Note 15. Lease Financing Obligation

12 Months Ended

Mar. 31, 2013

Debt and Capital Leases Disclosures [Text Block]

NOTE 15.    LEASE FINANCING OBLIGATION

We leased Hillview Facility from Mission West Properties, L.P. in August 2007. We had accounted for this sale and leaseback transaction as a financing transaction, which is included in the long-term lease financing obligations line item on the consolidated balance sheet as of March 27, 2011. The effective interest rate was 8.2%. At the end of the lease term, March 31, 2011, the terminal value of the lease of $12.2 million was settled in a non-cash transaction with the expiration of the Hillview Facility lease.

Depreciation expense for the Hillview Facility recorded over the straight-line method for the remaining useful life for the periods indicated below were as follows (in thousands): 

	Fiscal Years Ended
	March 31, 2013		April 1, 2012		March 27, 2011
Depreciation expense	$	—	$	—	$	323

The former Hillview Facility, which we originally leased from Mission West Properties, L.P. as part of a sale-leaseback transaction, was sublet in April 2008. The sublease expired on March 31, 2011. There was no sublease income for fiscal years 2013 and 2012 whereas fiscal year 2011 included sublease income of $1.4 million.

We have acquired engineering Design Tools under capital leases. We acquired Design Tools of $0.9 million in July 2012 under a three-year license, $4.5 million in December 2011 under a three-year license, $5.8 million in October 2011 under a three-year license, $1.0 million in June 2010 under a three-year license, $1.3 million in December 2009 under a 28-month license, and $1.1 million in July 2009 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 consolidated balance sheets. The obligations related to the Design Tools were included in other current liabilities and long-term lease financing obligations in our consolidated balance sheets as of March 31, 2013 and April 1, 2012, 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):

	Fiscal Years Ended
	March 31, 2013		April 1, 2012		March 27, 2011
Amortization expense	$	3,523	$	3,706	$	3,526

Future minimum lease and sublease income payments for the lease financing obligations as of March 31, 2013 are as follows (in thousands):

Lease financing

Fiscal Years	Design tools
2014	$	3,340
2015		1,375
2016		19
2017 and thereafter		16
Total minimum lease payments		4,750
Less: amount representing interest		219
Present value of future minimum lease payments		4,531
Less: short-term lease financing obligations		3,189
Long-term lease financing obligations	$	1,342

Interest expense for the Hillview Facility and Design Tools lease financing obligations for the periods indicated were as follow (in thousands): 

	Fiscal Years Ended
	March 31, 2013		April 1, 2012		March 27, 2011
Interest expense – Design Tools	$	143	$	210	$	232
Interest expense – Hillview facility		—		—		1,020
Total	$	143	$	210	$	1,252

In the course of our business, we enter into arrangements accounted for as operating leases related to the licensing of engineering design software and the rental of office space. Rent expenses for all operating leases for the periods indicated below were as follows (in thousands):

	Fiscal Years Ended
	March 31, 2013		April 1, 2012		March 27, 2011
Rent expense	$	616	$	2,121	$	1,889

Our future minimum lease payments for the lease operating obligations as of March 31, 2013 are as follows (in thousands):

Operating lease

Fiscal Years	Facilities
2014	$	538
2015		312
2016		243
2017		73
2018 and thereafter		18
Total future minimum lease payments	$	1,184