Quarterly report pursuant to Section 13 or 15(d)

7. COMMITMENTS AND CONTINGENCIES

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7. COMMITMENTS AND CONTINGENCIES
6 Months Ended
Jun. 30, 2016
Notes to Financial Statements  
NOTE 7 - COMMITMENTS AND CONTINGENCIES

Leases

 

The Company leases office space in Newton MA under a 4 month lease that expires July 31, 2016. At that point, the lease will end with no further obligation. The Company recognized rent expense of $5,400 and $14,380 during the three months ended June 30, 2016 and 2015, respectively.  The Company recognized rent expense of $10,350 and $28,761 during the six months ended June 30, 2016 and 2015, respectively

 

Future minimum lease payments under all non-cancelable operating leases as of June 30, 2016, are as follows:

 

Fiscal Year      
2016   $ 1,800  
         

 

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 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 was responsible and bears the expense for marketing and commercializing SUGARDOWN®, including the creation and payment for marketing, creative and promotional materials. The agreement defined certain minimum net sales levels that Benchworks must achieve to maintain exclusivity; and the agreement also provided for net sales splits with Benchworks receiving 65% of the first $10 million in net sales from the sale of SUGARDOWN® in North America, with a declining share to 50% for net sales in excess of $40 million. The agreement was terminated in July 2015. Revenue generated pursuant to the Marketing Agreement for the three and six months ended June 30, 2015, were $3,206 and $19,122, respectively.