osg securities litigation - united states …...osg and the underwriter defendants and...
TRANSCRIPT
999215_7
UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK
x In re OSG SECURITIES LITIGATION
This Document Relates To:
ALL ACTIONS.
: : : : : : x
Civil Action No. 1:12-cv-07948-SAS
CLASS ACTION
STIPULATION OF SETTLEMENT WITH THE UNDERWRITER DEFENDANTS
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This Stipulation of Settlement with the Underwriter Defendants, dated August 4, 2015 (the
“Underwriter Defendants Stipulation”), is made and entered into by and among the following
Settling Parties to the above-entitled litigation (the “Litigation” or the “Action”): (i) Lead Plaintiffs
Stichting Pensioenfonds DSM Nederland, Indiana Treasurer of State and Lloyd Crawford
(collectively, “Lead Plaintiffs”) (on behalf of themselves and each of the Class Members), by and
through their counsel of record in the Litigation; and (ii) Citigroup Global Markets Inc., Deutsche
Bank Securities Inc., DNB Markets, Inc. (f/k/a DnB NOR Markets, Inc.), Goldman, Sachs & Co.,
HSBC Securities (USA) Inc., ING Financial Markets LLC and Morgan Stanley & Co. LLC (f/k/a
Morgan Stanley & Co. Incorporated) (collectively, the “Underwriter Defendants”), by and through
their counsel of record in the Litigation.1 This Underwriter Defendants Stipulation is intended by the
Settling Parties to fully, finally, and forever resolve, discharge, release, and settle all claims asserted
in the Action against the Underwriter Defendants, upon and subject to the terms and conditions
hereof and subject to the approval of the United States District Court for the Southern District of
New York (the “Court”).
I. THE LITIGATION
This is a federal securities class action on behalf of a Class (to be certified for settlement
purposes only). For the purposes of this Settlement only, the Class is defined in ¶1.8 below.
Nothing in this Underwriter Defendants Stipulation shall serve in any fashion, either directly or
indirectly, as evidence or support for certification of a litigation class, and the Settling Parties intend
that the provisions herein concerning certification of the Class shall have no effect whatsoever in the
event that the Settlement does not become Final.
1 All terms with initial capitalization not otherwise defined herein shall have the meanings ascribed to them in ¶1 herein.
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On November 20, 2014, the Settling Parties attended a formal mediation session before the
Honorable Layn R. Phillips (Ret.). At the end of that mediation, the Settling Parties reached an
agreement-in-principle to resolve the Litigation on the specific terms set forth herein, and on
December 23, 2014, the Settling Parties executed a Memorandum of Understanding (“MOU”).
II. CLAIMS OF THE LEAD PLAINTIFFS AND BENEFITS OF
SETTLEMENT
Lead Plaintiffs believe that the claims asserted in the Litigation have merit and that the
evidence developed to date supports those claims. Lead Plaintiffs and Lead Counsel, however,
recognize and acknowledge the expense and length of continued proceedings necessary to prosecute
the Litigation against the Underwriter Defendants through the conclusion of discovery, summary
judgment, trial, potential post-trial proceedings, and appeals. Lead Plaintiffs also have taken into
account the uncertain outcome and the risk in connection with continuing the Litigation, as well as
the difficulties and delays inherent in such litigation. Lead Plaintiffs also are mindful of the inherent
problems of proof and possible defenses related to the securities law violations asserted in the
Litigation. Lead Counsel believe that the Settlement set forth in this Underwriter Defendants
Stipulation confers substantial benefits upon the Class. Based on their evaluation, Lead Plaintiffs
and Lead Counsel have determined that the Settlement set forth in this Underwriter Defendants
Stipulation is in the best interests of the Class, and that the Settlement provided for herein is fair,
reasonable, and adequate.
III. THE UNDERWRITER DEFENDANTS’ DENIALS OF WRONGDOING
AND LIABILITY
The Underwriter Defendants have denied and continue to deny that they have committed any
violation of the federal securities laws or other laws, and they maintain that their conduct was at all
times proper and in compliance with all applicable provisions of law. The Underwriter Defendants
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deny specifically each and all of the claims and contentions alleged by Lead Plaintiffs in the
Litigation, along with all charges of wrongdoing or liability against them arising out of any of the
conduct, statements, acts, or omissions alleged, or that could have been alleged, in the Litigation. In
addition, the Underwriter Defendants maintain that they have meritorious defenses to all claims
alleged in the Litigation.
As set forth below, this Underwriter Defendants Stipulation shall in no event be construed or
deemed to be evidence of an admission or concession on the part of the Released Underwriter
Defendant Parties (as defined in ¶1.27) with respect to any claim or allegation of any fault, liability,
wrongdoing, or damage whatsoever, or any infirmity in the defenses that Underwriter Defendants
have, or could have, asserted. The Underwriter Defendants are entering into this Underwriter
Defendants Stipulation solely to eliminate the uncertainty, burden and expense associated with
further litigation. The provisions contained in this Underwriter Defendants Stipulation, any
documentation that may be required to obtain the Court’s preliminary and final approval of the
Settlement, or any press release or other statement or report by the Settling Parties, shall not be
offered or deemed as, written to suggest, or received in any proceeding as a presumption,
concession, admission, or evidence of any fault, liability, or wrongdoing as to any facts or claims
that have been, or could have been, asserted in the Action, or any other actions or proceedings.
