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Ayers Bath Litigation
−Removed: FGI Industries (formerly known as Foremost Groups, Inc.) (“FGI USA”), our wholly-owned subsidiary, is currently involved in litigation arising from its efforts to protect an exclusivity agreement with sanitaryware manufacturer Tangshan Huida Ceramic Group Co., Ltd.
−Removed: In 2011, FGI USA filed a complaint against Ayers Bath (USA) Corporation (“Ayers Bath”) in the United States District Court for the Central District of California (the “District Court”) and succeeded in obtaining an injunction barring Ayers Bath from selling, distributing or offering for sale Huida parts and products in the United States and Canada.
−Removed: As a result, Ayers Bath ceased all business activity.
−Removed: Ayers Bath filed a voluntary chapter 7 petition in the United States Bankruptcy Court for the Central District of California (the “Bankruptcy Court”) on March 22, 2013.
−Removed: FGI USA filed a proof of claim in the Ayers Bath bankruptcy case for an amount not less than $5,265,000, which was deemed allowed, but due to Ayers Bath’s lack of assets, FGI USA only received a distribution of $7,757.24.
−Removed: On January 9, 2014, FGI USA filed a complaint in the District Court against Tangshan Ayers, as Ayers Bath’s alter ego, to recover the balance of its damages.
−Removed: The District Court ultimately referred the litigation to the Bankruptcy Court, whereby FGI USA filed a motion in Bankruptcy Court to add Tangshan Ayers as judgment debtor, thereby allowing FGI USA to recover its proof of claim.
−Removed: A hearing for the motion to add Tangshan Ayers as judgment debtor was held on June 7, 2021.
−Removed: On September 22, 2021, the Bankruptcy Court issued a report and recommendation to the District Court recommending that it deny FGI USA’s motion to amend the judgment.
−Removed: We filed an objection to the report in October 2021, which was overruled by the Bankruptcy Court in September 202 2 , but the District Court allowed FGI USA to amend its complaint, which was filed in June 2023.
−Removed: Huida moved to compel arbitration under the amended complaint in June 2023.
−Removed: FGI USA opposed the motion to compel arbitration and in February 2024, the District Court denied that motion.
+Added: As previously disclosed, FGI Industries (formerly known as Foremost Groups, Inc.), our wholly-owned subsidiary, was involved in litigation arising from its efforts to protect an exclusivity agreement with sanitaryware manufacturer Tangshan Huida Ceramic Group Co., Ltd.
+Added: (“Huida”) through the second quarter of 2024.
+Added: In June 2024, the parties entered into a settlement agreement with a mutual release of all claims related to the litigation.
+Added: The settlement amount of $180,000 is reflected in other income (expenses), net on our consolidated statements of operations and comprehensive (loss) income.
MINE SAFETY DISCLOSURES
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.