NOTE 13: COMMITMENTS AND CONTINGENCIES

a. The Company is not a party to any litigation or other legal proceedings that the Company believes could reasonably be expected to have a material adverse effect on the Company’s business, results of operations and financial condition.

b. As of December 31, 2017, the Company and its subsidiaries had several non-cancelable operating leases, primarily for facilities and equipment. These leases generally contain renewal options and require the Company and its subsidiaries to pay all executory costs such as maintenance and insurance. In addition, the Company has several fixed service agreements with sub-contractors.

Rent expenses for the years ended December 31, 2015, 2016 and 2017, were $1,094, $1,259 and $1,417, respectively.

As of December 31, 2017, future purchase obligations and minimum rental commitments for leasehold properties and operating leases with non-cancelable terms are as follows:


	Minimum rental commitments for leasehold properties		Commitments for other lease obligations		Other purchase obligations		Total
2018	$	1,226	$	3,168	$	2,237	$	6,631
2019		436		1,323		—		1,759
2020		372		—		—		372
2021		40		—		—		40

	$	2,074	$	4,491	$	2,237	$	8,802

c. Royalties:

The Company participated in programs sponsored by the Israeli government for the support of research and development activities. Through December 31, 2017, the Company had obtained grants from the IIA for certain of the Company’s research and development projects. The Company is obligated to pay royalties to the IIA, amounting to 3%-3.5% of the sales of the products and other related revenues (based on the dollar) generated from such projects, up to 100% of the grants received. Royalty payment obligations also bear interest at the LIBOR rate. The obligation to pay these royalties is contingent on actual sales of the products and in the absence of such sales, no payment is required.

Royalty expenses relating to the IIA grants included in cost of revenues for the years ended December 31, 2015, 2016 and 2017 amounted to $482, $539 and $1,016, respectively. As of December 31, 2017, the aggregate contingent liability to the IIA (including interest) amounted to $22,254.