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Commitments and Contingencies | 6 Months Ended
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Jul. 03, 2021
Commitments And Contingencies Disclosure [Abstract] |
Commitments and Contingencies | 8. Commitments and Contingencies COVID-19. The COVID-19 pandemic has created and may continue to create significant uncertainty in global markets, which has disrupted and harmed, and may continue to disrupt and harm, the Company's business, financial condition, and results of operations. The extent of the impact of COVID-19 on the Company's operational and financial performance will depend on certain developments, including but not limited to the duration and spread of the outbreak, duration of local, state and federal issued public health orders, impact on our customers and our sales cycles, impact on our employees and impact on regional and worldwide economies and markets in general, all of which are uncertain and cannot be predicted. Operating Lease Commitments. Our operating lease commitments consist of facility and office equipment leases. Operating lease expenses for the six months ended July 3, 2021 and June 27, 2020 were approximately $0.6 million and $0.7 million, respectively. The weighted average discount rate used in calculating the present value of lease payments was 4.8%. As of July 3, 2021, the weighted average remaining lease term for our operating leases was 3.1 years. The following represents maturities of operating lease liabilities as of July 3, 2021 (in thousands):
Fiscal Year |  | Operating Lease Payments |
Remainder of 2021 (6 months) |  | $ | 565 |
2022 |  |  | 1,031 |
2023 |  |  | 1,084 |
2024 |  |  | 711 |
2025 |  |  | — |
Total lease payments |  |  | 3,391 |
Less: Imputed interest |  |  | (401 | )
Total lease liabilities |  | $ | 2,990 |
On April 30, 2021, the First Amendment to that certain Triple Net Lease dated April 26, 2017 between the Company and ZIC 1212 Terra Bella LLC (“First Amendment”) was executed, among other things, to reduce the portion of premises leased by the Company and extend the lease term through August 31, 2024. Pursuant to the First Amendment, the base monthly rent for the reduced premises of approximately 29,830 square feet, ranges from $84,121 to $93,070, for the period May 1, 2021 to August 31, 2024. The Company is also responsible for the payment of certain operating expenses and taxes during the term. The Lease provides the landlord with a termination right, which can be exercised by the landlord by giving written notice to the Company at least thirty (30) months prior to the effective date of the termination. Purchase Commitments. Our purchase commitments consist primarily of non-cancellable purchase commitments with vendors to manufacture certain components and ophthalmic instrumentation. As of July 3, 2021, our future minimum payments through fiscal year 2022 for our purchase commitments were approximately $14.2 million. Indemnities. We enter into standard indemnification arrangements in the ordinary course of business. Pursuant to these arrangements, we indemnify, hold harmless, and agree to reimburse the indemnified parties for losses suffered or incurred by the indemnified parties (generally our business partners or customers) in connection with any trade secret, copyright, patent or other intellectual property infringement claim by any third-party with respect to our products. The term of these indemnification agreements is generally perpetual any time after the execution of the agreement. The maximum potential amount of future payments that we could be required to make under these agreements is not determinable. We have never incurred costs to defend lawsuits or settle claims related to these indemnification agreements. As a result, we believe the estimated fair value of these agreements is minimal. We have entered into indemnification agreements with our directors and officers that may require us to indemnify our directors and officers against liabilities that may arise by reason of their status or service as directors or officers, other than liabilities arising from willful misconduct of a culpable nature. These agreements also require us to advance their expenses incurred as a result of any proceeding against them as to which they could be indemnified and to make good faith determination whether or not it is practicable for us to obtain directors and officers insurance. We currently have directors and officers liability insurance. Legal Proceedings. From time to time, we may be involved in legal proceedings arising in the ordinary course of business. Although the results of litigation and claims cannot be predicted with certainty, we currently believe that the final outcome of these ordinary course matters will not have a material adverse effect on our business, operating results, financial condition or cash flows. Regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors.

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