NOTE 15  COMMITMENTS AND CONTINGENCIES Inventory Purchase Commitment The Company uses contract manufacturers to provide manufacturing services for its products. During the normal course of business, in order to manage manufacturing lead times and help ensure adequate supply, the Company enters into agreements with its contract manufacturer that either allow them to procure inventory based on criteria as defined by the Company or that establish the parameters defining the Companys requirements. A significant portion of the Companys purchase commitments arising from these agreements consist of firm, non-cancelable and unconditional purchase commitments. In certain instances, these agreements allow the Company the option to cancel, reschedule or adjust the Companys requirements based on its business needs prior to firm orders being placed. As of June 30, 2020, the Company had total purchase commitments for inventory of $7.4 million, of which $0.9 million was accrued in the Condensed Consolidated Balance Sheet. Other Purchase Obligations On December 31, 2019, TiVo entered into a contract requiring the Company to generate a minimum number of Qualified Referred Subscribers (as defined in the contract) over a 30 month period. In the event that the aggregate number of Qualified Referred Subscribers generated by the Company within the specified time period is less than the minimum guaranteed subscribers, the Company is required to pay an amount equal to the shortfall between the number of Qualified Referred Subscribers generated by the Company and the required minimum multiplied by a per Qualified Referred Subscribers fee, up to a maximum of $5.0 million. As of June 30, 2020, no amounts were accrued in the Condensed Consolidated Balance Sheet related to this contract as the Company believes it will be able to generate the minimum number of Qualified Referred Subscribers within the 30 month commitment p eriod . Under certain other contractual arrangements, the Company may be obligated to pay up to approximately $10.9 million over an estimated period of approximately four years if certain milestones are achieved. Indemnifications In the normal course of business, the Company provides indemnifications of varying scopes and amounts to certain of its licensees, customers, and business partners against claims made by third parties arising from the use of the Company's products, intellectual property, services or technologies. The Company cannot reasonably estimate the possible range of losses that may be incurred pursuant to its indemnification obligations, if any. Variables affecting any such assessment include, but are not limited to: the nature of the claim asserted; the relative merits of the claim; the financial ability of the party suing the indemnified party to engage in protracted litigation; the number of parties seeking indemnification; the nature and amount of damages claimed by the party suing the indemnified party; and the willingness of such party to engage in settlement negotiations. To date, no such claims have been filed against the Company and no liability has been recorded in the Companys financial statements. As permitted under Delaware law, the Company has agreements whereby it indemnifies its officers and directors for certain events or occurrences while the officer or director is, or was, serving at the Companys request in such capacity. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited; however, the Company believes, given the absence of any such payments in the Companys history, and the estimated low probability of such payments in the future, that the estimated fair value of these indemnification agreements is immaterial. In addition, the Company has directors and officers liability insurance coverage that is intended to reduce its financial exposure and may enable the Company to recover any payments, should they occur. Contingencies At each reporting period, the Company evaluates whether or not a potential loss amount or a potential range of losses is probable and reasonably estimable under the provisions of the authoritative guidance that addresses accounting for contingencies. The Company is currently unable to predict the final outcome of lawsuits to which it is a party and therefore cannot determine the likelihood of loss nor estimate a range of possible losses. An adverse decision in any of these proceedings could significantly harm the Companys business and consolidated financial position, results of operations or cash flows. The Company and its subsidiaries are involved in litigation matters and claims in the normal course of business. In the past, the Company and its subsidiaries have litigated to enforce their respective patents and other intellectual property rights, to enforce the terms of license agreements, to protect trade secrets, to determine the validity and scope of the proprietary rights of others and to defend itself or its customers against claims of infringement or invalidity. The Company expects it or its subsidiaries will be involved in similar legal proceedings in the future, including proceedings regarding infringement of its patents, and proceedings to ensure proper and full payment of royalties by licensees under the terms of its license agreements. The existing and any future legal actions may harm the Companys business. For example, legal actions could cause an existing licensee or strategic partner to cease making royalty or other payments to the Company, or to challenge the validity and enforceability of patents owned by the Companys subsidiaries or the scope of license agreements with the Companys subsidiaries, or could significantly damage the Companys relationship with such licensee or strategic partner and, as a result, prevent the adoption of the Companys other technologies by such licensee or strategic partner. Litigation could also severely disrupt or shut down the business operations of licensees or strategic partners of the Companys subsidiaries, which in turn would significantly harm ongoing relations with them and cause the Company to lose royalty revenue. The costs associated with legal proceedings are typically high, relatively unpredictable, and not completely within the Companys control. These costs may be materially higher than expected, which could adversely affect the Companys operating results and lead to volatility in the price of its common stock. Whether or not determined in the Companys favor or ultimately settled, litigation diverts managerial, technical, legal, and financial resources from the Companys business operations. Furthermore, an adverse decision in any of these legal actions could result in a loss of the Companys proprietary rights, subject the Company to significant liabilities, require the Company to seek licenses from others, limit the value of the Companys licensed technology or otherwise negatively impact the Companys stock price or its business and consolidated financial results .