IV. TERMS OF STIPULATION AND AGREEMENT OF SETTLEMENT
NOW, THEREFORE, without any admission or concession on the part of Lead Plaintiffs of
any lack of merit of the Action whatsoever, and without any admission or concession on the part of
the Underwriter Defendants of any liability or wrongdoing or lack of merit in the defenses
whatsoever, it is hereby STIPULATED AND AGREED, by and among Lead Plaintiffs (for
themselves and on behalf of the Class Members) and the Underwriter Defendants, by and through
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their respective counsel of record, and subject to the approval of the Court, that, in consideration of
the benefits flowing to the Settling Parties from the Settlement, the Released Claims shall be finally
and fully compromised, settled, and released, and the Litigation shall be dismissed against the
Underwriter Defendants with prejudice, upon and subject to the terms and conditions of the
Underwriter Defendants Stipulation, as follows:
1. Definitions
As used in the Underwriter Defendants Stipulation the following terms have the meanings
specified below:
1.1 “Authorized Claimant” means any Claimant who or which submits a Claim Form to
the Claims Administrator that is approved for payment pursuant to the terms of the Underwriter
Defendants Stipulation.
1.2 “Bankruptcy Court” means the United States Bankruptcy Court for the District of
Delaware.
1.3 “Barred Claims” means (i) claims and claims over for contribution or indemnity (or
any other claim or claim over for contribution or indemnity however denominated on whatsoever
theory), arising out of or related to the claims or allegations asserted by Lead Plaintiffs in the Action,
or (ii) any other claim of any type, whether arising under state, federal, common, or foreign law, for
which the injury claimed is that Persons’ actual or threatened liability to Lead Plaintiffs and/or Class
Members arising out of or related to the claims or allegations asserted by Lead Plaintiffs in the
Action; provided, however, that Barred Claims shall not include, and nothing in the bar order
contained in the Order and Final Judgment shall release or alter, the contractual rights, if any, (i)
between or among the Underwriter Defendants under their applicable agreements relating to any
offering of securities by Overseas Shipholding Group, Inc. (“OSG”), or (ii) between the Underwriter
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Defendants, on the one hand, and OSG, on the other hand, under any applicable Underwriting
Agreements with respect to any right of indemnification in connection with the payment of the
Settlement Amount or incurrence of defense costs.
1.4 “Claim” means a Proof of Claim and Release Form submitted to the Claims
Administrator.
1.5 “Claim Form” or “Proof of Claim and Release Form” means the form, substantially in
the form to be approved by the Court and disseminated at a future date to the Class Members, that a
Claimant will be required to complete and timely submit to the Claims Administrator in order to be
eligible to share in a distribution of the net proceeds of the recoveries obtained on behalf of the
Class.
1.6 “Claimant” means all Persons who or which submit a Claim Form to the Claims
Administrator seeking to be eligible to share in the net proceeds of the recoveries obtained on behalf
of the Class.
1.7 “Claims Administrator” means, subject to the approval of the Court, the firm of
Gilardi & Co. LLC.
1.8 “Class” means, solely for purposes of this Settlement, all Persons who or which
purchased or otherwise acquired (a) OSG’s 8.125% Senior Notes Due 2018 (the “Senior Notes”),
pursuant or traceable to OSG’s March 2010 registration statement and prospectus supplement for the
Senior Notes; and/or (b) OSG’s common stock during and inclusive of the period October 29, 2007
through October 19, 2012. Excluded from the Class are: the Defendants, G. Allen Andreas
(“Andreas”), and their respective successors and assigns; past and current officers and directors of
OSG and the Underwriter Defendants and PricewaterhouseCoopers LLP (“PwC”) and Ernst &
Young LLP (“E&Y”) during the Class Period; members of the immediate families of the Individual
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Defendants and Andreas; the legal representatives, heirs, successors, or assigns of the Individual
Defendants and Andreas; and any entity in which any of the above excluded Persons have or had a
majority ownership interest. Also excluded from the Class are those Persons who timely and validly
request exclusion from the Class in accordance with the requirements set by the Court and the Notice
of Pendency and Proposed Partial Settlements of Class Action, Motion for Attorneys’ Fees and
Settlement Fairness Hearing to be sent to the Class Members pursuant to the Notice Order.
1.9 “Class Member” or “Class Members” means any Person who falls within the
definition of the Class as set forth in ¶1.8 of this Underwriter Defendants Stipulation.
1.10 “Class Period” means the period commencing on October 29, 2007 and ending on
October 19, 2012, inclusive.
1.11 “Complaint” means the Third Consolidated Amended Complaint for Violations of the
Federal Securities Laws filed by Lead Plaintiffs in this Action on February 18, 2014.
1.12 “Defendants” means Alan R. Batkin, Thomas B. Coleman, Charles A. Fribourg,
Stanley Komaroff, Solomon N. Merkin, Joel I. Picket, Ariel Recanati, Oudi Recanati, Thomas F.
Robards, Jean-Paul Vettier, Michael J. Zimmerman, Morten Arntzen, Myles R. Itkin, E&Y, PwC
and the Underwriter Defendants.
1.13 “Effective Date” means the first date by which all of the events and conditions
specified in ¶7.1 of this Underwriter Defendants Stipulation have been met and have occurred or
have been waived.
1.14 “Escrow Account” means an interest-bearing escrow account controlled by the
Escrow Agent.
1.15 “Escrow Agent” means Robbins Geller Rudman & Dowd LLP and its successor(s).
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1.16 “Final” means when the last of the following with respect to the Order and Final
Judgment, substantially in the form of Exhibit B attached hereto, shall occur: (i) the expiration of
three (3) business days after the time for the filing of any motion to alter or amend the Order and
Final Judgment under Federal Rule of Civil Procedure 59(e) has passed without any such motion
having been filed; (ii) the expiration of the time for the filing or noticing of any appeal from the
Order and Final Judgment without any appeal having been filed; and (iii) if such motion to alter or
amend is filed or if an appeal is filed or noticed, then immediately after the determination of that
motion or appeal so that the Order and Final Judgment is no longer subject to any further judicial
review or appeal whatsoever, whether by reason of affirmance by court of last resort, lapse of time,
voluntary dismissal of the appeal, or otherwise, and in such a manner as to permit the consummation
of the Settlement in accordance with the terms and conditions of this Underwriter Defendants
Stipulation. For purposes of this paragraph, an appeal shall include any petition for a writ of
certiorari or other writ that may be filed in connection with the approval or disapproval of this
Underwriter Defendants Settlement, but shall not include any appeal that concerns only the issue of
attorneys’ fees and expenses or the Plan of Allocation of the Settlement Fund. Any proceeding or
order, or any appeal or petition for a writ of certiorari pertaining solely to any plan of distribution
and/or application for attorneys’ fees, costs, or expenses shall not in any way delay or preclude the
Order and Final Judgment from becoming Final.
