Commitments and Contingencies

12 Months Ended

Feb. 02, 2013

Commitments and Contingencies

E. COMMITMENTS AND CONTINGENCIES

At February 2, 2013, the Company was obligated under operating leases covering store and office space, automobiles and certain equipment for future minimum rentals as follows:

	TOTAL
FISCAL YEAR	(in millions)
2013	$	46.9
2014		37.0
2015		30.3
2016		25.9
2017		20.1
Thereafter		91.9
	$	252.1

In addition to future minimum rental payments, many of the store leases include provisions for common area maintenance, mall charges, escalation clauses and additional rents based on a percentage of store sales above designated levels. The store leases are generally five years in length and contain renewal options extending their terms by 5 to 10 years.

Amounts charged to operations for all occupancy costs, automobile and leased equipment expense were $54.9 million, $53.0 million and $52.8 million for fiscal 2012, fiscal 2011 and fiscal 2010, respectively.

In fiscal 2006, as part of a sale-leaseback transaction with a subsidiary of Spirit Finance Corp. (“Spirit”), the Company entered into a twenty-year lease agreement for its corporate headquarters and distribution center whereby the Company agreed to lease the property it sold to Spirit back for an annual rent of $4.6 million. The Company realized a gain of approximately $29.3 million on the sale of this property, which has been deferred and is being amortized over the initial 20 years of the related lease agreement. At the end of the initial term, the Company will have the opportunity to extend the Lease Agreement for six additional successive periods of five years. In addition, on February 1, 2011, the fifth anniversary of the Lease Agreement, and for every fifth anniversary thereafter, the base rent will be subject to a rent increase not to exceed the lesser of 7% or a percentage based on changes in the Consumer Price Index. The Company’s current annual rent of $5.1 million will be offset each lease year by $1.5 million related to the amortization of this deferred gain. This lease commitment, excluding the impact of the gain, is included in the above table of expected future minimum rentals obligations.