Neiman Marcus 2008 Annual Report Download - page 45

Table of Contents
Contractual Obligations and Commitments
The following table summarizes our estimated significant contractual cash obligations at August 1, 2009:
Payments Due By Period
(in thousands) Total
Fiscal Year
2010
Fiscal
Years
2011-2012
Fiscal
Years
2013-2014
Fiscal Year
2015 and
Beyond
Contractual obligations:
Senior Secured Term Loan Facility (1) $ 1,625,000 $ 26,617 $ — $ 1,598,383 $ —
Senior Notes 734,500 — — — 734,500
Senior Subordinated Notes 500,000 — — — 500,000
2028 Debentures 125,000 — — — 125,000
Interest requirements (2) 1,117,300 213,500 352,300 283,800 267,700
Lease obligations 900,900 55,600 103,100 91,500 650,700
Minimum pension funding obligation
(3) 161,000 — 60,500 57,200 43,300
Other long-term liabilities (4) 69,100 5,000 11,400 13,200 39,500
Construction and purchase
commitments (5) 887,900 799,500 40,600 47,800 —
$ 6,120,700 $ 1,100,217 $ 567,900 $ 2,091,883 $ 2,360,700
(1) Pursuant to the terms of our Senior Secured Term Loan Facility, we will be required to prepay $26.6 million of outstanding
borrowings under that facility in the first quarter of fiscal year 2010 from excess cash flow, as defined in the credit agreement
governing that facility, that we generated in fiscal year 2009. The above table does not reflect future excess cash flow prepayments, if
any, that may be required under the term loan facility.
(2) The cash obligations for interest requirements reflect 1) interest requirements on our fixed-rate debt obligations at their
contractual rates, 2) interest requirements on floating rate debt obligations not subject to interest rate swaps at rates in effect at August
1, 2009 and 3) interest requirements on floating rate debt obligations subject to interest rate swaps at the fixed rates provided through
the swap agreements. A 1% increase in the floating rates related to floating rate debt outstanding at August 1, 2009 not subject to
interest rate swaps would increase annual interest rate requirements by approximately $6.3 million.
(3) At July 31, 2009 (the most recent measurement date), our actuarially calculated projected benefit obligation for our Pension
Plan was $428.0 million and the fair value of the assets was $272.0 million. Our policy is to fund the Pension Plan at or above the
minimum amount required by law. We made a $15.0 million voluntary contribution to the Pension Plan in both fiscal years 2009 and
2008. Based upon currently available information, we will not be required to make contributions in fiscal year 2010 to the Pension
Plan.
(4) Included in other long-term liabilities at August 1, 2009 are our liabilities for our Pension, SERP and Postretirement Plans
aggregating $261.0 million. Our scheduled obligations with respect to our SERP and Postretirement Plan liabilities consist of
expected benefit payments through 2019, as currently estimated using information provided by our actuaries. Also included in other
long-term liabilities at August 1, 2009 are our liabilities related to 1) the unrealized loss on financial instruments of $57.8 million, 2)
uncertain tax positions (including related accruals for interest and penalties) of $12.4 million and 3) other obligations aggregating
$19.0 million, primarily for employee benefits. Future cash obligations related to these liabilities are not currently estimable.
(5) Construction commitments relate primarily to obligations pursuant to contracts for the construction of new stores and the
renovation of existing stores expected as of August 1, 2009. These amounts represent the gross construction costs and exclude
developer contributions of approximately $54 million which we expect to receive pursuant to the terms of the construction contracts.
In the normal course of our business, we issue purchase orders to vendors/suppliers for merchandise. Our purchase orders are
not unconditional commitments but, rather represent executory contracts requiring performance by the vendors/suppliers, including
the delivery of the merchandise prior to a specified cancellation date and the compliance with product specifications, quality standards
and other requirements. In the event of the vendor's failure to meet the agreed upon terms and conditions, we may cancel the order.
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