COMMITMENTS AND CONTINGENCIES

Leases

The Company leases certain of its facilities and equipment under operating leases with terms generally ranging from three to five years. Most facility leases contain renewal options. Remaining future minimum rentals due under non-cancelable operating leases are as follows (in thousands):



Fiscal
2018	$	102,299
2019	85,949
2020	66,046
2021	47,174
2022	26,474
Thereafter	39,654
	$	367,596

Rent expense under such leases was $117.7 million, $74.3 million and $50.0 million for the years ended December 31, 2017, 2016 and 2015, respectively.

As a result of the Merger, the Company recognized a favorable lease intangible asset and an unfavorable lease intangible liability related to assumed Cash America leases to the extent such leases contained favorable or unfavorable terms relative to market (together the “Lease Intangibles”). The current portion of favorable lease intangibles is included in prepaid expenses and other current assets and the non-current portion is included in other assets in the accompanying consolidated balance sheets. The current portion of unfavorable lease intangibles is included in accounts payable and accrued liabilities and the non-current portion is included in other liabilities in the accompanying consolidated balance sheets. The Lease Intangibles are amortized to rent expense, which is a component of store operating expenses, on a straight-line basis over the lives of the respective leases.

The following table details amounts for the Lease Intangibles for the years ending December 31, 2017 and 2016 (in thousands):



	Year Ended December 31,
	2017			2016
Favorable lease intangible asset	$	53,429		$	61,875
Unfavorable lease intangible liability	$	(25,367	)	$	(34,989	)

The net amortization of the Lease Intangibles reduced store operating expense by $1.0 million and $0.2 million for the years ended December 31, 2017 and 2016, respectively. Additionally, the Company closed 12 stores with Lease Intangibles during the year ended December 31, 2017 and wrote-off $0.2 million in net unfavorable lease intangibles. The remaining weighted-average amortization period for favorable and unfavorable lease intangibles is 5.1 and 2.3 years, respectively. Estimated future net amortization of the Lease Intangibles is as follows (in thousands):



Fiscal
2018	$	(73	)
2019	929
2020	1,920
2021	2,395
2022	2,906
Thereafter	19,985
	$	28,062

Litigation

The Company, in the ordinary course of business, is a defendant (actual or threatened) in certain lawsuits, arbitration claims and other general claims. In management’s opinion, any potential adverse result should not have a material adverse effect on the Company’s financial position, results of operations, or cash flows.

Guarantees

The Company offers fee-based CSO Programs to assist consumers in obtaining extensions of credit from Independent Lenders. The Company’s CSO Programs comply with the respective jurisdiction’s credit services organization act, credit access business law or a similar statute. Under the CSO Programs, the Company assists customers in applying for a short-term extension of credit from the Independent Lenders and issues the Independent Lenders a guarantee for the repayment of the extension of credit. The extensions of credit made by the Independent Lenders to credit services customers typically range in amount from $50 to $1,500 and have terms of 7 to 365 days. The Independent Lenders are considered variable interest entities of the Company. The net loans outstanding represent less than 50% of the Independent Lenders’ total assets. In addition, the Company does not have any ownership interest in the Independent Lenders, does not exercise control over them and is not the primary beneficiary and, therefore, does not consolidate the Independent Lenders’ results with its results.

The Company is required to recognize, at the inception of the guarantee, a liability for the fair value of the obligation undertaken by issuing the guarantees. According to the guarantee, if the borrower defaults on the extension of credit, the Company will pay the Independent Lenders the principal, accrued interest, insufficient funds fee and late fees, if applicable, all of which the Company records as a component of its credit loss provision. The Company is entitled to seek recovery, directly from its customers, of the amounts it pays the Independent Lenders in performing under the guarantees. The Company records the estimated fair value of the liability in accrued liabilities. The loss provision associated with the CSO Programs is based primarily upon historical loss experience, with consideration given to recent loss trends, delinquency rates, economic conditions and management’s expectations of future credit losses. The Company’s maximum loss exposure under all of the outstanding guarantees issued on behalf of its customers to the Independent Lenders as of December 31, 2017 was $10.1 million compared to $13.2 million at December 31, 2016.