14. Commitments and Contingencies

Operating Lease Commitments

At December 29, 2018, CRA had the following minimum rental commitments for office space and equipment leases, all of which are under non-cancelable operating leases (in thousands):


	Rental
Fiscal Year	Commitments
2019		13,835
2020		13,963
2021		13,914
2022		13,972
2023		14,061
Thereafter		56,272
	$	126,017

Certain office leases contain renewal options that CRA may exercise at its discretion, which were not included in the amounts above. Rent expense was approximately $13.2 million, $12.1 million, and $10.4 million in fiscal 2018, fiscal 2017, and fiscal 2016, respectively.

On February 24, 2014, CRA entered into an agreement (the "original lease") to lease 57,602 square feet of office space in Boston, Massachusetts. The lease commenced on February 1, 2015 and is set to expire on July 31, 2025. Subject to certain conditions, the lease will be extendible for two five-year periods. The annual base rent under the lease is approximately $2.4 million for the first lease year, and is subject to annual increases of approximately 2% per annum. On February 24, 2015, CRA signed a first amendment (the "first amendment lease") to lease additional office space of 10,057 square feet on the building's 25th floor for a total of 67,659 square feet. The first amendment lease commenced on June 15, 2015 and is set to expire on June 30, 2020. Subject to certain conditions, the first amendment lease will be extendible for one three-year period. The annual fixed rent under the first amendment lease is approximately $0.5 million. The original lease included a tenant improvement allowance of approximately $4.8 million, as well as a rent abatement of approximately $1.2 million. The performance of CRA’s obligations under the lease is secured by a $1.6 million letter of credit.

On August 16, 2017, the Company entered into a second amendment (the "second amendment lease") to our original lease with BP Hancock LLC, as landlord, for office space located at 200 Clarendon Street, Boston, Massachusetts. Under the second amendment, the Company will lease 28,757 square feet of office space on the building’s 11th floor, in addition to the 67,659 square feet of office space we currently lease on the building’s 9th, 10th and 25th floors. The landlord expects to deliver possession of the new space on or before April 1, 2019. If CRA does not have possession of the new space by April 1, 2020 and certain other conditions are not satisfied, the second amendment gives us a right to terminate the second amendment lease with respect to the space on the 11th floor. The second amendment also extends the base term of the original lease for an additional five years ending on July 31, 2030. Beginning six months after the landlord delivers possession of the new space on the 11th floor to the Company or, if earlier, when CRA commences operations in the new space, the annual base rent for the new space through July 30, 2030, exclusive of customary operating costs and expenses, will be approximately $1.9 million per year, subject to annual increases of approximately 1.7% per year. Beginning on August 1, 2025, the annual fixed rent for the 9th and 10th floors will be payable at the same rate per square foot then in effect for the 11th floor. The second amendment includes a tenant improvement allowance of approximately $2.9 million. Subject to certain conditions, the second amendment lease will be extendable for two additional five-year periods. The second amendment also gives the Company the right to terminate the first amendment lease of 10,057 square feet of office space on the building’s 25th floor effective as of the date on which we begin paying rent for the 11th floor. On May 24, 2018, the Company notified the landlord of its intent to terminate the first amendment lease of the 25th floor effective as of the rent commencement date of the second amendment lease, which is expected to occur on or before October 1, 2019.

On June 27, 2018, CRA entered into a third amendment (the "third amendment lease") to the lease with BP Hancock LLC for an additional 14,097 square feet of office space on the 12th floor of our Boston office building. The landlord expects to deliver possession of the new space on or before May 1, 2019. If CRA does not have possession of the new space on the 12th floor by May 1, 2020 and certain other conditions are not satisfied, the third amendment gives the Company a right to terminate the third amendment lease with respect to the new space on the 12th floor. The third amendment is coterminous with the lease for the 9th, 10th and 11th floors, ending on July 31, 2030. Beginning six months after the landlord delivers possession of the space on the 12th floor to us or, if earlier, when we commence operations in the new space, the annual base rent for the new space through the end of the third amendment lease’s base term, exclusive of customary operating costs and expenses, will be approximately $1.0 million per year, subject to annual increases of approximately 1.6% per year. The third amendment includes a tenant improvement allowance of approximately $1.2 million. The third amendment also gives the Company a right of first offer to rent certain additional office space in the building if it becomes available.

