15. COMMITMENTS AND CONTINGENT LIABILITIES Product Liability Claims The Company is subject to product warranty claims that arise in the ordinary course of its business. For certain manufactured products, the Company maintains a product warranty accrual which is adjusted on a monthly basis as a percentage of cost of sales. This product warranty accrual is periodically adjusted based on the identification or resolution of known individual product warranty claims. The following table sets forth the Company s continuing operations product warranty accrual: Warranty Liability Balance at December 31, 2012 $ 15,727 Additions to warranty liability 1,136 Warranty liability utilized (9,102) Balance at September 30, 2013 $ 7,761 Included within the above table are concrete tie warranty reserves of approximately $ 6,940 and $ 14,837 as of September 30, 2013 and December 31, 2012, respectively. The Company continues to work with the Union Pacific Railroad (UPRR) to identify and replace defective ties related to the warranty claim asserted under CXT Incorporated s (CXT) 2005 supply contract. The Company believes the UPRR will complete the physical replacement of ties pursuant to the 2013 replacement program during the fourth quarter of 2013. During the nine months ended September 30, 2013 there were no changes to the Company s estimate of the number of defective concrete ties that will ultimately require replacement. Replaced ties have been deducted from the Company s warranty liability. The Company will continue to assess the adequacy of its reserve as information from the UPRR replacement activity becomes available. While the Company believes this is a reasonable estimate of the potential warranty claim s , these estimate s could change due to the emergence of new information and /or future events. There can be no assurance at this point that future potential costs pertaining to these claim s or other potential future claims will not have a material impact on the Company s results of operations. Environmental and Legal Proce