Commitments and Contingencies

12 Months Ended

May 31, 2017

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

NOTE 15 — Commitments and Contingencies

The Company leases retail store space, certain distribution and warehouse facilities, and office space and other non-real estate assets under operating leases expiring from 1 to 17 years after May 31, 2017. Rent expense was $731 million, $661 million and $594 million for the years ended May 31, 2017, 2016 and 2015, respectively. Amounts of minimum future annual commitments under non-cancelable operating and capital leases are as follows (in millions):

	2018		2019		2020		2021		2022		Thereafter		Total
Operating leases	$	537	$	509	$	438	$	399	$	350	$	1,672	$	3,905
Capital leases and other financing obligations(1)	$	34	$	32	$	28	$	25	$	26	$	225	$	370

(1) Capital leases and other financing obligations include payments related to build-to-suit lease arrangements.

As of May 31, 2017 and 2016, the Company had letters of credit outstanding totaling $152 million and $157 million, respectively. These letters of credit were generally issued for the purchase of inventory and guarantees of the Company’s performance under certain self-insurance and other programs.

In connection with various contracts and agreements, the Company provides routine indemnification relating to the enforceability of intellectual property rights, coverage for legal issues that arise and other items where the Company is acting as the guarantor. Currently, the Company has several such agreements in place. However, based on the Company’s historical experience and the estimated probability of future loss, the Company has determined that the fair value of such indemnification is not material to the Company’s financial position or results of operations.

In the ordinary course of its business, the Company is involved in various legal proceedings involving contractual and employment relationships, product liability claims, trademark rights and a variety of other matters. While the Company cannot predict the outcome of its pending legal matters with certainty, the Company does not believe any currently identified claim, proceeding or litigation, either individually or in aggregate, will have a material impact on the Company’s results of operations, financial position or cash flows.