Bright Mountain Media, Inc.

From time to time, we may become involved in legal proceedings and claims arising in the ordinary course of business, including but not limited to, disputes in the areas of contracts, data protection, content regulation, intellectual property, consumer protection, e-commerce, marketing, advertising, rights of publicity, health and safety, employment and labor, competition, and taxation. We record a liability when we believe that it is probable that we will incur a loss, and the amount of that loss can be reasonably estimated.

Ladenburg

On July 11, 2023, Ladenburg Thalmann & Co. Inc. (“Ladenburg”) filed an action against the Company for breach of contract in the United States District Court for the Southern District of Florida (the “District Court”), Case No. 9:23-cv-81019-AMC. Ladenburg alleges that it entered into an Investment Banking Agreement (the “Agreement”) with the Company on September 1, 2020. According to Ladenburg, that Agreement provided that Ladenburg would be the exclusive investment advisor and banker for the Company and that the Company entered into a transaction during the term of the Agreement on which Ladenburg was due a fee. On March 26, 2026, the Company and Ladenburg entered into a binding settlement agreement and mutual release, pursuant to which the Company agreed to pay a total settlement amount of $950,000. The settlement amount was funded from the restricted cash collateral securing the appeal bond. Following settlement, approximately $994,000 of the remaining restricted cash collateral was applied to reduce the outstanding principal balance of the Twenty-First Amendment Term Loans with Centre Lane Partners, and the remaining restricted cash collateral was released and returned to Centre Lane Partners pursuant to the Twenty-Sixth Amendment to the Credit Agreement. See Note 10, Centre Lane Senior Secured Credit Facility, to the consolidated financial statements. The Company recorded the effects of the settlement in its consolidated financial statements for the six months ended June 30, 2026, including a reduction of litigation-related accruals and the recognition of a net gain of approximately $1.1 million, which is reflected within legal fees in general and administrative expenses. As of June 30, 2026, the matter has been fully resolved, and the parties have released all claims related to the litigation.

Other Litigation

Other litigation is defined as smaller claims or litigation that are neither individually nor collectively material. It does not include lawsuits that relate to collections.

The Company is party to various other legal proceedings that arise in the ordinary course of business, separate from normal course accounts receivable collections matters. Due to the inherent difficulty of predicting the outcome of these other legal proceedings, the Company cannot predict the eventual outcome of these matters, and it is reasonably possible that some of them could be resolved unfavorably to the Company. As a result, it is possible that the Company’s results of operations or cash flows in a particular fiscal period could be materially affected by an unfavorable resolution of pending litigation or contingencies.