Update of Litigation Against Prior Management and Related
In its Current Report on Form 8-K filed July 9, 2018, Applied Energetics, Inc. (the Company) indicated that it had filed a lawsuit against George Farley and AnnMarieCo LLC (AMC) in the Court of Chancery in the state of Delaware. This report provides an update on the progress of the litigation.
In connection with the lawsuit, the Company requested a temporary restraining order prohibiting Mr. Farley and AMC from selling their 25 million shares of the Companys common stock which the Company alleges were improperly issued. On July 20, 2018, the Delaware Court of Chancery, Vice Chancellor Tamika Montgomery-Reeves presiding, entered a status quo order upon the stipulation of the parties, whereby Mr. Farley and AMC agreed not to transfer, alienate or sell any of their shares pending a ruling on the Companys motion for a preliminary injunction.
On July 26, 2018, the Delaware Court of Chancery entered a scheduling order setting dates and deadlines for, among other matters, a hearing and briefing schedule on the amount of the bond the Company would be required to post to maintain the status quo order through the preliminary injunction hearing, a hearing and briefing schedule on the motion for a preliminary injunction, and a discovery schedule.
Also, in connection with the lawsuit, on August 8, 2018, the Company filed a motion to disqualify Mr. Farleys attorney, Ryan Whalen, who had previously represented the Company.
On August 14, 2018, the Delaware Court of Chancery issued an order requiring the Company to post a bond in the total amount of $200,446.52. On August 21, 2018, the Company posted the bond via Atlantic Specialty Insurance Company acting as surety. Pursuant to the contract between the Company and Atlantic Specialty Insurance Company, the Company deposited $200,446.52 in cash as collateral for the surety agreement.
On August 23, 2018, the Delaware Court of Chancery court extended the hearing date on the Companys motion for a preliminary injunction to October 23, 2018, and simultaneously ordered an increase in the bond amount of $55,446.52. On August 30, 2018, the Company posted the increased bond amount, again with Atlantic Specialty Insurance Company acting as surety, and deposited the additional $55,446.52 in cash with the surety.
On September 7, 2018, the Delaware Court of Chancery entered an order setting a briefing schedule on the Companys motion to disqualify Mr. Whalen.
On September 10, 2018, the Delaware Court of Chancery entered an order governing the production and exchange of confidential documents and information among the parties in discovery.
The Company expects to provide further updates on the status of the litigation as circumstances warrant.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
APPLIED ENERGETICS, INC.
By:
/s/ Bradford Adamczyk
Bradford Adamczyk,
Principal Executive Officer
Date
: September 13, 2018
