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COMMITMENTS AND CONTINGENCIES | 12 Months Ended
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Dec. 31, 2023
COMMITMENTS AND CONTINGENCIES. |
COMMITMENTS AND CONTINGENCIES | 10. COMMITMENTS AND CONTINGENCIES Commitments At December 31, 2023 and December 31, 2022, the Company had commitments of approximately $8.6 million and $6.4 million, respectively, for construction and acquisition of property, plant and equipment. The Company migrated its enterprise resource planning (ERP) system to a multi-tenant cloud environment in 2021 and is continuing to implement additional modules such as enterprise performance management, human capital management, data analytics and the use of artificial intelligence. At December 31, 2023 and December 31, 2022, the Company had commitments related to the continuing implementation project of approximately $1.4 million and $2.6 million, respectively, in software license fees payable in installments through 2025. Contingencies The Company has entered into arrangements with third-party lenders where it has agreed to repurchase products that are repossessed from the independent distributor customer in the event of default. These arrangements are typically subject to a maximum repurchase amount. For fiscal years ended December 31, 2023 and December 31, 2022, the maximum amount of collateral the Company could be required to purchase was $128.7 million and $74.1 million, respectively. The Company’s financial exposure under these arrangements is limited to the difference between the amount paid to third-party lenders for repurchases of inventory and the amount received upon subsequent resale of the repossessed product. The Company had no repurchases of inventory during fiscal 2023 and 2022 and concluded the liability associated with potential repurchase obligations was neither probable, nor material. Litigation We are subject to a variety of claims and lawsuits that arise from time to time in the ordinary course of business. The Company has established accruals for matters that are probable and reasonably estimable and maintains product liability and other insurance that management believes to be adequate. Although management believes that any pending claims and lawsuits will not have a significant impact on the Company’s consolidated financial position or results of operations, the adjudication of such matters are subject to inherent uncertainties and management’s assessment may change depending on future events.

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