Company: SKLZ
Filing Date: 2025-11-06
Form Type: 10-K
Source: 0001801661-25-000050
Chunk: 203

Company: Skillz Inc.
Filing Date: 2025-11-06
Form: 10-K
Item: Item 8
Chunk 203
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2022, the Company entered into an agreement with a holder of intellectual property (the “Partner”) pursuant to which the Company would develop and market mobile games with the Partner’s brand and the Partner would use “good faith efforts” to promote the games. In consideration, the Company would pay the Partner minimum royalties totaling $1.5 million, but not to exceed $2.0 million, of which $0.5 million had been accrued as of December 31, 2024. The Company contended that the Partner failed to provide good faith efforts to market and, as a result withheld royalty payments. The Partner contended that the Company was in breach of the agreement due to non-payment of royalty payments. The Partner served the Company a complaint on January 14, 2025. In April 2025, the Partner and the Company agreed to attend mediation on this matter and settled the matter for a payment of $0.5 million to the Partner in June 2025 (see Note 10, Commitments and Contingencies).Vendor Disputes      Between November 2022 and March 2023, the Company and a vendor entered into several agreements in which the vendor would perform defined professional services. Of the $7.2 million in invoices from the vendor, the Company paid $3.2 million and claimed that the vendor expanded the scope of work without authorization, over billed for its services, performed poorly and unilaterally refused to perform certain agreed upon deliverables. The vendor, in turn, claimed it received proper authorization for the work it performed, completed its contracted-for tasks and that the Company breached the agreements and failed to pay outstanding invoices. The vendor sought $4.0 million in damages, plus interest, attorney fees and costs of litigation. The Company sought counterclaims from the vendors for breach of contract, breach of implied covenant of good faith and fair dealing, and fraudulent inducement and is sought approximately $15 million in damages, plus interest, attorney fees and costs of litigation. In March 2025, the vendor and the Company settled the dispute. In exchange for mutual releases of all claims, the Company paid the vendor $2.75 million  (see Note 10, Commitments and Contingencies).      In April 2022, the Company and a vendor entered an agreement to license certain rights to develop vendor branded mobile games.  In consideration, the Company agreed to pay the vendor certain monetary amounts over three years and the vendor,