Commitments and Contingencies | Note 10 Commitments and Contingencies Office Lease Agreements On September 22, 2015 the Company signed a lease for office space in Irvine, California, and subsequently moved its operation to this location. This lease expires in September 2018 and carries a current monthly rent of approximately $5,350. Legal Proceedings 1. Adaptive Medias, Inc. v. Vdopia, Inc . , Alameda County Superior Court, Case No. RG16806402. On March 4, 2016, Adaptive filed suit against Vdopia for recovery of over $177,246 owed. A trial date has been scheduled in February of 2017. 2. Open X Technologies, Inc. v. Adaptive Medias, Inc . , American Arbitration Association (AAA), Case No. 01-15-0006-0657. On December 16, 2015, Open X filed a demand with AAA for arbitration of a dispute over $58,701 allegedly owed by Adaptive, plus claimed interest, attorneys fees, and costs, etc. The Company has denied all allegations. An Arbitration trial previously scheduled for July 8, 2016 but has been delayed and as of the date of this filing has not been rescheduled. 3. Viewster, AG v. Adaptive Medias, Inc. , Orange County Superior Court, Case No. 30-2015-00809444-CU-BC-CJC. On September 14, 2015, Viewster, AG, a Swiss corporation, sued Adaptive. A default judgment was entered and Adaptive filed a motion to set it aside. In January 2015, while that motion was pending, the parties entered into a settlement agreement, pursuant to which Adaptive would make installment payments totaling $58,592. Adaptive was not able to make all the installment payments, and the judgment is now enforceable but it has been reduced by a prior payment. On January 16, 2016 the Company entered into a settlement agreement with a vendor to settle $55,137 in payables for $58,593 including fees and costs. 4. Shandy Media, Inc. v. Adaptive Medias, Inc. , Los Angeles County Superior Court, Case No. BC588554. On or about July 20, 2015, Shandy Media sued Adaptive for $83,655, which Shandy claimed Adaptive owed pursuant to a service agreement. The Company denied all allegations. On or about April 7, 2016, the parties entered into a settlement agreement pursuant to which Adaptive agreed to pay Shandy $40,000 by June 1, 2016, in full settlement and release of all claims, and if Adaptive fails to pay the settlement amount by June 1, 2016, then a judgment will be entered against Adaptive for $83,655. 5. 2Blue Media Group, LLC v. Adaptive Medias, Inc. , Orange County Superior Court, Case No. 30-2015-00806086-CU-CL-CJC. On August 24, 2015, 2Blue Media Group, LLC filed a lawsuit claiming that Adaptive owed $25,825 for services. The Company has denied all allegations. An Arbitration trial previously scheduled for June 20, 2016 but has been delayed and as of the date of this filing has not been rescheduled. 6. Khoi Senderowicz v. Kasian Franks, Andrew Linton, Mimvi, Inc. , Alameda County Superior Court, Case No. RG13689457. On July 29, 2013, Plaintiff Khoi Senderowicz sued the Companys founder and former officer, Kasian Franks. The lawsuit also named as defendants the Company and an alleged shareholder. Senderowicz claimed that Company was responsible for two residential properties she rented to Franks. Senderowicz sought over $353,983 in claimed unpaid rent, property damages, and lost rent. Senderowicz also sought to redeem 50,000 shares of restricted common stock that Franks issued to her children in March of 2011, and she claimed she was entitled to an another 250,000 shares that Franks allegedly promised. The Company denied all allegations. In June 2015, the Company agreed to settle Senderowcizs claims in exchange for payment of $26,000 and cooperation in removing the restrictions on the 50,000 shares. Senderowicz later claimed that the settlement should be set aside. The Company has since settled the matter for $65,000 in Company common stock. 7. Amanda Besemer v. Adaptive Medias, Inc., Mimvi, Inc. , Los Angeles County Superior Court, Case No. SC 123934. On February 27, 2014, Amanda Besemer sued the Company for alleged breach of an Advisory Board Member Agreement that she claimed she entered into with the Companys founder and former officer, Kasian Franks. The lawsuit was filed in the Santa Clara County Superior Court (San Jose), but on or about March 20, 2015, the lawsuit was transferred and re-filed in the Los Angeles County Superior Court (Santa Monica). Besemer received over $100,000 worth of stock. She alleged that the Member Agreement entitled her to an additional 800,000 shares which she claims were worth $704,000. The Company denied all allegations. In March 2016, the parties entered into a settlement agreement, pursuant to which the Company agreed to pay a total of $75,000 in monthly installments, the last of which is due in January 2017. Under the agreement, if the Company defaults on the payments a judgment may be entered against Adaptive for $100,000, less any prior payments. 