Annual report pursuant to Section 13 and 15(d)

Commitments and Contingencies

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Commitments and Contingencies
 12 Months Ended
Jun. 30, 2018
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies

NOTE 18 – COMMITMENTS AND CONTINGENCIES

 

(A) Non-cancellable operating leases

 

  ● The Company’s headquarters is located in Calabasas California with approximately 5,000 rentable square feet for $16,828 per month. The term of the lease is for five years and five months and expires April 30, 2023.
  ● The Australia lease is a three-year lease that expires in June 2023 with a monthly rent of approximately $5,100.
  ● The Beijing lease is a three-year lease that expires in August 2019 with a monthly rent of approximately $30,443.
  ● The Bangkok lease is a three years lease expiring in May 2020 with a monthly rent of approximately $10,728.
  ● The NetSol Europe facilities, located in Horsham, United Kingdom, are leased until June 23, 2021 with a monthly rent of approximately $10,489.
  ● VLS facilities, located in Chester, United Kingdom, are leased until July 2026 with a monthly rent of approximately $3,122.

 

Upon expiration of the leases, the Company does not anticipate any difficulty in obtaining renewals or alternative space. Rent expense amounted to $1,722,019 and $1,887,840 for the years ended June 30, 2018 and 2017, respectively.

 

The total annual lease commitment for the next five years is as follows:

 

FYE 6/30/19   $ 942,688  
FYE 6/30/20     539,980  
FYE 6/30/21     428,950  
FYE 6/30/22     244,429  
FYE 6/30/23     199,486  

 

(B) Litigation

 

On April 7, 2017, Conister Bank Limited filed a complaint in the High Court of Justice Chancery Division, as claim no. HC-2017-001045 against our subsidiary, Virtual Lease Services Limited (“VLS”). The complaint alleges that VLS was in willful default of their agreements with Conister Bank Limited by failing to fulfill its obligations under the agreements with Conister. The complaint was settled and dismissed on March 19, 2018, for £300,000 (approximately $394,737) of which insurance covered £209,000 (approximately $275,000).