1.17 “Individual Defendants” means Alan R. Batkin, Thomas B. Coleman, Charles A.
Fribourg, Stanley Komaroff, Solomon N. Merkin, Joel I. Picket, Ariel Recanati, Oudi Recanati,
Thomas F. Robards, Jean-Paul Vettier, Michael J. Zimmerman, Morton Arntzen and Myles R. Itkin.
1.18 “Lead Counsel” means Robbins Geller Rudman & Dowd LLP or its successor(s).
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1.19 “Lead Plaintiffs” means Stichting Pensioenfonds DSM Nederland, Indiana Treasurer
of State and Lloyd Crawford.
1.20 “Notice Order” means the order described in ¶3.1 hereof.
1.21 “Order and Final Judgment” means the judgment to be rendered by the Court,
substantially in the form attached hereto as Exhibit B.
1.22 “Person” means a natural person, individual, corporation, limited liability corporation,
professional corporation, limited liability partnership, partnership, limited partnership, limited
liability company, association, joint stock company, estate, legal representative, trust, unincorporated
association, government or any political subdivision or agency thereof, and any business or legal
entity and all of their respective spouses, heirs, beneficiaries, executors, administrators, predecessors,
successors, representatives, or assignees.
1.23 “Plaintiffs’ Counsel” means any counsel who have appeared for Lead Plaintiffs in the
Litigation.
1.24 “Plan of Allocation” means the plan or formula of allocation of the Settlement Fund,
which will be proposed to the Court, whereby the Settlement Fund shall be distributed to Authorized
Claimants after payment of Notice and Administration Costs (as defined herein), Taxes and Tax
Expenses, and such attorneys’ fees, costs, expenses, and interest as may be awarded by the Court.
1.25 “Related Underwriter Defendant Persons” means each of an Underwriter Defendant’s
past, present or future parents, subsidiaries and affiliates, and their respective directors, officers,
employees, partners, members, principals, agents, underwriters, insurers, co-insurers, reinsurers,
controlling shareholders, attorneys, accountants or auditors, financial or investment advisors or
consultants, banks or investment bankers, personal or legal representatives, predecessors, successors,
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assigns, spouses, heirs, related or affiliated entities, or any entity in which an Underwriter Defendant
has a controlling interest.
1.26 “Released Claims” shall collectively mean any and all claims (including “Unknown
Claims” as defined in ¶1.39 hereof) against the Underwriter Defendants and their Related
Underwriter Defendant Persons, arising out of, relating to, or in connection with both (i) the facts,
events, transactions, acts, occurrences, statements, representations, misrepresentations, or omissions
which were or could have been alleged in the Litigation, and (ii) the purchase or acquisition, holding,
sale or disposition of all securities issued by OSG, including, but not limited to, the Senior Notes or
common stock, during the Class Period.
1.27 “Released Underwriter Defendant Parties” means each and all of the Underwriter
Defendants and their Related Underwriter Defendant Persons.
1.28 “Releases” means the releases set forth in ¶¶4.1, 4.2 and 4.3 of this Underwriter
Defendants Stipulation.
1.29 “Settled Underwriter Defendants’ Claims” means all claims (including, but not
limited to, “Unknown Claims” as defined in ¶1.39 hereof), demands, losses, rights, and causes of
action of any nature whatsoever, that have been or could have been asserted in the Litigation or any
forum by the Released Underwriter Defendant Parties or any of them against Lead Plaintiffs, Class
Members and Plaintiffs’ Counsel which arise out of or relate in any way to the institution,
prosecution, assertion, settlement, or resolution of the Litigation (except for claims to enforce the
Settlement).
1.30 “Settlement” means the settlement of the Litigation as set forth in this Underwriter
Defendants Stipulation.
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1.31 “Settlement Amount” means the principal amount of Four Million U.S. Dollars
($4,000,000.00), to be paid pursuant to ¶2.1 of this Underwriter Defendants Stipulation, plus any
interest that may accrue thereon after the Underwriter Defendants have paid the principal amount
pursuant to ¶2.1 of this Underwriter Defendants Stipulation. Such amount is paid as consideration
for full and complete settlement of all the Released Claims. The Released Underwriter Defendant
Parties shall have no obligation whatsoever to pay any amount over and above the Settlement
Amount.
1.32 “Settlement Fund” means the interest-bearing Escrow Account controlled by the
Escrow Agent into which the Underwriter Defendants shall deposit the Settlement Amount on behalf
of the Underwriter Defendants.
1.33 “Settlement Hearing” means the hearing to determine whether the proposed
Settlement embodied by this Underwriter Defendants Stipulation is fair, reasonable, and adequate to
the Class, and whether the Court should (1) enter an Order and Final Judgment approving the
proposed Settlement, (2) approve the Plan of Allocation of Settlement proceeds, and (3) determine
an award of attorneys’ fees and expenses to Plaintiffs’ Counsel.
1.34 “Settling Parties” means, collectively, each of the Underwriter Defendants and the
Lead Plaintiffs on behalf of themselves and each of the Class Members.
1.35 “Supplemental Agreement” means the agreement described in ¶2.12.
1.36 “Taxes” means all taxes (including any estimated taxes, interest or penalties) arising
with respect to the income earned by the Settlement Fund as described in ¶2.10.
