Note 11. Commitments

Leases

We lease office space and equipment under noncancelable operating and capital leases with various expiration dates, some of which contain renewal options.

On March 1, 1996, we entered into a 20-year capital lease for a building in Ashburn, Virginia, that serves as our corporate headquarters. We have accounted for this transaction as a capital lease and have accordingly recorded assets and a corresponding liability of approximately $12.3 million.

The following is a schedule by years of future minimum payments under capital leases together with the present value of the net minimum lease payments as of December 31, 2012 (in thousands):

	Property			Equipment			Total
2013	$	2,064			34			2,098
2014		2,064			33			2,097
2015		2,063			30			2,093
2016		516			1			517
2017		----			1			1

Total minimum obligations		6,707			99			6,806
Less amounts representing interest (ranging from 4.4% to 17.4%)		(1,760	)		(2	)		(1,762	)

Net present value of minimum obligations		4,947			97			5,044
Less current portion		(1,208	)		(33	)		(1,241	)

Long-term capital lease obligations at December 31, 2012	$	3,739		$	64		$	3,803

In accordance with the Ashburn lease agreement, every three years the rent is subject to adjustments in accordance with changes in the United States Department of Labor, Bureau of Labor Statistics Consumer Price Index ("CPI"). Accordingly, effective April 2011, the adjustment in monthly rent payment based on the change in CPI was $7,000 per month, from $165,000 to $172,000.

Accumulated amortization for property and equipment under capital leases at December 31, 2012 and 2011 is $11.7 million and $11.1 million, respectively.

Future minimum lease payments for all noncancelable operating leases at December 31, 2012 are as follows (in thousands):

2013	$	679
2014		512
2015		523
2016		382
2017		267
Remainder		1,806
Total minimum lease payments	$	4,169

Rent expense charged to operations for 2012, 2011, and 2010, totaled $1.1 million, $1.2 million, and $1.2 million, respectively.

Warranties

We provide product warranties for products sold through certain U.S. Government contract vehicles. We accrue a warranty liability at the time that we recognize revenue for the estimated costs that may be incurred in connection with providing warranty coverage. Warranties are valued using historical warranty usage trends; however, if actual product failure rates or service delivery costs differ from estimates, revisions to the estimated warranty liability may be required. Accrued warranties are reported as other current liabilities on the consolidated balance sheets.

	Balance Beginning of Year		Accruals			Warranty Expenses			Balance End of Year
	(amount in thousands)

Year Ended December 31, 2012	$	953	$	(393	)	$	(334	)	$	226
Year Ended December 31, 2011	$	1,079	$	257		$	(383	)	$	953
Year Ended December 31, 2010	$	1,708	$	(341	)	$	(288	)	$	1,079