Note 8. Commitments and Contingencies

12 Months Ended

Mar. 31, 2012

Commitments and Contingencies Disclosure [Text Block]

Note 8. Commitments and Contingencies

Leases

We rent our facilities in Natick, MA (“Natick”) and Orangeburg, NY (“Orangeburg”) from non-related parties. We occupy approximately 10,000 square feet in our facility in Natick under a lease, amended in April 2012, which expires in June 2014. Our Orangeburg facility occupies approximately 20,500 square feet, and our current lease expires in July 2015. We also lease some office and production equipment under leases that expire in August 2014.

The following table summarizes the future minimum lease commitments under all operating and capital leases as of March 31, 2012:

Fiscal Year Ending March 31,	Office Lease Commitments		Capital Lease Obligations
2013	$	429	$	107
2014		339		82
2015		343		22
2016		143		-
Total future minimum lease payments	$	1,254		211
Less—amount representing interest				(23	)
Present value of future payments			$	188

Total rent expense was approximately $462 thousand and $494 thousand in fiscal years 2012 and 2011, respectively. Certain of our leases contain purchase and/or renewal options.

Warranty Obligations

We provide warranty on all of our products. We estimate the costs that may be incurred under warranties and record a liability in the amount of such costs at the time the product is sold. Factors that affect our warranty liability include the number of units sold, historical and anticipated rates of warranty claims, and cost per claim. We periodically assess the adequacy of our recorded warranty liabilities and adjust the amounts as necessary. Warranty expense is recorded in cost of sales in our statement of operations.

The following table summarizes changes in our warranty reserve for fiscal years 2012 and 2011:

	March 31,
	2012			2011
Warranty reserve at April 1	$	106		$	145
Warranties accrued during the fiscal year		344			93
Warranties settled during the fiscal year		(147	)		(132	)
Warranty reserve at March 31	$	303		$	106

The warranty reserve at March 31, 2012 and 2011 is included in accrued expenses in our consolidated balance sheets.

Litigation

As of March 31, 2012, we had no material legal proceedings to which we, or any of our subsidiaries, are a party or to which any of our properties are subject.