Commitments and Contingencies

12 Months Ended

Dec. 31, 2016

Commitments And Contingencies Disclosure [Abstract]

Note 11. Commitments and Contingencies

Intellectual Property Indemnification Obligations – The Company will, from time to time, in the normal course of business, agree to indemnify certain customers, vendors or others against third party claims that Nanometrics’ products, when used for their intended purpose(s), or the Company’s intellectual property, infringe the intellectual property rights of such third parties or other claims made against parties with whom it enters into contractual relationships. It is not possible to determine the maximum potential amount of liability under these indemnification obligations due to the limited history of prior indemnification claims and the unique facts and circumstances that are likely to be involved in each particular claim. Historically, the Company has not made payments under these obligations and believes that the estimated fair value of these agreements is immaterial. Accordingly, no liabilities have been recorded for these obligations in the accompanying consolidated balance sheets as of December 31, 2016 and December 26, 2015.

The Company maintains certain open inventory purchase agreements with its suppliers to ensure a smooth and continuous supply availability for key components. The Company’s liability under these purchase commitments is generally restricted to a forecasted time-horizon as mutually agreed upon between the parties. This forecasted time-horizon can vary among different suppliers. The Company estimates its open inventory purchase commitment as of December 31, 2016 was approximately $30.6 million. Actual expenditures will vary based upon the volume of the transactions and length of contractual service provided. In addition, the amounts paid under these arrangements may be less in the event that the arrangements are renegotiated or cancelled.

The Company leases facilities and certain equipment under non-cancelable operating leases. Rent expense, which is recorded on a straight-line basis over the term of the respective lease, for 2016, 2015 and 2014 was approximately $1.8 million, $1.7 million and $2.0 million, respectively. Future minimum lease payments under its operating leases are as follows (in thousands):

	Operating Leases
2017	$	1,562
2018		1,189
2019		755
2020		301
2021		79
Thereafter		—
Total	$	3,886

On June 17, 2009, the Company announced a strategic business partnership with Zygo Corporation (“Zygo”) whereby it has purchased inventory and certain other assets from Zygo, and the two companies entered into a supply agreement. The Company made payments to Zygo over a period of time as acquired inventory was sold and other aspects of the supply agreement were executed. The Company made royalty and sustaining engineering payments of $0.3 million and $0.9 million to Zygo in fiscal years 2016 and 2015, respectively.

On December 8, 2016, the Company amended its agreement with Zygo, of which, the Company is released from any existing and future contingent liabilities to Zygo.