The assumptions used as of December 31, 1999, 1998 and 1997 in determining pension cost and liability shown above were as follows:

For measurement purposes, a 2.5% and 5.0% annual rate of increase in the per capita cost of covered pension benefits was assumed for 1999 and 1998, respectively.

The components of net periodic pension benefit cost for the years ended December 31, 1999, 1998 and 1997 were as follows (in thousands):

EMCOR contributes to various union pension funds based upon wages paid to union employees of EMCOR. Such contributions approximated $71.1 million, $57.4 million and $50.8 million for the years ended December 31, 1999, 1998 and 1997, respectively.

EMCOR has a defined contribution retirement plan that covers its U.S. nonunion eligible employees. Contributions to this plan are based on a percentage of the employee’s base compensation. The expense recognized for the years ended December 31, 1999, 1998 and 1997, for the defined contribution plan was $2.2 million, $1.9 million and $2.6 million, respectively.

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, 1999 are as follows (in thousands):

Rent expense for the years ended December 31, 1999, 1998 and 1997 was $15.1 million, $12.1 million and $9.8 million, respectively. Rent expense for the years ended December 31, 1999, 1998 and 1997 included sublease rentals of $0.7 million, $0.1 million: and $2.3 million, respectively.

EMCOR has employment agreements with certain of its executive officers and management personnel. These agreements generally continue until terminated by the executive or EMCOR and provide for severance benefits if terminated. Certain of the agreements provide the employees 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 the 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.