Commitments And Contingencies

9 Months Ended

Sep. 30, 2017

Commitments and Contingencies Disclosure [Abstract]

Commitments And Contingencies

9. COMMITMENTS AND CONTINGENCIES

Litigation

There are various claims, lawsuits, and disputes with third parties and pending actions involving various allegations against us incident to the operation of our business, principally product liability cases. While we believe that the various claims are without merit, we are unable to predict the ultimate outcome of such litigation. We therefore maintain insurance, subject to self-insured retention limits, for all such claims, and establish accruals for product liability and other claims based upon our experience with similar past claims, advice of counsel and the best information reasonably available. At September 30, 2017 and December 31, 2016, we had $200,000 and $25,000 accrued, respectively, for product liability claims. These product liability claims are subject to various uncertainties, and it is possible that they may be resolved unfavorably to us. While it is not possible to predict with certainty the outcome of the various cases, it is the opinion of management that, upon ultimate resolution, the cases will not have a material adverse effect on our consolidated financial position, results of operations or cash flows.

Our insurance policies covering product liability claims must be renewed annually. Although we have been able to obtain insurance coverage for product liability claims at a cost and on other terms and conditions that have been acceptable to us, we may not be able to procure acceptable policies in the future.

Commitments

In June 2017, we loaned our independent distributor in South Korea $1.5 million and entered into a long-term note receivable. The loan is intended to assist this distributor with its business development and operating cash flows. The fair value of the note receivable is management's estimate based on the present value of estimated collectability scenarios.

At September 30, 2017, we had outstanding commitments for the purchase of inventory, raw materials and supplies of $14.5 million and outstanding commitments for the purchase of capital equipment of $7.5 million.