Commitments and Contingencies |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2011 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Commitments and Contingencies |
Operating Lease Obligations
The
Company leases office facilities under non-cancelable operating
leases expiring in various years through 2012.
Following
is a summary of future minimum payments under initial terms of
leases at September 30, 2011:
These
amounts do not reflect future escalations for real estate taxes and
building operating expenses. Rental expense for
continuing operations amounted to $92 and $184, respectively, for
the periods ended September 30, 2011 and 2010.
Other Obligations
As
of September 30, 2011, the Company was obligated for payments under
various distribution agreements, equipment lease agreements,
employment contracts and the management agreement described in Note
11 with initial terms greater than one year at September 30,
2011. As of September 30, 2011, accrued management fees
payable to Trinad Management are $135. Annual
payments relating to these commitments at September 30, 2011 are as
follows:
Litigation
Twistbox’s
wholly owned subsidiary, WAAT Media Corp. (“WAAT”) and
General Media Communications, Inc. (“GMCI”) are parties
to a content license agreement dated May 30, 2006, whereby
GMCI granted to WAAT certain exclusive rights to exploit GMCI
branded content via mobile devices. GMCI terminated the
agreement on January 26, 2009 based on its claim that WAAT
failed to cure a material breach pertaining to the non-payment of a
minimum royalty guarantee installment in the amount of $485.
On or about March 16, 2009, GMCI filed a complaint seeking the
balance of the minimum guarantee payments due under the agreement
in the approximate amount of $4,085. WAAT has counter-sued
claiming GMCI is not entitled to the claimed amount and that it has
breached the agreement by, among other things, failing to promote,
market and advertise the mobile services as required under the
agreement and by fraudulently inducing WAAT to enter into the
agreement based on GMCI’s repeated assurances of its
intention to reinvigorate its flagship brand. GMCI has filed
a demurrer to the counter-claim. WAAT subsequently filed an
amended counter-claim. On August 16, 2011, the LA
Superior Court ruled in favor of WAAT’s Summary Judgment
Motion. As a result, GMCI’s potential damages have been
limited to the amount of minimum royalty installments that accrued
prior to termination of the content license agreement in the amount
of approximately $800. Trial has been scheduled for April 16, 2012.
WAAT intends to vigorously defend against this action.
Principals of both parties continue to communicate to find a
mutually acceptable resolution. The Company has accrued for its
estimated liability in this matter.
The
Company is subject to various claims and legal proceedings arising
in the normal course of business. Based on the opinion
of the Company’s legal counsel, management believes that the
ultimate liability, if any in the aggregate of other claims will
not be material to the financial position or results of operations
of the Company for any future period; and no liability has been
accrued.
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