Commitments and Contingencies

12 Months Ended

Jun. 29, 2014

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

The Company has operating leases for the use of certain real estate and equipment. Substantially all operating leases are non-cancelable or cancelable only by the payment of penalties. All lease payments are based on the lapse of time but include, in some cases, payments for insurance, maintenance and property taxes. There are no purchase options on operating leases at favorable terms, but most real estate leases have one or more renewal options. Certain leases on real estate are subject to annual escalations for increases in utilities and property taxes.

The Company has entered into several operating lease agreements, some of which contain provisions for future rent increases, rent free periods, or periods in which rent payments are reduced (abated). For each lease, the total amount of rental payments due over the lease term is being charged to rent expense on a straight-line method over the term of the lease. The difference between rent expense recorded and the amount paid is credited or charged to “accrued rent expense,” which is included in “Other current liabilities” in the accompanying consolidated balance sheet.

Total rental expense on all operating leases totaled $11.8 million, $11.6 million, and $11.2 million for the fiscal years ended June 29, 2014, June 30, 2013, and June 24, 2012, respectively. The Company had outstanding purchase commitments for capital expenditures of approximately $15.7 million at June 29, 2014. The Company had no material capital lease obligations as of June 29, 2014.

As of June 29, 2014, minimum rental commitments by period under operating leases are as follows (in thousands):

			Fiscal Year
	Total		2015		2016		2017		2018		2019		2020 and thereafter
Minimum fixed rentals	$	49,320	$	12,393	$	10,170	$	7,021	$	6,240	$	5,988	$	7,508

During fiscal year 2012, the Company entered into an amended foundry services agreement with one of its contract manufacturers for wafer fabrication, under which the Company is entitled to purchase silicon wafers through December 31, 2017.  Under the terms of the agreement, the Company advanced funds of $1.5 million against future processing charges.  The advance payment is recoverable in the form of a fixed amount per wafer purchased.  Any portion of the advance not recovered as of December 31, 2017 will be forfeited.  As of June 29, 2014, the Company believes that the $1.2 million outstanding balance of the advance will be recovered.