Company: AOSL
Filing Date: 2025-08-28
Form Type: 10-K
Source: 0001628280-25-041297
Chunk: 48

Company: ALPHA & OMEGA SEMICONDUCTOR Ltd
Filing Date: 2025-08-28
Form: 10-K
Item: Item 15
Chunk 48
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's subsidiaries in China only out of their retained earnings, if any, as determined in accordance with China accounting standards and regulations.  Each China subsidiary is also required to set aside at least 10% of its after-tax profit, if any, based on China accounting standards each year to its statutory reserves until the cumulative amount of such reserves reaches 50% of its registered capital.  As a result of these China laws and regulations, the Company's subsidiaries in China are restricted in their abilities to transfer a portion of their net assets to the Company.  As of June 30, 2025 and 2024, such restricted portion amounted to approximately $93.9 million and $93.5 million, or 11.4% and 10.5%, of our total consolidated net assets attributable to the Company, respectively.  As the Company's subsidiaries in China are not revenue generating operating units, the Company does not expect to repatriate funds in the form of dividends, loans or advances from its subsidiaries in China for working capital and other funding purposes.

15. Commitments and Contingencies

Purchase commitmentsAs of June 30, 2025 and 2024, the Company had approximately $85.9 million and $100.8 million, respectively, of outstanding purchase commitments primarily for purchases of semiconductor raw materials, wafers, spare parts, packaging and testing services and others.As of June 30, 2025 and 2024, the Company had approximately $14.1 million, and $6.9 million, respectively, of commitments for the purchase of property and equipment.Other commitmentsSee Notes 1, 7 and 8 to the Consolidated Financial Statements contained in this annual Report on Form 10-K for descriptions of commitments including Joint Venture, bank borrowings and leases.Contingencies and indemnitiesThe Company has in the past, and may from time to time in the future, become involved in legal proceedings arising from the normal course of business activities.  The semiconductor industry is characterized by frequent claims and litigation, including claims regarding patent and other intellectual property rights as well as improper hiring practices.  Irrespective of the validity of such claims, the Company could incur significant costs in the defense of such claims and suffer adverse effects on its operations.As previously disclosed, the Company cooperated with the Department of Commerce (“DOC”) in connection with its administrative investigation regarding certain transactions by the Company.  On July 2, 2025, the Company announced that it reached a settlement agreement with DOC to