LEGAL PROCEEDINGS.
−Removed: A judgment was entered against us on October 26, 2009 in the amount of $72,852, plus accruing interest from that date at the rate of $20 per day and post judgment costs incurred in enforcing the judgment.
A stipulation for judgment was filed by Carmel Solutions, Inc.
−Removed: (Carmel) in the Superior Court of California, Orange County, in accordance with, and upon our default of, a settlement agreement we entered into with Carmel on May 5, 2009.
+Added: ("Carmel") in the Superior Court of California, Orange County, in accordance with, and upon our default of, a settlement agreement we entered into with Carmel on May 5, 2009, and a judgment was entered against us on October 26, 2009 in the amount of $72,852, plus accruing interest from that date at the rate of $20 per day and post judgment costs incurred in enforcing the judgment.
+Added: As of December 31, 2010, the financial statements contain a payable amount of $60,000 in relation to this action.
+Added: Our management is confident that the lower amount will be more reflective of the end settlements amount.
+Added: There are currently no discussions taking place between the parties on settling this amount and no approach has been received from Carmel since the judgment was entered.
We are a defendant in a pending legal proceeding filed by AT&T on December 11, 2009, in the U.S District Court of the District of Connecticut.
This suit alleges one cause of action for breach of contract.
−Removed: The Complaint claims that we owe money for services rendered, that we subsequently entered into a settlement agreement with AT&T to settle the amount owed to AT&T, and that we failed to make any payments due under such settlement agreement.
−Removed: AT&T seeks an automatic entry of judgment against us in the amount of $440,672 plus interest, attorney’s fees and costs.
+Added: The complaint alleges that we owe money for services rendered, that we subsequently entered into a settlement agreement with AT&T to settle the amount owed to AT&T, and that we failed to make any payments due under such settlement agreement.
+Added: AT&T was granted an automatic entry of judgment against us in the amount of $440,672 plus interest, attorney’s fees and costs.
+Added: In December of 2010, AT&T obtained an Order of Garnishment against one of our bank accounts in the amount of $510,525, $76,653 of which was actually garnished.
+Added: We are currently negotiating a payment schedule with AT&T that management is confident will result in a structured plan to allow us pay the remaining balance.
+Added: As of December 31, 2010, the financial statements contain a payable amount of $440,672 in relation to this action.
+Added: Our management is in active discussions with AT&T to agree a phased payment of this amount over two years and is confident that this outcome will result from those discussions.
We are also one of a number of defendants in a pending legal proceeding filed by First Citizens Bank & Trust, Inc.
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We did not respond within the time period allowed.
+Added: A motion for default judgment was filed on October 11, 2010 against us for the amount of $200,000 plus interest, attorney’s fees and costs.
+Added: As of December 31, 2010, we have accrued $200,000 in the accounts in relation to this action.
+Added: Management has opened discussions with representatives of the plaintiff to discuss a phased payment of the amount due.
+Added: It is too early for management to say if this will be achieved.
Bill Burbank, our previous President and COO, filed a lawsuit against us in the 15th Judicial Circuit in Palm Beach County, Florida on September 22, 2010.
−Removed: This suit alleges one cause of action for breach of agreement.
+Added: This complaint alleges one cause of action for breach of agreement.
The Complaint claims that we entered into a settlement agreement with Bill Burbank to settle the amount owed to him, and that we failed to make the first payment due under such settlement agreement.
−Removed: Burbank seeks a judgment for damages in the amount of $190,000 plus interest, attorney’s fees and costs.
−Removed: Because Thermocredit has a first priority secured interest against all of our assets, we expect that Thermocredit will stop the actual collection on this judgment, and management hopes to be able to negotiate further with Mr.
−Removed: Burbank and come to a reasonable settlement.
+Added: Burbank sought and received a judgment for damages in the amount of $190,000 plus interest, attorney’s fees and costs.
+Added: As of December 31, 2010, we have accrued $195,623 in the accounts in relation to this action to include interest and penalties.
+Added: Management intends to enter into renewed discussions with Mr.
+Added: Burbank to discharge this amount.
+Added: On October 25, 2010, China Voice Holding Corp.
+Added: ("CHVC") filed a lawsuit against us in the 15th Judicial Circuit in Palm Beach County, Florida.
+Added: This suit alleges one cause of action for breach of contract.
+Added: The complaint alleges that we entered into a settlement agreement with CHVC to settle the amount owed to it, and that we failed to make the first monthly payment due under such settlement agreement.
+Added: CHVC sought and received a judgment for damages in the amount of $82,742 plus pre-judgment interest of 18% per annum starting September 1, 2010, plus $500,000 as an additional liquidated damage, post judgment interest, costs and attorney’s fees.
+Added: As of December 31, 2010, we have accrued $2,182,676 in the financial statements in relation to this action to include interest and penalties.
+Added: In the interim, a large proportion of this amount as been assigned to a third party by CHVC and management is in active discussions with that party to agree new payment terms.
+Added: On November 10, 2010, Abovenet Communications filed a complaint against us in US District Court for the Southern District of New York, alleging breach of contract and seeking $87,761 in damages, plus interest, attorney’s fees and costs.
+Added: As of December 31, 2010, we have accrued $16,000 in the financial statements in relation to this action, which is the amount of services used from Abovenet prior to its action.
+Added: It is too early in the process for management to accurately estimate the full contingency amount attached to this legal action.
+Added: To date, no discussions have taken place with Abovenet in relation to settling this action.
+Added: On November 24, 2010, Tom Davis filed a Demand for Arbitration alleging a breach of the settlement agreement by and among Mr.
+Added: Davis and Flint, and seeking damages in the amount of $2,230,000.
+Added: As of December 31, 2010 the financial statements include $1,126,875 in loans and accrued interest and $1,530,000 in preferred shares in relation to Mr.
+Added: Management remains confident that suitable terms can be reached with Mr.
+Added: Davis to reschedule agreed payment arrangements to settle this action.
Because Thermocredit has a first priority secured interest against all of Flint’s assets, Flint expects that Thermocredit will stop the actual collection on any of these judgments, and management hopes to be able to negotiate further with these plaintiffs and come to a reasonable settlement.
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.