Note 11 – Commitments And Contingencies

Litigation

From time to time the Company and its subsidiaries are parties to litigation arising in the ordinary course of business operations. Such litigation primarily involves claims for personal injury, property damage, breach of contract and claims involving employee relations and certain administrative proceedings. On November 14, 2025, the landlord for the real property lease in St. Petersburg, Florida, filed a notice of default for unpaid rent.  The company has not yet responded to the complaint. On December 10, 2025, the landlord for the real property lease in St Petersburg, Florida filed a Complaint for Damages.  Based on current information, we believe that the ultimate conclusion of the various pending litigation, in the aggregate, may have a material adverse effect on our consolidated financial position, results of operations and cash flows and liquidity. See Note 13 in the Notes to Consolidated Financial Statements included in this report.

Leases

The Company leased office space under non-cancelable operating leases with remaining lease terms ranging from 1 to 7 years. These leases require monthly lease payments that may be subject to annual increases throughout the lease term.  Certain of these leases also include renewal options at the election of the Company to renew or extend the lease for an additional 2 to 5 years. These optional periods have not been considered in the determination of the right-of-use assets or lease liabilities associated with these leases as the Company did not consider it reasonably certain it would exercise the options. The Company performed evaluations of its contracts and determined each of its identified leases are operating leases.

The sublease agreement to sublease half of the 31,000 square feet of office in St. Petersburg, Florida that commenced on February 1, 2017, expired on June 30, 2022. The lease was re-measured at that time and as a result, the Company recorded an impairment loss of $373 in general and administrative expenses. The lease was re-measured again in 2023 and, as a result, the Company recorded an impairment loss of $488 in general and administrative expenses. As of September 30, 2024, a subtenant still has not been found and one is not anticipated to be found before the lease expires. The Company incurred an impairment loss of $284 in general and administrative expenses  As of December 31, 2024, a subtenant still has not been found.  On November 15, 2025, the Company received a Notice of Default from the landlord followed by a Complaint for Damages for breach of lease on December 10, 2025.  As a result, the Company incurred an impairment losses of $1,389 in general and administrative expenses in 2024.

For the year ended December 31, 2024, the Company incurred $327 of lease expense on the consolidated statements of operations in relation to these operating leases, of which $212 was variable rent expense not included within the measurement of the Company's operating right-of-use assets and lease liabilities. The variable rent expense consists primarily of the Company's proportionate share of operating expenses, property taxes, and insurance and is classified as lease expense due to the Company's election to not separate lease and non-lease components. For the year ended December 31, 2023, total rental expense for operating leases was $706, of which $90 was variable rent expense.

In September 2024, the Company amended one of its lease agreements to extend the lease for 1,533 square feet of office space in Boca Raton, Florida for an additional 12 calendar months, commencing on November 1, 2024 and expired on October 31, 2025.

The lease agreement for 18,700 square feet of office space in Farmingdale, New York used by NutraScience Labs as its corporate office commenced on June 2, 2017 and was surrendered to the landlord, as part of the abandonment of operations, on May 12, 2023.

The lease agreement for 13,500 square feet of office space in Hauppauge, New York used by NutraScience labs as its secondary office space and warehouse commenced on May 1, 2021 and was forfeited to the landlord, as part of the abandonment of operations, on September 30, 2023. A loss of $454 was recorded in general and administrative expenses. 

As of December 31, 2024, the future maturities of the Company’s lease liabilities were as follows:

Included below is other information regarding leases for the year ended December 31, 2024.

Employee Agreements

We have entered into employment agreements with certain members of management. The terms of each agreement are different. However, one or all of these agreements include stipulated base salary, bonus potential, vacation benefits, severance and non-competition agreements.