1.37 “Tax Expenses” means expenses and costs incurred in connection with the calculation
and payment of taxes or the preparation of tax returns and related documents including, without
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limitation, expenses of tax attorneys and/or accountants and mailing and distribution costs relating to
filing (or failing to file) the returns described in ¶2.10.
1.38 “Underwriter Defendants” means Citigroup Global Markets Inc., Deutsche Bank
Securities Inc., DNB Markets, Inc. (f/k/a DnB NOR Markets, Inc.), Goldman, Sachs & Co., HSBC
Securities (USA) Inc., ING Financial Markets LLC and Morgan Stanley & Co. LLC (f/k/a Morgan
Stanley & Co. Incorporated).
1.39 “Unknown Claims” means (a) any Released Claims that Lead Plaintiffs or any Class
Member does not know or suspect to exist in his, her or its favor at the time of the release of the
Released Underwriter Defendant Parties, which, if known by him, her or it, might have affected his,
her or its settlement with and release of the Released Underwriter Defendant Parties, or might have
affected his, her or its decision(s), with respect to the Settlement; and (b) any Settled Underwriter
Defendants’ Claims that any Underwriter Defendant does not know or suspect to exist in his, her or
its favor at the time of the release of the Lead Plaintiffs, Class Members and Plaintiffs’ Counsel,
which, if known by him, her or it, might have affected his, her or its settlement with and release of
the Lead Plaintiffs, Class Members and Plaintiffs’ Counsel, or might have affected his, her or its
decision(s) with respect to the Settlement. With respect to any and all Released Claims and Settled
Underwriter Defendants’ Claims, the Settling Parties stipulate and agree that, upon the Effective
Date, Lead Plaintiffs and the Underwriter Defendants shall expressly waive, and each of the Class
Members shall be deemed to have, and by operation of the Order and Final Judgment shall have,
expressly waived any and all provisions, rights, and benefits conferred by California Civil Code
§1542 and any law of any state or territory of the United States, or principle of common law, which
is similar, comparable, or equivalent to California Civil Code §1542, which provides:
A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if
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known by him or her must have materially affected his or her settlement with the debtor.
Lead Plaintiffs and Class Members may hereafter discover facts in addition to or different from those
that any of them now know or believe to be true related to the subject matter of the Released Claims,
but Lead Plaintiffs shall expressly and each Class Member, upon the Effective Date, shall be deemed
to have, and by operation of the Order and Final Judgment shall have, fully, finally, and forever
settled and released any and all Released Claims, known or unknown, suspected or unsuspected,
contingent or non-contingent, disclosed or undisclosed, matured or unmatured, which now exist, or
heretofore have existed upon any theory of law or equity now existing or coming into existence in
the future, including, but not limited to, conduct that is negligent, intentional, with or without malice,
or a breach of any duty, law or rule, without regard to the subsequent discovery or existence of such
different or additional facts. Similarly, the Underwriter Defendants may hereafter discover facts in
addition to or different from those that any of them now knows or believes to be true related to the
subject matter of the Settled Underwriter Defendants’ Claims, but each Underwriter Defendant shall
expressly and, upon the Effective Date, shall be deemed to have, and by operation of the Order and
Final Judgment shall have, fully, finally, and forever settled and released any and all Settled
Underwriter Defendants’ Claims, known or unknown, suspected or unsuspected, contingent or non-
contingent, disclosed or undisclosed, matured or unmatured, which now exist, or heretofore have
existed upon any theory of law or equity now existing or coming into existence in the future,
including, but not limited to, conduct that is negligent, intentional, with or without malice, or a
breach of any duty, law or rule, without regard to the subsequent discovery or existence of such
different or additional facts. The Settling Parties acknowledge, and Lead Plaintiffs, the Class
Members, and the Underwriter Defendants shall be deemed by operation of the Order and Final
Judgment to have acknowledged, that the inclusion of “Unknown Claims” in the definition of
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Released Claims and Settled Underwriter Defendants’ Claims was separately bargained for and is a
key element of the Settlement of which these releases are a part.
2. The Settlement
a. The Settlement Fund
2.1 In consideration of the settlement of the Released Claims against the Released
Underwriter Defendant Parties, the Underwriter Defendants shall cause the Settlement Amount to be
deposited into the Settlement Fund on or before thirty (30) days after the later of (i) the entry of an
order by the Court granting preliminary approval of the Settlement, and (ii) the provision to the
Underwriter Defendants of all information necessary to effectuate a transfer of funds, including the
bank name and ABA routing number, account name and number, and a signed W-9 reflecting the
taxpayer identification number for the Settlement Fund.
2.2 The Settlement Amount is to be paid by the Underwriter Defendants, severally and
not jointly, according to the allocation terms determined by the Underwriter Defendants. No
Underwriter Defendant will be liable for any portion of the Settlement Amount not paid by any other
Underwriter Defendant, nor for any interest accruing on such unpaid amount. In the event that one
or more of the Underwriter Defendants fails to pay their agreed share of the Settlement Amount, the
remaining Underwriter Defendants shall have the right, but not the obligation, to fund the shortfall.
In the event that the entire Settlement Amount is not funded when due, Lead Plaintiffs shall have the
right to terminate the Settlement.
2.3 Other than the obligation of the Underwriter Defendants to pay or cause to be paid the
Settlement Amount into the Settlement Fund, the Underwriter Defendants shall have no obligation to
make any other payment into the Settlement Fund pursuant to this Underwriter Defendants
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Stipulation. The interest earned on the Settlement Fund shall be for the benefit of the Class upon the
Effective Date of the Settlement.
b. The Escrow Agent
2.4 The Escrow Agent will invest the Settlement Fund created pursuant to ¶2.1 hereof
only in instruments backed by the full faith and credit of the United States Government or fully
insured by the United States Government or an agency thereof, and will reinvest the proceeds of
these instruments as they mature in similar instruments at their then-current market rates. All risks
related to the investment of the Settlement Fund in accordance with the guidelines set forth in this
paragraph shall be borne by the Settlement Fund, and neither the Underwriter Defendants nor the
Released Underwriter Defendant Parties shall have any responsibility for or liability whatsoever with
respect to the maintenance, investment, or distribution of the Settlement Fund, the actions of the
Escrow Agent, or any transactions executed by the Escrow Agent.
