10. Commitments and Contingencies During fiscal 2009, the company purchased certain inventory components under arrangements that required payment only after such components where actually used in production. Based on the company s current production plans we have determined that these components will not be used and we offset the inventory balance for undelivered items against the related accounts payable balance during the quarter ended March 31, 2015. Additionally, we intend to return approximately $0.2 million of such items that are included in the inventory and accounts payable balances as of September 30, 2015. The vendor that provided these components is currently disputing this arrangement and is requesting payment for these items. The company believes the amount at issue is approximately $1.2 million and intends to vigorously contest this assertion. Management does not believe that the ultimate resolution of this matter will have a material adverse effect on our consolidated financial position, results of operations or cash flows. We are also subject to claims and litigation arising in the ordinary course of business. Our management considers that any liability from any reasonably foreseeable disposition of such claims and litigation, individually or in the aggregate, would not have a material adverse effect on our consolidated financial position, results of operations or cash flows. We are not currently engaged in any other litigation which would be anticipated to have a material adverse effect on our financial condition or results of operations. We have entered into employment agreements with our chief executive officer, chief financial officer and interim chief strategy officer that specify the executive s current compensation, benefits and perquisites, the executive s entitlements upon termination of employment, and other employment rights and responsibilities. In connection with the termination of the company s employment relationship with its former chief executive officer and president in February