Quarterly report pursuant to Section 13 or 15(d)

8. COMMITMENTS AND CONTINGENCIES

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8. COMMITMENTS AND CONTINGENCIES
6 Months Ended
Jun. 30, 2015
Notes to Financial Statements  
NOTE 8 - COMMITMENTS AND CONTINGENCIES

The Company entered into a three year lease agreement for their office lease facility commencing July 1, 2012, with escalating rental payments. On February 21, 2013, the Company amended the lease agreement to extend the lease through March 2018 and increase rental space. The effects of variable rent disbursements have been expensed on a straight-line basis over the life of the lease. The Company recognized rent expense of $14,380 and $14,382 during the three months ended June 30, 2015 and 2014, respectively.  The Company recognized rent expense of $28,761 and $28,762 during the six months ended June 30, 2015 and 2014, respectively.  As of June 30, 2015 and December 31, 2014, there was $20,746 and $22,810, respectively, of deferred rent included in accrued expenses and other current liabilities in the accompanying balance sheets.

 

Future minimum lease payments under all non-cancelable operating leases as of June 30, 2015 are as follows:

 

Fiscal Year      
2015     31,344  
2016     64,299  
2017     66,519  
2018     16,770  
    $ 178,932  

 

Marketing Agreement

 

On May 14, 2014, the Company entered into a definitive Marketing Agreement with Benchworks SD, LLC (Benchworks), a company engaged in the marketing, promotion and offering for distribution and sale of pharmaceutical, healthcare and consumer products. Under the terms of the agreement, the Company has granted Benchworks the exclusive right to promote, market, sell and distribute SUGARDOWN® in North America for an initial term of one year, subject to extension in accordance with the terms of the agreement. Benchworks is responsible and bears the expense for marketing and commercializing SUGARDOWN®, including the creation and payment for marketing, creative and promotional materials. The agreement defines certain minimum net sales levels that Benchworks must achieve to maintain exclusivity.  Revenue generated pursuant to the Marketing Agreement for the three and six months ended June 30, 2015 were $3,206 and $19,122, respectively.  The agreement was terminated in July 2015.