First American Financial Corp Commitments Disclosure
NOTE 18. Commitments and Contingencies:
Lease commitments
The Company leases certain office facilities, automobiles and equipment under operating leases, which, for the most part, are renewable. The majority of these leases also provide that the Company pay insurance and taxes.
Future minimum rental payments under operating leases that have initial noncancelable lease terms in excess of one year, as of December 31, 2018, are as follows:
|
|
(in thousands) |
|
||
|
Year |
|
|
|
|
|
2019 |
$ |
76,375 |
|
|
|
2020 |
|
68,026 |
|
|
|
2021 |
|
54,853 |
|
|
|
2022 |
|
41,859 |
|
|
|
2023 |
|
28,948 |
|
|
|
Thereafter |
|
64,732 |
|
|
|
|
$ |
334,793 |
|
|
Total rental expense for all operating leases, including month-to-month rentals, was $89.4 million, $91.0 million and $91.4 million for the years ended December 31, 2018, 2017 and 2016, respectively.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2018 | Feb 20, 2019 | Showing above |
| 2017 | Feb 16, 2018 | |
| 2016 | Feb 17, 2017 | |
| 2015 | Feb 19, 2016 | |
About Commitments Disclosures
Commitments and contingencies disclosures catalog a company's off-balance-sheet obligations and legal exposures — purchase commitments, guarantee arrangements, pending litigation, and regulatory proceedings. These items represent potential future cash outflows that may not appear as liabilities on the balance sheet until they become probable and estimable.
Key signals: litigation reserves and disclosed loss ranges quantify management's estimate of legal exposure, but unquantified "reasonably possible" losses often represent the larger risk. Watch for changes in language around pending cases — shifts from "remote" to "reasonably possible" or increases in estimated loss ranges signal deteriorating outcomes. Unconditional purchase obligations and take-or-pay contracts create fixed cost structures that reduce operational flexibility. Guarantee arrangements for subsidiaries or joint ventures can create cascading obligations. Compare the total commitment schedule against projected free cash flow to assess whether the company can meet its obligations without additional financing.