Summary Notice of Pendency and Proposed Settlement of Shareholder Derivative Actions

Rhea-AI Summary

CreateAI Holdings Inc. (OTCMKTS: TSPH), formerly TuSimple Holdings, announced a proposed settlement of shareholder derivative actions pending in California and Delaware courts. The settlement includes a $42.5 million cash payment to be paid into an escrow account, which will ultimately be transferred to the company after deducting attorneys' fees, expenses, and taxes.

The settlement acknowledges the actions' role in amending the Amended and Restated Cooperation Agreement with Mo Chen and confirms the binding Mutual Confidentiality Agreement between TuSimple and Hydron. The Settlement Fairness Hearing is scheduled for July 9, 2025, where the court will determine the settlement's fairness and consider attorneys' fees.

Stockholders holding shares as of July 9, 2025, may object to the settlement by June 18, 2025. As this is a derivative action, the cash recovery will benefit the company directly, with no direct payments to individual stockholders.

Positive

• $42.5 million settlement payment to benefit the company
• Amendment of Cooperation Agreement with Mo Chen
• Confirmation of binding Mutual Confidentiality Agreement with Hydron

Negative

• Legal expenses and fees will reduce the final settlement amount received by the company
• Ongoing legal proceedings and associated costs

SAN DIEGO, April 21, 2025 /PRNewswire/ -- CreateAI Holdings Inc., formerly known as TuSimple Holdings Inc. (OTCMKTS: TSPH) ("CreateAI" or the "Company"), today released the following notice:

A Federal Court authorized this Notice. This is not a solicitation from a lawyer.

TO: ALL PERSONS OR ENTITIES WHO OR WHICH HELD SHARES OF TUSIMPLE HOLDINGS, INC. ("TUSIMPLE" OR THE "COMPANY") COMMON STOCK.

PLEASE READ THIS NOTICE CAREFULLY AND IN ITS ENTIRETY. 
YOUR RIGHTS WILL BE AFFECTED BY THE ACTION.

YOU ARE HEREBY NOTIFIED, pursuant to Rule 23.1 of the Federal Rules of Civil Procedure and an Order of the United States District Court for the Southern District of California (the "California Court"), of the pendency of the stockholder derivative action captioned Wilhoite, et al. v. Hou, et al., Case No. 3:23-cv-02333-BEN-MSB, pending in the California Court, and the stockholder derivative action captioned In re TuSimple Holdings, Inc. Stockholder Litigation, C.A. No. 2022-1095-PAF (the "Delaware Action" and, together with the California Action, the "Actions"), pending in the Court of Chancery of the State of Delaware.

YOU ARE ALSO NOTIFIED that the Settling Parties have reached a proposed settlement of the Actions (the "Settlement"), subject to the approval of the California Court, as provided in a Stipulation of Settlement dated December 18, 2024 (the "Stipulation"). Under the terms of the proposed Settlement, Settling Defendants will cause to be paid $42,500,000 in cash into an escrow account, which together with any interest earned on the cash payment and less any deductions for attorneys' fees and expenses for Plaintiffs' Counsel (including any incentive awards to Plaintiffs) and any applicable taxes and tax expenses, will be paid to the Company. Additionally, pursuant to the Settlement (i) Settling Defendants and TuSimple acknowledge that the Actions played a substantial role in the amendment of the Amended and Restated Cooperation Agreement, dated April 3, 2024, by and among TuSimple and Mo Chen and (ii) TuSimple and Hydron affirm that they are parties to the Mutual Confidentiality and Nondisclosure Agreement that continues to remain binding on TuSimple and Hydron.

A more detailed description of the Settlement terms, as well as a description of the history of the Actions and an explanation of stockholders' legal rights with respect to the Settlement, is provided in the full printed Notice of Pendency and Proposed Settlement of Stockholder Derivative Actions (the "Notice"). The Notice and the Stipulation are publicly available on the "Investor Relations" section of the Company's website, https://ir.tusimple.com/overview/default.aspx, and on California Plaintiffs' Lead Counsel's websites: www.blbglaw.com and www.bottinilaw.com.

The California Court will consider the Settlement and all matters related to the Settlement at the Settlement Fairness Hearing. The Settlement Fairness Hearing will be held on July 9, 2025, at 10:30 a.m., before the Honorable Roger T. Benitez at the United States District Court for the Southern District of California, Courtroom 5A (Fifth Floor) of the Edward J. Schwartz United States Courthouse, 221 West Broadway, San Diego, CA 92101. At the Settlement Fairness Hearing, the California Court will, among other things: (i) determine whether the California Plaintiffs and California Plaintiffs' Lead Counsel have adequately represented the interests of TuSimple and its stockholders; (ii) determine whether the proposed Settlement on the terms and conditions provided for in the Stipulation is fair, reasonable, and adequate to TuSimple and its stockholders, and should be approved by the Court; (iii) determine whether the Judgment, substantially in the form attached as Exhibit B to the Stipulation, should be entered dismissing the California Action with prejudice; (iv) determine whether the application by California Plaintiffs' Lead Counsel, on behalf of all Plaintiffs' Counsel, for an award of attorneys' fees and litigation expenses, including any application for an incentive award to each of the Plaintiffs (the "Fee and Expense Application"), should be approved; and (v) consider any other matters that may properly be brought before the Court in connection with the Settlement. Stockholders do not need to attend the Settlement Fairness Hearing.

