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Commitments And Contingent Liabilities
 12 Months Ended
Mar. 03, 2012
Commitments And Contingent Liabilities [Abstract]  
Commitments And Contingent Liabilities

17 Commitments and Contingent Liabilities

Operating lease commitments. As of March 3, 2012, the Company was obligated under noncancelable operating leases for buildings and equipment. Certain leases provide for increased rentals based upon increases in real estate taxes or operating costs. Future minimum rental payments under noncancelable operating leases are:

 

(In thousands)

   2013      2014      2015      2016      2017      Thereafter      Total  

Total minimum payments

    $ 6,737       $ 5,650       $ 4,848       $ 4,735       $ 3,041       $ 3,309       $ 28,320   

Total rental expense was $11.9 million, $10.1 million and $14.9 million in fiscal 2012, 2011 and 2010, respectively.

At March 3, 2012, the Company had two sale and leaseback agreements, one for a building that provides an option to purchase the building at projected future fair market value upon expiration of the lease in 2014 and one for equipment that provides an option to purchase the equipment at projected future fair market value upon expiration of the lease in 2018. The leases are classified as operating leases in accordance with applicable financial accounting standards. The Company has a deferred gain of $5.9 million under the sale and leaseback transactions, which is included in the balance sheet caption as accrued expenses and other long-term liabilities. The average annual lease payment over the life of the remaining leases is $2.0 million.

Bond commitments. In the ordinary course of business, predominantly in the Company's installation business, the Company is required to provide surety or performance bonds that commit payments to its customers for any non-performance by the Company. At March 3, 2012, $100.5 million of the Company's backlog was bonded by performance bonds with a face value of $309.9 million. Performance bonds do not have stated expiration dates, as the Company is released from the bonds upon completion of the contract. The Company has never been required to pay on these performance-based bonds with respect to any of the current portfolio of businesses.

 

Guarantees and warranties. The Company accrues for warranty and claim costs as a percentage of sales based on historical trends and for specific sales credits as they become known and estimable. Actual warranty and claim costs are deducted from the accrual when incurred. The Company's warranty and claim accruals are detailed below.

 

(In thousands)

   2012     2011  

Beginning warranty accrual

    $ 9,887      $ 4,996   

Additional accruals

      2,766        11,583   

Claims paid

      (5,443 )      (6,692 ) 
  

 

 

    

 

 

  

Ending warranty accrual

    $ 7,210      $ 9,887   
  

 

 

    

 

 

  

During fiscal 2011, the Company experienced a high level of architectural glass product quality issues, including quality issues resulting from a vendor-supplied material. This higher level of activity impacted fiscal 2011 warranty expenses and year-end accruals, for items identified but not yet resolved. The impact of this activity was largely reported in fiscal 2011 cost of sales.

Letters of credit. At March 3, 2012, the Company had ongoing letters of credit related to its construction contracts and certain industrial development bonds. The total value of letters of credit under which the Company was obligated as of March 3, 2012 was approximately $25.5 million. The Company's total availability under its $80.0 million credit facility is reduced by borrowings under the facility and also by letters of credit issued under the facility. As of March 3, 2012, letters of credit in the amount of $13.2 million had been issued under the facility.

Purchase obligations. The Company has purchase obligations for raw material commitments and capital expenditures. At March 3, 2012, these obligations totaled $46.5 million.

Non-compete agreements. The Company has entered into a number of non-compete and consulting agreements associated with current and former employees. As of March 3, 2012, future payments of $1.2 million were committed under such agreements.

Litigation. The Company is a party to various legal proceedings incidental to its normal operating activities. In particular, like others in the construction supply industry, the Company's construction supply businesses are routinely involved in various disputes and claims arising out of construction projects, sometimes involving significant monetary damages or product replacement. The Company is subject to litigation arising out of employment practices, workers compensation, general liability and automobile claims. Although it is very difficult to accurately predict the outcome of such proceedings, facts currently available indicate that no such claims will result in losses that would have a material adverse effect on the financial condition of the Company.