Lowe's 2013 Annual Report Download - page 64

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56
The future minimum rental payments required under operating leases and capitalized lease obligations having initial or
remaining non-cancelable lease terms in excess of one year are summarized as follows:
(In millions)
Fiscal Year
Operating
Leases
Capitalized
Lease
Obligations
Total
2014
$
447
$
88
$
535
2015
445
79
524
2016
442
68
510
2017
432
56
488
2018
411
52
463
Later years
3,411
443
3,854
Total minimum lease payments
$
5,588
$
786
$
6,374
Less amount representing interest
(351
)
Present value of minimum lease payments
435
Less current maturities
(47
)
Present value of minimum lease payments, less current maturities
$
388
Rental expenses under operating leases were $421 million, $409 million and $410 million in 2013, 2012 and 2011, respectively,
and were recognized in SG&A expense. Excluded from these amounts are rental expenses associated with closed locations
which were recognized as exit costs in the period of closure.
NOTE 15: Commitments and Contingencies
The Company is a defendant in legal proceedings considered to be in the normal course of business, none of which,
individually or collectively, are expected to be material to the Company’s financial statements. In evaluating liabilities
associated with its various legal proceedings, the Company has accrued for probable liabilities associated with these matters.
The amounts accrued were not material to the Company’s consolidated financial statements in any of the years presented.
Reasonably possible losses for any of the individual legal proceedings which have not been accrued were not material to the
Company’s consolidated financial statements.
As of January 31, 2014, the Company had non-cancelable commitments of $881 million related to certain marketing and
information technology programs, and purchases of merchandise inventory. Payments under these commitments are scheduled
to be made as follows: 2014, $577 million; 2015, $272 million; 2016, $25 million; 2017, $7 million.
At January 31, 2014, the Company held standby and documentary letters of credit issued under banking arrangements which
totaled $64 million. The majority of the Company’s letters of credit were issued for insurance contracts.
NOTE 16: Related Parties
A brother-in-law of the Company’s Chief Customer Officer is a senior officer and shareholder of a vendor that provides
millwork and other building products to the Company. The Company purchased products from this vendor in the amount of
$70 million in 2013, $78 million in 2012 and $82 million in 2011. Amounts payable to this vendor were insignificant at
January 31, 2014 and February 1, 2013.
A member appointed to the Company's Board of Directors during fiscal year 2013, also serves on the Board of Directors of a
vendor that provides branded consumer packaged goods to the Company. The Company purchased products from this vendor
in the amount of $145 million in 2013. Amounts payable to this vendor were $11 million at January 31, 2014.