2. Investments

Available-for-sale investments are carried at fair value, inclusive of unrealized gains and losses, and net of discount accretion and premium amortization computed using the level yield method. Net unrealized gains and losses are included in other comprehensive income (loss) net of applicable income taxes. Gains or losses on sales of available-for-sale investments are recognized using the first-in, first-out method and are included in either other income or interest income depending upon the type of security.

Available-for-sale securities as of March 24, 2013 are summarized as follows (in thousands):

	Amortized Costs		Gross Unrealized Gain		Gross Unrealized Loss			Net Unrealized Gain		Market Value
Short-Term Investments:

Corporate debt	$	—	$	13	$	—		$	13	$	13
U.S. government and agency obligations		15,033		12		—			12		15,045
Total short-term investments	$	15,033	$	25	$	—		$	25	$	15,058

Equity securities	$	11,631	$	3,931	$	(152	)	$	3,779	$	15,410

Available-for-sale securities as of June 24, 2012 are summarized as follows (in thousands):

	Amortized Costs		Gross Unrealized Gain		Gross Unrealized Loss			Net Unrealized Gain		Market Value
Short-Term Investments:

Corporate debt	$	6,045	$	26	$	—		$	26	$	6,071
U.S. government and agency obligations		57,796		10		(5	)		5		57,801
Total short-term investments	$	63,841	$	36	$	(5	)	$	31	$	63,872
Long-Term Investments:

U.S. government and agency obligations	$	15,053	$	7	$	(6	)	$	1	$	15,054
Total long-term investments	$	15,053	$	7	$	(6	)	$	1	$	15,054

Equity securities	$	11,631	$	3,848	$	—		$	3,848	$	15,479

2. Investments (Continued)

The Company manages its total portfolio to encompass a diversified pool of investment‑grade securities. The investment policy is to manage its total cash and investments balances to preserve principal and maintain liquidity while achieving moderate returns on the investment portfolio.

In addition, the Company has a note receivable from a privately held company which was carried at cost of $0.4 million in other assets. This investment was carried at cost as the Company determined that it was nonmarketable since the issuer is a start-up company whose securities are not publicly traded, and as a result, it was not practicable to estimate the fair value of the investment. During the three months ended March 24, 2013, the privately held company in which the Company has an equity investment experienced a negative change in financial condition. The Company then evaluated that the investment was permanently impaired and recorded an impairment charge of $0.4 million during the three months ended March 24, 2013.

The Company also holds as strategic investments the common stock of three publicly traded foreign companies. The common stock of the three companies are shown as "Equity securities" in the tables above and are included in other assets on the consolidated balance sheets. The common shares of the publicly traded companies are traded on either the Tokyo Stock Exchange or the Taiwan Stock Exchange. The Company holds an option on one of the strategic investments to put the associated number of common shares back to the issuer at a fixed price in local currency (which is described as the "Put Option" in Note 1). The Put Option became effective September 1, 2009 and is reported at fair value. As of March 24, 2013, the fair value of the Put Option was $2.9 million, with changes in fair value recorded in other expense (income), net (See Note 3, "Derivative Financial Instruments"). Dividend income from these investments was $0.1 million and $0.2 million for the three and nine months ended March 24, 2013, respectively, and $0.1 million for the nine months ended March 25, 2012. The Company received no dividend income from these equity investments during the three months ended March 25, 2012.

The Company evaluates securities for other-than-temporary impairment on a quarterly basis. Impairment is evaluated considering numerous factors, and their relative significance varies depending on the situation. Factors considered include the length of time and extent to which the market value has been less than cost; the financial condition and near-term prospects of the issuer of the securities; and the intent and ability of the Company to retain the security in order to allow for an anticipated recovery in fair value. If, based upon the analysis, it is determined that the impairment is other-than-temporary, the security is written down to fair value, and a loss is recognized through earnings.

