Commitments and Contingencies

9 Months Ended

Apr. 02, 2017

Commitments and Contingencies

Commitments and Contingencies

NOTE 12 – Commitments and Contingencies

During the third quarter of fiscal 2017, Kecy experienced a wind-generated power disruption that temporarily halted production for several days and severely damaged key equipment.  The Company is insured for these business interruption and equipment repair costs and filed an insurance claim with its insurance provider.  The estimated loss of $0.4 million is expected to be covered by insurance and is recorded as an insurance claim receivable at April 2, 2017. 

The Company leases land, facilities, and equipment under various non-cancellable operating lease agreements expiring through August 31, 2024, which contain various renewal options.  The Company also leases equipment under non-cancellable capital lease agreements expiring through June 30, 2024.  The capital leases have interest rates ranging from 3.0% to 4.6%.

From time to time, the Company is a party to various litigation matters incidental to the conduct of its business.  As of April 2, 2017, the Company is not presently a party to any legal proceedings, the resolution of which, management believes, would have a material adverse effect on its business, operating results, financial condition, or cash flows.