RenovaCare Inc. Provides Notice of Proposed Derivative Settlement to All Record Holders and Beneficial Owners of RenovaCare, Inc.

Rhea-AI Summary

RenovaCare Inc. (OTC: RCAR) has announced a proposed settlement for a derivative action lawsuit. Under the settlement terms, defendant Rayat will cancel all debt owed to him by RenovaCare. The company has also agreed to ensure that when a new Board of Directors is formed, the majority of board members will be independent, having no material relationship with the company, executive team, or day-to-day operations.

The settlement hearing is scheduled for April 22, 2025, where the court will determine if the settlement is fair and reasonable, and consider approval of up to $350,000 in attorneys' fees. Shareholders as of February 5, 2025, who wish to object must file written notices by April 2, 2025.

Positive

• Cancellation of all company debt owed to defendant Rayat
• Implementation of stronger corporate governance through board independence requirements

Negative

• Payment of up to $350,000 in attorneys' fees and expenses
• Ongoing legal proceedings indicating corporate governance issues

SCOTTSDALE, Ariz.--(BUSINESS WIRE)-- RenovaCare Inc. (OTC: RCAR):

IN THE EIGHTH JUDICIAL DISTRICT COURT OF THE STATE OF NEVADA
IN AND FOR CLARK COUNTY

PETER RIGSBY, Derivatively on Behalf of RENOVACARE, INC.,   Plaintiff, v.   HARMEL S. RAYAT, KAIYO NEDD, ALAN L. RUBINO, THOMAS BOLD, ROBERT W. COOK, STEPHEN YAN-KLASSEN, and KENNETH KIRKLAND,   Defendants,   -and-   RENOVACARE, INC., a Nevada Corporation,   Nominal Defendant.

) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) )

Case No. A-22-850369-C   Dept. No. 16

NOTICE OF PROPOSED DERIVATIVE SETTLEMENT

TO: ALL RECORD HOLDERS AND BENEFICIAL OWNERS OF
RENOVACARE, INC. ("RENOVACARE" OR THE "COMPANY")
COMMON STOCK AS OF FEBRUARY 5, 2025 (THE "RECORD DATE")

PLEASE TAKE NOTICE that the above-captioned consolidated derivative action (the "Nevada State Court Action") is being settled on the terms set forth in a Stipulation of Settlement, dated February 5, 2025 (the "Stipulation" or "Settlement").¹ Under the terms of the Stipulation, as a part of the proposed Settlement, defendant Rayat shall extinguish any and all debt owed to him by RenovaCare by cancelling any and all debt instruments memorializing the debt. In addition, RenovaCare shall, if and when a Board of Directors is reconstituted, ensure that a majority of the board members (i) do not have a material relationship with the Company; (ii) are not a part of the Company's executive team; and (iii) are not involved in the day-to-day operations of the Company (the "Reform"). The cancellation of the debt and this Reform are designed to address the claims asserted in the Nevada State Court Action and related Derivative Actions² and enhance RenovaCare's internal controls. RenovaCare and its Board acknowledged and agreed that Plaintiffs' efforts, including their efforts in investigating, preparing, commencing, and prosecuting the Derivative Actions, were a material cause for the cancellation of the debt and the implementation of the Reform, and both confer substantial benefits upon RenovaCare and its shareholders.

The full Board reviewed the derivative settlement parameters, and exercising its business judgment and mindful of its duties to stockholders, approved the Settlement.

IF YOU WERE A RECORD OR BENEFICIAL OWNER OF RENOVACARE COMMON STOCK AS OF FEBRUARY 5, 2025. PLEASE READ THIS NOTICE CAREFULLY AND IN ITS ENTIRETY AS YOUR RIGHTS MAY BE AFFECTED BY PROCEEDINGS IN THE ABOVE REFERENCED LITIGATION.

On April 22, 2025, at 9:30a.m., the Court will hold a hearing (the "Settlement Hearing") in the Nevada State Court Action, either in person, telephonically or via video. The purpose of the Settlement Hearing is to determine (i) whether the Settlement is fair, reasonable and adequate;

(ii) whether a final judgment should be entered and the Nevada State Court Action should be dismissed with prejudice pursuant to the Stipulation; and (iii) whether to approve up to $350,000 in attorneys' fees and expenses for Plaintiffs' Counsel; and (iv) such other matters as may be necessary or proper under the circumstances.

