At this time, it is not possible to make any determination as to how much any individual Settlement Class Member may receive from the Settlement.
Pursuant to the Settlement, Dole has agreed to pay or cause to be paid seventy-four million dollars ($74,000,000) in cash. The Settlement Amount will be deposited into an escrow account. The Settlement Amount plus any interest earned thereon is referred to as the “Settlement Fund.” If the Settlement is approved by the Court and the Effective Date occurs, the “Net Settlement Fund” (that is, the Settlement Fund less: (a) all federal, state and/or local taxes on any income earned by the Settlement Fund and the reasonable costs incurred in connection with determining the amount of and paying taxes owed by the Settlement Fund (including reasonable expenses of tax attorneys and accountants); (b) the costs and expenses incurred in connection with providing notice to Settlement Class Members and administering the Settlement on behalf of Settlement Class Members; and (c) any attorneys’ fees and Litigation Expenses awarded by the Court) will be distributed to Settlement Class Members who submit valid Claim Forms, in accordance with the proposed Plan of Allocation or such other plan of allocation as the Court may approve.
The Net Settlement Fund will not be distributed unless and until the Court has approved the Settlement and a plan of allocation, and the time for any petition for rehearing, appeal or review, whether by certiorari or otherwise, has expired.
Neither Defendants nor any other person or entity that paid any portion of the Settlement Amount on their behalf are entitled to get back any portion of the Settlement Fund once the Court’s order or judgment approving the Settlement becomes Final. Defendants shall not have any liability, obligation or responsibility for the administration of the Settlement, the disbursement of the Net Settlement Fund or the plan of allocation.
Approval of the Settlement is independent from approval of a plan of allocation. Any determination with respect to a plan of allocation will not affect the Settlement, if approved.
Unless the Court otherwise orders, any Settlement Class Member who fails to submit a Claim Form postmarked on or before August 9, 2017 shall be fully and forever barred from receiving payments pursuant to the Settlement but will in all other respects remain a Settlement Class Member and be subject to the provisions of the Stipulation, including the terms of any Judgment entered and the releases given. This means that each Settlement Class Member releases the Released Plaintiffs’ Claims (as defined in ¶ 36 of the Notice) against the Defendants’ Releasees (as defined in ¶ 37 of the Notice) and will be enjoined and prohibited from filing, prosecuting or pursuing any of the Released Plaintiffs’ Claims against any of the Defendants’ Releasees whether or not such Settlement Class Member submits a Claim Form.
Participants in and beneficiaries of a plan covered by ERISA (“ERISA Plan”) should NOT include any information relating to their transactions in Dole common stock held through the ERISA Plan in any Claim Form that they may submit in this Action. They should include ONLY those shares that they held outside of the ERISA Plan. Claims based on any ERISA Plan’s sales of Dole common stock during the Class Period may be made by the plan’s trustees. To the extent any of the Defendants or any of the other persons or entities excluded from the Settlement Class are participants in such an ERISA Plan, such persons or entities shall not receive, either directly or indirectly, any portion of the recovery that may be obtained from the Settlement by the ERISA Plan.
The Court has reserved jurisdiction to allow, disallow or adjust on equitable grounds the Claim of any Settlement Class Member.
Each Claimant shall be deemed to have submitted to the jurisdiction of the Court with respect to his, her or its Claim Form.
Only Settlement Class Members, i.e., persons and entities who sold Dole common stock during the Class Period and were damaged as a result of such sales, will be eligible to share in the distribution of the Net Settlement Fund. Persons and entities that are excluded from the Settlement Class by definition or that exclude themselves from the Settlement Class pursuant to request will not be eligible to receive a distribution from the Net Settlement Fund and should not submit Claim Forms. Dole common stock is the only security that is included in the Settlement.
