7. Commitments

Leases

The Company leases office facilities and equipment under various operating and capital lease agreements. The initial terms of these leases range from 2 year to 15 years and generally provide for periodic rent increases and renewal options. Certain leases require the Company to pay taxes, insurance and maintenance. In connection with certain operating leases, the Company has security deposits recorded and maintained as restricted cash totaling $7.2 million as of December 31, 2016.

Rent expense is recognized on a straight-line basis over the term of the lease. Accordingly, rent expense recognized in excess of rent paid is reflected as a liability in the accompanying Consolidated Balance Sheets. Rent expense, including costs directly associated with the facility leases, was approximately $10.6 million, $9.3 million, and $11.5 million for the years ended December 31, 2016, 2015, and 2014, respectively.

The Company’s future minimum annual lease payments under capital and operating leases, including payments for costs directly associated with the facility leases, for years ending after December 31, 2016 are as follows (in thousands):

	Capital			Operating
	Leases			Leases
2017	$	630		$	12,273
2018		580			9,398
2019		429			9,048
2020		10			8,662
2021		—			7,131
Thereafter		—			11,362
Total minimum lease payments	$	1,649		$	57,874
Less amount representing interest		(200	)
Present value of obligations under capital leases		1,449
Less current portion		(512	)
Long-term capital lease obligations	$	937

Licensing and Purchasing Agreements

The Company is contingently obligated to make payments of up to $11.8 million in cash if specified future events occur or conditions are met as provided in certain consulting, purchase and/or product develop agreements. Not all of the respective agreements specify milestone payment timelines. The Company has also entered into certain consulting arrangements to pay up to approximately $18.7 million in the aggregate in the event that specified revenue-based milestones are achieved prior to 2024. Any such payment will be made in a combination of cash and the Company’s common shares as provided in the agreements. Any payments in satisfaction of theses contingent obligations are considered a cost of goods sold and are recognized as and if milestones are achieved. These agreements expire on various dates through 2024.

Executive Severance Plans

The Company has employment contracts with key executives and maintains severance plans that provide for the payment of severance and other benefits if terminated for reasons other than cause, as defined in those agreements and plans. Certain agreements call for payments that are based on historical compensation, accordingly, the amount of the contractual commitment will change over time commensurate with the executive’s applicable earnings. At December 31, 2016, future commitments for such key executives were approximately $30.2 million. In certain circumstances, the agreements call for the acceleration of equity vesting. Those figures are not reflected in the above information.