Quarterly report pursuant to Section 13 or 15(d)

Note 13 - Lease Financing Obligations

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Note 13 - Lease Financing Obligations
9 Months Ended
Jan. 01, 2017
Notes to Financial Statements  
Debt and Capital Leases Disclosures [Text Block]
NOTE
13.
LEASE FINANCING OBLIGATIONS
 
We have acquired licenses to engineering design tools (“Design Tools”) under capital leases. We acquired licenses to Design Tools of
$6.9
million in
January
2015
under a
two
-year license and
two
three
-year licenses with prepayment of
$1.0
million,
$4.4
million in
October
2014
under a
three
-year license with a prepayment of
$1.5
million for the
first
year license and
$0.9
million in
July
2012
under a
three
-year license all of which were accounted for as capital leases and recorded in the property, plant and equipment, net line item in the condensed consolidated balance sheets. The obligations related to the Design Tools were included in other current liabilities and long-term lease financing obligations in our condensed consolidated balance sheets as of
January
1,
2017
and
March
27,
2016,
respectively. The effective interest rates for the Design Tools range from
2.0%
to
7.25%.
 
Amortization expense related to the Design Tools, which was recorded using the straight-line method over the remaining useful life for the periods indicated below, was as follows (in thousands):
 
 
 
Three Months Ended
 
 
Nine Months Ended
 
 
 
January 1,
 
 
December 27,
 
 
January 1,
 
 
December 27,
 
 
 
2017
 
 
2015
 
 
2017
 
 
2015
 
Amortization expense
  $
1,483
    $
941
    $
2,825
    $
2,979
 
 
 
During the
three
and
nine
months ended
January
1,
2017,
we recorded
$0
and
$1.5
million in impairment charges, respectively, and a restructuring expense of
$0.4
million associated with a portion of these Design Tools.
 
Future minimum lease and sublease income payments for the lease financing obligations as of
January
1,
2017
are as follows (in thousands):
 
Fiscal Years
 
Design tools
 
2017 (3 months remaining)
  $
510
 
2018
   
1,530
 
Total minimum lease payments
   
2,040
 
Less: amount representing interest
   
(326
)
Present value of future minimum lease payments
   
1,714
 
Less: short-term lease financing obligations
   
(1,714
)
Long-term lease financing obligations
  $
-
 
 
 
Interest expense for the lease financing obligations for the periods indicated below was as follows (in thousands):
 
 
 
Three Months Ended
 
 
Nine Months Ended
 
 
 
January 1,
 
 
December 27,
 
 
January 1,
 
 
December 27,
 
 
 
2017
 
 
2015
 
 
2017
 
 
2015
 
Interest expense
  $
19
    $
65
    $
87
    $
158
 
 
In the course of our business, we enter into arrangements accounted for as operating leases related to rental of office space. Rent expenses for all operating leases for the periods indicated below were as follows (in thousands):
 
 
 
Three Months Ended
 
 
Nine Months Ended
 
 
 
January 1,
 
 
December 27,
 
 
January 1,
 
 
December 27,
 
 
 
2017
 
 
2015
 
 
2017
 
 
2015
 
Rent expense
  $
499
    $
186
    $
666
    $
530
 
 
Our future minimum lease payments for the lease operating obligations as of
January
1,
2017
are as follows (in thousands):
 
Fiscal Years
 
Facilities
 
2017 (3 months remaining)
  $
472
 
2018
   
1,482
 
2019
   
292
 
2020
   
48
 
Total future minimum lease payments
  $
2,294