2.5 The Escrow Agent shall not disburse the Settlement Fund except as provided by: (i)
this Underwriter Defendants Stipulation; or (ii) an order of the Court.
2.6 Subject to further order(s) and/or directions as may be made by the Court, the Escrow
Agent is authorized to execute such transactions on behalf of the Class Members as are consistent
with the terms of this Underwriter Defendants Stipulation. The Released Underwriter Defendant
Parties shall have no responsibility for or liability whatsoever with respect to the actions of the
Escrow Agent, or any transaction executed by the Escrow Agent.
2.7 All funds held by the Escrow Agent shall be deemed and considered to be in custodia
legis of the Court, and shall remain subject to the jurisdiction of the Court, until such time as such
funds shall be distributed or returned pursuant to the Underwriter Defendants Stipulation and/or
further order(s) of the Court.
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2.8 Notwithstanding the fact that the Effective Date has not yet occurred, the Escrow
Agent may pay from the Settlement Fund, without further order of the Court, the costs and expenses,
up to Two Hundred and Fifty Thousand U.S. Dollars ($250,000.00), reasonably and actually
incurred in connection with providing notice to members of the Class, mailing the Notice and Proof
of Claim and Release Form and publishing notice (such amount shall include, without limitation, the
actual costs of publication, printing and mailing the Notice, and reimbursement to nominee owners
for forwarding notice to their beneficial owners), and the administrative expenses incurred and fees
charged by the Claims Administrator in connection with providing notice and processing the
submitted Claims (“Notice and Administration Costs”). In the event that the Settlement is
terminated pursuant to the terms of this Underwriter Defendants Stipulation, any actual Notice and
Administration Costs paid or incurred for the above purposes shall not have to be returned or repaid
to the Underwriter Defendants.
2.9 The Released Underwriter Defendant Parties shall have no interest or involvement in,
or any responsibility, authority, or liability whatsoever for: (a) the selection of the Escrow Agent; (b)
the establishment or maintenance of the Escrow Account; (c) the development or application of the
Plan of Allocation; (d) any issue pertaining to the administration of the Settlement, including, but not
limited to, processing or payment of Claims, or nonperformance of the Escrow Agent; (e) the
maintenance, investment, or distribution of the Settlement Fund; (f) the payment or withholding of
Taxes (including interest and penalties) owed by the Settlement Fund; or (g) any losses incurred in
connection with the foregoing, and shall have no liability whatsoever to any Persons, including, but
not limited to, Lead Plaintiffs, or any other Class Member in connection with the foregoing.
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c. Taxes
2.10 (a) The Settling Parties and their counsel agree that the Settlement Fund is
intended to be and should be treated as being at all times a “qualified settlement fund” within the
meaning of Treasury Regulation §1.468B-1. In addition, the Escrow Agent shall timely make such
elections as necessary or advisable to carry out the provisions of this ¶2.10, including the “relation-
back election” (as defined in Treasury Regulation §1.468B-1(j)(2)) back to the earliest permitted
date. Such elections shall be made in compliance with the procedures and requirements contained in
such Treasury Regulations promulgated under §1.468B of the Internal Revenue Code of 1986, as
amended (the “Code”). It shall be the responsibility of the Escrow Agent to timely and properly
prepare and deliver the necessary documentation for signature by all necessary parties, and thereafter
to cause the appropriate filing to occur.
(b) For the purpose of §1.468B of the Code and the Treasury Regulations
promulgated thereunder, the Escrow Agent shall be designated as the “administrator” of the
Settlement Fund. The Escrow Agent shall timely and properly file all informational and other tax
returns necessary or advisable with respect to the Settlement Fund (including, without limitation, the
returns described in Treasury Regulation §1.468B-2(k)). Such returns (as well as the election
described in ¶2.10(a) hereof) shall be consistent with this ¶2.10 and in all events shall reflect that all
Taxes as defined in ¶1.36 hereof (including any estimated Taxes, interest, or penalties) on the
income earned by the Settlement Fund shall be paid out of the Settlement Fund as provided in
¶2.10(c) hereof.
(c) All: (i) Taxes (including any estimated Taxes, interest, or penalties) arising
with respect to the income earned by the Settlement Fund, including any Taxes or tax detriments that
may be imposed upon the Released Underwriter Defendant Parties with respect to any income
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earned by the Settlement Fund for any period during which the Settlement Fund does not qualify as a
“qualified settlement fund” for federal or state income tax purposes; and (ii) Tax Expenses, costs,
and other expenses incurred in connection with the operation and implementation of this ¶2.10
(including, without limitation, expenses of tax attorneys and/or accountants and mailing and
distribution costs and expenses relating to filing (or failing to file) the returns described in this
¶2.10), shall be paid out of the Settlement Fund. In no event shall the Released Underwriter
Defendant Parties have any responsibility for or liability whatsoever with respect to the Taxes or the
Tax Expenses. The Escrow Agent shall indemnify and hold each of the Released Underwriter
Defendant Parties harmless for Taxes and Tax Expenses (including, without limitation, Taxes
payable by reason of any such indemnification). Further, Taxes and Tax Expenses shall be treated
as, and considered to be, a cost of administration of the Settlement Fund and shall be timely paid by
the Escrow Agent out of the Settlement Fund without prior order from the Court, and the Escrow
Agent shall be obligated (notwithstanding anything herein to the contrary) to withhold from
distribution to Authorized Claimants any funds necessary to pay such amount, including the
establishment of adequate reserves for any Taxes and Tax Expenses (as well as any amounts that
may be required to be withheld under Treasury Regulation §1.468B-2(1)(2)); neither the Released
Underwriter Defendant Parties nor their counsel are responsible therefor nor shall they have any
liability with respect thereto. The Settling Parties hereto agree to cooperate with the Escrow Agent,
each other, and their tax attorneys and accountants to the extent reasonably necessary to carry out the
provisions of this ¶2.10.
