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OTHER COMMITMENTS AND CONTINGENCIES | 12 Months Ended
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Dec. 31, 2015
Notes to Financial Statements |
NOTE 15. OTHER COMMITMENTS AND CONTINGENCIES | Property and Rental Agreements In March 2014, we signed a lease for offices located in Purchase, New York. The lease is for 3,650 square feet of office space with a monthly cost of approximately $8,500 per month. In October 2015, pursuant to our acquisition of Bovie Bulgaria, we are obligated to pay $6,350 per month for the lease expiring on December 31, 2016. The following is a schedule of approximate future minimum lease payments under operating leases as of December 31, 2015 (in thousands):
2016 |  | $ | 187 |
2017 |  |  | 114 |
Therafter |  |  | 267 |
Total |  | $ | 568 |
Rent expense for the years ended December 31, 2015, 2014 and 2013 approximated $120,000, $72,000, and $228,000, respectively. Purchase Commitments At December 31, 2015, we had purchase commitments for inventories totaling approximately $3.3 million, substantially all of which is expected to be purchased by the end of 2016. Employment Agreements At December 31, 2015, we were obligated under six employment agreements which have expiration dates between December 2016 and March 2017.
Name |  | Contract Expiration Date
Robert Gershon |  | N/A(1)
J. Robert Saron |  | December, 2016
Moshe Citronowicz |  | December, 2016
Andrew Makrides |  | December, 2016
John McCarthy |  | March, 2017
Jay D. Ewers |  | N/A(1)
(1) | Employment contracts were revised to remove a date certain for the conclusion of such term and provide for the Executives to remain employed by the Company until such time as their employment is terminated pursuant to the terms of their Employment Agreement.
Approximate future minimum payments under these agreements are as follows as of December 31, 2015 (in thousands):
2016 |  | $ | 1,591 |
2017 |  |  | 94 |
Total |  | $ | 1,685 |
Employment contracts contain an automatic extension for a period of one year after the initial term unless we provide the executives with appropriate 60 days written notice pursuant to the contracts. The employment agreements provide, among other things, that the executive may be terminated as follows:
| (a) | Upon the death of the executive, in which case the executive's estate shall be paid the basic annual compensation due the employee pro-rated through the date of death.
| (b) | By the resignation of the executive at any time upon at least thirty (30) days prior written notice to Bovie in which case Bovie shall be obligated to pay the employee the basic annual compensation due him pro-rated to the effective date of termination.
| (c) | By Bovie, "for cause" if during the term of the employment agreement the employee violates the non-competition provisions of his employment agreement, or is found guilty in a court of law of any crime of moral turpitude in which case the contract would be terminated and provisions for future compensation forfeited.
| (d) | By Bovie, without cause, with the majority approval of the Board of Directors, for Mr. Makrides, Mr. Gershon, Mr. Saron, Mr. McCarthy, Mr. Ewers, and Mr. Citronowicz at any time upon at least thirty (30) days prior written notice to the executive. In this case Bovie shall be obligated to pay the executive compensation in effect at such time, including all bonuses, accrued or prorated, and expenses up to the date of termination. Thereafter for Messrs. Makrides, Saron, and Citronowicz, Bovie shall pay the executive three times the salary in effect at the time of termination payable in one lump sum.
| (e) | If Bovie fails to meet its obligations to the executive on a timely basis, or if there is a change in the control of Bovie, the executive may elect to terminate his employment agreement. Upon any such termination or breach of any of its obligations under the employment agreement, Bovie shall pay Mr. Makrides, Mr. Saron and Mr. Citronowicz a lump sum severance equal to three times the annual salary and bonus in effect the month preceding such termination or breach as well as any other sums which may be due under the terms of the employment agreement up to the date of termination. Mr. Gershon shall be paid two times his annual salary and bonus in effect the month preceding such termination or breach as well as any other sums which may be due under the terms of the employment agreement up to the date of termination.
There are no other employment contracts that have non-cancelable terms in excess of one year. Litigation Stockholder Derivative Action In September 2011, the Company was served in a purported stockholder derivative action (the "Derivative Action") that was filed in the United States District Court for the Middle District of Florida (the "Court") against the Company and certain of its present and former officers and directors. The complaint asserted, among other things, breach of fiduciary duties and bad faith in relation to the management of the Company's business. The complaint sought, among other things, unspecified compensatory damages and various forms of equitable relief. The allegations in the Derivative Action appear to be based largely on counterclaims previously asserted by Steven Livneh, a former director of the Company, in a prior litigation between the Company and Mr. Livneh which was settled. On June 26, 2014, the Company entered into a Stipulation and Agreement of Settlement ("Stipulation of Settlement") setting forth the terms of the settlement of the claims asserted against the Company in the Derivative Action. On July 7, 2014, the Court issued an Amended Order Preliminarily Approving Derivative Settlement and Providing for Notice ("Preliminary Order") preliminarily approving the Stipulation of Settlement. On October 2, 2014, the Court entered an order and final judgment approving the Stipulation of Settlement. In the normal course of business, we are subject, from time to time, to legal proceedings, lawsuits and claims. Such matters are subject to many uncertainties, and outcomes are not predictable with assurance. If any of these matters arise in the future, it could affect the operating results of any one or more quarters. We expense costs of litigation related to contingencies in the periods in which the costs are incurred.

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