NOTES TO CONSOLIDATED FINANCIAL STATEMENTS EMCOR and its subsidiaries lease land, buildings and equipment under various leases. The leases frequently include renewal options and require EMCOR to pay for utilities, taxes, insurance and maintenance expenses. Future minimum payments, by year and in the aggregate, under capital leases, non-cancelable operating leases and related sub-leases with initial or remaining terms of one  or more years at December 31, 2001 were as follows  (in thousands): NOTE K — COMMITMENTS AND CONTINGENCIES Capital Operating Sublease Lease Lease Income 2002 $ 121 $ 25,138 $ 637 2003 98 19,721 647 2004 34 15,080 546 2005 8 9,741 389 2006 6 5,581 355 Thereafter — 7,708 1,457 Total minimum  lease payments 267 $ 82,969 $ 4,031 Amounts  representing interest (18) Present value of  net minimum  lease payments $ 249 Rent expense for the years ended December 31, 2001, 2000 and 1999 was $28.5 million, $25.4 million and  $15.1 million, respectively. Rent expense for the years ended December 31, 2001, 2000 and 1999 included sublease rental income of $0.7 million, $0.6 million  and $0.7 million, respectively. EMCOR has employment agreements for a fixed term with its executive officers and certain management personnel. The employment agreements with executive officers may be terminated by the executive or EMCOR but, if terminated by EMCOR, the agreements provide for severance benefits. Certain of the agreements provide the executives with certain additional rights if a change of control (as defined) of EMCOR occurs. EMCOR is contingently liable to sureties in respect of performance and payment bonds issued by sureties in connection with certain contracts entered into by EMCOR’s subsidiaries in the normal course of their business. EMCOR has agreed to indemnify the sureties for any payments made by them in respect of such bonds. EMCOR is subject to regulation with respect to the  handling of certain materials used in construction which are classified as hazardous or toxic by federal, state and local agencies. EMCOR’s practice is to avoid participation in projects principally involving the remediation or removal  of such materials. However, where remediation is a required part of contract performance, EMCOR believes it complies with all applicable regulations governing the discharge  of material into the environment or otherwise relating  to the protection of the environment. A subsidiary of EMCOR has guaranteed indebtedness of a venture in which it has a 40% interest; the other venture partner, Baltimore Gas and Electric, has a 60% interest. The venture designs, constructs, owns, operates, leases and maintains facilities to produce chilled water for sale to customers for use in cooling. These guarantees are not expected to have a material adverse effect on EMCOR’s financial position or results of operations. Under one guarantee, each of the venturers is jointly and severally liable for the venture’s $25.0 million borrowing due December 2031. The other guarantee is related to the venture’s $50.0 million revolving credit facility expiring September 2002, under which guarantee EMCOR’s subsidiary could be responsible for 40%  of the indebtedness. Pursuant to EMCOR’s bankruptcy reorganization, when it was formerly known as JWP, Inc., a wholly-owned subsidiary, SellCo Corporation (“SellCo”), issued approximately $48.1 million principal amount of 12.0% Subordinated Contingent Payments Notes, due 2004, (the “SellCo Notes”). Interest is payable semiannually in additional SellCo Notes. Net Cash Proceeds (as defined in the Indenture pursuant to which the SellCo Notes were issued) from the sales of stock or assets of SellCo subsidiaries were to be used to redeem SellCo Notes. The SellCo Notes are not obligations of EMCOR and, accordingly, are not included in the accompanying Consolidated Balance Sheets as of December 31, 2001 and 2000. Since the date of issuance, approximately $23.2 million of the SellCo Notes have been redeemed with proceeds from the sale of stock and assets of SellCo subsidiaries and the prepayment by EMCOR of the Supplemental SellCo Note. The SellCo Notes mature on December 15, 2004 if not deemed canceled at an earlier date pursuant to the Indenture. EMCOR ANNUAL REPORT 2001  41