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Commitments and Contingencies
12 Months Ended
Feb. 02, 2019
Commitments And Contingencies Disclosure [Abstract]  
Commitments and Contingencies

F. COMMITMENTS AND CONTINGENCIES

At February 2, 2019, the Company was obligated under operating leases covering store and office space, automobiles and certain equipment for future minimum rentals and merchandise purchase obligations as follows:

 

 

 

Total

 

FISCAL YEAR

 

(in millions)

 

Fiscal 2019

 

$

67.4

 

Fiscal 2020

 

 

62.7

 

Fiscal 2021

 

 

60.4

 

Fiscal 2022

 

 

55.1

 

Fiscal 2023

 

 

46.6

 

Thereafter

 

 

56.6

 

 

 

$

348.8

 

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 5 to 10 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 $64.9 million, $66.0 million, and $63.9 million for fiscal 2018, fiscal 2017 and fiscal 2016, respectively.

In fiscal 2006, as part of a sale-leaseback transaction with a subsidiary of Spirit Finance Corp. (“Spirit”), the Company entered into a 20-year lease agreement (the “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 was deferred and being amortized over the initial 20 years of the related lease agreement through the end of fiscal 2018.  However, as part of the adoption of ASU 2016-02, the remaining balance of the deferred gain of $10.3 million, will be recognized as an adjustment to opening retained earnings in the first quarter of fiscal 2019.

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 $5.2 million is included in the above table of expected future minimum rentals obligations for fiscal 2019 and fiscal 2020 and $5.6 million thereafter.

Included in the table above, is a merchandise purchase obligation for which the Company is contractually committed to meet minimum purchases of $10.0 million in each fiscal year through fiscal 2023.