(d) The Released Underwriter Defendant Parties shall have no responsibility for
or liability whatsoever with respect to Taxes (including the payment or withholding of Taxes), Tax
Expenses, costs, and other expenses reasonably and actually incurred in connection with providing
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notice to the Class, locating Class Members, assisting with the filing of claims, administering and
distributing the Net Settlement Fund to Authorized Claimants, processing Proof of Claim and
Release Forms, or paying escrow fees and costs, nor shall they have any responsibility for or liability
whatsoever for any claims with respect thereto.
d. Termination of Settlement
2.11 Lead Counsel and the counsel for the Underwriter Defendants shall have the right to
terminate the Settlement and this Underwriter Defendants Stipulation by providing written notice of
their election to do so to all other Settling Parties within fifteen (15) days of: (a) the Court’s denial of
Lead Plaintiffs’ motion for preliminary approval of the Settlement in any material respect; (b) the
Court’s refusal to approve this Underwriter Defendants Stipulation or Settlement or any material part
thereof; (c) the Court’s declining to enter the Order and Final Judgment in any material respect; (d)
the Underwriter Defendants’ failure to timely make payment of the full Settlement Amount into the
Escrow Account; or (e) the date upon which the Order and Final Judgment is modified or reversed in
any material respect by an order that is a Final decision on the matter. Any decision with respect to
any Fee and Expense Application, or with respect to any Plan of Allocation, shall not be considered
material to this Underwriter Defendants Stipulation or Settlement, shall not affect the finality of any
Order and Final Judgment, and shall not be grounds for termination of the Settlement.
2.12 In addition to the grounds set forth in ¶2.11 above, counsel for the Underwriter
Defendants shall have the unilateral right to terminate the Settlement in the event that Class
Members who or which, pursuant to timely and valid requests for exclusion from the Class, meet the
conditions set forth in the confidential supplemental agreement (“Supplemental Agreement”), in
accordance with the terms of that agreement. The Supplemental Agreement, which is being
executed concurrently herewith, shall not be filed with the Court and its terms shall not be disclosed
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in any other manner (other than the statements herein and in the Notice, to the extent necessary, or as
otherwise provided in the Supplemental Agreement) unless and until the Court otherwise directs or a
dispute arises between Lead Plaintiffs and the Underwriter Defendants concerning its interpretation
or application. If submission of the Supplemental Agreement is required for resolution of a dispute
or is otherwise ordered by the Court, Lead Plaintiffs and the Underwriter Defendants will undertake
to have the Supplemental Agreement submitted to the Court in camera. Copies of all requests for
exclusion received and copies of all written revocations of requests for exclusion received shall be
sent to counsel for the Underwriter Defendants and to Lead Counsel within a reasonable time of
receipt by the Claims Administrator, and in any event not less than fourteen (14) days prior to the
Settlement Hearing.
2.13 If (i) the Underwriter Defendants exercise their right to terminate the Settlement as
provided in this Underwriter Defendants Stipulation; (ii) Lead Plaintiffs exercise their right to
terminate this Settlement as provided in this Underwriter Defendants Stipulation; (iii) the Court
disapproves the Settlement; or (iv) the Effective Date as to the Settlement otherwise fails to occur,
then:
(a) The Settlement and the relevant portions of this Underwriter Defendants
Stipulation shall be canceled and terminated without prejudice and this Underwriter Defendants
Stipulation shall be null and void and shall have no further force or effect;
(b) Lead Plaintiffs and the Underwriter Defendants shall revert to their respective
positions in the Action on December 23, 2014;
(c) The terms and provisions of this Underwriter Defendants Stipulation and the
fact of this Settlement, with the exception of this ¶2.13(c) and ¶¶2.8, 2.10(c), 6.2, 6.3, 8.1, 9.5, and
9.6 herein, shall have no further force and effect with respect to the Settling Parties and shall not be
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enforceable, or used in the Action or in any other proceeding for any purpose, and any Order and
Final Judgment or order entered by the Court in accordance with the terms of this Underwriter
Defendants Stipulation shall be treated as vacated, nunc pro tunc;
(d) Within fifteen (15) business days after written notification to the Escrow
Agent by Lead Counsel or the Underwriter Defendants’ counsel, the Settlement Fund (including, but
not limited to, any funds received by Lead Counsel consistent with ¶6.2 below), less any expenses
and any costs which have either been disbursed or incurred and chargeable to Notice and
Administration Costs and less any Taxes paid or due or owing shall be refunded by the Escrow
Agent to the Underwriter Defendants (or such other persons or entities as the Underwriter
Defendants may direct) pursuant to written instructions from counsel to the Underwriter Defendants.
Lead Counsel or their designee shall apply for any tax refund owed to the Settlement Fund and pay
the proceeds to the Underwriter Defendants, after deduction of any fees or expenses incurred in
connection with such application(s) for refund(s), pursuant to written instructions from the
Underwriter Defendants’ counsel; and
(e) To the extent that Lead Counsel or the Underwriter Defendants’ counsel send
a written notification to the Escrow Agent pursuant to ¶2.13(d), the form of such notice shall be
provided to the other three (3) business days before delivery to the Escrow Agent.
