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Commitments and Contingencies
 12 Months Ended
Dec. 29, 2012
Commitments and Contingencies  
Commitments and Contingencies

14. Commitments and Contingencies

        License Agreements.    The Company has various license agreements to market watches and jewelry bearing certain trademarks or patents owned by various third parties. In accordance with these agreements, the Company incurred royalty expense of approximately $181.8 million, $160.2 million and $109.4 million in fiscal years 2012, 2011 and 2010, respectively. These amounts are included in the Company's cost of sales or if advertising related, selling and distribution expenses. At fiscal year end 2012, certain of the Company's significant license agreements had expiration dates between fiscal years 2013 and 2017. These license agreements require the Company to pay royalties ranging from 5% to 20% of defined net sales. Future minimum royalty commitments under these license agreements, by fiscal year, are as follows (in thousands):

2013

   $ 144,910  

2014

     75,311  

2015

     57,995  

2016

     3,714  

2017

     3,990  
       

 

   $ 285,920  
       

        Leases.    The Company leases its retail and outlet store facilities as well as certain of its office and warehouse facilities and equipment under non-cancelable operating leases and capital leases. Most of the retail and outlet store leases provide for contingent rental payments based on operating results and require the payment of taxes, insurance and other costs applicable to the property. Generally, these leases include renewal options for various periods at stipulated rates. Rent expense under these agreements was approximately $131.5 million, $107.3 million and $88.6 million for fiscal years 2012, 2011 and 2010, respectively. Contingent rent expense was approximately $11.1 million, $9.0 million and $3.8 million for fiscal years 2012, 2011 and 2010, respectively. Future minimum rental commitments under non-cancelable leases, by fiscal year, are as follows (in thousands):

 
   Operating Leases   Capital Leases  

2013

   $ 130,423   $ 1,095  

2014

     117,516     1,204  

2015

     104,285     1,100  

2016

     87,406     1,096  

2017

     76,274     1,070  

Thereafter

     223,821     4,703  
           

 

   $ 739,725   $ 10,268  
           

Less amounts representing interest

           (814 )
             

Capital lease obligations, included in short-term debt and in other long-term debt

         $ 9,454  
             

        Purchase Obligations.    As of December 29, 2012, the Company had purchase obligations totaling $271.2 million.

        Asset Retirement Obligations.    ASC 410, Asset Retirement and Environmental Obligations ("ASC 410") requires that the fair value of a liability for an asset retirement obligation be recognized in the period in which it is incurred if a reasonable estimate of fair value can be made and that the associated asset retirement costs be capitalized as part of the carrying amount of the long-lived asset. The Company's asset retirement obligations relate to costs associated with the retirement of leasehold improvements under office leases within the Europe wholesale segment and the Asia Pacific wholesale segment and under retail store leases within the Direct to consumer segment. The Company had asset retirement obligations of $6.6 million as of December 29, 2012.

        Litigation.    The Company is occasionally subject to litigation or other legal proceedings in the normal course of its business. The Company does not believe that the outcome of any currently pending legal matters, individually or collectively, will have a material effect on the business or financial condition of the Company.