What changed in this filing

/stocks — the workspaceLOADING

Item 1. Legal Proceedings

2025-05-15 compared with 2024-11-19 · 18 added, 52 removed, 2 unchanged (97% of the section changed)

Legal Proceedings.

July 26, 2024, OAC 111 Flatiron, LLC and OAC Adelphi, LLC, filed a civil action in the Supreme Court of the State of New York against

MICS Nomad LLC, a subsidiary of the Company (“MICS NY”), and the Company (“the Defendants”) for alleged breach

of lease, seeking monetary damages including unpaid rent, future unpaid rent, and other expenses related to the lease.

The complaint

alleges the Defendants breached the lease in various material respects.

September 25, 2024, the Company entered into a Settlement Agreement for a full release and dismissal of the complaint within 5 business

days of the Company’s payment of $250,000.

Pursuant to the Settlement Agreement, the Company made the first payment of $150,000

was made on September 25, 2024 and a final payment of $100,000 was due and paid on October 25, 2024.

On October 29, 2024 the Landlord

filed a discontinuance with prejudice.

to the asset purchase agreement with SemiCab, the Company assumed a judgement against SemiCab regarding damages resulting from contract

breach for IT subscription-based services.

On March 28, 2020, SemiCab entered into a service contract and agreement with Blue Yonder,

(“Blue Yonder”) for certain IT subscription-based services.

The original term of the agreement was for three years,

at a price of $100,000 per year, for a total of $300,000.

On June 21, 2023, Blue Yonder filed a lawsuit claiming damages in the

amount of $275,000 with the Maricopa County Superior Court in Arizona (“Lawsuit”).

The suit was found in favor of Blue Yonder

in the amount of $509,119, subject to two separate milestone payments that would otherwise deem the entire balance due satisfied if either

milestone payment is made by the Company.

The first milestone payment for $175,000 and was due on July 1, 2024 and was not made.

In the event this payment is made, the remaining settlement shall be deemed satisfied.

If this payment is not made, the Company shall

owe a total of $225,000 by October 1, 2024.

In the event this payment is made, the remaining settlement shall be deemed satisfied.

neither payment is made, Blue Yonder shall be entitled to execute the full $509,119 beginning January 1, 2025.

As of the date of this

filing, none of the scheduled payments have been made.

A liability of $509,119 has been recorded as a component of accrued expenses on

the accompanying condensed consolidated balance sheets.

December 21, 2023, Ault Lending, LLC, a wholly owned subsidiary of Ault Alliance, Inc.

(“Ault”), one of the Company’s

largest shareholders, filed a derivative shareholder action in Delaware Chancery Court against the Company, its Directors, and other

Company shareholders (The Stingray Group, Inc.

and Regalia Ventures) (“the Defendants”) for alleged breach of fiduciary duty

in approving a recent above-market private placement equity transaction.

The complaint alleges the Company, and its directors followed

an inadequate process in evaluating the private placement transaction which occurred back in November 2023 and entered into the transaction

with an intent to dilute Ault’s ownership stake in the Company.

The Company filed a motion to dismiss the complaint.

Company’s assessment of the facts underlying the claims, the uncertainty of the litigation and the preliminary stage of the case,

the Company cannot reasonably estimate the potential loss or range of loss that may result from this action.

were no other material changes during the quarter ended September 30, 2024, to our disclosure in Part I, Item 3, “Legal Proceedings”

of our Form 10-KT for the period ended December 31, 2023.

There are no other relevant matters to disclose under this Item for this period.

See Note 8 to our consolidated financial statements entitled “Commitments and Contingencies” which is incorporated in this

item by reference.

December 21, 2023, Ault Lending, LLC (“Ault Lending”), a wholly owned subsidiary of Ault Alliance, Inc., which was at one

time one of our largest stockholders, filed a derivative shareholder action in Delaware Chancery Court against us, our board of directors,

Stingray Group and Regalia Ventures for alleged breach of fiduciary duty in approving a

recent above-market private placement equity transaction.

The complaint alleged that we and our board of directors followed an inadequate

process in evaluating the private placement transaction that we completed in November 2023 and that we and our board of directors entered

into the transaction with an intent to dilute Ault’s ownership stake in us.

Ault Lending was seeking the following relief from the

(i) declarations that the defendant directors breached their fiduciary duties, and that Stingray Group and Regalia

Ventures aided and abetted those breaches, (ii) rescinding our sale of shares to Stingray Group and Regalia

Ventures , and (iii) awarding damages and attorney’s fees to Ault Lending.

On April 30, 2025, Ault Lending filed a motion with the

court requesting that the claims be dismissed without prejudice and on that same date, the court approved the dismissal of the claims

without prejudice.

There were no other material

changes to the disclosures made in Part I – Item 3.

Legal Proceedings of our Annual Report on Form 10-K for the year ended December

31, 2024 regarding these matters.

required for small reporting companies.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

DEFAULTS UPON SENIOR SECURITIES

MINE SAFETY DISCLOSURES

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.

What changed 10-Q

Item 1. Legal Proceedings