Commitments and Contingencies

3 Months Ended

Jun. 30, 2021

Commitments and Contingencies Disclosure [Abstract]

Commitment with a Government Agency

In connection with a contract with a government agency, the Company entered into a commitment to acquire equipment and services from vendors totaling $7.4 million, all of which is reimbursable. The Company has made total purchases of $7.0 million cumulatively as of June 30, 2021, of which $7.0 million was reimbursed by the government agency as of June 30, 2021. During the three months ended June 30, 2021, the Company made purchases of $112 thousand and the remaining accounts payable to the vendors was $155 thousand as of June 30, 2021. For the three months ended March 31, 2021, the Company made purchases of $270 thousand, of which $124 thousand was in accounts payable as of March 31, 2021.

Operating Leases

The Company leases office and fabrication space in Goleta, California, and office space in Campbell, California and in Japan under noncancelable operating lease agreements. The terms of certain leases provide for escalating rental payments through the term of the lease. The Company recognizes rent expense on a straight-line basis over the lease term and accrues for rent expense incurred but not paid.

As of June 30, 2021, future minimum operating lease commitments were as follows (in thousands):


2022	$	508
2023	322
2024	241
Thereafter	60
Total	$	1,131

The Company recorded rent expense, net of rental income, which includes common area maintenance fees in addition to the base rent, of $225 thousand and $195 thousand for the three months ended June 30, 2021 and 2020, respectively. Rental income from a noncancelable sublease was $0 and $45 thousand for the three months ended June 30, 2021 and 2020, respectively. As of June 30, 2021, there is no the future minimum rental payments to be received under the noncancelable sublease.

Contingencies

During the ordinary course of business, the Company may become a party to legal proceedings incidental to its business. The Company accrues contingent liabilities when it is probable that future expenditures will be made and such expenditures can be reasonably estimated. Legal cost is expensed as incurred. The Company is not aware of any material legal claims or assessments. Although the results of litigation and claims are inherently unpredictable, management believes there was not at least a reasonable possibility that the Company had incurred a material loss with respect to any loss contingencies as of June 30, 2021 and through the issuance of these financial statements.

Indemnification

The Company from time to time enters into types of contracts that contingently require the Company to indemnify parties against third-party claims. These contracts primarily relate to: (1) real estate leases, under which the Company may be required to indemnify property owners for environmental and other liabilities and for other claims arising from the Company’s use of the applicable premises; (2) agreements with the Company’s officers, directors, and employees, under which the Company may be required to indemnify such persons from liabilities arising out of their relationship; (3) indemnifying customers in the event of product failure; and (4) agreements with outside parties that use the Company’s intellectual property, under which the Company may indemnify for copyright or patent infringement related specifically to the use of such intellectual property.

Historically, the Company has not been required to make payments under these obligations, and no liabilities have been recorded for these obligations in the Company’s unaudited condensed consolidated financial statements.