Commitments and Contingencies Operating Leases The Company has entered into operating leases for certain office space and equipment, some of which contain renewal options. Estimated future lease payments under all non-cancelable operating leases with terms in excess of one year, including taxes and service fees, are as follows (in thousands): Operating Leases Year ending December 31: 2014 (remainder of the year) $ 439 2015 1,483 2016 541 2017 83 2018 and thereafter   Total minimum lease payments $ 2,546 Warranties The Company accrues for warranty costs based on historical trends for the expected material and labor costs to provide warranty services. Warranty periods are generally one year from the date of shipment. The following table reconciles changes in the Company s accrued warranties and related costs for the nine months ended September 30, 2014 and 2013 (in thousands): Nine Months Ended September 30, 2014 2013 Beginning balance $ 1,265 $ 1,499 Charged to cost of revenue 208 466 Claims and settlements (507 ) (719 ) Ending balance $ 966 $ 1,246 Performance Bonds In the normal course of operations, the Company arranges for the issuance of various types of surety bonds, such as bid and performance bonds, which are agreements under which the surety company guarantees that the Company will perform in accordance with contractual or legal obligations. The Company had no such surety bonds as of September 30, 2014 . Purchase Commitments The Company has agreements with various contract manufacturers which include non-cancellable inventory purchase commitments. The Company s inventory purchase commitments typically allow for cancellation of orders 30 days in advance of the required inventory availability date as set by the Company at time of order. The amount of non-cancellable purchase commitments outstanding was $6.4 million as of September 30, 2014 . Royalties The Company has certain royalty commitments associated with the shipment and licensing of certain products. Royalty expense is generally based on a dollar amo