Target 2011 Annual Report Download - page 48

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Commitments and Contingencies
At January 28, 2012, our contractual obligations were as follows:
Payments Due by Period
Contractual Obligations
Less than 1-3 3-5 After 5
(millions) Total 1 Year Years Years Years
Recorded Contractual Obligations:
Long-term debt (a)
Unsecured $14,680 $3,001 $1,502 $ 778 $ 9,399
Nonrecourse 1,000 750 250 — —
Capital lease obligations (b) 4,340 122 241 241 3,736
Real estate liabilities (c) 54 54 — — —
Deferred compensation (d) 455 47 103 114 191
Tax contingencies (e) —————
Unrecorded Contractual Obligations:
Interest payments – long-term debt
Unsecured 9,722 691 1,204 1,161 6,666
Nonrecourse 4 4 — — —
Operating lease (b) 3,888 194 354 295 3,045
Real estate obligations (f) 430 301 129 — —
Purchase obligations (g) 1,396 492 782 28 94
Future contributions to retirement
plans (h) —————
Contractual obligations $35,969 $5,656 $4,565 $2,617 $23,131
(a) Required principal payments only. Excludes fair market value adjustments recorded in long-term debt, as required by derivative and
hedging accounting rules.
(b) Total contractual lease payments include $2,894 million and $1,910 million of capital lease payments and operating lease payments,
respectively, related to options to extend the lease term that are reasonably assured of being exercised. These payments also include
$828 million and $171 million of legally binding minimum lease payments for stores that are expected to open in 2012 or later for capital and
operating leases, respectively. Capital lease obligations include interest.
(c) Real estate liabilities include costs incurred but not paid related to the construction or remodeling of real estate and facilities.
(d) Deferred compensation obligations include commitments related to our nonqualified deferred compensation plans. The timing of deferred
compensation payouts is estimated based on payments currently made to former employees and retirees, forecasted investment returns,
and the projected timing of future retirements.
(e) Estimated tax contingencies of $318 million, including interest and penalties, are not included in the table above because we are not able to
make reasonably reliable estimates of the period of cash settlement.
(f) Real estate obligations include commitments for the purchase, construction or remodeling of real estate and facilities.
(g) Purchase obligations include all legally binding contracts such as firm minimum commitments for inventory purchases, merchandise
royalties, equipment purchases, marketing-related contracts, software acquisition/license commitments and service contracts. We issue
inventory purchase orders in the normal course of business, which represent authorizations to purchase that are cancelable by their terms.
We do not consider purchase orders to be firm inventory commitments; therefore, they are excluded from the table above. If we choose to
cancel a purchase order, we may be obligated to reimburse the vendor for unrecoverable outlays incurred prior to cancellation. We also
issue trade letters of credit in the ordinary course of business, which are excluded from this table as these obligations are conditioned on
terms of the letter of credit being met.
(h) We have not included obligations under our pension and postretirement health care benefit plans in the contractual obligations table above
because no additional amounts are required to be funded as of January 28, 2012. Our historical practice regarding these plans has been to
contribute amounts necessary to satisfy minimum pension funding requirements, plus periodic discretionary amounts determined to be
appropriate.
Off Balance Sheet Arrangements We do not have any arrangements or relationships with entities that are not
consolidated into the financial statements or financial guarantees that are reasonably likely to materially affect our
liquidity or the availability of capital resources.
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