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Commitments and Contingencies
 12 Months Ended
Jan. 31, 2013
Commitments and Contingencies

NOTE G — COMMITMENTS AND CONTINGENCIES

Lease Agreements

The Company leases warehousing, executive and sales facilities, retail stores, equipment and vehicles under operating leases with options to renew at varying terms. Leases with provisions for increasing rents have been accounted for on a straight-line basis over the life of the lease.

Certain leases provide for contingent rents, which are determined as a percentage of gross sales. The Company records a contingent rent liability in accrued expenses on the Consolidated Balance Sheets and the corresponding rent expense on the Consolidated Statements of Income when management determines that achieving the specified levels during the fiscal year is probable.

 

The following schedule sets forth the future minimum rental payments for operating leases having non-cancelable lease periods in excess of one year at January 31, 2013:

 

Year Ending January 31,

    Amount  
     (In thousands)  

2014

    $ 34,724   

2015

      29,715   

2016

      29,050   

2017

      26,101   

2018

      20,735   

Thereafter

      81,336   
  

 

 

  
   $ 221,661   
  

 

 

  

Rent expense on the above operating leases for the years ended January 31, 2013, 2012 and 2011 was approximately $31.6 million, $25.9 million and $22.4 million, respectively.

License Agreements

The Company has entered into license agreements that provide for royalty payments ranging from 4% to 19% of net sales of licensed products as set forth in the agreements. The Company incurred royalty expense (included in cost of goods sold) of approximately $85.2 million, $68.7 million and $56.8 million for the years ended January 31, 2013, 2012 and 2011, respectively. Contractual advertising expense, which is normally based on a percentage of net sales, associated with certain license agreements (included in selling, general and administrative expense) was $24.9 million, $22.9 million and $18.8 million for the years ended January 31, 2013, 2012 and 2011, respectively. Based on minimum sales requirements, future minimum royalty and advertising payments required under these agreements are:

 

Year Ending January 31,

    Amount  
     (In thousands)  

2014

    $ 80,369   

2015

      63,516   

2016

      58,506   

2017

      50,715   

2018

      50,991   

Thereafter

      63,699   
  

 

 

  
   $ 367,796