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Related Party Transactions
 3 Months Ended
Jun. 24, 2022
Related Party Transactions [Abstract]  
Related Party Transactions Related Party Transactions
Transactions involving Sanken
The Company sells products to, and purchases in-process products from, Sanken. As of June 24, 2022, Sanken held approximately 51.5% of the Company’s outstanding common stock.
Net sales of Company products to Sanken totaled $41,709 and $35,453 during the three months ended June 24, 2022 and June 25, 2021, respectively. Although certain costs are commingled, shared or allocated, cost of goods sold and gross margins attributable to related party sales are consistent with those of third-party customers. Trade accounts receivables, net of allowances from Sanken, totaled $30,081 and $27,256 as of June 24, 2022 and March 25, 2022, respectively. Other accounts receivable from Sanken totaled $28 and $104 as of June 24, 2022 and March 25, 2022, respectively.
Termination of Sanken Distribution Agreement
In May 2022, the Company entered into a letter of intent with Sanken to develop a plan to transition the supply chain and sales activity in Japan from Sanken to the Company. During the planning process, both parties will define the transition timeline and method for customer communication, supply chain transfer and sales coverage. The Company and Sanken will also define a method to continue engagement with Sanken on the support of select customers.
Transactions involving Polar Semiconductor, LLC (“PSL”)
The Company purchases in-process products from PSL. PSL is a subsidiary of Sanken, 70% owned by Sanken and 30% owned by the Company.
Purchases of various products from PSL totaled $14,671 and $13,380 for the three months ended June 24, 2022 and June 25, 2021, respectively. Accounts payable to PSL included in amounts due to related party totaled $4,704 and $5,222 as of June 24, 2022 and March 25, 2022, respectively.
On December 2, 2021, AML entered into a loan agreement with PSL wherein PSL provided an initial promissory note to AML for a principal amount of $7,500 (the “Initial PSL Loan”). The Initial PSL Loan will be repaid in equal installments, comprising principal and interest accrued at 1.26% per annum, over a term of four years with payments due on the first day of each calendar year quarter (April 1, July 1, October 1, and January 1). In addition, PSL has the option of borrowing up to an additional $7,500 under the same terms of the PSL Loan (the “Secondary PSL Loan” and, together with the Initial PSL Loan, the “PSL Promissory Notes”). The loan funds will be used by PSL to procure a deep ultraviolet scanner and other associated manufacturing tools necessary to increase wafer fabrication capacity in support of the Company’s increasing wafer demand. As of June 24, 2022, the outstanding balance of the PSL Promissory Notes was $7,031. During the three months ended June 24, 2022, PSL made a quarterly payment to AML of $500, which included $31 of interest income. On July 1, 2022, PSL made a quarterly payment to AML of $491, which included $22 of interest income.
During the first quarter of 2023, PSL informed the Company of its election to draw upon the Secondary PSL Loan. The Secondary PSL Loan was funded to PSL on July 1, 2022.
Sublease Agreement
In 2014, the Company, through one of its subsidiaries, entered into a sublease agreement with Sanken pursuant to which it subleases certain office building space in Japan from Sanken. The sublease automatically renews on an annual basis unless either party provides notice to the other party otherwise and can be terminated by either party upon providing six
months’ notice. The Company made aggregate payments of approximately $48 and $56 to Sanken under the sublease agreement during the three months ended June 24, 2022 and June 25, 2021, respectively.
Consulting Agreement
In September 2017 and prior to Reza Kazerounian becoming a member of the Board, the Company entered into a board executive advisor agreement, as amended in June 2018 (the “Consulting Agreement”), with Mr. Kazerounian, pursuant to which the Company engaged Mr. Kazerounian to serve as executive advisor to the Board and the office of Chief Executive Officer. The Consulting Agreement provides for a fee payable to Mr. Kazerounian on a monthly basis in exchange for his services. The Consulting Agreement provides that if Mr. Kazerounian is terminated by the Board, he will be entitled to a severance payment in the amount of $180. The Board and Mr. Kazerounian each have the right to terminate the Consulting Agreement at any time. During the three months ended June 24, 2022 and June 25, 2021, the Company paid aggregate fees of $72 and $56, respectively, to Mr. Kazerounian pursuant to the Consulting Agreement.
Employment Relationship
On June 20, 2022, the Board elected Kojiro Hatano to the Board as a class II director, to serve until the Company’s 2022 annual meeting of shareholders and until his successor is duly elected and qualified. Mr. Hatano was elected to the Board as a designee of Sanken pursuant to the Company’s Amended and Restated Stockholders Agreement, dated as of June 16, 2022. Mr. Hatano has served as Manager of Business Performance for the Company since January 2006. During the three months ended June 24, 2022 and June 25, 2021, Mr. Hatano received compensation, consisting of salary, benefits and reimbursement of living expenses of approximately $51 and $48, respectively, from the Company. This amount was partially reimbursed to the Company by Sanken.