Please Note: The California Court has reserved the right to adjourn the Settlement Fairness Hearing or any adjournment thereof, including the consideration of the Fee and Expense Application, without further notice of any kind other than by oral announcement at the Settlement Fairness Hearing or any adjournment thereof. The Court has further reserved the right to approve the Stipulation and the Settlement, at or after the Settlement Fairness Hearing, with such modifications as may be consented to by the Settling Parties and without further notice to TuSimple stockholders. The Settlement Fairness Hearing may be converted to a hearing by Zoom or telephone, in which case information about how to attend the hearing remotely will be provided on the docket. You should monitor the Court's docket and the websites of California Plaintiffs' Lead Counsel, as indicated below, before making plans to attend the Settlement Fairness Hearing. You may also confirm the date and time of the Settlement Fairness Hearing by contacting California Plaintiffs' Lead Counsel as indicated below.

If you are a TuSimple stockholder who or which continues to hold shares of TuSimple common stock as of July 9, 2025, the date of the Settlement Fairness Hearing, you may object to the proposed Settlement and the Fee and Expense Application in writing, and you also have the right to appear at the Settlement Fairness Hearing. Any objections must be in writing and filed with the Clerk of the Court for the United States District Court for the Southern District of California and delivered to California Plaintiffs' Lead Counsel and TuSimple's Counsel such that they are received no later than June 18, 2025, in accordance with the instructions set forth in the Notice.

Please Note: Because the Actions were brought as derivative actions, which means that the Actions were brought by Plaintiffs on behalf of, and for the benefit of, TuSimple, the cash recovery from the Settlement will go to the Company. Individual TuSimple stockholders will not receive any direct payment from the Settlement. Also, please note that there is no proof of claim form for stockholders to submit in connection with this Settlement, and stockholders are not required to take any action in response to this notice.

PLEASE DO NOT TELEPHONE THE COURT OR THE OFFICE OF THE CLERK OF THE COURT TO INQUIRE ABOUT THIS SETTLEMENT.

All questions regarding this notice and the Settlement should be made to California Plaintiffs' Lead Counsel:

Jeroen van Kwawegen
Bernstein Litowitz Berger
& Grossmann LLP
1251 Avenue of the Americas
New York, NY 10020
Telephone: (800) 380-8496                                                                                               
Email: settlements@blbglaw.com                                                                                         
Website: www.blbglaw.com 

Francis A. Bottini, Jr.
Albert Y. Chang
Bottini & Bottini, Inc.
7817 Ivanhoe Avenue, Suite 102
La Jolla, CA 92037
Telephone: (858) 914-2001
Email: fbottini@bottinilaw.com  
achang@bottinilaw.com 
Website: www.bottinilaw.com

Dated:  April 17, 2025   

By Order of the Court

United States District Court Southern District of California

About CreateAI Holdings Inc.

CreateAI (formerly TuSimple) is a global applied artificial intelligence company with offices in the US, China, and Japan. The Company is developing leading AI technology for a number of end-use applications and pioneering the future of digital entertainment content production, seamlessly blending cutting-edge generative AI technology with the creativity of world-class talent. Our mission is to redefine the boundaries of what's possible in digital storytelling by developing immersive, captivating, and visually stunning experiences that resonate with audiences on a global scale.

Investor Relations Contact:
ICR for CreateAI
CreateAI.IR@icrinc.com 

Media Contact:
Brad Burgess
ICR, LLC
CreateAI.PR@icrinc.com 

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SOURCE CreateAI Holdings Inc.

FAQ

What is the settlement amount in the CreateAI Holdings (TSPH) shareholder derivative actions?

The settlement amount is $42.5 million in cash, which will be paid to the company after deducting attorneys' fees, expenses, and applicable taxes.

When is the Settlement Fairness Hearing for the TSPH shareholder derivative actions?

The Settlement Fairness Hearing is scheduled for July 9, 2025, at 10:30 a.m. at the United States District Court for the Southern District of California.

Will TSPH shareholders receive direct payments from the settlement?

No, individual shareholders will not receive direct payments as this is a derivative action. The cash recovery will go directly to the company.

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

Shareholders must submit their objections by June 18, 2025, to be received by the Court and relevant counsel.