AIG 2015 Annual Report Download - page 309

ITEM 8 / NOTE 15. CONTINGENCIES, COMMITMENTS AND GUARANTEES
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Commitments
We occupy leased space in many locations under various long-term leases and have entered into various leases covering the
long-term use of data processing equipment.
The following table presents the future minimum lease payments under operating leases at December 31, 2015:
(in millions)
2016 $ 304
2017 234
2018 168
2019 126
2020 93
Remaining years after 2020 210
Tot al $ 1,135
Rent expense was $327 million, $471 million and $414 million for the years ended December 31, 2015, 2014 and 2013,
respectively.
Other Commitments
In the normal course of business, we enter into commitments to invest in limited partnerships, private equity funds and hedge
funds and to purchase and develop real estate in the U.S. and abroad. These commitments totaled $2.6 billion at December
31, 2015.
Guarantees
Subsidiaries
We have issued unconditional guarantees with respect to the prompt payment, when due, of all present and future payment
obligations and liabilities of AIGFP and of AIG Markets arising from transactions entered into by AIG Markets.
In connection with AIGFP’s business activities, AIGFP has issued, in a limited number of transactions, standby letters of credit
or similar facilities to equity investors of structured leasing transactions in an amount equal to the termination value owing to
the equity investor by the lessee in the event of a lessee default (the equity termination value). The total amount outstanding at
December 31, 2015 was $208 million. In those transactions, AIGFP has agreed to pay such amount if the lessee fails to pay.
The amount payable by AIGFP is, in certain cases, partially offset by amounts payable under other instruments typically equal
to the present value of scheduled payments to be made by AIGFP. In the event that AIGFP is required to make a payment to
the equity investor, the lessee is unconditionally obligated to reimburse AIGFP. To the extent that the equity investor is paid the
equity termination value from the standby letter of credit and/or other sources, including payments by the lessee, AIGFP takes
an assignment of the equity investor’s rights under the lease of the underlying property. Because the obligations of the lessee
under the lease transactions are generally economically defeased, lessee bankruptcy is the most likely circumstance in which
AIGFP would be required to pay without reimbursement.