Note 14 Commitments and Contingencies

 

Royalty expense amounted to $6.5 million and $6.7 million during fiscal years 2026 and 2025, respectively. The Company’s commitment for the next five fiscal years for minimum guaranteed royalty payments under its license agreements as of March 29, 2026 is $9.2 million, consisting of $5.0 million, $3.6 million, $425 thousand, $59 thousand and $59 thousand due in fiscal years 2027, 2028, 2029, 2030 and 2031, respectively.

 

The Company is, from time to time, involved in various legal proceedings relating to claims arising in the ordinary course of its business. Neither the Company nor any of its subsidiaries is a party to any such legal proceeding the outcome of which, individually or in the aggregate, is expected to have a material adverse effect on the Company’s financial position, results of operations or cash flows.

 

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Historical Timeline

Fiscal YearFiled
2026Jun 24, 2026Showing above
2025Jun 25, 2025
2024Jun 28, 2024
2023Jun 26, 2023
2022Jun 8, 2022
2021Jun 9, 2021
2020Jun 10, 2020
2019Jun 13, 2019
2018Jun 13, 2018
2017Jun 14, 2017
2016Jun 9, 2016

About Commitments Disclosures

Commitments and contingencies disclosures catalog a company's off-balance-sheet obligations and legal exposures — purchase commitments, guarantee arrangements, pending litigation, and regulatory proceedings. These items represent potential future cash outflows that may not appear as liabilities on the balance sheet until they become probable and estimable.

Key signals: litigation reserves and disclosed loss ranges quantify management's estimate of legal exposure, but unquantified "reasonably possible" losses often represent the larger risk. Watch for changes in language around pending cases — shifts from "remote" to "reasonably possible" or increases in estimated loss ranges signal deteriorating outcomes. Unconditional purchase obligations and take-or-pay contracts create fixed cost structures that reduce operational flexibility. Guarantee arrangements for subsidiaries or joint ventures can create cascading obligations. Compare the total commitment schedule against projected free cash flow to assess whether the company can meet its obligations without additional financing.