COMMITMENTS AND CONTINGENCIES

12 Months Ended

Sep. 30, 2011

COMMITMENTS AND CONTINGENCIES

NOTE 13.  COMMITMENTS AND CONTINGENCIES

The Company is obligated under non-cancelable operating leases, primarily for manufacturing equipment, buildings and office equipment.  Leases for buildings occupied by IEC's businesses expire as follows: Wire and Cable in December 2012, Celmet in July 2014, and SCB primarily in September 2013.  These operating leases generally contain renewal options and require the Company to pay executory costs such as taxes, insurance and maintenance.  Approximate minimum lease obligations for the next five years, together with rent expense incurred during the two years covered by these financial statements, are as follows:

	Obligation
Future Rental Obligations	to pay rent
	(thousands)
Years ending September 30,
2012	$	1,292
2013		943
2014		252
2015		18
2016		4
Total rent expense for years ended September 30,
2011	$	1,429
2010		808

For the year ended September 30, 2011, IEC obtained 53% of the materials used in production from two vendors, Arrow Electronics, Inc. and Avnet, Inc. If either of these vendors were to cease supplying us with materials for any reason, this would force us to find alternative sources of supply. A change in suppliers could cause a delay in availability of products and a possible loss of sales, which could adversely affect operating results.

During August 2011, one of IEC's operating units entered into a five-year agreement with one of its suppliers to purchase a minimum volume of materials in exchange for receiving favorable pricing on the unit's purchases.  In the event the unit's cumulative purchases do not equal or exceed stated minimums, the supplier has a right to terminate the agreement and the IEC unit would be obligated to pay an early termination fee that declines from $365 thousand to zero over the term of the agreement.  IEC does not expect to pay a termination fee, as the company expects to exceed minimum purchase requirements under the agreement.