Today, Wavin - Jaarverslag.com

Wavin Annual Report 2010 | page 12732. Operating leasesNon-cancellable operating leases are payable as follows:(€ x 1,000) 2010 2009Less than one year 16,072 10,912Between one and fi ve years 30,720 31,555More than fi ve years 13,591 17,125Total 60,383 59,592The Group leases a number of warehouse and factory facilities and internal transport equipment under operating leases.The leases typically run for an initial period of between fi ve and ten years, with an option to renew the lease after that date.None of the leases includes purchase liabilities or contingent rentals. Some leases provide for additional rent payments thatare based on changes in a local price index.During the year ended 31 December 2010 € 19.1 million was recognised as an expense in the income statement in respectof operating leases and rental costs (2009: € 17.6 million).33. Capital commitmentsWith respect to the purchase of investment goods, per 31 December 2010 obligations have been entered into and ordershave been placed to a value of € 8.5 million (2009: € 8.7 million).34. Contingent liabilitiesAt 31 December 2010 bank guarantees issued mainly for bid bonds and performance bonds amount to approximately€ 4.9 million (2009: € 7.8 million). Per 31 December 2010 letters of credit were issued for an amount of € 8.9 million (2009:€ 9.8 million).The Group is defending its position in different procedures brought up by employees, suppliers and/or customers in differentcountries in Europe. While liability is not admitted, the estimated fi nes and legal costs are provided for when it is anticipated totake defensive actions. Based on legal advice, the Group does not expect the outcome of the actions to have a materialeffect on the Group’s fi nancial position.For drawings under the Syndicated Loan Facility of € 500 million the Group has provided lenders securities consisting ofmortgages on real estate, pledges on receivables, inventories and bank accounts for a total amount of € 440.1 million. For anamount of € 278.9 million shares in subsidiaries have been pledged. The leverage ratio should not be below a certain levelwhereas the interest coverage should at least meet a certain level (for details we refer to note 26). The Group must assurethat the aggregate tangible assets and the aggregate Ebitda of the identifi ed guarantors represent at least 70% of theconsolidated tangible assets and the consolidated Ebitda of the Wavin Group.Wavin N.V. and the subsidiaries have issued cross guarantees for drawings under the notional cash pool system.Almost all the subsidiaries in The Netherlands form a fi scal unity with Wavin N.V. for the income tax, VAT and tax on wages.Wavin N.V. is severally liable for the tax debts of the fi scal unity.35. Related partiesIdentity of related partiesThe Group has a related party relationship with its subsidiaries and associates (see overview principal direct and indirectparticipations). During 2010 there was a related party relationships with Stichting Preferente Aandelen Wavin which has a calloption for preference shares of Wavin N.V. (for details we refer to note F of the Company Financial Statements).The Group also has a related party relationship with Wavin Plastics Pension Scheme, Hepworth Building Products PensionScheme, Wavin Ireland Pension Scheme and Stichting Pensioenfonds Owase (for details we refer to note 27). Finally,a related party relationship exists with the Supervisory Board members and Management Board members (for details we referto note K of the Company Financial Statements).