12. Commitments and Contingencies

12 Months Ended

Dec. 31, 2017

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Land Lease

The Company operates a plant in Corpus Christi, Texas.  The facility is located in the Rincon Industrial Park on approximately 15 acres of land, with approximately 14 acres leased from the Port of Corpus Christi Authority (the "Port") and approximately one acre owned by the Company. The lease payment is subject to an adjustment every 5 years for what the Port calls the "equalization valuation". This is used as a means of equalizing rentals on various Port lands and is determined solely at the discretion of the Port. The last equalization valuation was July 2017 at which time the annual lease increased from approximately $95,000 to $178,000. The Company and the Port executed an amended lease agreement on July 11, 2000, which extended the expiration date of the lease to June 30, 2027.

Minimum future rental payments for non-cancelable leases as of December 31, 2017 for the next five years ending December 31 and in total thereafter are as follows:

Years Ending December 31,
(In thousands)
2018	$	178
2019		178
2020		178
2021		178
2022		178
Thereafter		800
Total minimum lease payments	$	1,690

Rent expense under these leases was approximately $160,000 and $114,000 for the years ended December 31, 2017 and 2016, respectively.

Capital Leases

The Company’s operation in The Netherlands entered into a capital lease, in the amount of €89,550 ($107,460) for a compressed air system from Diependael. The lease, which has an interest rate of 5.75%, includes executory costs of €270 ($324) and a purchase option of €9,950 ($11,940) at the end of the 36 month lease term.

Year Ending December 31, 2017
(In thousands)
2018	$	39
2019		39
2020		29
Total minimum lease payments		107
Less:  Amount representing executory costs		–
Net minimum lease payments		107
Less:  Amount representing interest		(8	)
Present value of net minimum lease payments		99
Less:  Current maturities of capital lease obligations		(34	)
Long-term capital lease obligations, net of current maturities	$	65

Contingencies

There are claims arising in the normal course of business that are pending against the Company.  While it is not feasible to predict or determine the outcome of any case, it is the opinion of management that the ultimate dispositions will have no material effect on the consolidated financial statements of the Company.

The Company believes that it is in compliance with all applicable federal, state and local laws and regulations relating to the discharge of substances into the environment, and it does not expect that any material expenditure for environmental control facilities will be necessary in order to continue such compliance.