Staples 2013 Annual Report Download - page 128

STAPLES, INC. AND SUBSIDIARIES
Management's Discussion and Analysis of Financial Condition and
Results of Operations (continued)
B-14
was $7.3 million, with a weighted-average interest rate of 0.4%. The maximum amount outstanding under the Commercial Paper
Program during 2012 was $100.0 million. At the end of 2012 there were no outstanding borrowings under the Commercial Paper
Program.
At February 1, 2014, we had approximately $1.55 billion in total cash and funds available through credit agreements,
which consisted of $1.06 billion of available credit and $492.5 million of cash and cash equivalents. Of the $492.5 million in cash
and cash equivalents, approximately $281 million is held in jurisdictions outside the United States. While there could be tax
consequences if such amounts were moved out of these jurisdictions or repatriated to the United States, we currently intend to use
most of the cash and cash equivalents held outside of the United States to finance the obligations and current operations of our
foreign businesses. The determination of the amount of the unrecognized deferred tax liability related to the undistributed earnings
is not practicable because of the complexities associated with its hypothetical calculation.
Off-Balance Sheet Financing Arrangements
We do not have any off-balance sheet financing arrangements as of February 1, 2014, nor did we utilize any during 2013.
Contractual Obligations and Commercial Commitments
A summary, as of February 1, 2014, of balances available under our credit agreements and contractual obligations is
presented below (amounts in thousands):
Payments Due By Period
Contractual Obligations and Commercial
Commitments (1)(2)(6)
Available
Credit
Total
Outstanding
Obligations
Less than
1 Year 1-3 Years 3-5 Years
More than
5 Years
January 2018 Notes (5) — 500,000 — — 500,000 —
January 2023 Notes (5) — 500,000 — — — 500,000
May 2018 Revolving Credit Facility 1,000,000 — — — — —
Other lines of credit 160,475 100,100 100,100 — — —
Other notes and capital leases — 6,028 3,882 1,544 373 229
Total (5) $ 1,160,475 $ 1,106,128 $ 103,982 $ 1,544 $ 500,373 $ 500,229
Interest expense — $ 251,875 $ 35,625 $ 71,250 $ 57,500 $ 87,500
Operating leases (3) — $ 3,607,915 $ 799,591 $ 1,263,425 $ 766,831 $ 778,068
Purchase obligations (4) — $ 564,762 $ 429,991 $ 73,427 $ 28,596 $ 32,748
(1) As of February 1, 2014, we had gross unrecognized tax benefits of $281.0 million, of which $266.0 million, if recognized,
would affect the Company's tax rate, and an additional $46.7 million for gross accrued interest and penalties (see Note J
- Income Taxes in the Notes to the Consolidated Financial Statements). At this time, we are unable to make a reasonable
estimate of the timing of payments in connection with these tax liabilities; therefore, such amounts are not included in
the contractual obligation table above.
(2) The above table excludes expected future contributions to our pension and post-retirement benefit plans. See Note L -
Pension and Other Post-Retirement Benefit Plans in the Notes to the Consolidated Financial Statements for details about
these future contributions.
(3) The operating lease payments reported above do not include common area maintenance or real estate taxes, which are
expected to approximate 25% to 28% of the related operating lease payments. Utility costs related to leased facilities
have also been excluded from this table because the payments do not represent contractual obligations until the services
have been provided. Future annual minimum payments include restructuring related obligations as of February 1, 2014.
(4) Many of our purchase commitments may be canceled by us without advance notice or payment, and we have excluded
such commitments, along with intercompany commitments. Contracts that may be terminated by us without cause or
penalty but require advance notice for termination are valued on the basis of an estimate of what we would owe under
the contract upon providing notice of termination.
(5) The amounts represent the par value of our debt obligations. See Note F - Debt and Credit Agreements in the Notes to
the Consolidated Financial Statements for information related to the carrying value of these obligations as of February 1,
2014.
(6) As of February 1, 2014, Staples had open standby letters of credit totaling $105.8 million