AnalytixInsight Announces Delay in Filing Its Annual Audited Financial Statements and Interim Court Order

Business Wire
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TORONTO, May 03, 2024--(BUSINESS WIRE)--AnalytixInsight Inc. ("AnalytixInsight", or the "Company") (TSX-V: ALY) announced today that, further to its press release dated April 23, 2024 (the "Default Announcement"), the Company failed to file its audited financial statements for the year ended December 31, 2023 and the related Management’s Discussion and Analysis and the certifications related to such filings required from the Company’s chief executive officer and chief financial officer (collectively, the "Required Filings") by the filing deadline of April 29, 2024 (the "Default").

The Company also announced today that, in connection with recently disclosed legal proceedings filed in the Ontario Superior Court of Justice (Commercial List) (the "Proceedings"), the Court released an endorsement on May 1, 2024 setting forth various intended interim orders (the "Interim Orders") following an expedited hearing held on April 26, 2024. The Court stated that it made the Interim Orders in light of its findings that two directors of the Company, namely Prakash Hariharan and Chaith Kondragunta, had conducted themselves in a fashion that appeared oppressive to the interests of the Company and certain of its directors and officers, and to preclude Messrs. Hariharan and Kondragunta from participating in the activities of the Company’s board of directors (the "Board") until there has been a further investigation and determination of their alleged misconduct.

The Interim Orders provide, among other things, that:

(a)

a Court-ordered inspector (the "Inspector") be appointed immediately to investigate allegations against Mr. Hariharan, including with respect to alleged insider trading, tipping, self-dealing, and lack of disclosure of material information to the Company and its shareholders, and against Mr. Kondragunta relative to his alleged assistance to Mr. Hariharan by approving the Company paying for Mr. Hariharan’s personal expenses;

 

(b)

the Inspector is to be chosen by way of Messrs. Hariharan, Kondragunta and Jith Veeravalli selecting from one of three candidates to be proposed by the applicants;

 

(c)

the Inspector have broad powers to investigate the allegations, with the Company being obliged to fund the cost of such investigation up to an initial maximum of $100,000, and the Inspector being obliged to prepare a report of his or her findings by a date to be agreed or ordered by the Court;

 

(d)

pending further order of the Court: (i) Messrs. Hariharan and Kondragunta are not to participate in meetings or activities of the Board, with the incumbent members of the Board, pending further order of the Court, to be Vincent Kadar, Scott Gardner and Mr. Veeravalli, and (ii) the Board is to conduct only such business as is necessary for the ongoing operation of the Company and its management, and if the Board proposes to authorize any business activity out of the ordinary course of business, it is to seek the Court’s approval for any such activity; and

 

(e)

once the report of the Inspector has been delivered, the Court will reconvene to consider next steps, including a potential schedule for a trial of an issue or issues.

The Court stated in its reasons that, while it had made preliminary observations with respect to certain matters insofar as those preliminary observations were necessary preconditions to the Interim Orders, the Court had not yet made final determinations on many matters.

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