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Commitments and Contingencies
6 Months Ended
Jun. 30, 2015
Notes to Financial Statements  
Note 14 - Commitments and Contingencies

In July 2014, the Company entered into an agreement to lease a new gyrotron and associated equipment from a vendor pursuant to a capital lease. The lease requires four payments aggregating $220,000, of which $40,000 was paid, $45,000 is due upon successful launch (expected by the fourth quarter of 2015), and $75,000 and $60,000 is due at the first and second anniversary of launch, respectively. The lease contains a $1 bargain purchase option following the completion of payments made by the Company. The term of the lease begins when the equipment is commissioned at the Bensalem, Pennsylvania facility, which has not occurred as of June 30, 2015.

 

In February 2015 the Company entered into an agreement to purchase a cyromagnet for $134,700 of which $40,410 was paid in April 2015, $40,410 will be due 30 days after delivery (expected by the fourth quarter of 2015), $26,940 will be due 6 months after successful provisional acceptance testing and $26,940 will be due 18 months after successful provisional acceptance testing.

 

Leases - The Company leases office and warehouse space under an operating lease which expired on July 31, 2015, and was automatically renewed on that date for an additional 12 months at $9,846/month. Rent expense for the three and six months ended June 30, 2015 and the three and six months ended June 30, 2014 amounted to $29,538, $59,192, $25,123 and $50,248 respectively.

 

Aggregate future minimum lease payments from June 30, 2015 under the non-cancelable operating lease are $127,103 through July 2016. The Company has made a $12,253 security deposit included within other assets in the accompanying balance sheets as of June 30, 2015 and December 31, 2014.

 

Claims - The Company is subject to a claim arising in the normal course of business. In the opinion of management, the amount of the ultimate liability, if any, with respect this action will not have a material adverse effect on the financial position, results of operation or cash flow of the Company.