Assure Holdings Corp IONM

PRESS RELEASE

[JohnEnglish]

https://www.nasdaq.com/press-release/assure-holdings-corp-announces-update-20180321-01019

Highlights:

The "reportable events", as such term is defined in NI 51-102, which were communicated by the Former Auditor to the Board and the Audit Committee in writing are as follows:

• Mr. Willer failed to provide a draft of the financial statements of the Company for the quarter ended September 30, 2017 (the "Q3 Financial Statements"). The Former Auditor did not advise the Audit Committee or the Board of Mr. Willer's apparent repeated failure to respond to their requests. For reasons that are not clear, the Former Auditor decided not to contact an alternative executive in the Company who could have provided the Q3 Financial Statements.
  
   
• Mr. Willer used his position as a fiduciary within the Company to access funds in excess of those due and owing to him. The Board became aware of Mr. Willer's unauthorized use of Company funds and created an independent special committee to undertake an internal investigation. The amount of the Company funds accessed by Mr. Willer was not material. However, Mr. Willer's breach of his position as a fiduciary was of concern to the Audit Committee and Board. As a precautionary measure pending completion of the internal investigation, the Audit Committee advised the Board to remove Mr. Willer's access to Company funds.  The Board did so.
  
   
• Shortly prior to commencing the audit fieldwork with the Former Auditor, the Audit Committee disclosed to the Former Auditor the results of the internal investigation and specifically Mr. Willer's unauthorized use of Company funds. Unfortunately, the Former Auditor did not provide the Audit Committee with an opportunity to consider or respond to their concern prior to the delivery of their resignation letter dated March 7, 2018.
  
   
• In addition to Mr. Willer's unauthorized use of Company funds, Mr. Willer engaged in actions apparently designed to conceal other inappropriate conduct. A lack of internal controls allowed Mr. Willer to conceal from the Company the service of a garnishment order arising out of a settled litigation claim unrelated to the Company.  The steps taken by Mr. Willer prevented the Company from discovering the existence of, and responding in a timely manner to, the garnishment order.  
  
   
• The Former Auditor concern regarding the significant increase in amounts owed to the Company by Mr. Parsons and Mr. Willer, as presented in the December 31, 2017 preliminary trial balance and as previously disclosed in the Q3 Financial Statements. These amounts represent a commingling of personal and business expenses charged to the Company's credit card, the majority of which are owed by Mr. Parsons. The Company is currently working to reconcile these charges to determine the exact amounts. Mr. Parsons has committed to repaying these amounts. Controls are being implemented to prevent commingling of funds in the future. 
  
   
• The Audit Committee requested an opportunity for a representative of the Company to first inform the recently appointed Chief Financial Officer, Peter Csapo of the results of the internal investigation pertaining to Mr. Willer's conduct prior to the Former Auditor discussing such details with Mr. Csapo. To that end, the Audit Committee requested that the Former Auditor allow them a reasonable period of time to do so. The Former Auditor interpreted the Audit Committee's request as a direction to withhold the results of the investigation from the new Chief Financial Officer for an indeterminate amount of time. The Audit Committee rejects this position.