Item 3. Legal Proceedings
ITEM
3. LEGAL PROCEEDINGS
The
Company is subject, from time to time, to litigation, claims and suits arising in the ordinary course of business. As of the date of
filing, there are no material claims or suits whose outcomes could have a material effect on the Company’s financial statements.
On
June 21, 2018, Power Up Lending Group Ltd., sued both the Company and four of its managers, ex-managers, and directors of the Company
in the United States District Court for the Eastern District of New York. The case was dropped against the Company and the claim discharged
by the bankruptcy court upon Plan Confirmation on September 18, 2019. Power Up has continued a tort case against the individuals. Our
director and officer insurance has agreed to cover our chief executive officer Benjamin Slager, chief financial officer Anthony Santelli,
as well as ex-controller Dennis Lenaburg, in this case. Management believes the Complaint is frivolous. The defendants have filed amended
answers and counterclaims as of the date of this filing, and the case has gone into the discovery phase.
ITEM
4. MINE SAFETY DISCLOSURES
Not
applicable.
6
PART
II
Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.