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9. Commitments and contingencies
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6 Months Ended | ||
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Jun. 30, 2011
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| Commitments and Contingencies Disclosure [Text Block] |
Legal
matters
The
Company concluded its litigation in previous matters
involving the Company’s prior Chairman and Chief
Executive, Jeffrey Muller and all related matters and are of
the current opinion that the Company no longer faces
litigation liability in connection with those cases. The
Company is continuing to ensure it’s obligations are
fully in compliance with a previous injunction order entered
by a Federal District Court over six years ago to timely file
all of the Company’s financial and related
reports. The Company will shortly be petitioning
the Federal District Court to dissolve the compliance
injunction on the basis that for more than a six-year period,
under the Company’s new administrative and executive
leadership, it has been in full compliance with the
Company’s SEC financial and reporting obligations. The
Company can provide no assurance that such action to dissolve
the injunction would be successful.
There
is no other litigation of any significance with the exception
of the matters that have arisen under, and are being handled
in, the normal course of business.
Litigation
Involving Former Executive Officer
As
previously reported, on April 7, 2010, Bruce McKinnon, the
former CEO of the Company, and the Company entered into an
Agreement Re: Collection on Judgment (“Judgment”)
(the “Settlement Agreement”), wherein
McKinnon, among other things, agreed to cease further
collection efforts on the Judgment, and the Company, among
other things, agreed to satisfy the Judgment for, and
McKinnon agreed to accept as full and final satisfaction of
the Judgment, subject to certain payment waivers described
below, a total amount of $360,000, plus interest of ten
percent (10%) per annum from March 15, 2010, on the unpaid
balance until paid, payable as follows: $30,000 on
April 7, 2010; $85,000 on or before April 15, 2010; and,
$15,000 per month commencing on June 1, 2010, until
paid. As of June 30, 2011, all payments
have been made on time and the balance due is
$74,541. The Settlement Agreement also provides
that if the Company makes all payments thereunder on a timely
basis, McKinnon will waive final payments due him in the
amount of $35,000. On July 15, 2011, the Company made the
full and final payment to Bruce McKinnon.
There
is no other litigation of any significance with the exception
of the matters that have arisen under, and are being handled
in, the normal course of business.
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