There are no pending legal proceedings against the Company. To the Company’s knowledge, there have been no cases initiated by or against the Company, nor any cases resolved, since the date of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2011 was filed with the SEC.
CCI has been a party to a number of other proceedings, informal demands, or debt for services brought by former unsecured creditors to collect past due amounts for services. CCI is attempting to settle these demands and unfilled claims. CCI does not consider any of these claims to be material.
During the quarter ended September 30, 2012, the Company recorded a write off totaling $490,000 of trade debt deemed uncollectible by the holder due to the expiration of the statute of limitations. This adjustment was recorded as a reduction in selling, general and administrative expense.
During the quarter ended March 31, 2011, the Company entered into a settlement with a vendor to pay $32,000. As a result, the vendor forgave $15,000 of additional debt. The settlement was recorded as a reduction in research and development expense.