NOTE 12: Commitments and Contingencies

Rental expense for operating leases for engineering, selling, administrative and manufacturing totaled $17.7 million, $19.0 million and $18.6 million in fiscal 2017, 2016, and 2015, respectively.

At September 29, 2017, the Company’s rental commitments for noncancelable operating leases with a duration in excess of one year were as follows:

In Thousands

Fiscal Year
2018	$	13,382
2019		10,334
2020		8,194
2021		5,872
2022		5,004
2023 and thereafter		9,021
Total	$	51,807

The Company is subject to purchase obligations for goods and services. The purchase obligations include amounts under legally enforceable agreements for goods and services with defined terms as to quantity, price and timing of delivery. As of September 29, 2017, the Company’s purchase obligations were as follows:

In Thousands			Less than		1‒3		4‒5		After 5
	Total		1 year		years		years		years

Purchase obligations	$	666,071	$	642,422	$	22,555	$	1,094	$	-

The Company is a party to various lawsuits and claims, both as plaintiff and defendant, and has contingent liabilities arising from the conduct of business, none of which, in the opinion of management, is expected to have a material effect on the Company’s financial position or results of operations. The Company believes that it has made appropriate and adequate provisions for contingent liabilities.

In March 2014 the Company entered into a Consent Agreement with the DTCC to resolve alleged ITAR civil violations. Among other things, the Consent Agreement required the Company to pay a $20 million penalty, of which $10 million was suspended and eligible for offset credit. In fiscal 2016, the DTCC approved costs the Company incurred to implement compliance measures to fully offset the $10 million suspended payment. The Consent Agreement was closed in fiscal 2017.

During fiscal 2015 the Company recognized a $15.7 million gain in other income and a $2.4 million reduction in interest expense upon the lapse of a statutory period related to a liability for a non-income tax position of an acquired company. In addition, the Company incurred a $2.9 million loss in other income on foreign currency exchange resulting from the funding of the acquisition of Esterline Advanced Displays.

In fiscal 2016 the Company received a $5 million insurance recovery due to an energetic incident at one of our countermeasure operations, which occurred in the third quarter of fiscal 2016. The Company received a $7.8 million insurance recovery from this incident in fiscal 2017.

Approximately 586 U.S.-based employees or 12% of total U.S.-based employees were represented by various labor unions. The Company’s non-U.S. operations are subject to union and national trade union agreements and to local regulations governing employment.