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Note 17 - Commitments and Contingencies
 12 Months Ended
Dec. 31, 2017
Notes to Financial Statements  
Commitments and Contingencies Disclosure [Text Block]
(
17
)        Commitments and Contingencies
 
The Company leases certain of its real property and certain equipment under operating leases with terms ranging from month-to-month to
ten
years and which contain various renewal and rent escalation clauses. Future minimum annual lease commitments under operating leases that have initial or remaining noncancelable lease terms in excess of
one
year as of
December
 
31,
 
2017
are as follows (in thousands):
 
2018
   $
1,465
  
2019
    
1,385
  
2020
    
1,317
  
2021
    
1,362
  
2022
    
1,378
  
2023 and thereafter
    
5,074
  
Total   $
11,981
  
 
Rent expense for the years ended
December
 
31,
 
2017
and
2016
totaled approximately
$1,427,000
and
$2,392,000,
respectively.
 
As of
December
 
31,
 
2017,
the Company had outstanding purchase commitments of approximately
$3,296,000
primarily for the acquisition of inventory.
 
The Company bears insurance risk
as a member of a group captive insurance entity for certain general liability, automobile and workers’ compensation insurance programs, a self-insured worker’s compensation program and a self-insured employee health program. The Company records estimated liabilities for its insurance programs based on information provided by the
third
-party plan administrators, historical claims experience, expected costs of claims incurred but
not
paid, and expected costs to settle unpaid claims. The Company monitors its estimated insurance-related liabilities on a quarterly basis. As facts change, it
may
become necessary to make adjustments that could be material to the Company’s consolidated results of operations and financial condition.
 
The Company is involved in certain litigation and contract issues arising in the normal course of business.
While the outcome of these matters cannot, at this time, be predicted in light of the uncertainties inherent therein, management does
not
expect that these matters will have a material adverse effect on the consolidated financial position or results of operations of the Company.
 
The Company accounts for
loss contingencies in accordance with U.S. generally accepted accounting principles (GAAP).  Estimated loss contingencies are accrued only if the loss is probable and the amount of the loss can be reasonably estimated.  With respect to a particular loss contingency, it
may
be probable that a loss has occurred but the estimate of the loss is within a wide range or undeterminable.  If the Company deems an amount within the range to be a better estimate than any other amount within the range, that amount will be accrued.  However, if
no
amount within the range is a better estimate than any other amount, the minimum amount of the range is accrued.
 
On
May
 
3,
 
2016,
the Company entered into a lease for a manufacturing facility, effective
December 
31,
 
2016.
The Company, Sypris Electronics and the landlord of the previous Tampa facility were involved in litigation over certain terms of the previous lease (see Part II, Item
1,
“Legal Proceedings”). As such, the Company accrued an estimated
$500,000
during the year ended
December 31, 
2016,
related to its estimated obligation under the lease and repairs required to be made to the facility. During the year ended
December 
31,
2017,
the Company spent
$52,000
in repairs to the facility as part of the dispute. On
April 7, 2017,
the Company entered a settlement agreement, whereby the Company’s net cash outlay was
$448,000
to resolve the disputes and the legal proceeding was dismissed.
 
The Company has various current and previously-owned facilities subject to a variety of environmental regulations. The Company has received certain indemnifications from either companies previously owning these facilities or from purchasers of those facilities. A
s of
December 
31,
 
2017
and
2016,
no
amounts were accrued for any environmental matters. See “Legal Proceedings” in Part I, Item
3
of this Annual Report on Form
10
-K.
 
On
December
27,
2017,
the U.S. Department of Labor (the “DOL”) filed a lawsuit alleging that the Company had misinterpreted the language of its Company’s
401
(k) Plans (collectively, the “Plan”). The DOL does
not
appear to dispute that the Company reached such interpretation in good faith and after consulting with independent ERISA counsel. If the DOL’s allegations were upheld by a court, the Company could be required to make additional contributions into the accounts of its Plan participants. The Company regards the DOL’s allegations to be without merit and plans to vigorously litigate the matter.
 
During the year ended
December
 
31,
 
2017,
the Company became aware of a lawsuit involving
one
of Sypris Electronics’ customers and its primary distributor. This customer has informed the Company that, as a result of the lawsuit, the customer
no
longer intends to pursue its current business, and has expressed an intention to transfer this business to a designated successor. The Company holds
$1,034,000
of inventory related specifically to this customer as of
December 
31,
 
2017.
On
December 21, 2017
the Company entered a new supply agreement with the designated successor, which provides for purchases in excess of our inventories on hand and for prices in excess of our cost.
No
assurances can be given that the successor customer will be successful or will comply with the terms of the new agreement, which could adversely affect our ability to recoup any or all of our investment in these inventories. However, given the uncertainties described above,
no
estimate currently can be made of a range of amounts of loss that are reasonably possible should the program with the successor
not
be successful.