Hub Cyber Security $11M Securities Class Action Settlement

Investors who purchased or otherwise acquired publicly traded common stock of Hub Cyber Security Ltd. on the open market between March 1, 2023, and July 31, 2023, or received Hub shares through the business combination with Mount Rainier Acquisition Corp. may be eligible to claim a cash payment from a class action settlement.

Hub Cyber Security agreed to pay $11 million to settle a securities class action lawsuit alleging it made materially false and misleading statements and failed to disclose material facts and risks. The lawsuit claimed Hub misrepresented the commitment status of investors in a $50 million PIPE facility, the strength of the company's internal controls given undisclosed insider embezzlement and the market readiness of its flagship product.

Who can file a claim?

The settlement includes all persons and entities who purchased or otherwise acquired Hub Cyber Security Ltd. publicly traded common stock on the open market between March 1, 2023, and July 31, 2023, inclusive, or received Hub shares through the conversion of Mount Rainier or Legacy Hub securities as part of the business combination on or about March 1, 2023, and were damaged as a result.

Additional details

• Both individuals and entities can be class members.
• Each separate legal entity or separately managed account must submit a separate claim.
• Authorized representatives may submit claims on behalf of beneficial owners subject to the requirements of the claim form.
• Agents, executors, administrators, guardians and trustees may submit claims on behalf of others and must provide proof of authority.
• Participants in and beneficiaries of any employee retirement or benefit plan covered by ERISA should not include Hub securities transactions made through an employee plan on an individual claim form.
• Plan trustees must submit claims for employee plan transactions.

How much can class members get?

The total settlement fund is $11,000,000. The amount each class member will receive depends on several factors:

• The number of valid claims submitted
• The number of shares purchased or acquired during the class period
• The timing of each investor purchase, sale and holding
• The total recognized losses of all claimants

The settlement administrator will distribute payments on a pro rata basis according to the court-approved plan of allocation:

• The estimated average distribution per allegedly damaged share is approximately $0.12 before deductions for taxes, notice and administration costs, and attorneys' fees and expenses.
• Actual payments may be higher or lower depending on individual claims and the total number of valid claims.
• The settlement administrator will calculate each class member's payment based on the recognized loss amount assigned to each transaction.
• Recognized loss amounts depend on purchase and sale timing. The settlement administrator will calculate them using the court-approved plan of allocation.
• The settlement administrator will apply different formulas depending on how class members acquired and held their securities.
• For shares converted from Mount Rainier or Legacy Hub securities in the business combination, the purchase price is $2.53 per share (the opening price on March 1, 2023).
• For shares sold before the close of trading on July 31, 2023, the recognized loss is the purchase price (not to exceed $2.53) minus the sale price.
• For shares held as of the close of trading on July 31, 2023, the recognized loss is the purchase price (not to exceed $2.53) minus $0.57 (the closing price that day).
• Shares converted from Mount Rainier securities specifically will receive a 50% upward adjustment due to standing under Section 12(a)(2) claims.

• If total recognized losses 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 a Hub Cyber Security 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 May 13, 2026.

Settlement administrator's mailing address: In Re Hub Cyber Security Ltd. Securities Litigation, c/o Strategic Claims Services, P.O. Box 230, 600 N. Jackson St., Ste. 205, Media, PA 19063

Proof or documentation required to submit a claim

All class members must provide the last four digits of their Social Security number or full taxpayer identification number. They must also provide purchase, acquisition and sale information, including:

• Trade dates
• Number of shares purchased, acquired or sold
• Total purchase, sale or acquisition price

Class members must also provide documentation to support their transactions in Hub securities. Acceptable proof includes:

• Broker confirmation slips
• Broker account statements
• Authorized statements from a broker, financial advisor or financial institution containing the transactional information found in a confirmation slip

Payout options

• Physical check

$11 million settlement fund

The $11,000,000 settlement fund includes:

• Settlement administration costs: To be determined
• Attorneys' fees: Up to $3,666,667
• Attorneys' expenses: Up to $205,000
• Service awards to class representatives: Up to $30,000 total
• Payments to eligible class members: Remainder of the fund

Important dates

• Deadline to file a claim: May 13, 2026
• Opt-out deadline: June 1, 2026
• Fairness hearing: June 29, 2026

When is the Hub Cyber Security class action settlement payout date?

The settlement administrator will issue payments after it completes processing and the court resolves any appeals and grants final approval to the settlement.

Why did this class action settlement happen?

The class action lawsuit alleged Hub Cyber Security and certain executives made false and misleading statements regarding the commitment status of PIPE investors, the company's internal controls given undisclosed embezzlement by corporate insiders and the readiness of its flagship product for market. The plaintiffs claimed these statements inflated Hub's securities price and caused investor losses when corrective information entered the market.

Hub denied all allegations of wrongdoing but agreed to settle to avoid the costs, risks and delays of continued litigation.

Sources

1. Class notice
2. Claim form