NOTE 13.

COMMITMENTS AND CONTINGENCIES

Leases

As of March 31, 2016, our contractual obligations for our operating lease obligations for succeeding years are as follows (in thousands):

	Payments Due by Period
			Due in Fiscal
	Total		2017		2018		2019		2020		2021		Thereafter
Operating lease obligations	$	24,600	$	2,386	$	2,292	$	2,284	$	2,304	$	2,364	$	12,970

Our operating lease obligations comprised our principal facility and various leased facilities and equipment under operating lease agreements, which expire on various dates from fiscal 2017 through fiscal 2026. Our principal facilities located in Union City, California is under a non-cancelable operating lease agreement, which expires in fiscal 2026. The monthly rental payments on principal facilities lease increase based on a predetermined schedule and accordingly, we recognize rent expense on a straight-line basis over the life of the lease. Rent expense from continuing operations under operating leases was $2.3 million, $2.0 million and $2.0 million for fiscal 2016, 2015 and 2014, respectively. Rent expense from discontinued operations under operating leases was $0, $0.2 million and $0.1 million for fiscal 2016, 2015 and 2014, respectively.

Commitments

We have purchase commitments, consisting of supply and inventory related agreements, totaling approximately $11.5 million as of March 31, 2016. These purchase order commitments primarily include our purchase obligations to purchase from SMB of Denmark through calendar year 2016 and Diatron of Hungary through fiscal 2018.

Patent Licensing Agreement. From January 2009 to February 2015, under our license agreement with Alere, we licensed co-exclusively certain worldwide patent rights related to lateral flow immunoassay technology in the field of animal health diagnostics in the professional marketplace. The license agreement enabled us to develop and market products under rights from Alere in the animal health and laboratory animal research markets. In exchange for the license rights, we (i) paid an up-front license fee of $5.0 million to Alere in January 2009, (ii) agreed to pay royalties during the term of the agreement, based solely on sales of products in a jurisdiction country covered by valid and unexpired claims in that jurisdiction under the licensed Alere patent rights, and (iii) agreed to pay a yearly minimum license fee of between $0.5 million to $1.0 million per year, which fee was creditable against any royalties due during such calendar year. The royalties, if any, were payable through the date of the expiration of the last valid patent licensed under the agreement that includes at least one claim in a jurisdiction covering products we sell in that jurisdiction. The yearly minimum fees were payable for so long as we desire to maintain exclusivity under the agreement. Effective February 2015, we terminated our license agreement with Alere as the licensed patents that we used had expired. In accordance with the terms of the license agreement, we had no outstanding liabilities related to this license agreement at March 31, 2016.

Litigation

We are involved from time to time in various litigation matters in the normal course of business. There can be no assurance that existing or future legal proceedings arising in the ordinary course of business or otherwise will not have a material adverse effect on our business, consolidated financial position, results of operations or cash flows.