8. Phunware, Inc. adv. Adaptive Medias, Inc. Phunware, Inc. has asserted a claim against Adaptive for $6,133. The Company denies any liability but has yet to answer the complaint. 9. E.J. Hilbert adv. Adaptive Medias, Inc. E.J. Hilbert has asserted claims against Adaptive for alleged breaches and/or alleged failures to grant him 500,000 shares of restricted stock and 500,000 stock options. The Company denies any liability. As of the date of this filing no further action has been made by the plaintiff. 10. Crowdgather, Inc. adv. Adaptive Medias, Inc. Crowd Gather has asserted a claim against Adaptive for $10,987. 11. OneScreen, Inc. v. Patel Orange County Superior Court Case No. 30-2014-00699812. 12. AdOn Network, LLC v. OneScreen, Inc., et al., San Francisco Superior Court Case No. CGC-14-542878. AdOn Network, LLC (AdOn) originally filed suit against OneScreen arising out of an alleged settlement agreement that OneScreen entered into with AdOn on March 14, 2014. AdOn asserts that OneScreen breached the settlement and asserts various contractual and quasi-contractual claims against OneScreen. AdOn is seeking damages of approximately $429,000. In its First Amended Complaint, Plaintiff also sued the Company for successor liability for OneScreens alleged debts. The Company demurred to the First Amended Complaint, but the court denied the demurrer. The Company has answered the First Amended Complaint and intends to vigorously defend against the claims. Adaptive filed a summary judgement motion which is set for hearing on July 28, 2016. 13. MeetMe, Inc. v. Beanstock Media, Inc., et al., Philadelphia Court of Common Pleas On September 29, 2015, MeetMe, Inc. (MeetMe) filed suit against Beanstock Media, Inc. (Beanstock) and the Company. MeetMe asserts breach of contract claims regarding an alleged debt that it claims it is owed by Beanstock. MeetMe also claims that the Company allegedly guaranteed Beanstocks debt through a subsequent agreement. The parties are exploring settlement of the matter, but Adaptive intends to vigoursly defend against the claims if a settlement is not reached. On January 5, 2016, Beanstock was put into involuntary bankruptcy. Beanstocks bankruptcy has resulted in a stay of the proceedings of the case, and the Court recently denied MeetMes motion to sever the claims against Adaptive. Since the case is in its preliminary stages and currently stayed, and no discover has been take, it is impossible to determine the exact likelihood of success on MeetMes claims. The parties are exploring potential settlement of the matter. 14. Adaptive Medias, Inc. v. Beanstock Media, Inc, et al. On September 28, 2015, Adaptive filed suit against MeetMe, Inc (MeetMe), Jim Waltz, (Waltz) and Beanstock Media, Inc, (Beanstock) in Orange County Superior court. Adaptives lawsuit, among other things, asserts that Beanstock and Waltz fraudulently induced Adaptive into making a payment to MeetMe on behalf of Beanstock in the amount of $600,000, and that Waltz and Beanstock fraudulently induced Adaptives President to sign a purported guarantee of certain Beanstock payment obligation to MeetMe. Adaptive also asserts that Waltz breached his fiduciary duties to Adaptive, and that MeetMe aided and abetted those breaches. Adaptive seeks an amount of damages to be proved a trial, declaratory relief, recession, and punitive damages. On January 5, 2016, Beanstock was put into involuntary bankruptcy. Beanstocks bankruptcy has resulted in a stay of the proceedings. Because MeetMe and Waltz have not yet answered the Complaint, the case is currently stayed due to Beanstalk filing for Bankruptcy, and no discovery has been taken, it is impossible to determine the exact likelihood of success on these claims. 15. Adaptive Medias, Inc. v. Jim Waltz, et al., Orange County Superior Court Case No. 30-2015-00812007-CU-FR-CJC On September 28, 2015, the Company filed suit against former director Jim Waltz (Mr. Waltz), Beanstock and MeetMe, Inc. The Company asserts various claims relating to Mr. Waltz self-dealing as a director of the Company , including fraudulent conduct that resulted in Adaptive Medias paying and allegedly guaranteeing obligations incurred by Beanstock. Among other relief, the Company seeks to recover the monies that were paid to MeetMe, and it seeks to void and/or rescind the obligations Adaptive Medias allegedly incurred as a result of Mr. Waltz fraudulent conduct and breaches of his fiduciary duties. Because MeetMe and Waltz have not yet answered the Complaint, the case is currently stayed due to Beanstalk filing for Bankruptcy, and no discovery has been taken, it is impossible to determine the exact likelihood of success on these claims. |