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Investors who held Centricus Acquisition Corp. Class A ordinary shares or units as of July 26, 2021; purchased or acquired Arqit Quantum Inc. ordinary shares or warrants in connection with the merger or on a U.S. stock exchange between Sept. 7, 2021, and Dec. 13, 2022; or purchased or acquired Arqit securities pursuant or traceable to the Sept. 2, 2021, offering may be eligible to claim a cash payment from a class action settlement.
Arqit Quantum Inc. and several individual defendants agreed to pay $7 million to settle a securities class action lawsuit alleging they made materially false and misleading statements and omissions regarding the company's quantum encryption technology, business prospects and financial condition in connection with the merger with Centricus Acquisition Corp. and the subsequent Arqit securities offering.
Who can file a claim?
The settlement includes three classes of eligible investors:
- Section 14(a) class: All beneficial holders of Centricus Class A ordinary shares and Centricus units as of the July 26, 2021, record date for the special meeting of shareholders held on Aug. 31, 2021, to consider approval of the merger.
- Section 10(b) class: All persons or entities who purchased or otherwise acquired Arqit ordinary shares or warrants in connection with the merger or on a U.S. stock exchange between Sept. 7, 2021, and Dec. 13, 2022, inclusive.
- Securities Act class: All persons or entities who purchased or otherwise acquired Arqit securities pursuant or traceable to the effective registration statement and prospectus filed with the SEC for the Sept. 2, 2021, Arqit securities offering in connection with the merger.
Additional details
- Both individuals and entities can be class members.
- Each separate legal entity or separately managed account must submit a separate claim.
- All joint beneficial owners must sign the claim form.
- Agents, executors, administrators, guardians, conservators and trustees may submit claims on behalf of others and must provide proof of authority.
How much can class members get?
The total settlement fund is $7,000,000. The estimated average recovery is approximately $0.23 per Arqit ordinary share and $0.05 per Arqit warrant before deductions for taxes, administration costs and attorneys' fees and expenses. The amount each class member receives depends on several factors:
- The number of valid claims submitted
- The amount of the net settlement fund after deductions
- The number and timing of securities purchased or acquired
- Whether and when the class member held or sold the securities
The settlement administrator will distribute payments on a pro rata basis according to the court-approved plan of allocation:
- The plan of allocation divides claims into three categories, each with its own recognized loss calculation based on the type of claim (Section 10(b), Section 14(a) or Securities Act).
- Recognized loss amounts for Section 10(b) and Section 14(a) claims depend on when the class member purchased and sold Arqit securities and the amount of inflation in the security price during the holding period. The settlement administrator will calculate them using inflation tables included in the settlement notice (pages 23-26 of the settlement notice).
- For Section 10(b) claims involving Arqit ordinary shares or warrants purchased during the class period and sold before April 18, 2022, the recognized loss is $0.
- For Section 10(b) claims involving Arqit ordinary shares purchased during the class period and held as of the close of trading on March 13, 2023, the recognized loss is the lesser of the decline in inflation during the holding period or the purchase price minus $2.55 (the average closing price for Arqit ordinary shares from Dec. 14, 2022, through March 13, 2023).
- For Section 14(a) claims involving Centricus units or Class A ordinary shares held as of July 26, 2021, and exchanged for Arqit ordinary shares, the recognized loss calculations follow the same structure as Section 10(b) claims using the same inflation tables.
- For Securities Act claims, the settlement administrator will use the statutory formula under Section 11(e) of the Securities Act to calculate recognized loss amounts.
- For Arqit ordinary shares traceable to the Sept. 2, 2021, offering and sold before April 14, 2023, the recognized loss is the lesser of $10 (the offering price) minus the sale price or the purchase price minus the sale price.
- For Arqit ordinary shares traceable to the offering and held as of the close of trading on April 14, 2023, the recognized loss is $8.76 per share.
- For Arqit warrants traceable to the offering and sold before April 14, 2023, the recognized loss is the lesser of $0.99 (the offering price) minus the sale price or the purchase price minus the sale price.
- For Arqit warrants traceable to the offering and held as of the close of trading on April 14, 2023, the recognized loss is $0.66 per warrant.
- For each purchase or acquisition, the recognized loss amount is the greatest of the claimant's Section 10(b), Section 14(a) and Securities Act recognized loss amounts. A claimant may recover for one of these claims per transaction but not more than one.
- The settlement administrator will apply the first-in, first-out method to match sales against holdings and purchases.
- If total recognized claims exceed the net settlement fund, the settlement administrator will reduce payments on a pro rata basis.
- Class members whose payment would be less than $10 will not receive a payout.
How to claim an Arqit securities class action settlement payment
Class members may file a claim online or download, print and complete the PDF claim form and mail it to the settlement administrator. The claim deadline is June 22, 2026.
Settlement administrator's mailing address: In re Arqit Quantum Inc. Securities Litigation, c/o Kroll Settlement Administration LLC, PO Box 225391, New York, NY 10150-5391
Proof or documentation required to submit a claim
All class members must provide holdings, acquisition and sale information for their transactions in Arqit and Centricus securities. They must also provide documentation to support their transactions. Acceptable proof includes:
- Broker confirmation slips
- Monthly or yearly brokerage statements
- Other documentation showing the details of transactions in Arqit or Centricus securities
$7 million settlement fund
The $7,000,000 settlement fund includes:
- Settlement administration costs: To be determined
- Attorneys' fees: Up to $2,333,333.33
- Attorneys' expenses: Up to $175,000
- Service awards to plaintiffs: Up to $22,500 total
- Payments to eligible class members: Remainder of the fund
Important dates
- Opt-out deadline: May 11, 2026
- Fairness hearing: June 1, 2026
- Deadline to file a claim: June 22, 2026
When is the Arqit Quantum securities class action settlement payout date?
The settlement administrator will issue payments after it processes all claims and the court resolves any appeals and grants final approval of the settlement.
Why did this class action settlement happen?
The class action lawsuit alleged Arqit Quantum Inc. and certain individual defendants made materially false and misleading statements and omissions regarding the company's quantum encryption technology, business prospects and financial condition in connection with the merger with Centricus Acquisition Corp. and Arqit securities offering. The plaintiffs claimed these misrepresentations inflated the prices of Arqit securities and caused investor losses when corrective information entered the market on April 18, 2022, and Dec. 14, 2022.
The defendants denied all allegations of wrongdoing but agreed to settle to avoid the uncertainty, costs and delays of continued litigation.
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