Any Current RenovaCare Shareholder that objects to the Settlement shall have a right to appear and to be heard at the Settlement Hearing, provided that he, she or it was a shareholder of record or beneficial owner as of February 5, 2025. Any Current RenovaCare Shareholder who satisfies this requirement may enter an appearance through counsel of such shareholder's own choosing and at such shareholder's own expense, or may appear on their own. However, no Current RenovaCare Shareholder shall be heard at the Settlement Hearing unless, no later than April 2, 2025, such shareholder has filed with the Court, a written notice of objection containing the following information:

1. Your name, legal address, and telephone number;
2. The case name and number (Rigsby v. Rayat, et al., Case No. A-22-850369-C)
3. Proof of being a Current RenovaCare Shareholder as of the Record Date, February 5, 2025;
4. The date(s) you acquired your RenovaCare shares;
5. A statement of each objection being made;
6. Notice of whether you intend to appear at the Settlement Hearing (you are not required to appear);
7. Copies of any papers you intend to submit to the Court, along with the names of any witness(es) you intend to call to testify at the Settlement Hearing and the subject(s) of their testimony; and
8. The identities of any cases, by name, court, and docket number, in which the objector or his, her, or its attorney has objected to a settlement in the last three years.

Only Current RenovaCare Shareholders who have filed and delivered valid and timely written notices of objection will be entitled to be heard at the Settlement Hearing unless the Court orders otherwise. If you wish to object to the proposed Settlement, you must file the written objection described above with the Court on or before April 2, 2025.

Any Current RenovaCare Shareholder as of February 5, 2025 who does not make his, her or its objection in the manner provided herein shall be deemed to have waived such objection and shall be forever foreclosed from making any objection to the fairness, reasonableness or adequacy of the Settlement as incorporated in the Stipulation and/or to the requested attorneys' fees and expenses to Plaintiffs' Counsel, unless otherwise ordered by the Court, but shall otherwise be bound by the Judgment to be entered and the releases to be given.

Inquiries may be made to Plaintiffs' Counsel: Stephen J. Oddo, Robbins LLP, 5060 Shoreham Place, Suite 300, San Diego, CA 92122, Telephone: (619) 525-3990, soddo@robbinsllp.com; John P. Aldrich, Aldrich Law Firm, Ltd., 7866 West Sahara Avenue, Las Vegas, NV 89117, Telephone: 702-583-6748, jaldrich@johnaldrichlawfirm.com.

PLEASE DO NOT CONTACT THE COURT REGARDING THIS NOTICE

¹ This notice should be read in conjunction with, and is qualified in its entirety by reference to, the text of the Stipulation, which has been filed with the Eighth Judicial District Court of the State of Nevada in and for Clark County. All capitalized terms herein have the same meanings as set forth in the Stipulation. The Stipulation can also be accessed on the website of Robbins LLP, Plaintiff's Counsel, at https://robbinsllp.com/category/notices/.
² "Derivative Actions" means collectively the derivative actions styled as Rigsby v. Rayat, et al., Case No. A-22-850369-C (the "Nevada State Court Action"); Medrano v. Rayat, et al., Case No. CV 2022-006382 (Ariz. Super. Ct.-Maricopa Cnty.) (the "Arizona State Derivative Action"); and In re RenovaCare Derivative Litigation, Case No. 2:21-cv-20569 (D.N.J.) (the "New Jersey Federal Derivative Action").

DATED: February 11, 2025

View source version on businesswire.com: https://www.businesswire.com/news/home/20250212878984/en/

soddo@robbinsllp.com

jaldrich@johnaldrichlawfirm.com

Source: RenovaCare Inc.

FAQ

What are the key terms of RenovaCare's (RCAR) derivative settlement?

The settlement includes the cancellation of all debt owed to defendant Rayat and requires that future board members be independent without material relationships to the company.

When is the settlement hearing for RenovaCare (RCAR) scheduled?

The settlement hearing is scheduled for April 22, 2025, at 9:30 a.m.

How much are the attorney fees in the RCAR settlement?

The settlement includes up to $350,000 in attorneys' fees and expenses for Plaintiffs' Counsel.

What is the deadline for RCAR shareholders to object to the settlement?

Shareholders must file written objections by April 2, 2025.

What corporate governance changes will RCAR implement after the settlement?

RenovaCare will ensure that the majority of future board members are independent, not part of the executive team, and not involved in daily operations.