7. LEASES

Operating and Capital Leases:

As of December 31, 2015, the Company leases office space for corporate offices, a distribution facility in Texas, a raw materials warehouse in Maryland, as well as 41 leases for previously corporate-operated Medifast Weight Control Centers under lease terms ranging from five to ten years. The 41 leases include 3 Centers closed in December 2013, 7 Centers that were closed in December 2014, and 31 leases for Centers that were sold to franchise partners during 2014 and entered into sublease agreements with the franchisees. The Company accrued for the remaining lease obligations net of any sublease income in 2014, see Note 12 for exit activity and clinic obligations. Monthly payments under the Medifast Weight Control Centers leases range in price from $1,800 to $5,000. The Company is additionally required to pay property taxes, utilities, insurance and other costs relating to the leased facilities.

The Company leases large commercial printers for our printing operation that supports our sales channels and network equipment for information technology that are accounted for as capital leases. The leases extend through December 2016.

The following table summarizes our future minimum rental and lease payments required under non-cancelable original lease terms in excess of one year as of December 31, 2015:

	Operating Leases		Capital Leases
2016	$	2,829,000	$	225,000
2017		1,758,000		-
2018		355,000		-
2019		31,000		-
Total minimum lease payments	$	4,973,000	$	225,000
Less amount representing interest				6,000
Present value of minimum lease payments (current)			$	219,000

Current portion				219,000
Long-term portion			$	-

Total minimum lease payments have not been reduced by minimum sublease rent income of approximately $2.0 million due under future non-cancelable subleases.

The following is a summary of the Company’s rent expense for the years ended December 31, 2015, 2014 and 2013:

	2015		2014		2013
Continuing Operations		1,506,000		1,460,000		1,400,000
Discontinued Operations		(1,002,000)		7,189,000		5,233,000
	$	504,000	$	8,649,000	$	6,633,000

For the period ended December 31, 2015, the positive impact to rent expense is due to lease termination agreements that resulted in the reversal of rent obligations estimates that were expensed in 2014. For the periods ended December 31, 2014 and 2013, the discontinued operations rent expense includes an accrual of $4.4 million and $1.1 million, respectively, for continuing obligations for operating leases related to centers closed during the periods.

Equipment lease expense for continuing operations for the years ended December 31, 2015, 2014, and 2013 was $1.0 million, $1.2 million, and $1.4 million, respectively.