Duos Technologies Group, Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

NOTE 12 - COMMITMENTS AND CONTINGENCIES

NOTE 12 - COMMITMENTS AND CONTINGENCIES	12 Months Ended
Dec. 31, 2014
Notes to Financial Statements
NOTE 12 - COMMITMENTS AND CONTINGENCIES	NOTE 12 – COMMITMENTS AND CONTINGENCIES Operating lease On April 25, 2011, the Company entered into a 3 year escalating lease agreement for 1,352 square feet commencing in July. The monthly rental rate is $1,800, $1,920 and $2,040 for the lease years ending July 31, 2012, 2013 and 2014, respectively. The Company terminated this lease in July of 2014 owing three months’ rent for total of $6,091. On August 1^st, 2014, the Company entered into a settlement agreement with the landlord whereby a note was executed for a total of $4,401 to be paid in 7 monthly installments of $600 with the first payment in September 1, 2014, foregoing the original rent deposit of $1,690 and an 8^thfinal payment of $201 for a total settlement of $6,091. The balance at December 31, 2014 was $2,965 and included in accounts payable. On May 9, 2014 a two year lease was signed by Management for a new office located at 2114 Rays Way, Stuart, Florida, 34994. A security deposit in the amount of $1,200 was paid at the time of signing. The monthly rental rate is $1,200 and $1,260 for the lease years ending July 31, 2015 and July 31, 2016, respectively. The lease was terminated due to the relocation of our office to Jacksonville, FL as a result of the completion of reverse triangular merger (see Note 18). Accordingly, deposit of $1,200 was forfeited for early termination. Rent expense for the years ended December 31, 2014 and 2013 was $24,887 and $26,527, respectively. Legal Matters From time to time, we may be involved in litigation relating to claims arising out of our operations in the normal course of business. As of December 31, 2014 there were no pending or threatened lawsuits that could reasonably be expected to have a material effect on the results of our operations, other than noted below. In early 2015, the Company elected to cancel its software development with FacilityTeam of Ontario, Canada. This cancellation was based primarily on a lack of deliverables against pre-agreed project milestones. FacilityTeam elected to file a suit for breach of contract in Palm Beach county Florida which both had no merit and was in direct contravention of the agreed resolution for disputes being mediation and, if necessary, Arbitration. The Company’s counsel is currently working to resolve this issue without incurring undue legal expense and the Company believes there is no merit to their claims.

NOTE 12 - COMMITMENTS AND CONTINGENCIES

12 Months Ended

Dec. 31, 2014

Notes to Financial Statements

NOTE 12 - COMMITMENTS AND CONTINGENCIES

NOTE 12 – COMMITMENTS AND CONTINGENCIES

Operating lease

On April 25, 2011, the Company entered into a 3 year escalating lease agreement for 1,352 square feet commencing in July. The monthly rental rate is $1,800, $1,920 and $2,040 for the lease years ending July 31, 2012, 2013 and 2014, respectively. The Company terminated this lease in July of 2014 owing three months’ rent for total of $6,091. On August 1^st, 2014, the Company entered into a settlement agreement with the landlord whereby a note was executed for a total of $4,401 to be paid in 7 monthly installments of $600 with the first payment in September 1, 2014, foregoing the original rent deposit of $1,690 and an 8^thfinal payment of $201 for a total settlement of $6,091. The balance at December 31, 2014 was $2,965 and included in accounts payable.

On May 9, 2014 a two year lease was signed by Management for a new office located at 2114 Rays Way, Stuart, Florida, 34994. A security deposit in the amount of $1,200 was paid at the time of signing. The monthly rental rate is $1,200 and $1,260 for the lease years ending July 31, 2015 and July 31, 2016, respectively. The lease was terminated due to the relocation of our office to Jacksonville, FL as a result of the completion of reverse triangular merger (see Note 18). Accordingly, deposit of $1,200 was forfeited for early termination.

Rent expense for the years ended December 31, 2014 and 2013 was $24,887 and $26,527, respectively.

Legal Matters

From time to time, we may be involved in litigation relating to claims arising out of our operations in the normal course of business. As of December 31, 2014 there were no pending or threatened lawsuits that could reasonably be expected to have a material effect on the results of our operations, other than noted below.

In early 2015, the Company elected to cancel its software development with FacilityTeam of Ontario, Canada. This cancellation was based primarily on a lack of deliverables against pre-agreed project milestones. FacilityTeam elected to file a suit for breach of contract in Palm Beach county Florida which both had no merit and was in direct contravention of the agreed resolution for disputes being mediation and, if necessary, Arbitration. The Company’s counsel is currently working to resolve this issue without incurring undue legal expense and the Company believes there is no merit to their claims.