Annual report pursuant to Section 13 and 15(d)

Commitments and Contingencies

v3.19.2
Commitments and Contingencies
12 Months Ended
Jun. 30, 2019
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies
16. Commitments and Contingencies

In addition to the leased warehouse and office space described in Note 14 above, the Company leases additional warehouse facilities from unrelated third parties under operating leases.

Minimum future rental commitments for all of the Company’s real property leases, including those with related parties, approximate the following (in thousands): 

Fiscal years ending June 30,    
     
2020   $ 1,922  
2021     1,554  
2022     1,332  
2023     1,031  
2024     179  
  Total   $ 6,018  

 

Rent expense, including those with related parties, under these leases totaled approximately $1.5 million and $704,000 for fiscal 2019 and 2018, respectively.

The Company, through its manufacturers, provides parts warranties for products sold. These warranties are mainly the responsibility of the manufacturer. As such, warranty-related expenses are generally insignificant to the Company’s consolidated financial statements.  

Further, in the ordinary course of business, certain of the Company’s contracts require the Company to provide performance and payment bonds related to projects in process. These bonds are intended to provide a guarantee to the customer that the Company will perform under the terms of the contract and that the Company will pay subcontractors and vendors. If the Company fails to perform under the contract or pay subcontractors and vendors, the customer may demand that the surety make payments or provide services under the bond. The Company is required to reimburse the surety for any such expenses or outlays it incurs. As of June 30, 2019 and June 30, 2018, outstanding performance and payment bonds totaled $8.0 million and $8.3 million, respectively. As of June 30, 2019, there were no estimated costs to complete on projects secured by these bonds. As of June 30, 2018, estimated costs to complete projects secured by these bonds totaled $4.4 million.  

The Company may from time to time become subject to litigation and other legal proceedings. Litigation and other legal proceedings may require the Company to incur significant expenses, including those relating to legal and other professional fees. In addition, litigation and other legal proceedings are inherently uncertain, and adverse outcomes in litigation or other legal proceedings could adversely affect the Company’s financial condition, cash flows, and operating results.