Company: MRCY
Filing Date: 2025-05-06
Form Type: 10-Q
Source: 0001049521-25-000017
Chunk: 115

Company: MERCURY SYSTEMS INC
Filing Date: 2025-05-06
Form: 10-Q
Item: Item 8
Chunk 115
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, 2024, the Company filed its opposition motion on September 6th, the plaintiffs filed their response brief on September 17, 2024, and the Company filed its reply on September 30, 2024. On October 17, 2024, the Company received a shareholder derivative demand alleging the same claims as those covered in the federal securities class action. On November 14, 2024, the Company and the shareholder entered into a tolling agreement on this derivative demand. On February 20, 2025, the court issued an order that dismissed claims relating to 14 of 17 challenged statements and that allowed the remaining three challenged statements to proceed. The court also dismissed Messrs. Ruppert and Farnsworth from the lawsuit. The parties are beginning the discovery process. On March 4, 2025, the Company received an additional derivative demand from another shareholder alleging the same claims as those covered in the federal securities class action and the first derivative demand. Subject to the terms of the Company's by-laws and applicable Massachusetts law, Mr. Aslett, the Company's former Chief Executive Officer, and Mr. Ballhaus, the Company's current Chief Executive Officer, are indemnified by the Company for this matter. The Company believes the claims in the complaint and derivative demands are without merit and intends to defend itself vigorously. It is too early to determine what responsibility, if any, the Company will have for this matter.

21

On January 31, 2024, a former employee at the Company's Torrance, California location, filed a wage and hour class action lawsuit in California state court in Los Angeles County, along with a companion Private Attorneys General Act (“PAGA”) lawsuit, to act in a representative capacity for other Mercury Mission Systems, LLC employees in California, alleging a range of violations of California wage and hour regulations. On October 1, 2024, a second former employee at our Torrance location filed a PAGA notice to act in a representative capacity on allegations of a range of violations of California wage and hour regulations. On December 21, 2024, the Company reached an agreement in principle to settle these wage and hour class action claims for $450, which settlement in principle is subject to a final settlement agreement and review and approval by the court.INDEMNIFICATION OBLIGATIONSThe Company’s standard product sales and license agreements entered into in the ordinary course of business typically contain an indemnification provision pursuant to which the Company indemnifies