Commitments and Contingencies

12 Months Ended

Dec. 31, 2016

Commitments and Contingencies

15. Commitments and Contingencies

Commitments

In 2014, the Company entered into a $50 million commitment to purchase an alternative investment vehicle which is comprised of European non-performing loans. As of December 31, 2016, the Company has funded $34.3 million of this commitment leaving $15.7 million as unfunded.

In June, 2016, the Company entered into a $40 million commitment with an investment manager that provides financing for middle market companies. As of December 31, 2016, the Company has funded $30.9 million of this commitment leaving $9.1 million as unfunded.

Lease Commitments

Total rental expense under operating leases for the years ended December 31, 2016, 2015, and 2014 was $3.7 million, $3.5 million, and $2.6 million, respectively. Rent expense was net of sublease income of $0.02 million, $0.07 million, and $0.04 million for the years ended December 31, 2016, 2015, 2014, respectively. At December 31, 2016, future minimum cash payments under non-cancelable operating leases were as follows:

(Dollars in thousands)
2017	$	3,227
2018		3,185
2019		2,157
2020		117
Total	$	8,686

Legal Proceedings

The Company is, from time to time, involved in various legal proceedings in the ordinary course of business. The Company maintains insurance and reinsurance coverage for such risks in amounts that it considers adequate. However, there can be no assurance that the insurance and reinsurance coverage that the Company maintains is sufficient or will be available in adequate amounts or at a reasonable cost. The Company does not believe that the resolution of any currently pending legal proceedings, either individually or taken as a whole, will have a material adverse effect on its business, results of operations, cash flows, or financial condition.

There is a greater potential for disputes with reinsurers who are in runoff. Some of the Company’s reinsurers’ have operations that are in runoff, and therefore, the Company closely monitors those relationships. The Company anticipates that, similar to the rest of the insurance and reinsurance industry, it will continue to be subject to litigation and arbitration proceedings in the ordinary course of business.

Other Commitments

The Company is party to a Management Agreement, as amended, with Fox Paine & Company, whereby in connection with certain management services provided to it by Fox Paine & Company, the Company agreed to pay an annual management fee to Fox Paine & Company. See Note 14 above for additional information pertaining to this management agreement.