Commitments and Contingencies
|3 Months Ended|
Mar. 31, 2015
|Commitments and Contingencies Disclosure [Abstract]|
|Commitments and Contingencies||
10. COMMITMENTS AND CONTINGENCIES
Total rent expense for the three months ended March 31, 2015 and 2014 was $115,947 and $103,307, respectively.
On March 24, 2015, the Company entered into an employment agreement with Mr. Ira Feintuch to serve as the Companys Chief Operating Officer for an initial three year term renewable annually unless written notice is provided 60 days prior to the renewal term. In consideration thereof, Mr. Feintuch is to receive an annual salary of $250,000 and shall participate in all benefit programs of the Company. In addition, Mr. Feintuch will receive 1,000,000 shares of Series A Convertible Preferred Stock, 1,500 shares of Series C Convertible Preferred Stock and 1,500,000 shares of common stock. The stock awards are payable 50% upon the signing of the employment agreement and 50% upon the one year anniversary of the employment agreement. The total fair value of the stock awards was $1,750,000, of which $875,000 was recognized immediately upon issuance and the remaining $875,000 will be recognized over the one year service period. The Company estimated the fair value of the common stock and Series C Convertible Preferred Stock based on observed prices of sales and/or exchanges of identical securities within the last six months. The Company estimated the fair value of the Series A Convertible Preferred Stock based on observed prices of sales and/or exchanges of similar securities within the last six months. As of March 31, 2015, the Company had not issued 750,000 shares of common stock that were payable upon signing of the employment agreement and, as a result, the Company accrued for the liability, which was $316,465 as of March 31, 2015. See Note 5 Accrued Expenses Accrued Issuable Equity. In addition, options to purchase an aggregate of 1,495,665 shares of common stock held by Mr. Feintuch with exercise prices ranging from $1.00 to $1.46 per share had their expiration dates extended to March 24, 2018. As a result, the Company recorded option modification expense of $47,536 during the three months ended March 31, 2015.
LITIGATION AND DISPUTES
From time to time, the Company is a defendant or plaintiff in various legal actions that arise in the normal course of business.
350 GREEN, LLC
There have been five lawsuits filed against 350 Green by creditors of 350 Green regarding unpaid claims. These lawsuits relate solely to alleged pre-acquisition unpaid debts of 350 Green. Also, there are other unpaid creditors, aside from those noted above, that claim to be owed certain amounts for pre-acquisition work done on behalf of 350 Green solely, that potentially could file lawsuits at some point in the future.
On August 7, 2014, 350 Green received a copy of a complaint filed by Sheetz, a former vendor of 350 Green alleging breach of contract and unjust enrichment of $112,500. The complaint names 350 Green, 350 Holdings LLC and CCGI in separate breach of contract counts and names all three entities together in an unjust enrichment claim. CCGI and 350 Holdings will seek to be dismissed from the litigation, because, as the complaint is currently plead, there is no legal basis to hold CCGI or 350 Green liable for a contract to which they are not parties. The parties held a mediation conference on May 15, 2015 but no settlement was reached. The parties continue to negotiate a settlement.
The entire disclosure for commitments and contingencies.
Reference 1: http://www.xbrl.org/2003/role/presentationRef