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Subsequently, in February 2024, Usio refiled its case in Tennessee, where Kauder, Pioletti, and Triple Pay Play reside.
−Removed: On May 3, 2024, Kauder, Pioletti and Triple Pay Play filed a Motion to Dismiss Usio’s Complaint;
−Removed: this motion was heard August 5, 2024.
−Removed: On March 14, 2025 the motion was denied, with future proceedings to continue at a date yet to be determined.
−Removed: We have not recorded a contingency in relation to this case, as we consider the risk of loss remote as related to this lawsuit.
−Removed: GREENWICH BUSINESS CAPITAL, LLC
−Removed: On or about September 25, 2019, Usio and Greenwich Business Capital LLC, or GBC, entered into an Agreement for payment processing services.
−Removed: Usio effectively terminated the agreement with GBC on October 31, 2023, by providing GBC with the requisite 30-days written notice.
−Removed: On November 13, 2023, GBC filed lawsuit against Usio, alleging violations of the NACHA rules in the State of Rhode Island Kent Superior Court.
−Removed: In early March 2024, Usio filed a Motion to Dismiss for improper venue and failure to state a claim.
−Removed: On May 20, 2024, Usio’s Motion to Dismiss was heard in the State of Rhode Island Kent Superior Court.
−Removed: On December 6, 2024, the Judge ruled in favor of Usio and dismissed the case.
−Removed: We did not record a contingency in relation to this case.
−Removed: On September 1, 2021, KDHM, LLC, an entity owned by the former owners of IMS, sued PDS Acquisition Corp, now known as Usio Output Solutions, Inc., in the 73rd District Court of Bexar County, Texas claiming a breach of the asset purchase agreement executed by the parties on December 14, 2020.
+Added: On May 3, 2024, Kauder, Pioletti and Triple Pay Play filed a Motion to Dismiss Usio’s Complaint, and this motion was heard August 5, 2024.
+Added: On March 14, 2025 the motion was denied.
+Added: On July 11, 2025, Usio attended a deposition with Kauder and Triple Pay Play in Nashville, Tennessee.
+Added: On September 29, 2025, Kauder, Pioletti and Triple Pay Play agreed to Usio’s settlement and filed a Joint Notice of Voluntary Nonsuit with Prejudice in The Chancery Court of Maury County Tennessee on October 10, 2025.
+Added: The settlement was in the amount of $115,000, which was recorded on our statement of operations as a reduction of SG&A expense for the year ended December 31, 2025.
+Added: On September 1, 2021, KDHM, LLC ("KDHM"), an entity owned by the former owners of IMS, sued PDS Acquisition Corp, now known as Usio Output Solutions, Inc., in the 73rd District Court of Bexar County, Texas, claiming a breach of the asset purchase agreement executed by the parties on December 14, 2020.
The lawsuit alleges that due to a mistake, accident, or inadvertence, certain customer deposits in the amount of $317,000 were improperly transferred to us.
We believe that plaintiff's claims contradict the express terms of the asset purchase agreement, and we intend to continue to vigorously defend this matter.
−Removed: As a result of this post-sale dispute, we subsequently discovered that KDHM, LLC and its principals made certain misrepresentations and breached the terms of the asset purchase agreement.
+Added: As a result of this post-sale dispute, we subsequently discovered that KDHM and its principals made certain misrepresentations and breached the terms of the asset purchase agreement.
On September 28, 2021, we filed an answer generally denying the plaintiff’s allegations.
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On May 2, 2024, the court denied Usio’s motion.
−Removed: On July 12, 2024, we filed an appeal on the lower court's decision, which is pending review.
+Added: On July 12, 2024, we filed an appeal on the lower court's decision.
As part of the July 12, 2024 appeal, Usio was required to obtain a bond in the amount of $474,229.
−Removed: Please refer to "Management's Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources" for a description of certain financing arrangements we established in connection with this bond.
−Removed: We have not recorded a contingency in relation to this case, as we consider the risk of loss remote as related to this lawsuit.
+Added: See Note 5 of the notes to our consolidated financial statements in this report for more information.
+Added: On April 2, 2025, the Fourth Court of Appeals reversed the trial court’s judgment and rendered judgement that KDHM should take nothing against Usio on its “money had and received claim.” With respect to the remaining claims, the court remanded back to the lower court.
+Added: On April 11, 2025, KDHM filed a Motion for Reconsideration with the appellate court, which was denied on May 5, 2025.
+Added: On August 8, 2025, KDHM filed in the Supreme Court of Texas a Petition for Review from the Fourth Court of Appeals at San Antonio, Texas, which was denied on January 30, 2026.
+Added: On February 6, 2026, KDHM agreed to Usio’s settlement.
+Added: The settlement was in the amount of $120,000, which will be recorded on our statement of operations as a reduction of SG&A expense in 2026.
+Added: The Company has an unsecured revolving line of credit with a maximum borrowing capacity of $475,000.
+Added: The facility was established on May 29, 2024, and matures on June 5, 2026.
+Added: As of December 31, 2025, no amounts had been drawn under this line of credit since its origination.
+Added: This line of credit was obtained to support the bond requirement in the KDHM lawsuit appeal but remains fully available.
+Added: The Company also has an irrevocable letter of credit in the amount of $474,229, issued on June 3, 2024, with a maturity date of June 3, 2026.
+Added: This letter of credit was obtained as part of the bonding requirement for the KDHM lawsuit appeal and has not been drawn upon since its issuance.
+Added: As a result of the KDHM lawsuit settlement, the Company will not renew the line of credit or letter of credit upon their maturity.
+Added: There are no ongoing costs associated with the maintenance of either of these credit facilities.
+Added: These credit facilities were arranged to comply with legal requirements related to the Company’s appeal and provide additional liquidity resources if needed.
+Added: Management continues to monitor its financial position and believes that existing cash balances, along with these credit facilities, are sufficient to meet operational needs and legal obligations.
OTHER PROCEEDINGS
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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.