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These excerpts taken from the BIG 10-K filed Mar 30, 2009. Off-Balance Sheet Arrangements For a discussion of the KB Bankruptcy Lease Obligations, see note 11 to the accompanying consolidated financial statements. Because the KB Toys business filed for bankruptcy again in December 2008 and liquidated all of its store operations, we accrued a contingent liability on our balance sheet in the amount of $5.0 million for 31 KB Toys 32 store leases for which we may have an indemnification or guarantee obligation. Because of uncertainty inherent in the assumptions used to estimate this liability, our estimated liability could ultimately prove to be understated and could result in a material adverse impact on our financial condition, results of operations, and liquidity. Off-Balance Sheet For a discussion of the KB Bankruptcy 32 | ||||||||||
store leases for which we may have an These excerpts taken from the BIG 10-K filed Apr 1, 2008. Off-Balance Sheet Arrangements As of February 2, 2008, we have KB Lease Obligations, as that term is defined in note 11 to the accompanying consolidated financial statements, with respect to approximately 52 open KB Toys stores. In 2007, we entered into an agreement with KB Toys and various Prentice Capital entities (owners/affiliates of KB Toys) which we believe provides for a cap of our liability under the existing KB Toys guaranteed store leases and an indemnification from the Prentice Capital entities with respect to any renewals, extensions, modifications, or amendments of these guaranteed leases which could potentially add incremental liability to us beyond the date of the agreement, which was September 24, 2007. Under these agreements, KB Toys is required to update us periodically with respect to the status of any remaining leases which they believe we have guaranteed. In addition, we have the right to request the net asset value of Prentice Capital Offshore in order to monitor the sufficiency of their indemnification. Because these remaining guarantees were issued prior to January 1, 2003, they are not subject to the fair value recognition provisions of Financial Accounting Standards Board (“FASB”) Interpretation (“FIN”) No. 45, Guarantor’s Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others. However, we will recognize a liability if a loss in connection with any of the KB Lease Obligations becomes probable and reasonably estimable. See note 11 to the accompanying consolidated financial statements for further discussion of KB Toys matters. Off-Balance Sheet As of February 2, 2008, we have KB Lease This excerpt taken from the BIG 10-K filed Apr 4, 2007. Off-Balance Sheet Arrangements As of February 3, 2007, we have approximately 84 KB Lease Obligations related to KB Toys’ stores and main office building. The relevant guarantees were issued prior to January 1, 2003, and are not subject to the fair value recognition provisions of Financial Accounting Standards Board (“FASB”) Interpretation No. 45. The typical KB Lease Obligation provides that the terms of the underlying lease may be extended, amended, or modified without the consent of the guarantor. As a result, we are unable to estimate any potential range of loss in the event of non-performance by KB Toys. See Note 11 to the consolidated financial statements in this Form 10-K for further discussion of KB Toys matters. 28 | EXCERPTS ON THIS PAGE:
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