Comfort Inn 2014 Annual Report Download - page 106
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Table of Contents
The Company enters into operating leases primarily for office space, office equipment and transportation vehicles. Minimum rents as defined in the
Company’s lease agreements including rent escalations, rent holidays and rental concessions are recognized on the straight-line basis over the non-
cancellable lease term. Payments made to or on behalf of the Company for leasehold improvement incentives are considered reductions in rental expense and
are amortized on a straight-line basis over the non-cancellable lease term. Rental expense under non-cancellable operating leases was approximately $10.4
million, $12.6 million and $9.2 million for the years ended December 31, 2014, 2013 and 2012, respectively. The Company received sublease rental income
related to real estate leased to third-parties totaling $0.4 million, $0.3 million and $0.3 million during the years ended December 31, 2014, 2013 and 2012.
Future minimum lease payments are as follows:
Minimum lease payments $ 11,604
$ 11,532
$ 10,856
$ 9,897
$ 9,286
$ 26,403
$ 79,578
Minimum sublease
rentals (75)
—
—
—
—
—
(75)
$ 11,529
$ 11,532
$ 10,856
$ 9,897
$ 9,286
$ 26,403
$ 79,503
The Company’s Senior Notes due 2020 and 2022 are guaranteed jointly, severally, fully and unconditionally, subject to certain customary limitations,
by eight wholly owned domestic subsidiaries. There are no legal or regulatory restrictions on the payment of dividends to Choice Hotels International, Inc.
from subsidiaries that do not guarantee the Senior Notes. As a result of the guarantee arrangements, the following condensed consolidating financial
statements are presented. Investments in subsidiaries are accounted for under the equity method of accounting.
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