Commitments for the purchase, construction, lease or remodel- ing of real estate, facilities and equipment were approximately $545 million at year-end 2003. Throughout the year, we enter into various commitments to purchase inventory. In addition to the accounts payable reflected in our Statements of Financial Position on page 27, we had commit- ments with various vendors for the purchase of inventory as of January 31, 2004. The previous table excludes these commitments because these purchase commitments are cancelable by their terms. In 2004, we expect to invest $3.2 billion to $3.4 billion, mostly in new square footage for Target stores and the distribution infrastructure and systems to support this growth. Our estimated 2004 store opening program at Target reflects net square footage growth of approximately 8 to 9 percent, or 95 to 100 total new stores partially offset by closings and relocations. In addition, we expect to remodel approximately 70 stores in 2004. We are exposed to claims and litigation arising out of the ordinary course of business and use various methods to resolve those matters in a manner that serves the best interest of our shareholders and other constituents. The dispute resolution methods that we use include vigorous litigation, when necessary, and alternatives such as settlement discussions, where appropriate, to reduce the costs of litigation. Our policy is to fully disclose pending lawsuits and other known claims that we expect may have a material impact on our results of operations or financial condition. After consulting with legal counsel, management does not believe that any currently identified claims or litigation meet this criterion. At year-end 2003, owned, leased and GLYPH<210>combinedGLYPH<211> (generally an owned building on leased land) store locations by operating seg- ment were as follows: Our exposure to market risk results primarily from fluctuations in interest rates on our debt obligations and from the effect of equity market returns on our non-qualified defined contribution plans. We hold derivative instruments primarily to manage our exposure to these risks and all derivative instruments are matched against specific debt obligations or other liabilities. There have been no material changes in the primary risk exposures or management of the risks since the prior year. Our debt and interest rate swap instruments outstanding at January 31, 2004, including applicable interest rates, are discussed in the Notes to Consolidated Financial Statements on pages 33-34. The annualized effect of a one percentage point change in floating interest rates on our interest rate swap agreements and other floating rate debt obligations at January 31, 2004, would be to change interest expense by approximately $36 million. The annualized effect of a one percentage point change in equity market returns on our non-qualified defined contribution plans (inclusive of the effect of derivative instruments used to hedge or manage these exposures) would not be significant. Number of Stores February 1, January 31, 2003 Opened Closed 2004 Target * 1,147 101 23 1,225 MervynGLYPH<213>s 264 3 1 266 Marshall FieldGLYPH<213>s 64 — 2 62 Total 1,475 104 26 1,553 Legal Proceedings At January 31, 2004, our debt, lease and royalty contractual obli- gations were as follows: *Required principal payments only. Excludes SFAS No. 133, GLYPH<210>Accounting for Derivative Instruments and Hedging Activities,GLYPH<211> fair market value adjustments recorded in long-term debt. **Includes payments on $1.5 billion of floating rate long-term debt secured by credit card receivables, of which $750 million matures in July 2004 and $750 million matures in 2007. These payments are calculated assuming rates of 1.25%, 2.25%, 3.25% and 4.25% for 2004, 2005, 2006 and 2007, respectively. Excludes payments received or made relating to interest rate swaps discussed on pages 33-34. ***Total contractual lease payments. * Target includes 118 and 94 SuperTargets at January 31, 2004 and February 1, 2003, respectively. Owned and Leased Store Locations Commitments and Contingencies Payments Due by Period (millions) Less than 1-3 3-5 After 5 Contractual Obligations Total 1 Year Years Years Years Long-term debt * $10,828 $ 857 $1,254 $2,774 $ 5,943 Interest payments ** 6,062 587 1,103 912 3,460 Capital lease  obligations *** 264 21 39 38 166 Operating leases *** 1,778 163 286 236 1,093 Royalties 80 42 38 — — Contractual cash  obligations $19,012 $1,670 $2,720 $3,960 $10,662 Owned Leased Combined Total Target 987 87 151 1,225 MervynGLYPH<213>s 155 62 49 266 Marshall FieldGLYPH<213>s 49 11 2 62 Total 1,191 160 202 1,553 Market Risk 23