Note 10 — Commitments and Contingencies

The Company leases real estate and equipment with lease terms expiring through fiscal year 2029. Certain leases provide for renewal options and additional rentals based on escalations in operating expenses and real estate taxes.

Rental expense, including short-term leases, maintenance charges and taxes on leased facilities, was approximately $142 million, $138 million and $142 million for fiscal years 2018, 2017 and 2016, respectively. Rental expense does not include rent expense associated with facilities exited as part of previous restructuring plans and actions.

Future minimum lease payments under non-cancelable operating leases, including facilities exited as part of previous restructuring plans and actions, at March 31, 2018 were as follows:



Fiscal Year	(in millions)
2019	$	97
2020	85
2021	74
2022	54
2023	38
Thereafter	110
Total	$	458
Less income from subleases	(33		)
Net minimum operating lease payments	$	425

The Company has additional commitments to purchase goods and services of approximately $181 million in future periods, approximately $164 million of which expires by fiscal year 2023.

In connection with the share repurchase arrangement with Careal Holding AG (“Careal”), the Company agreed that it will indemnify Careal for certain potential tax matters resulting solely from the Company’s breach of the covenant relating to the post-closing holding of the repurchased shares under this arrangement. The Company believes that the occurrence of an event that could trigger the indemnification is within its control and is remote. Therefore, the Company has not recorded a liability related to such indemnification. The maximum potential future payment under this indemnification, excluding interest and penalties, if any, is estimated to be approximately CHF 101 million (which translated to approximately $106 million at March 31, 2018). Any changes to the Company’s assessment of the probability of the occurrence of an event that could trigger the indemnification provision may result in the Company recording a liability in the future, which would impact the results of operations for that period. Refer to Note 11, “Stockholders’ Equity” for additional information.

Litigation: The Company, from time to time, may be named as a defendant in various lawsuits and claims arising in the normal course of business. The Company may also become involved with contract issues and disputes with customers.

Based on the Company’s experience, management believes that the damages amounts claimed in a case are not a meaningful indicator of the potential liability. Claims, suits, investigations and proceedings are inherently uncertain and it is not possible to predict the ultimate outcome of cases. The Company believes that it has meritorious defenses in connection with its current lawsuits and material claims and disputes, and intends to vigorously contest each of them.

In the opinion of the Company’s management based upon information currently available to the Company, while the outcome of its lawsuits, claims and disputes is uncertain, the likely results of these lawsuits, claims and disputes are not expected, either individually or in the aggregate, to have a material adverse effect on the Company’s financial position, results of operations or cash flows, although the effect could be material to the Company’s results of operations or cash flows for any interim reporting period. For some matters, the Company is unable to estimate a range of reasonably possible loss due to the stage of the matter and/or other particular circumstances of the matter. For others, a range of reasonably possible loss can be estimated. For those matters for which such a range can be estimated, the Company estimates that, in the aggregate, the range of reasonably possible loss does not exceed $20 million. This is in addition to any amounts that have been accrued.