Commitments and Contingencies

3 Months Ended

Mar. 31, 2012

Commitments and Contingencies [Abstract]

Commitments and Contingencies

6. Commitments and Contingencies

Operating Leases

We lease our offices and production facilities under non-cancelable operating leases that expire in November 2016 and April 2017. The leases contain escalation clauses for increases in annual renewal options and require us to pay utilities, insurance, taxes and other operating expenses. Commencing January 1, 2012 and expiring in November 2016 we sublet 26,000 square feet of our Santa Barbara facility and leased 35,000 square foot facility in Austin, Texas that expires in April 2017.

For the three months ended March 31, 2012 and April 2, 2011, rent expense was $309,000 and $277,000, respectively.

Patents and Licenses

We have entered into various licensing agreements requiring royalty payments ranging from 0.13% to 2.5% of specified product sales. Certain of these agreements contain provisions for the payment of guaranteed or minimum royalty amounts. In the event that we fail to pay minimum annual royalties, these licenses may automatically become non-exclusive or be terminated. These royalty obligations terminate at various times from 2012 to 2020. For the three months ended March 31, 2012 and April 2, 2011, royalty expense totaled $6,000 and $43,000, respectively. Under the terms of certain royalty agreements, royalty payments made may be subject to audit. There have been no audits to date and we do not expect future audit adjustments to be significant.

The minimum lease payments under operating leases and license obligations are as follows:

Years ending December 31,	Licenses		Operating Leases
Remainder of 2012	$	25,000	$	1,185,000
2013		25,000		1,594,000
2014		30,000		1,644,000
2015		45,000		1,695,000
2016		45,000		1,621,000
Thereafter		90,000		67,000
Total payments	$	260,000	$	7,806,000