On November 29, 1999, CRA entered into an agreement to lease 44,932 square feet of office space in Washington, D.C. The lease commenced on May 1, 2000 and was set to expire on February 28, 2011. The original annual base rent was approximately $1.4 million for the first year, and subject to annual increases of approximately 2% per annum. Subsequent to entering into the lease, the original lease has had six amendments with the last being signed on July 11, 2016. The amendment consists of an additional 6,366 square feet, is set to expire on December 31, 2027, and has an annual base rent of approximately $0.3 million for the first year, subject to increases of 2.25% per annum. The amended and restated addendum includes a tenant improvement allowance of approximately $0.5 million and a rent abatement of approximately $0.2 million. The performance of CRA’s obligations under the lease is secured by a $0.2 million letter of credit.

On July 15, 2015, CRA entered into an agreement to lease 25,261 square feet of office space in New York, New York. The lease commenced on August 1, 2015 with a rent commencement date of June 1, 2016 and was set to expire on May 31, 2026. The original annual base rent was approximately $1.8 million per annum for the first five years of the lease’s base term, and subject to a maximum annual rent of $2.0 million. Subsequent to entering into the lease, the original lease was amended on April 21, 2017. On July 28, 2017, CRA entered into a second amendment to lease an additional 2,422 square feet of office space. The amendment expands the total office space to 44,270 square feet and is set to expire on April 30, 2028. The amendment includes a base rent abatement of approximately $0.2 million and a tenant improvement allowance of approximately $0.2 million, increasing the total base rent abatement to approximately $1.4 million and the total tenant improvement allowance to approximately $1.6 million. Following an initial rent abatement period, the annual base rent will be approximately $1.4 million per annum for the first five years of the lease’s base term, and subject to maximum annual rent of $1.5 million. The performance of CRA’s obligations under the lease is secured by a $1.3 million letter of credit.

On February 14, 2008, CRA entered into an agreement to lease 36,570 square feet of office space in Chicago, Illinois. The lease commenced on April 1, 2008 with a rent commencement date of August 1, 2008 and was set to expire on July 31, 2018. The annual base rent was approximately $1.0 million in fiscal year 2015 and is subject to 2.5% increases per annum. On May 8, 2017, CRA signed a first amendment to extend the term of the previously leased space of 41,642 square feet for an additional ten years ending on July 31, 2028. The amendment includes a base rent abatement of approximately $0.9 million, as well as a tenant improvement allowance of approximately $2.3 million. Following an initial rent abatement period, the annual base rent will be approximately $1.1 million per year, subject to annual increases of approximately 2.5% per year. At the end of the lease, CRA will be responsible to return the vacated floors to their original condition at CRA’s expense.

On May 20, 2016, CRA entered into an agreement to lease 22,990 square feet of office space in London, UK for the 4th and ground floors. The leases for both floors was set to expire on May 19, 2031. The initial base rent for the two floors is approximately £1.6 million per year, and is subject to increase every five years, based on rental market conditions at that time. On February 12, 2018, CRA entered into an agreement to lease an additional 7,354 square feet of office space. The agreement expands the total office space to 30,344 square feet and is set to expire on May 19, 2031. The agreement includes an additional base rent abatement and tenant improvement allowance of approximately £1.2 million, increasing the total rent incentives to approximately £4.7 million. The base rent for the additional space is approximately £0.5 million per year, increasing the total base rent to approximately £2.1 million, and is subject to increases every five years, based on rental market conditions at that time. At the end of the leases, CRA will be responsible to return the vacated floors to original condition at CRA’s expense.

On July 21, 2017, CRA entered into the first amendment of the San Francisco, CA lease, originally entered into with C1, for an additional 9,206 square feet of office space and to extend the terms for an additional eight years ending on September 30, 2025 with annual base rent of approximately $0.9 million per year, subject to increases of 3% per annum. The amendment includes a base rent abatement of approximately $0.4 million, as well as a tenant improvement allowance of approximately $1.2 million. The performance of CRA's obligations under the lease is secured by a $0.1 million letter of credit.

Other

CRA is party to standby letters of credit with its bank in support of the minimum future lease payments under leases for permanent office space amounting to $3.9 million as of December 29, 2018.

Contingencies

CRA is subject to legal actions arising in the ordinary course of business. In management’s opinion, CRA believes it has adequate legal defenses and/or insurance coverage with respect to the eventuality of such actions. CRA does not believe any settlement or judgment relating to any pending legal action would materially affect its financial position or results of operations.