| Accrued Liabilities |
As
of December 31, 2013 and 2012, the Company has the following accrued liabilities:
| |
|
12/31/2013 |
|
|
12/31/2012 |
|
| Accrued
Salaries and Wages |
|
|
|
|
|
|
|
|
| Accrued Salaries
and Wages (a) |
|
$ |
59,958 |
|
|
$ |
516,083 |
|
| |
|
|
|
|
|
|
|
|
| Disputed
Trade Payables |
|
|
|
|
|
|
|
|
| Disputed Trade Payables
(b) |
|
|
925,000 |
|
|
|
– |
|
| |
|
|
|
|
|
|
|
|
| Accrued
Expenses |
|
|
|
|
|
|
|
|
| Allowance for Sales Returns |
|
|
43,000 |
|
|
|
53,000 |
|
| Distribution Arrangements
Payable |
|
|
13,905 |
|
|
|
217,858 |
|
| Deferred Revenue |
|
|
– |
|
|
|
110,177 |
|
| Royalties Payable |
|
|
9,638 |
|
|
|
59,033 |
|
| Music Advances (c) |
|
|
450,000 |
|
|
|
– |
|
| Other
Accrued Expenses |
|
|
187,996 |
|
|
|
56,594 |
|
| Total Accrued Expenses |
|
|
704,539 |
|
|
|
496,662 |
|
| |
|
|
|
|
|
|
|
|
| Total
Accrued Liabilities |
|
$ |
1,689,497 |
|
|
$ |
1,012,745 |
|
|
(a) |
Accrued
but unpaid salaries and vacation benefits total $59,958 and $516,083 as of December 31,
2013 and 2012, respectively. On August 30, 2013, the Company issued 12% convertible notes
to several parties with a maturity date of October 21, 2013 for an aggregate of $530,000
(“Bridge Notes”). Cash was received in the aggregate of $309,000. Four officers
and directors of the Company converted outstanding salaries payable to the new notes
in the aggregate of $221,000. |
On November
15, 2013, in association with the Merger, the Company issued 124,146 shares of common stock were to members of the Pre-Merger
management team as well as the Company’s Chief Financial Officer as consideration for the cancellation of accrued, but unpaid,
salary and benefits in the amount of $612,443. The Company recognized a gain on the settlement of debt in the amount of $190,349.
|
(b) |
As
part of the Merger, the Company assumed certain liabilities from a previous member of
A Squared Entertainment, LLC which has claimed certain liabilities totaling $925,000.
The Company disputes the basis for this liability and has not heard from the claimant
for two years. |
|
(c) |
The
Company assumed these accrued expenses in association with the Merger. |
|