Annual report pursuant to Section 13 and 15(d)

Commitment and Contingencies

v3.23.1
Commitment and Contingencies
 12 Months Ended
Dec. 31, 2022
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies 24. Commitments and Contingencies
Legal Proceedings
From time to time, we may become involved in various claims and legal proceedings arising in the ordinary course of business, which, by their nature, are inherently unpredictable. We are not currently a party to any material claims or legal proceedings the outcome of which, if determined adversely to us, would individually or in the aggregate, have a material adverse effect on our business, financial condition or results of operations. Regardless of outcome, litigation and other legal proceedings can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors.
Other Contingencies
The Company analyzed its unique facts and circumstances related to potential obligations in a certain state jurisdiction, including the delivery nature of its prior year intercompany services, payroll and other benefits-
related services, current shared services between the parent and subsidiaries, and changing state laws and interpretations of those laws, and has determined that the Company may have an indirect tax obligation.
The Company has continued correspondence with the applicable authorities in an effort toward identifying a taxpayer-favorable resolution of the potential liabilities. As a result of this correspondence, the Company has updated its liability including interest and penalties based on its best estimate as of December 31, 2022.
The following table summarizes the estimated indirect tax liability activity during the year ended December 31, 2022:
(in thousands)
Balance, January 1, 2022 $ 737 
Payments (504)
Adjustment to Expense (146)
Balance, December 31, 2022 $ 87 
The Company continues to analyze the additional obligations it may have, if any, and it will adjust the liability accordingly.
Other Commitments
The Company has a commitment for launch and integration services with a launch services provider. As of December 31, 2022, the Company had a commitment for one launch, to include up to two satellites at a future estimated launch date for $1.7 million. The terms of the arrangement also allow the Company to remanifest the satellites if significant delays in excess of 365 days or other inexcusable delays occur with the provider. Subsequent to remanifest efforts four months after the 365 days, the Company can request a refund of all recoverable costs. Payment terms are 15 days from invoice date.
In addition, we have various other operational commitments for the next several years totaling $9.8 million as of December 31, 2022.