Commitments and Contingencies

12 Months Ended

Dec. 31, 2016

Note 17. Commitments and Contingencies

(a) Lease Commitments

The Company leases manufacturing and office facilities and certain equipment under operating leases that expire through 2037. Rental expense was $3.8 million, $3.8 million and $3.7 million under operating leases for the years ended December 31, 2016, 2015 and 2014, respectively. Future minimum lease commitments on non‑cancelable operating leases for the year ended December 31, 2016 are as follows:


	Operating
	Leases
	(in thousands)
2017	$	2,581
2018		1,390
2019		704
2020		352
2021		201
Thereafter		—
	$	5,228

(b) Sale Leaseback Financing Obligation

In addition to the lease commitments as described above, the Company entered into a 22-year lease agreement relating to our corporate headquarters in Beverly, Massachusetts. The following table relates to the cash payment schedule associated with this lease obligation as of December 31, 2016:


	Lease
	Obligation
	(in thousands)
2017	$	5,315
2018		5,470
2019		5,594
2020		5,719
2021		5,848
Thereafter		97,999
Total lease payments	$	125,945
Less interest portion		(78,359)
Sale leaseback obligation	$	47,586

The Company has non‑cancelable contracts and purchase orders for inventory of $43.9 million at December 31, 2016.

(d) Litigation

The Company is not presently a party to any litigation that it believes might have a material adverse effect on its business operations. The Company is, from time to time, a party to litigation that arises in the normal course of its business operations.

(e) Indemnifications

The Company’s system sales agreements typically include provisions under which the Company agrees to take certain actions, provide certain remedies and defend its customers against third‑party claims of intellectual property infringement under specified conditions and to indemnify customers against any damage and costs awarded in connection with such claims. The Company has not incurred any material costs as a result of such indemnifications and has not accrued any liabilities related to such obligations in the accompanying consolidated financial statements.