Braxia Scientific Corp. (CSE:BRAX, OTC:BRAXF) told investors it has reached agreements to settle class actions in the US and Canada pending court approval.
The US class action against the company and certain of its former officers was filed in the United States District Court for the Central District of California in April, 2021, while the Canadian Class Action was filed in the British Columbia Supreme Court in May 2021 against the company, its CEO, certain of its former officers, a shareholder, and underwriters.
The US Settlement contemplates a cash payment by the company of US$1 million to settle the US Class Action. The Canadian Settlement contemplates a cash payment of CA$1.9 million, of which the company will be paying CA$1.6 million, the medical research company said in a statement.
After available insurance, the total cost to Braxia to settle both class actions will be around CA$1.36 million, not including legal expenses incurred by the company, estimated at around CA$950,000, of which around CA$750,000 has been paid.
READ: Braxia Scientific generates double-digit year-over-year revenue increase in its fiscal 3Q 2022
Once the US and Canadian settlements receive court approval, both class actions will be dismissed against all defendants, including the company and its officers.
"Approval by the respective courts, notice to the putative classes, and the satisfaction of customary conditions to effectiveness will take several months," noted Braxia.
"As a result of the entry into the US Settlement and the Canadian Settlement, the company expects that the above-referenced total cost to settle will be incorporated into its results of operations and financial condition for the fiscal quarter ending June 30, 2022," it added.
Also in the statement, Braxia announced the resignation of David Greenberg as a director.
"The company appreciates David's meaningful contribution to the company and wishes him well in future endeavours," it said.
Contact the writer at giles@proactiveinvestors.com