PROPOSED PLAN OF ALLOCATION
The objective of the Plan of Allocation is to distribute the Settlement proceeds equitably among those Settlement Class Members who suffered economic losses as a proximate result of the alleged wrongdoing. The Plan of Allocation is not a formal damage analysis, and the calculations made in accordance with the Plan of Allocation are not intended to be estimates of, or indicative of, the amounts that Settlement Class Members might have been able to recover after a trial. Nor are the calculations in accordance with the Plan of Allocation intended to be estimates of the amounts that will be paid to Authorized Claimants under the Settlement. The computations under the Plan of Allocation are only a method to weigh the claims of Authorized Claimants against one another for the purpose of making pro rata allocations of the Net Settlement Fund.
Under the Plan of Allocation, Recognized Loss Amounts for sales of Dole common stock are calculated based on the difference in the amount of alleged artificial deflation in the prices of Dole common stock at the time of sale and at the time of purchase. For the period from January 2, 2013 through June 10, 2013, the estimated amounts of artificial deflation in Dole common stock are based on an event study conducted by Lead Plaintiffs’ damages expert that examined price changes in the Dole common stock in reaction to the alleged misstatements, adjusting for price changes that were attributable to market or industry forces. Additional artificial deflation introduced on June 11, 2013, the date of Defendant Murdock’s initial offer to acquire the outstanding shares of Dole, was calculated in consultation with Lead Plaintiffs’ damages expert based on an estimate of the price at which Dole common stock would have traded, assuming that none of the alleged deflationary misstatements, including the statements in Defendant Murdock’s letter to Dole’s board setting forth his initial acquisition proposal, had been made. Finally, following the release of the proxy statement concerning the Take-Private Transaction, which contained further allegedly false and misleading statements and omissions, and an allegedly misleading discounted cash flow analysis, the alleged artificial deflation in the Dole common stock under the Plan of Allocation is increased another $1.51 to a total of $6.84 per share, to reflect the difference between (i) the final offering price of $13.50 per share in the Take-Private Transaction and (ii) $20.34 per share, which the Court of Chancery found to be a reasonable per-share value for Dole’s stock based on the evidence at trial in that action.
In order to be eligible for a recovery under the Plan of Allocation, shares of Dole common stock purchased during the Class Period must be held through (and sold after) one or more dates on which Lead Plaintiffs alleged that the amount of artificial deflation in Dole common stock increased (“Deflationary Dates”). Under the Plan of Allocation, those Deflationary Dates are: January 25, 2013, March 13, 2013, May 3, 2013, May 28, 2013, June 11, 2013 and August 21, 2013. Shares of Dole common stock that are both purchased and sold within two contiguous Deflationary Dates (or between August 21, 2013 and the end of the Class Period) are not eligible for recovery under the Plan of Allocation.
CALCULATION OF RECOGNIZED LOSS AMOUNTS
Based on the formula stated below, a “Recognized Loss Amount” will be calculated for each sale of Dole common stock during the Class Period that is listed on the Proof of Claim Form and for which adequate documentation is provided.
For each share of Dole common stock held as of the opening of trading on January 2, 2013 and sold during the period from January 2, 2013 through the time immediately prior to the closing of the Take-Private Transaction on November 1, 2013, the Recognized Loss Amount shall be the amount of artificial deflation per share on the date of sale as stated in Table A at the end of the Notice.
For each share of Dole common stock purchased during the period from January 2, 2013 through the time immediately prior to the closing of the Take-Private Transaction on November 1, 2013 and sold during the period from January 2, 2013 through the time immediately prior to the closing of the Take-Private Transaction on November 1, 2013, the Recognized Loss Amount shall be the amount of artificial deflation per share on the date of sale as stated in Table A at the end of the Notice minus the amount of artificial deflation per share on the date of purchase as stated in Table A.
The Net Settlement Fund will be allocated among all Authorized Claimants whose Distribution Amount (defined in ¶ 62 below) is $10.00 or greater.
