Note M. Commitments

TJX is committed under long-term leases related to its continuing operations for the rental of real estate and fixtures and equipment. Most of our leases are store operating leases with a ten-year initial term and options to extend for one or more five-year periods. TJX Europe generally enters leases for ten to fifteen years with five or ten-year kick-out options. Many of our leases contain escalation clauses and some contain early termination penalties. In addition, we are generally required to pay insurance, real estate taxes and other operating expenses including, in some cases, rentals based on a percentage of sales. These expenses in the aggregate were approximately one-third of the total minimum rent in fiscal 2012, fiscal 2011 and fiscal 2010 and are not included in the table below.

The following is a schedule of future minimum lease payments for continuing operations as of January 28, 2012:


In thousands	Capital Lease		Operating Leases
Fiscal Year
2013	$	3,912	$	1,124,042
2014		3,912		1,057,770
2015		3,912		941,404
2016		3,586		819,481
2017		—		680,626
Later years		—		2,361,779
Total future minimum lease payments		15,322	$	6,985,102
Less amount representing interest		2,205
Net present value of minimum capital lease payments	$	13,117

The capital lease relates to a 283,000-square-foot portion of TJX's home office facility. Rental payments commenced June 1, 2001, and we recognized a capital lease asset and related obligation equal to the present value of the lease payments of $32.6 million.

Rental expense under operating leases for continuing operations amounted to $1,086.0 million for fiscal 2012, $1,031.4 million for fiscal 2011 and $962.0 million for fiscal 2010. Rental expense includes contingent rent and is reported net of sublease income. Contingent rent paid was $12.9 million in fiscal 2012, $12.0 million in fiscal 2011 and $13.0 million in fiscal 2010. Sublease income was $1.3 million in fiscal 2012, $1.2 million in fiscal 2011 and $1.3 million in fiscal 2010. The total net present value of TJX's minimum operating lease obligations approximated $5,951.8 million as of January 28, 2012.

TJX had outstanding letters of credit totaling $36.5 million as of January 28, 2012 and $39.1 million as of January 29, 2011. Letters of credit are issued by TJX primarily for the purchase of inventory.