Note 10 — Commitments and Contingencies

Operating Leases

The Company leases certain land and buildings under long-term operating lease agreements. The following is a schedule of future minimum lease payments by fiscal year required under such leases as of October 31, 2013:


In thousands
2014	$	93,066
2015		80,102
2016		62,699
2017		46,712
2018		34,490
Thereafter		88,289

	$	405,358

Total rent expense was approximately $123 million, $134 million and $127 million, in fiscal 2013, 2012 and 2011, respectively.

Professional Athlete Sponsorships

The Company establishes relationships with professional athletes in order to promote its products and brands. The Company has entered into endorsement agreements with professional athletes in sports such as surfing, skateboarding, snowboarding, BMX and motocross. Many of these contracts provide incentives for magazine exposure and competitive victories while wearing or using the Company’s products. Such expenses are an ordinary part of the Company’s operations and are expensed as incurred. The following is a schedule of future estimated minimum payments required under such endorsement agreements as of October 31, 2013:


In thousands
2014	$	24,527
2015		17,002
2016		12,559
2017		7,676
2018		3,132
Thereafter		—

	$	64,896

Litigation

As part of its global operations, the Company may be involved in legal claims involving trademarks, intellectual property, licensing, employment matters, compliance, contracts and other matters incidental to its business. The Company believes the resolution of any such matter currently threatened or pending will not have a material adverse effect on its financial condition, results of operations or liquidity.

Indemnities and Guarantees

During its normal course of business, the Company has made certain indemnities, commitments and guarantees under which it may be required to make payments in relation to certain transactions. These include (i) intellectual property indemnities to the Company’s customers and licensees in connection with the use, sale and/or license of Company products, (ii) indemnities to various lessors in connection with facility leases for certain claims arising from such facilities or leases, (iii) indemnities to vendors and service providers pertaining to claims based on the negligence or willful misconduct of the Company, and (iv) indemnities involving the accuracy of representations and warranties in certain contracts. The duration of these indemnities, commitments and guarantees varies and, in certain cases, may be indefinite. The majority of these indemnities, commitments and guarantees do not provide for any limitation of the maximum potential for future payments the Company could be obligated to make. The Company has not recorded any liability for these indemnities, commitments and guarantees in the accompanying consolidated balance sheets.

Long-Term Incentive Plan

The Company has a cash-based long-term incentive plan (“LTIP”) covering certain of its employees. Incentive payments are earned under the LTIP based upon the Company’s achievement of certain EBITDA targets or the Company’s common stock reaching a pre-defined target price for a period of 30 consecutive days. As of October 31, 2013, no amounts had been earned under the LTIP. However, if the Company’s stock price reaches $9.30 for a period of 30 consecutive days during fiscal 2014, the Company would be obligated to make incentive payments of approximately $4 million.