Cabela's 2013 Annual Report Download - page 107

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CABELA’S INCORPORATED AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands Except Share and Per Share Amounts)
17. COMMITMENTS AND CONTINGENCIES
The Company leases various buildings, computer and other equipment, and storage space under operating
leases which expire on various dates through January 2041. Rent expense on these leases as well as other month to
month rentals was $14,319, $13,605, and $9,541 for 2013, 2012, and 2011, respectively.
The following is a schedule of future minimum rental payments under operating leases at December 28, 2013:
For the fiscal years ending:
2014 $ 16,035
2015 20,956
2016 20,489
2017 20,098
2018 26,516
Thereafter 269,619
$ 373,713
The Company leases nine of its retail store sites. Certain of these leases include tenant allowances that are
amortized over the life of the lease. During 2013, we received $4,969 in tenant allowances. In 2012, no tenant
allowances were received. We expect to receive $3,500 in tenant allowances in 2014. Certain leases require
the Company to pay contingent rental amounts based on a percentage of sales, in addition to real estate taxes,
insurance, maintenance, and other operating expenses associated with the leased premises. These leases have terms
which include renewal options ranging from 10 to 70 years.
The Company has entered into real estate purchase, construction, and/or economic development agreements
for various new retail store site locations. At December 28, 2013, the Company had total estimated cash
commitments of approximately $384,400 outstanding for projected expenditures connected with the development,
construction, and completion of new retail stores. This does not include any amounts for contractual obligations
associated with retail store locations where the Company is in the process of certain negotiations. We expect to
fund these estimated capital expenditures over the next 12 months with funds from operations.
Under various grant programs, state or local governments provide funding for certain costs associated
with developing and opening a new retail store. The Company generally receives grant funding in exchange for
commitments, such as assurance of agreed employment and wage levels at the retail store or that the retail store
will remain open, made by the Company to the state or local government providing the funding. The commitments
typically phase out over approximately five to 10 years. If the Company failed to maintain the commitments during
the applicable period, the funds received may have to be repaid or other adverse consequences may arise, which
could affect the Company’s cash flows and profitability. At December 28, 2013, the total amount of grant funding
subject to a specific contractual remedy was $43,536. At December 28, 2013, and December 29, 2012, the amount
the Company had recorded in liabilities relating to these grants was $22,536 and $7,257, respectively.
The Company operates an open account document instructions program, which provides for Cabela’s-issued
letters of credit. We had obligations to pay participating vendors $48,409 and $55,455 at December 28, 2013, and
December 29, 2012, respectively.
The Financial Services segment enters into financial instruments with off-balance sheet risk in the normal
course of business through the origination of unsecured credit card loans. Unsecured credit card accounts are
commitments to extend credit and totaled $25,255,000 and $20,976,000 at December 28, 2013, and December 29,
2012, respectively. These commitments are in addition to any current outstanding balances of a cardholder.
Unsecured credit card loans involve, to varying degrees, elements of credit risk in excess of the amount recognized