If a Settlement Class Member has more than one purchase or sale of Dole common stock, purchases and sales will be matched on a First In, First Out (“FIFO”) basis. Class Period sales will be matched first against any holdings at the beginning of the Class Period, and then against purchases in chronological order, beginning with the earliest purchase made during the Class Period.
A Claimant’s “Recognized Claim” under the Plan of Allocation will be the sum of his, her or its Recognized Loss Amounts.
The Net Settlement Fund will be distributed to Authorized Claimants on a pro rata basis based on the relative size of their Recognized Claims. Specifically, a “Distribution Amount” will be calculated for each Authorized Claimant, which will be the Authorized Claimant’s Recognized Claim divided by the total Recognized Claims of all Authorized Claimants, multiplied by the total amount in the Net Settlement Fund. If any Authorized Claimant’s Distribution Amount calculates to less than $10.00, it will not be included in the calculation and no distribution will be made to that Authorized Claimant.
The date of covering a “short sale” is deemed to be the date of purchase or acquisition of the Dole common stock. The date of a “short sale” is deemed to be the date of sale of Dole common stock. Under the Plan of Allocation, however, the Recognized Loss Amount on “short sales” is zero. In the event that a Claimant has an opening short position in Dole common stock, his, her or its earliest Class Period purchases of Dole common stock will be matched against the opening short position until that short position is fully covered.
Option contracts are not securities eligible to participate in the Settlement. With respect to shares of Dole common stock purchased or sold through the exercise of an option, the purchase/sale date of the Dole common stock is the exercise date of the option and the purchase/sale price of the Dole common stock is the exercise price of the option.
After the initial distribution of the Net Settlement Fund, the Claims Administrator will make reasonable and diligent efforts to have Authorized Claimants cash their distribution checks. To the extent any monies remain in the fund nine (9) months after the initial distribution, if Lead Counsel, in consultation with the Claims Administrator, determine that it is cost-effective to do so, the Claims Administrator will conduct a re-distribution of the funds remaining after payment of any unpaid fees and expenses incurred in administering the Settlement, including for such re-distribution, to Authorized Claimants who have cashed their initial distributions and who would receive at least $10.00 from such re-distribution. Additional re-distributions to Authorized Claimants who have cashed their prior checks and who would receive at least $10.00 on such additional re-distributions may occur thereafter if Lead Counsel, in consultation with the Claims Administrator, determine that additional re-distributions, after the deduction of any additional fees and expenses incurred in administering the Settlement, including for such re-distributions, would be cost-effective. At such time as it is determined that the re-distribution of funds remaining in the Net Settlement Fund is not cost-effective, the remaining balance shall be contributed to non-sectarian, not-for-profit organization(s), to be recommended by Lead Counsel and approved by the Court.
Payment pursuant to the Plan of Allocation, or such other plan of allocation as may be approved by the Court, shall be conclusive against all Authorized Claimants. No person shall have any claim against Lead Plaintiffs, Plaintiffs’ Counsel, Lead Plaintiffs’ damages expert, Defendants, Defendants’ Counsel, any of the other Plaintiffs’ Releasees or Defendants’ Releasees, or the Claims Administrator or other agent designated by Lead Counsel arising from distributions made substantially in accordance with the Stipulation, the plan of allocation approved by the Court, or further orders of the Court. Lead Plaintiffs, the Defendants and their respective counsel, and all other Defendants’ Releasees, shall have no responsibility or liability whatsoever for: the investment or distribution of the Settlement Fund or the Net Settlement Fund; the plan of allocation; the determination, administration, calculation or payment of any Claim Form; nonperformance of the Claims Administrator; the payment or withholding of Taxes; or any losses incurred in connection therewith.
The Plan of Allocation set forth herein is the plan that is being proposed to the Court for its approval by Lead Plaintiffs after consultation with Lead Counsel and Lead Plaintiffs’ damages expert. The Court may approve this plan as proposed or it may modify the Plan of Allocation without further notice to the Class. Any orders regarding any modification of the Plan of Allocation will be posted on the Court Documents page.