3. Notice Order and Settlement Hearing
3.1 As promptly as practicable after execution of this Underwriter Defendants
Stipulation, the Lead Plaintiffs shall submit this Underwriter Defendants Stipulation together with its
Exhibits to the Court and shall apply for entry of an order (the “Notice Order”), substantially in the
form and content of Exhibit A attached hereto, which shall be unopposed by the Underwriter
Defendants, requesting, inter alia, the preliminary approval of the Settlement set forth in the
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Underwriter Defendants Stipulation, conditional certification of the Class for settlement purposes,
approval for the mailing of the Notice of Pendency and Proposed Partial Settlements of Class
Action, Motion for Attorneys’ Fees and Settlement Fairness Hearing (the “Notice”) and the Proof of
Claim and Release Form, substantially in the forms of Exhibits A-1 and A-2 attached hereto, and
approval of the publication of a Summary Notice, substantially in the form of Exhibit A-3 attached
hereto, or such other substantially similar form agreed to by the Settling Parties. The Notice shall
include the general terms of the Settlement as set forth in the Underwriter Defendants Stipulation,
the proposed Plan of Allocation, the general terms of the Fee and Expense Application as defined in
¶6.1 below, and the date of the Settlement Hearing.
3.2 Lead Plaintiffs will request that the Court hold a hearing (the “Settlement Hearing”)
and finally approve the Settlement of the Litigation against the Underwriter Defendants as set forth
herein. At or after the Settlement Hearing, Lead Plaintiffs also will request that the Court approve
the proposed Plan of Allocation and the Fee and Expense Application.
4. Releases
4.1 Upon the Effective Date, as defined in ¶1.13 hereof, Lead Plaintiffs and each Class
Member shall be deemed to have, and by operation of the Order and Final Judgment shall have,
fully, finally, and forever released, relinquished and discharged all Released Claims against the
Released Underwriter Defendant Parties, whether or not such Class Member executes and delivers a
Proof of Claim and Release Form.
4.2 The Proof of Claim and Release Form to be executed by Class Members shall release
all Released Claims against the Released Underwriter Defendant Parties and shall be substantially in
the form contained in Exhibit A-2.
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4.3 Upon the Effective Date, as defined in ¶1.13 hereof, each of the Released Underwriter
Defendant Parties shall be deemed to have, and by operation of the Order and Final Judgment shall
have, fully, finally, and forever released Lead Plaintiffs, Plaintiffs’ Counsel and each and all of the
Class Members from all Settled Underwriter Defendants’ Claims.
5. Administration and Calculation of Claims, Final Awards, and
Supervision and Distribution of the Settlement Fund
5.1 The Claims Administrator, subject to such supervision and direction of the Court
and/or Lead Counsel as may be necessary or as circumstances may require, shall administer and
calculate the claims submitted by Class Members and shall oversee distribution of the Net
Settlement Fund (defined below) to Authorized Claimants.
5.2 The Settlement Fund shall be applied as follows:
(a) to pay all the costs and expenses described in ¶2.8 above;
(b) to pay the Taxes and Tax Expenses described in ¶2.10 above;
(c) to pay Plaintiffs’ Counsel’s attorneys’ fees, expenses, and costs with interest
thereon, if and to the extent allowed by the Court (the “Fee and Expense Award”); and
(d) to distribute the balance of the Settlement Fund (the “Net Settlement Fund”)
to Authorized Claimants as allowed by the Underwriter Defendants Stipulation, the Plan of
Allocation, or the Court.
5.3 Upon the Effective Date and thereafter, and in accordance with the terms of the
Underwriter Defendants Stipulation, the Plan of Allocation, or such further approval and further
order(s) of the Court as may be necessary or as circumstances may require, the Net Settlement Fund
shall be distributed to Authorized Claimants, subject to and in accordance with the following:
(a) Each Class Member shall be required to submit a Proof of Claim and Release
Form, substantially in a form approved by the Court, supported by such documents as are designated
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therein, including proof of the transactions claimed, or such other documents or proof as the Claim
Administrator, in its discretion, may deem acceptable;
(b) All Proof of Claim and Release Forms must be submitted by the date specified
in the Notice unless such period is extended by order of the Court. Except as otherwise ordered by
the Court, any Class Member who fails to submit a Proof of Claim and Release Form by such date
shall be forever barred from receiving any payment pursuant to this Underwriter Defendants
Stipulation, but shall in all other respects be bound by all of the terms of this Underwriter
Defendants Stipulation and the Settlement, including the terms of the Order and Final Judgment to
be entered in the Litigation and the releases provided for therein and herein, and will be barred and
enjoined from bringing any action against the Released Underwriter Defendant Parties concerning
the Released Claims. A Proof of Claim and Release Form shall be deemed to have been submitted
when posted, if received with a postmark indicated on the envelope and if mailed by first-class mail
and addressed in accordance with the instructions thereon. In all other cases, the Proof of Claim and
Release Form shall be deemed to have been submitted when actually received by the Claims
Administrator. Notwithstanding the foregoing, Lead Counsel may, in their discretion, accept for
processing late submitted Claims so long as the distribution of the Net Settlement Fund to
Authorized Claimants is not materially delayed but shall have no liability for declining to accept any
late-submitted Claims;
(c) Each Proof of Claim and Release Form shall be submitted to and reviewed by
the Claims Administrator, who shall determine in accordance with this Underwriter Defendants
Stipulation and the approved Plan of Allocation the extent, if any, to which each Claim shall be
allowed, subject to review by the Court pursuant to subparagraph (e) below;
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(d) Proof of Claim and Release Forms that do not meet the submission
requirements may be rejected. Prior to rejection of a Proof of Claim and Release Form, the Claims
Administrator shall make reasonable efforts to communicate with the Claimant in order to remedy
the curable deficiencies in the Proof of Claim and Release Form submitted. The Claims
Administrator shall notify, in a timely fashion and in writing, all Claimants whose Proof of Claim
and Release Forms it proposes to reject in whole or in part, setting forth the reasons therefor, and
shall indicate in such notice that the Claimant whose Claim is to be rejected has the right to a review
by the Court if the Claimant so desires and complies with the requirements of subparagraph (e)
below;
(e) If any Claimant whose Claim has been rejected in whole or in part desires to
contest such rejection, the Claimant must, within twenty (20) days after the date of mailing of the
notice required in subparagraph (d) above, serve upon the Claims Administrator a notice and
statement of reasons indicating the Claimant’s grounds for contesting the rejection, along with any
supporting documentation, and requesting a review thereof by the Court. If a dispute concerning a
Claim cannot be otherwise resolved, Lead Counsel shall thereafter present the request for review to
the Court; and
(f) The Claims Administrator shall calculate the Claims of Authorized Claimants
in accordance with the Plan of Allocation. Following the Effective Date, the Claims Administrator
shall send to each Authorized Claimant his, her, or its pro rata share of the Net Settlement Fund. No
distributions will be made to Authorized Claimants who would otherwise receive a distribution of
less than $10.00.
