Company: SKLZ
Filing Date: 2025-12-11
Form Type: 10-Q
Source: 0001801661-25-000070
Chunk: 48

Company: Skillz Inc.
Filing Date: 2025-12-11
Form: 10-Q
Item: Item 1
Chunk 48
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 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 

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TABLE OF CONTENTSSKILLZ INC.NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Unaudited, amounts in tables are in thousands, unless otherwise noted)

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.Termination of Operating Lease     On April 18, 2025, the Company and the lessor of its former headquarters in San Francisco mutually agreed to terminate the lease. In exchange for the mutual releases, the Company paid the lessor a lump sum payment of $14.0 million. The loss on termination of the operating lease of $0.4 million represented the difference between the settlement amount and the carrying value of the lease obligation, and was recorded as a component of other income (expense), net in the statement of operations for the year ended December 31, 2024.Recovery of Legal Settlement    After receiving a total of $9.8 million from the D&O insurance carrier of the Flying Eagle legal matter, (see Note 8, Commitments and Contingencies) the Company, in July 2025, paid a settlement of $10.0 million on this matter which the court approved in September 2025. Skillz v. Tether Litigation     On August 29, 2025, the Company received a notice (“Notice”) from Tether indicating that Tether is terminating all of its various agreements with the Company (the “Tether Agreements”), including the Company’s Developer Terms and Conditions of Service, as amended from time to time, including by that certain Amendment to Skillz Online Developer Terms and Conditions of Service, dated January 15, 2020, effective as of September 1, 2025. The Company believes the termination notice to be invalid and in breach of Tether’s obligations under the Tether Agreements.     Following receipt of the Notice, on September 1, 2025, the Company filed suit in the Court of Chancery of the State of Delaware, seeking injunctive and declaratory relief in relation to Tether’s breach of the