World Fuel Services 2011 Annual Report Download - page 100

9. Commitments and Contingencies
Surety Bonds
In the normal course of business, we are required to post bid, performance and garnishment bonds. The
majority of the surety bonds posted relate to our aviation and land segments. As of December 31, 2011
and 2010, we had outstanding bonds that were arranged in order to satisfy various security
requirements of $31.4 million and $27.8 million, respectively. Most of these bonds provide financial
security for obligations which have already been recorded as liabilities.
Lease Commitments
As of December 31, 2011, our future minimum lease payments under non-cancelable operating leases
were as follows (in thousands):
Year Ended December 31,
2012 $ 21,045
2013 18,707
2014 17,800
2015 16,411
2016 13,160
Thereafter 35,318
$122,441
We incurred rental expense for all properties and equipment of $21.8 million, $10.0 million and
$9.1 million for 2011, 2010 and 2009, respectively.
Sales and Purchase Commitments
As of December 31, 2011, fixed sales and purchase commitments under our derivative programs
amounted to $390.7 million and $65.3 million, respectively.
Additionally, as of December 31, 2011, we had entered into certain other fixed price purchase
commitments with corresponding fixed price sales commitments, the majority of which were satisfied
within a two-week period. These purchase and sales commitments were made in the normal course of
business.
Vendor and Customer Rebate and Branding Allowances
We receive rebates and branding allowances from a number of our fuel suppliers. Typically, a portion of
the rebates and allowances is passed on to our customers under the same terms as required by our fuel
suppliers. Many of the agreements require repayment of all or a portion of the amount received if we (or
our customers, typically branded dealers in our land segment) elect to discontinue selling the specified
brand of fuel at certain locations. As of December 31, 2011, the estimated amount of fuel rebates and
branding allowances that would have to be repaid upon de-branding at these locations was $24.5 million.
Of this amount, $24.1 million would be due to us from the branded dealers under similar agreements
between us and such dealers. No liability is recorded for the amount of obligations which would become
payable upon debranding.
Agreements with Executive Officers and Key Employees
In March 2008, we entered into agreements with Paul H. Stebbins and Michael J. Kasbar for their
continued employment with the company. In August 2011, each of the agreements was amended to
reflect the transition of Mr. Kasbar from President and Chief Operating Officer to President and Chief
Executive Officer and Mr. Stebbins from Chairman and Chief Executive Officer to Executive Chairman,
effective January 1, 2012. The Kasbar agreement, as amended, provides for an annual base salary of
$750,000, which is subject to change from time to time as determined by our Compensation Committee
in its sole discretion, and such incentives, termination severance benefits and other compensation and
amounts as our Compensation Committee may determine from time to time in its sole discretion. The
Kasbar agreement, as amended, expires four years from the effective date, unless terminated earlier,
and will automatically extend for successive one-year terms unless either party provides written notice
to the other at least one year prior to the expiration of the term that such party does not want to extend
the term. The Stebbins agreement, as amended, provides for an annual base salary of $750,000, which
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