LONG-TERM LEASES

12 Months Ended

Feb. 01, 2014

Leases [Abstract]

Leases of Lessor Disclosure [Text Block]

NOTE 6 — LONG-TERM LEASES

The Company leases certain of its store locations under noncancelable operating leases that require monthly rental payments primarily at fixed rates (although a number of the leases provide for additional rent based upon sales) expiring at various dates through fiscal 2029. None of our operating leases contain residual value guarantees. Many of these leases contain renewal options and require the Company to pay taxes, maintenance, insurance and certain other operating expenses applicable to the leased properties. In addition, the Company leases various equipment under noncancelable operating leases. Total rent expense under operating leases was $60.0 million, $57.2 million and $53.2 million, for 2013, 2012 and 2011, respectively. Total contingent rentals included in operating leases above was $0.8 million for 2013, $0.7 million for 2012 and $1.0 million for 2011. Future minimum rental payments under all operating leases as of February 1, 2014 are as follows:

(in thousands)	Operating Leases
2014	$	46,423
2015		39,293
2016		32,782
2017		25,354
2018		15,962
Thereafter		50,060
Total minimum lease payments	$	209,874

The gross amount of property and equipment under capital leases was $5.1 million at both February 1, 2014 and February 2, 2013. Accumulated amortization on property and equipment under capital leases was $5.1 million at both February 1, 2014 and February 2,2013. We did not incur any amortization expense on assets under capital lease for 2010 as the assets were fully amortized. Amortization expense on assets under capital lease for both 2013 and 2012 was $34 thousand.

Related Party Transactions

Atlantic Retail Investors, LLC, which is partially owned by Michael J. Hayes, a director of the Company, owned the land and buildings occupied by thirteen Fred’s stores, until 2011, when ten of these properties were purchased by the Company. The terms and conditions regarding the leases on these locations were consistent in all material respects with other stores leases of the Company with unrelated landlords.

Fred’s Inc. is leasing three properties from Atlantic Retail Investors, LLC, and the total rental payments for related party leases were $301.0 thousand for the year ended February 1, 2014 and $326.1 thousand and $451.2 thousand for the years ended February 2, 2013 and January 28, 2012, respectively.