entered into an amended and restated credit agreement (the ‘‘2011
Restated Credit Agreement’’) with its banks. The 2011 Restated Credit Agreement provides for a $200 million
asset based revolving credit facility maturing on January 27, 2017. In addition, during the term of the 2011
Restated Credit Agreement, the Company may make up to four requests for additional credit commitments in
an aggregate amount not to exceed $200 million. Interest is based on the LIBOR rate in effect at the time of the
borrowing plus a 1.25 to 1.50 percent margin depending on certain provisions as defined in the 2011 Restated
Credit Agreement.
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 2015, other than amounts used to support standby letters of credit in connection with insurance
programs. The letters of credit outstanding as of January 31, 2015 were not significant.
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 January 31, 2015 is $1 million.
The quarterly facility fees paid on the unused portion was 0.25 percent for both 2014 and 2013. There were no
short-term borrowings during 2014 or 2013. Interest expense, including facility fees, related to the revolving
credit facility was $1 million for all years presented.
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