14. Commitments and Contingencies See "Deconsolidation of LEM" in Note 1 to the Consolidated Financial Statements regarding the Company's future minimum purchase commitments to LEM. Operating Leases Prior to November 1, 2010, the Company leased its principal administrative and distribution facilities in Carlsbad, California, under a month to month operating lease with monthly payments of approximately $38,000. On November 1, 2010, the Company entered into a 38 month facility lease for the same facility, which commenced on November 1, 2010 and terminates on December 31, 2013. The facility lease has total lease payments of approximately $1.1 million and average monthly rent payments of approximately $29,000. SPY Europe leases a warehouse facility in Varese, Italy, which is used primarily for international sales and distribution. The Company also leases certain computer equipment, vehicles and temporary housing in Italy. Rent expense was approximately $435,000 and $596,000 for the years ended December 31, 2011 and 2010, respectively. Future minimum rental payments required under operating leases that have initial or remaining non-cancelable lease terms in excess of one year are as follows: Year Ending December 31, (Thousands) 2012 $ 445 2013 433 2014 66 2015 48 Total $ 992 Capital Leases Future minimum lease payments under capital leases at December 31, 2011 are as follows: Year Ending December 31, (Thousands) 2012 $ 77 2013 57 2014 47 2015 47 2016 16 Total minimum lease payments 244 Amount representing interest (29 ) Present value of minimum lease payments 215 Less current portion (65 ) Long-term portion $ 150 The cost of equipment under a capital lease at December 31, 2011 and 2010 was approximately $324,000 and $128,000, respectively. The amount of accumulated depreciation related to equipment under capital lease at December 31, 2011 and 2010 was approximately $108,000 and $71,000, respectively. Amortization of assets held under capital leases is included in depreciation expense. Athlete Contracts At December 31,