COMMITMENTS AND CONTINGENCIES Royalties We license technology from third parties and have agreed to pay certain suppliers a royalty based on the number of chips sold or manufactured, the net sales price of the chips containing the licensed technology or a fixed non-cancelable fee. Royalty expense is recognized based on our estimated average unit cost for royalty contracts with non-cancelable prepayments and the stated contractual per unit rate for all other agreements. Royalty expense was $742 , $1,017 and $722 for the years ended December 31, 2018, 2017 and 2016, respectively, which is included in cost of revenue in our consolidated statements of operations. 401(k) Plan We sponsor a 401(k) plan for eligible employees. Participants may defer a percentage of their annual compensation on a pre-tax basis, not to exceed the dollar limit that is set by law. A discretionary matching contribution by the Company is allowed and is equal to a uniform percentage of the amount of salary reduction elected to be deferred, which percentage will be determined each year by the Company. We made no contributions to the 401(k) plan during the years ended December 31, 2018, 2017 and 2016. Leases We acquire rights to use certain software engineer design tools under software licenses, accounting for such arrangements is similar to capital leases. Our various office space and equipment leases are classified as operating leases. Certain of our leases for office space contain provisions under which monthly rent escalates over time and certain leases also contain provisions for reimbursement of a specified amount of leasehold improvements. When lease agreements contain escalating rent clauses, we recognize rent expense on a straight-line basis over the term of the lease. When lease agreements provide allowances for leasehold improvements, we capitalize the leasehold improvement assets and amortize them on a straight-line basis over the lesser of the lease term or the estimated useful life of the asset, and reduce rent expense on a straight-line basis over the term of the lease by the amount of the asset capitalized. When lease agreements provide rent holidays, we reduce rent expense on a straight-line basis over the term of the lease by the amount of the rent holiday. As of December 31, 2018, future minimum payments under non-cancelable software licenses and operating lease agreements are as follows: Year Ending December 31, Software licenses Operating leases Total 2019 $ 815 $ 1,856 $ 2,671 2020 173 1,039 1,212 2021  708 708 2022  539 539 2023  492 492 2024  378 378 988 $ 5,012 $ 6,000 Less: Interest component (86 ) Present value of minimum software license payments 902 Less: Current portion (748 ) Long-term portion of obligations $ 154 Rent expense for the years ended December 31, 2018, 2017 and 2016 was $2,782 , $2,488 and $1,770 , respectively. Other Contractual Obligation As part of the Acquisition discussed in "Note 3: Acquisition", we acquired debt associated with an agreement with the Government of Canada called Technology Partnerships Canada ("TPC"). As part of the TPC agreement, ViXS Systems Inc. was provided funding to assist in research and development expenses of which a portion was later required to be repaid because the conditions for repayment were met. The scheduled payments are made on a quarterly basis and end in January 2024. As of December 31, 2018, $446 is included in accrued liabilities and current portion of long-term liabilities in our consolidated balance sheet and $562 is included in long-term liabilities, net of current portion in our consolidated balance sheet. Contract Manufacturers In the normal course of business, we commit to purchase products from our contract manufacturers to be delivered within the next 90 days. In certain situations, should we cancel an order, we could be required to pay cancellation fees. Such obligations could impact our immediate results of operations but would not materially affect our business. Indemnifications Certain of our agreements include limited indemnification provisions for claims from third-parties relating to our intellectual property. It is not possible for us to predict the maximum potential amount of future payments or indemnification costs under these or similar agreements due to the conditional nature of our obligations and the unique facts and circumstances involved in each particular agreement. We have not made any payments under these agreements in the past, and as of December 31, 2018, we have not incurred any material liabilities arising from these indemnification obligations. In the future, however, such obligations could immediately impact our results of operations but are not expected to materially affect our business. Legal Proceedings We are subject to legal matters that arise from time to time in the ordinary course of our business. Although we currently believe that resolving such matters, individually or in the aggregate, will not have a material adverse effect on our financial position, our results of operations, or our cash flows, these matters are subject to inherent uncertainties and our view of these matters may change in the future.