O'Connor-based Brainytoys has announced that Robert Finn has resigned as a director of the company, despite being re-elected at last week's annual general meeting.
The company gave no reason for Mr Finn's sudden departure and a call was not returned at time of publishing.
According to a statement released last week, Brainytoys said some 23.2 million shares were cast in favour of Mr Finn's re-election, while 10,000 shares were against.
In his address to shareholders at the AGM, chairman Charles MacKinnon said the company had forfeited its contractual rights to the Marshmallow product range and licence and business after failing to settle.
The forfeit leaves the company with a "residual 3 out of 4 businesses acquired and a need for some additional working capital to support them", Mr MacKinnon said.
He added that the three remaining businesses are expected to generate sales of around $14 million in the 2008 calendar year.
"Whilst post-mortems can be productive, your Board is instead devoting its energy towards an expedited salvage or improvement of the status quo," Mr MacKinnon told shareholders.
"In this context, we are continuing to work intensely in the short term upon fund raising initiatives in the US and Australia..."
Brainytoys had previously said that if it was not able to raise capital or generate funds from asset sales by November 14, the directors expected to appoint a voluntary administrator.
Shares in Brainytoys closed unchanged at 1.5 cents today.
