Brookwood MC Investors, LLC & MCII v, PDI, Inc.

On March 30, 2017, the Company received a tenancy summons and verified complaint for nonpayment of its Parsippany, New Jersey office rent. The complaint alleged amounts owing of $203,734 covering unpaid base rent of $54,075 from January through March 2017, as well as late charges, attorney’s fees, and the redeposit of a security deposit of $136,975. The plaintiff landlord sought judgement for possession of the premises. A hearing in the Superior Court of New Jersey, Morris County-Special Civil part, took place on April 21, 2017. The Company subsequently entered into a settlement agreement with the plaintiff landlord on May 9, 2017 whereas the landlord applied the security deposit against the unpaid rent and the Company agreed to a payment plan of $25,000 per month beginning in April 2017 and through September 2017 when the balance of amounts are payable in full, for the remainder of its lease which expires June 30, 2017. The first payment was made on April 28, 2017.

Nasdaq Correspondence

On April 10, 2017, the Company received written notice from the Listing Qualifications department (the “Staff”) of The NASDAQ Capital Market (“Nasdaq”) notifying the Company that based on its Form 10-K for the fiscal year ended December 31, 2016, evidencing stockholder’s equity of $6.5 million, the Staff has determined that the Company complies with Nasdaq Listing Rule 5550(b)(1) and that the matter, previously disclosed by the Company, has been closed.

Debt Exchange

On April 18, 2017, the Company entered into the Agreement, with the Investor exchanging a non-convertible note for a new convertible note for the same amount. See Note 12, Long-Term Debt for details.