The following table provides the Company's other-than-temporary impairments for equity and mortgage-backed securities for the three and nine months ended March 24, 2013 and March 25, 2012 (in thousands):

	Three Months Ended				Nine Months Ended
	March 24, 2013		March 25, 2012		March 24, 2013		March 25, 2012
Privately held domestic company-common and preferred stock	$	―	$	―	$	―	$	1,504
Privately held company-note receivable		350		―		350		―
Publicly traded foreign company(s)-common stock		―		―		―		850
Mortgage-backed security		―		―		―		29
Total other-than-temporary impairments	$	350	$	―	$	350	$	2,383

2. Investments (Continued)

The unrealized loss position is measured and determined at each fiscal quarter end. The following tables summarize the fair value and gross unrealized losses related to available-for-sale investments, aggregated by type of investment and length of time that individual securities have been held (in thousands):

	Securities held in a loss position for less than 12 months at March 24, 2013					Securities held in a loss position for 12 months or more at March 24, 2013				Total in a loss position at March 24, 2013
	Market Value		Gross Unrealized Losses			Market Value		Gross Unrealized Losses		Market Value		Gross Unrealized Losses
Equity securities	$	4,631	$	(152	)	$	—	$	—	$	4,631	$	(152	)
Total	$	4,631	$	(152	)	$	—	$	—	$	4,631	$	(152	)

	Securities held in a loss position for less than 12 months at June 24, 2012					Securities held in a loss position for 12 months or more at June 24, 2012				Total in a loss position at June 24, 2012
	Market Value		Gross Unrealized Losses			Market Value		Gross Unrealized Losses		Market Value		Gross Unrealized Losses
U.S government and agency obligations	$	46,420	$	(11	)	$	—	$	—	$	46,420	$	(11	)
Total	$	46,420	$	(11	)	$	—	$	—	$	46,420	$	(11	)

As of March 24, 2013, the Company evaluated whether equity securities with gross unrealized losses of $0.2 million was other-than-temporarily impaired. The Company determined there was no indication of other-than-temporary impairment with regards to gross unrealized losses. The determination was based on the fact the Company has evaluated the near-term prospects of the equity investments in relation to the severity and duration of the impairment, and based on that evaluation, has the ability and intent to hold these investments until a recovery of fair value.

The amortized cost and estimated fair value of investments at March 24, 2013, by contractual maturity, are as follows (in thousands):

	Amortized Cost		Estimated Market Value
Due in 1 year or less	$	15,053	$	15,058
Total investments	$	15,053	$	15,058

The Company may decide to dispose of securities prior to the contractual maturity date indicated in the table above.

During the nine months ended March 24, 2013, available-for-sale securities were sold for total proceeds of $52.1 million, and for the three and nine months ended March 25, 2012 were sold for total proceeds of $12.2 million and $27.1 million, respectively. During the three months ended March 24, 2013, there were no sales of available-for-sale securities, and as a result, the Company did not recognize any gross realized gains (losses). Gross realized gains (losses) for the nine months ended March 24, 2013 and March 25, 2012 were de minimis.

2. Investments (Continued)

As a result of sales of available-for-sale securities, the Company reclassified $0.0 million for the nine months ended March 24, 2013, and $(0.0) million and $(0.2) million for the three and nine months ended March 25, 2012, respectively, from accumulated other comprehensive income to earnings as a component of interest income. During the three months ended March 24, 2013, the Company did not reclassify realized gains (losses) from accumulated other comprehensive income to earnings, as there were no sales of available-for-sale securities.

Fair Value of Investments

The following tables present the balances of investments measured at fair value on a recurring basis (in thousands):

	As of March 24, 2013
	Total		Level 1		Level 2		Level 3
Corporate debt	$	13	$	—	$	13	$	—
U.S. government and agency obligations		15,045		6,005		9,040		—
Equity securities-strategic investments		15,410		15,410		—		—
Total securities at fair value	$	30,468	$	21,415	$	9,053	$	—

	As of June 24, 2012
	Total		Level 1		Level 2		Level 3
Corporate debt	$	6,071	$	—	$	6,071	$	—
U.S. government and agency obligations		72,855		43,059		29,796		—
Equity securities-strategic investments		15,479		15,479		—		—
Total securities at fair value	$	94,405	$	58,538	$	35,867	$	—