Commitments and Contingencies

Operating Leases

The Company occupies certain facilities and operates certain equipment and vehicles under non‑cancelable lease arrangements. Lease agreements may contain lease escalation clauses and purchase and renewal options. The Company recognizes scheduled lease escalation clauses over the course of the applicable lease term on a straight-line basis in the Unaudited Consolidated Statements of Operations.

Total rent expense was $5,354 and $4,817 for the three months ended March 31, 2019 and 2018, respectively, and $10,916 and $9,754 for the six months ended March 31, 2019 and 2018, respectively.

Future minimum aggregate rental payments under non-cancelable operating leases are as follows:



Fiscal Year
Remainder of 2019	$	8,558
2020	14,182
2021	11,036
2022	7,575
2023	5,500
Thereafter	11,361
Total	$	58,212

Capital Leases

The gross and net carrying values of the equipment under capital leases as of March 31, 2019 and September 30, 2018 was as follows:



	March 31, 2019		September 30, 2018
Gross carrying amount	$	60,813	$	52,314
Net carrying amount	33,893		31,116

The following is a schedule showing the future minimum lease payments under capital leases by years and the present value of the minimum lease payments as of March 31, 2019.



Fiscal Year
Remainder of 2019	$	7,409
2020	11,762
2021	8,451
2022	5,859
2023	3,592
Thereafter	3,949
Total	41,022
Less amount representing interest (at rates ranging from 1.71% to 9.71%)	6,495
Present value of net minimum capital lease payments	34,527
Less current installments of obligations under capital leases	12,977
Obligations under capital leases, excluding current installments	$	21,550

The current installments of obligations under capital leases are included in Accrued expenses and other liabilities. Obligations under capital leases, excluding current installments, are included in Other non-current liabilities.

The Company is a lessor to multiple parties. The Company purchases equipment through internal funding or bank debt equal to the fair market value of the equipment. The equipment is then leased to customers for periods ranging from five to twenty years. As of March 31, 2019, future minimum lease payments receivable under operating leases are as follows:



Fiscal year
Remainder of 2019	$	3,066
2020	7,557
2021	5,547
2022	5,395
2023	4,410
Thereafter	58,945
Future minimum lease payments	$	84,920

Guarantees

From time to time, the Company is required to provide letters of credit, bank guarantees, or surety bonds in support of its commitments and as part of the terms and conditions on water treatment projects. In addition, the Company is required to provide letters of credit or surety bonds to the Department of Environmental Protection or equivalent in some states in order to maintain its licenses to handle toxic substances at certain of its water treatment facilities.

These financial instruments typically expire after all Company commitments have been met, a period typically ranging from twelve months to ten years, or more in some circumstances. The letters of credit, bank guarantees, or surety bonds are arranged through major banks or insurance companies. In the case of surety bonds, the Company generally indemnifies the issuer for all costs incurred if a claim is made against the bond.

As of March 31, 2019 and September 30, 2018 the Company had letters of credit totaling $14,541 and $11,777, respectively, and surety bonds totaling $133,555 and $123,427 respectively, outstanding under the Company’s credit arrangements. The longest maturity date of the letters of credit and surety bonds in effect as of March 31, 2019 was March 26, 2029. Additionally, as of March 31, 2019 and September 30, 2018, the Company had letters of credit totaling $0 and $857, respectively, and surety bonds totaling $2,429 and $2,469, respectively, outstanding under the Company’s prior arrangement with Siemens.

Litigation

From time to time, the Company is subject to various claims, charges and litigation matters that arise in the ordinary course of business. The Company believes these actions are a normal incident of the nature and kind of business in which the Company is engaged. While it is not feasible to predict the outcome of these matters with certainty, the Company does not believe that any asserted or unasserted legal claims or proceedings, individually or in the aggregate, will have a material adverse effect on its business, financial condition, results of operations or prospects.