Note 8 - Guarantees and Other Obligations

3 Months Ended

Mar. 25, 2017

Notes to Financial Statements

Commitments Contingencies and Guarantees [Text Block]

8. Guarantees and Other Obligations

Product Warranty

Our products are generally sold with warranty periods that range from

12

to

36

months following sale or acceptance. Parts and labor are covered under the terms of the warranty agreement. The warranty provision is based on historical and projected experience by product and configuration.

Changes in accrued warranty were as follows

(

in thousands

)

:

	Three Months Ended
	March 25,			March 26,
	2017			2016
Balance at beginning of period	$	4,350		$	4,886
Warranty expense accruals		1,736			1,820
Warranty payments		(1,191	)		(1,488	)
Warranty liability assumed		50			-
Balance at end of period	$	4,945		$	5,218

Accrued warranty amounts expected to be incurred after

one

year are included in noncurrent other accrued liabilities in the condensed consolidated balance sheet. These amounts total

$0.7

 million at

March

25,

2017

and

$0.6

 million at

December

31,

2016.

 

Borrowings

Revolving Lines of Credit

As a result of the Acquisition, we assumed a series of revolving credit facilities with various financial institutions in Japan. The credit facilities renew monthly and provide Kita with access to working capital totaling up to

$6.3

 million. At

March

25,

2017

total borrowings outstanding under the revolving lines of credit was

$3.2

 million. As these credit facility agreements renew monthly, they have been included in short-term borrowings in our condensed consolidated balance sheet. The revolving lines of credit are denominated in Japanese Yen and, as a result, amounts disclosed herein will fluctuate as a result of changes in currency exchange rates.

Term Loans

As a result of the Acquisition, as of

March

25,

2017

we assumed long-term term loans from a series of Japanese financial institutions totaling

$7.1

million primarily related to the expansion of Kita’s facility in Osaka, Japan. The loan amounts outstanding are collateralized by the facility and land. The loans carry interest rates ranging from

0.05%

to

1.43%

and expire at various dates through

2034.

At

March

25,

2017,

$1.2

 million of the term loans have been included in current installments of long-term debt in our condensed consolidated balance sheet. The term loans are denominated in Japanese Yen and, as a result, amounts disclosed herein will fluctuate as a result of changes in currency exchange rates.

Lines of Credit

We have

two

available lines of credit which provide

one

of our wholly owned subsidiaries with borrowings of up to a total of

2.5

 million Swiss Francs. At

March

25,

2017

and

December

31,

2016,

no

amounts were outstanding under the lines of credit.

Standby Letters of Credit

During the ordinary course of business, from time-to-time we provide standby letters of credit instruments to certain parties as required. As of

March

25,

2017,

no

amounts were outstanding under standby lines of credit.