Annual report pursuant to Section 13 and 15(d)

Commitments and Contingencies

v3.6.0.2
Commitments and Contingencies
12 Months Ended
Dec. 31, 2016
Commitments And Contingencies Disclosure [Abstract]  
Commitments and Contingencies

(12)

Commitments and Contingencies

 

(a)

Operating Leases

The Company has entered into lease agreements for office space and research facilities in San Diego, California; Rancho Santa Fe, California; Poway, California; Melbourne, Florida; Taipei, Taiwan; Shenzhen and Jiangsu, China; and Cambridgeshire, United Kingdom. Rent expense was $742,829, $672,526 and $584,269, for the years ended December 31, 2016, 2015 and 2014, respectively. The longest lease expires in June 2020. The Company moved into its new facility in San Diego, California during the year ended December 31, 2014. The new San Diego facility lease agreement included a tenant improvement allowance which provided for the landlord to pay for tenant improvements on behalf of the Company up to $515,000. Based on the terms of this landlord incentive and involvement of the Company in the construction process, the leasehold improvements purchased under the landlord incentive were determined to be property of the Company.

The future minimum lease payments required under operating leases in effect at December 31, 2016 were as follows:

 

Year ending:

 

 

 

 

2017

 

$

791,285

 

2018

 

 

542,404

 

2019

 

 

517,973

 

2020

 

 

265,940

 

 

 

$

2,117,601

 

 

 

(b)

Indemnification

In some agreements to which the Company is a party, the Company has agreed to indemnify the other party for certain matters, including, but not limited to, product liability and intellectual property. To date, there have been no known events or circumstances that have resulted in any material costs related to these indemnification provisions and no liabilities have been recorded in the accompanying financial statements.

 

(c)

Employment Agreements

During 2014 the Company entered into employment agreements with its CEO and certain members of its management team. These agreements provide severance in the aggregate amount of $575,000 for termination without cause as defined in the agreements.