Note 13 - Commitments and Contingencies |
12 Months Ended |
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Jun. 30, 2016 | |
| Notes to Financial Statements | |
| Commitments and Contingencies Disclosure [Text Block] |
NOTE 1
3
- COMMITMENTS AND CONTINGENCIES
From time to time, we may be involved in litigation relating to claims arising out of our operations. Since June 2015, we have been a party to a legal proceeding arising from a work related injury that took place in June 2013. We deny and dispute all liability and damage allegations made by or on behalf of the plaintiff. However, having fully considered the risks, time and costs associated with continued litigation of this claim, as well as an appeal, we have decided to fully and finally resolve and settle the dispute. Accordingly, on August 26, 2016 we entered into a settlement agreement with the plaintiff whereby in exchange for the plaintiff releasing Flux Power from any and all claims of any nature that the plaintiff had or now has or might in the future have against us, we agreed to pay the plaintiff $10,000 as settlement. Included in accrued expenses in the accompanying consolidated financial statements as of June 30, 2016 is a $10,000 accrual associated with this claim, which was paid in September 2016.
Operating Leases The Company’s corporate headquarters totals 22,054 square feet and is located in Vista, California. Effective February 25, 2014, the Company entered into a two-year lease agreement for this facility with average monthly rent payments of approximately $12,000 per month and paid a security deposit of $25,000, or approximately 2 months of rent. On February 20, 2016, we entered into a First Amendment to the Lease extending the expiration of the lease to May 31, 2016 and increasing the monthly rent payments for the period from March 1, 2016 to May 31, 2016 to $14,300 per month. On May 24, 2016, we entered into a Second Amendment to the Lease extending the lease term through May 31, 2018.
The Company also subleases space to a related party, Epic Boats, on a month-to-month basis at a rate of 10% of lease expense.
Total rent expense was $ 137,000 and $102,000 for the years ended June 30, 2016 and 2015, respectively, net of sublease income.
Future minimum rental payments required under operating leases that have initial or remaining non-cancelable lease terms in excess of one year are approximately
$158,000 and $162,000 for the fiscal years ending June 30, 2017 and 2018, respectively under the current lease expiring on May 31, 2018.
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