(11)

Commitments

Leases

The Company leases its office and warehouse facilities under operating leases which are subject to various step rent provisions, rent concessions and escalation clauses expiring at various dates through 2023. Escalation clauses are not material and have been excluded from minimum future annual rental payments. Rental expense, which is calculated on a straight-line basis, amounted to $10.7 million, $9.9 million and $10.1 million in 2016, 2015 and 2014, respectively. Minimum future annual rental payments are as follows:

2017	$	5,390
2018		5,028
2019		4,568
2020		3,689
2021		3,008
Thereafter		5,952
	$	27,635

License Agreements

The Company is party to a number of license and other agreements for the use of trademarks and rights in connection with the manufacture and sale of its products expiring at various dates through 2032. In connection with certain of these license agreements, the Company is subject to minimum annual advertising commitments, minimum annual royalties and other commitments as follows:

2017	$	113,633
2018		111,489
2019		114,897
2020		116,188
2021		118,169
Thereafter		332,830
	$	907,206

Future advertising commitments are estimated based on planned future sales for the license terms that were in effect at December 31, 2016, without consideration for potential renewal periods. The above figures do not reflect the fact that our distributors share our advertising obligations. Royalty expense included in selling, general, and administrative expenses, aggregated $37.8 million, $33.8 million and $35.6 million, in 2016, 2015 and 2014, respectively, and represented 7.3%, 7.2% and 7.1% of net sales for the years ended December 31, 2016, 2015 and 2014, respectively.