COMMITMENTS AND CONTINGENCIES

12 Months Ended

Dec. 31, 2016

9.COMMITMENTS AND CONTINGENCIES

Operating Leases

At December 31, 2016, the Company maintains leases for certain facilities and equipment. The Company has entered into facility agreements, some of which contain provisions for future rent increases. The total amount of rental payments due over the lease term is being charged to rent expense on the straight-line method over the term of the lease. The difference between rent expense recorded and the amount paid is credited or charged to deferred rent obligation, which is included in accrued liabilities in the accompanying consolidated balance sheets.

Minimum future rental commitments under all non-cancelable operating leases are as follows (in thousands):

Year ending December 31,	Total
2017	2,401
2018	2,271
2019	1,568
2020	1,143
2021	942
Thereafter	2,092
	$	10,417

Rental expense was $2,720, $1,946 and $1,976 in 2016, 2015 and 2014, respectively.

Severance Benefit Agreements

As of December 31, 2016, the Company has annually renewable severance benefit agreements with key employees which, among other things, provide inducement to the employees to continue to work for the Company during and after any period of a potential change in control of the Company. The agreements provide the employees with specified benefits upon the subsequent severance of employment in the event of change in control of the Company and are effective for 24 months thereafter. In addition, severance benefits include, for some employees, a gross-up payment for excise taxes, if any.

Litigation

The Company is involved in certain actions that have arisen out of the ordinary course of business. Management believes that resolution of the actions will not have a significant adverse effect on the Company’s consolidated financial position or results of operations.