10.	Commitments and Contingencies

As of

December 31, 2018,

we had approximately

$117.8

million of obligations remaining under operating lease arrangements related primarily to terminal and support facilities. Future minimum lease payments under noncancelable operating leases (with initial or remaining lease terms in excess of

one

year) as of

December 31, 2018,

are approximately

$117.8

million, with payment streams as follows (in millions):

2019

$34.9;

2020

$29.9;

2021

$20.7;

2022

$13.7;

and thereafter -

$18.6.

Total rent expense was

$98.7

million in

2018,

$64.3

million in

2017,

and

$44.1

million in

2016.

December 31, 2018,

we had outstanding commitments of approximately

$381.6

million, net of proceeds from sales or trade-ins during

2019

and

2020,

which is primarily related to the acquisition of containers, chassis, and tractors.

During

2018,

we issued financial standby letters of credit as a guaranty of our performance under certain operating agreements and self-insurance arrangements. If we default on our commitments under the agreements or other arrangements, we are required to perform under these guaranties. The undiscounted maximum amount of our obligation to make future payments in the event of defaults is approximately

$1.3

million as of

December 31, 2018.

We are a defendant in certain alleged class-action lawsuits in which the plaintiffs are current and former California-based drivers who allege claims for unpaid wages, failure to provide meal and rest periods, and other items. In the lead class-action, we reached an agreement and recorded a reserve in

September 2018

to resolve all pending claims for a class settlement payment of

$15

million, subject to Court approval. The Court granted preliminary settlement approval in

November 2018.

Notice of the settlement has been mailed to all settlement class members and the deadline for objections to the settlement passed without any objections filed. We expect the Court’s order granting final approval to be issued in

April 2019.

The overlapping claims in the other alleged class-action lawsuits remain stayed pending final approval of the settlement in the lead class-action case.

January 2017,

we exercised our right to utilize the arbitration process to review the division of revenue collected beginning

May 1, 2016,

as well as to clarify other issues, under our Joint Service Agreement with BNSF Railway Company (BNSF). BNSF requested the same, and the arbitration process is on-going. On

October 5, 2018,

we received the arbitrators’ Interim Award. The details of the Interim Award are confidential and require the parties to submit additional information requested by the arbitrators to decide certain unresolved matters. For the determined components of the Interim Award, we recorded an

$18.3

million pre-tax charge in the

third

quarter

2018,

related to certain charges claimed by BNSF for specific services requested for customers from

April 2014

through

May 2018.

December 7, 2018

the arbitrators’ issued their Clarified Interim Award of

October 5, 2018

resulting from some of the parties’ additional submissions to the Panel regarding certain issues related to determining the revenue division between the parties. On

January 11, 2019,

the Panel issued its Second Interim Award ordering that

$89.4

million is due from the Company to BNSF resulting from the adjusted revenue divisions relating to the

2016

period at issue (

$52.1

million) and for calendar year

2017

(

$37.3

million). The parties have been instructed to make further submissions on the revenue divisions for calendar year

2018

and going forward, as well as other confidential issues raised during the arbitration process so that the panel can issue an appropriate interim and/or final award regarding all issues raised during the proceeding. We recorded pretax charges for contingent liabilities in the

fourth

quarter

2018

$89.4

million claimed by the BNSF for the period

May 1, 2016

through

December 31, 2017

and

$44.6

million for the period

January 1, 2018

through

December 31, 2018,

for a total of

$134

million.

The other financial implications from the Interim Award and the Clarified Interim Award will

not

be fully determined until the arbitrators issue additional award(s) following their review of each party’s requested additional submissions. At this time, we are unable to reasonably predict the final outcome of the arbitration, and, as such,

further gain or loss contingency can be determined or recorded. If decided adversely, this matter could result in a liability material to our financial condition or results of operations. BNSF provides a significant amount of rail transportation services to our JBI business segment. Normal commercial business activity between the parties, including load tendering, load tracing, billing and payments, is expected to continue on a timely basis.

We are involved in certain other claims and pending litigation arising from the normal conduct of business. Based on present knowledge of the facts and, in certain cases, opinions of outside counsel, we believe the resolution of these claims and pending litigation will

not

have a material adverse effect on our financial condition, results of operations or liquidity.