RELATED PARTY TRANSACTIONS

9 Months Ended

Sep. 30, 2017

(12) RELATED PARTY TRANSACTIONS

The Company employs Mr. Martin Sandgaard and Mr. Joachim Sandgaard, both sons of Thomas Sandgaard. Compensation was $43,000 and $40,000 for the three months ended September 30, 2017 and 2016, respectively and $129,000 and $101,000 for the nine months ended September 30, 2017 and 2016, respectively. To meet Mr. Sandgaard’s obligation to his former wife under a settlement agreement, the Company, during the fourth quarter of 2015, entered into 3 year employment arrangement totaling $100,000 per year with Mr. Joachim Sandgaard.

Related party payables primarily consist of advances made to the Company and inventory purchases made on behalf of the Company. Accrued liabilities as of September 30, 2017 and December 31, 2016 include a net payable to Thomas Sandgaard of $0 and $75,000 respectively, and a net payable to an employee of $0 and $112,000 respectively. During the three months ended September 30, 2017 the company made repayments to Thomas Sandgaard and an employee of $0 and $93,000 respectively. During the nine months ended September 30, 2017 the Company made a repayment to Thomas Sandgaard and an employee of $75,000 and $112,000 respectively.