INVESTMENT IN PARAGON WASTE SOLUTIONS LLC |
6 Months Ended |
|---|---|
Jun. 30, 2015 | |
| Business Combinations [Abstract] | |
| INVESTMENT IN PARAGON WASTE SOLUTIONS LLC |
NOTE 7 - INVESTMENT IN PARAGON WASTE SOLUTIONS LLC
In February 2015, PWS entered into a License Agreement with Xinhua Energy Environmental Technology Co., Ltd, a large multi-national environmental company based in China (“Xinhua”). The agreement provides for the exclusive rights to distribute PWS’s patented technology in China, Hong Kong, Macau and the Taiwan territories (“Territory”). The grant was for both the medical waste, as well as the refinery vertical markets within the Territory. The Agreement calls for, among other things, the formation of a U.S. joint venture company, (“P&P Company”), to be owned 50/50 by PWS and Xinhua or its designee (“JV Entity”) and an obligation by Xinhua to fund all necessary and reasonable capital requirements to permit and roll out the PWS technology in the Territory as well as staff and manage the JV Entity’s operations. The Agreement also calls for the payment of a $430,000 placement fee for the first PWS CoronaLux™ unit to be commissioned in China of which $322,500 was paid March 31, 2015 and the remaining $107,500 will be paid upon shipment of the unit to China which has not yet shipped as of June 30, 2015.
Upon the occurrence of certain events and timely performance by Xinhua, a second placement fee of $350,000 is required to be paid and, upon that second payment, it will then be granted exclusive manufacturing rights to produce the units to be deployed in the Territory.
Payments received for licensing and placement fees have been recorded as deferred revenue in the accompanying condensed consolidated balance sheets at June 30, 2015 and December 31, 2014 and are recognized as revenue ratably over the term of their respective contracts. |