Company: MCFT
Filing Date: 2025-08-27
Form Type: 10-K
Source: 0000950170-25-111682
Chunk: 60

Company: MasterCraft Boat Holdings, Inc.
Filing Date: 2025-08-27
Form: 10-K
Item: Item 6
Chunk 60
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 2023. 12. COMMITMENTS AND CONTINGENCIESRepurchase ObligationsUnder certain conditions, the Company is obligated to repurchase new inventory repossessed from dealerships by financial institutions that provide credit to the Company’s dealers. See Note 1 for more information regarding the terms and accounting policies related to this obligation. The Company’s obligations under such floor plan agreements are subject to various calculations and caps based on amounts currently owed by dealers to these financial institutions and, based on such terms, totaled approximately $41.0 million and $42.0 million as of June 30, 2025 and June 30, 2024, respectively. We incurred no material impact from repurchase events during the years ended June 30, 2025, 2024, and 2023. The Company recorded a repurchase liability of $1.6 million and $1.7 million as of June 30, 2025 and 2024, respectively.Purchase CommitmentsThe Company is engaged in an exclusive contract with a single vendor to provide engines for its MasterCraft performance sport boats. This contract makes this vendor the only supplier to MasterCraft for in-board engines and expires June 30, 2030. The Company is obligated to purchase a minimum number of engines for each model year under this contract. The Company could also be required to pay a penalty to this vendor in order to maintain exclusivity if annual purchases under the agreement fail to meet a certain volume threshold. We incurred no penalties related to purchase commitments during the years ended June 30, 2025, 2024, and 2023.Operating LeasesThe Company has lease agreements for certain personal and real property. Leases with an initial lease term of 12 months or less are not recorded on the balance sheet. Our lease agreements do not include any significant renewal options. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.The Company determines if an arrangement is a lease at lease inception. Operating lease right-of-use (“ROU”) assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at the commencement date. Because the rates implicit in the Company's lease contracts are not readily determinable, the Company uses its incremental borrowing rate based on information available at the commencement date in determining the present value of future payments. The incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments, and in economic environments where the