Commitments and Contingencies

12 Months Ended

Dec. 31, 2013

Commitments and Contingencies [Abstract]

Note 10 – Commitments and Contingencies

The Company leases its executive offices and warehouse facilities in Fort Lauderdale, Florida from an entity controlled by its Chairman, President and Chief Executive Officer. On May 16, 2013, the term of the lease, which was scheduled to expire on May 1, 2018, was extended through December 31, 2023. The lease requires an annual minimum base rent of $94,800 and provides for a maximum annual 2% increase in subsequent years, although the entity has not raised the minimum rent since the Company entered into a previous lease agreement in 1998. Additionally, the leasing entity is entitled to reimbursement of all taxes, assessments, and any other expenses that arise from ownership. Each of the parties to the lease has agreed to review the terms of the lease every three years at the request of the other party. Rent expense under the lease during each of the years ended December 31, 2013 and 2012 was approximately $96,000.

The Company leases from the Alabama State Port Authority a 1.5 acre docking facility on the Alabama River, located approximately eleven miles from the Company’s Alabama manufacturing facility. The lease expires on September 30, 2014, and requires the Company to pay rent and additional expenses totaling approximately $8,000 annually.

The following is a schedule of minimum future rentals on the Company’s non-cancelable operating leases.

12 month period ending December 31,
2014	$	96,064
2015		97,985
2016		99,945
2017		101,944
2018		103,983
Thereafter		551,953
Total	$	1,051,874

From time to time the Company will actively defend its patents through legal action. Odorstar, the Company’s 50% owned joint venture, is currently the plaintiff in two separate lawsuits. During 2013, Odorstar filed a claim of patent infringement against another party. This claim was denied by the court in January 2014 and Odorstar has filed an appeal in Federal Court. The defendant has filed a motion for attorneys’ fees of $250,000, however there is no determination at this time as to the likelihood of success of Odorstar’s appeal or the defendant’s motion. Based on the facts from the Company’s attorneys we do not expect the court to grant the defendant’s motion.

The defendants in the second lawsuit have filed counter-claims, however at this time the outcome of these matters cannot be determined.

- Definition

The entire disclosure for significant arrangements with third parties, which includes operating lease arrangements and arrangements in which the entity has agreed to expend funds to procure goods or services, or has agreed to commit resources to supply goods or services, and operating lease arrangements. Descriptions may include identification of the specific goods and services, period of time covered, minimum quantities and amounts, and cancellation rights.

+ References+ Details