5.4 Persons who otherwise would be members of the Class but desire to be excluded from
this Settlement shall be required to provide a written statement that the Person wishes to be excluded
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from the Class for receipt by the Claims Administrator on or before fourteen (14) days prior to the
Settlement Hearing. Unless otherwise ordered by the Court, any Person who purchased, acquired, or
held the Senior Notes and/or OSG common stock purchased or otherwise acquired during the Class
Period who does not submit a timely and valid request for exclusion as provided by this Underwriter
Defendants Stipulation and its Exhibits shall be bound by this Underwriter Defendants Stipulation.
5.5 Except for their obligation to pay or cause payment of the Settlement Amount into the
Settlement Fund as set forth herein, the Released Underwriter Defendant Parties shall have no
responsibility for or liability whatsoever with respect to the investment or distribution of the
Settlement Fund, administration of the Plan of Allocation, the determination, administration, or
calculation of claims, or the payment or withholding of Taxes or Tax Expenses, or any losses
incurred in connection therewith.
5.6 No Person shall have any claim against Lead Plaintiffs, the Escrow Agent, Plaintiffs’
Counsel, the Claims Administrator, the Underwriter Defendants, the Released Underwriter
Defendant Parties, or counsel for the Underwriter Defendants based on distributions made
substantially in accordance with this Underwriter Defendants Stipulation and the Settlement
contained herein, the Plan of Allocation, or further order(s) of the Court.
5.7 The Underwriter Defendants shall not have a reversionary interest in the Net
Settlement Fund. If there is any balance remaining in the Net Settlement Fund after six (6) months
from the date of distribution of the Net Settlement Fund (whether by reason of tax refunds, uncashed
checks, or otherwise), then, after the Claims Administrator has made reasonable and diligent efforts
to have Class Members who are entitled to participate in the distribution of the Net Settlement Fund
cash their distributions, any balance remaining shall be redistributed on a pro rata basis among
Authorized Claimants who negotiated the checks sent to them in the initial distribution and who
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would receive a minimum of $10.00. These redistributions shall be repeated until the balance
remaining in the Net Settlement Fund is de minimis and any remainder shall thereafter be donated to
an appropriate non-profit organization selected by Lead Counsel as approved by the Court.
5.8 It is understood and agreed by the Settling Parties that any proposed Plan of
Allocation of the Net Settlement Fund, including, but not limited to, any adjustments to an
Authorized Claimant’s Claim set forth therein, is not a part of this Underwriter Defendants
Stipulation and is to be considered by the Court separately from the Court’s consideration of the
fairness, reasonableness, and adequacy of the Settlement set forth in this Underwriter Defendants
Stipulation, and any order or proceeding relating to the Plan of Allocation shall not operate to
terminate or cancel this Underwriter Defendants Stipulation or affect the finality of the Court’s
Order and Final Judgment approving the Underwriter Defendants Stipulation and the Settlement set
forth therein, or any other orders entered pursuant to this Underwriter Defendants Stipulation. Lead
Plaintiffs and Lead Counsel may not cancel or terminate the Settlement (or this Underwriter
Defendants Stipulation) based on the Court’s or any appellate court’s ruling with respect to the Plan
of Allocation or any other plan of allocation in this Action, and, as set forth in ¶2.11, it is not a
condition to the Effective Date occurring that a plan of allocation shall have been approved by the
Court. The time to appeal from approval of the Settlement shall commence upon the entry of the
Court’s Order and Final Judgment approving this Underwriter Defendants Stipulation regardless of
whether a Plan of Allocation has been approved.
6. Plaintiffs’ Counsel’s Attorneys’ Fees and Expenses
6.1 Lead Counsel may submit an application or applications (the “Fee and Expense
Application”) to the Court for distributions to Plaintiffs’ Counsel from the Settlement Fund for: (a)
an award of attorneys’ fees from the Settlement Fund; (b) payment of expenses and costs incurred in
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connection with prosecuting the Litigation; and (c) any interest on such costs and expenses at the
same rate and for the same periods as earned by the Settlement Fund. The Underwriter Defendants
shall take no position with respect to Lead Counsel’s requested attorneys’ fees and expenses.
6.2 The attorneys’ fees, expenses, and costs, as awarded by the Court, shall be paid to
Lead Counsel from the Settlement Fund, as ordered, immediately after the Court executes an order
awarding such fees and expenses, notwithstanding the existence of any objections thereto, or
potential for appeal therefrom, or collateral attack on the Settlement or any part thereof. Lead
Counsel shall thereafter allocate, subject to the conditions below, the attorneys’ fees amongst
Plaintiffs’ Counsel in a manner in which they in good faith believe reflects the contributions of such
counsel to the prosecution and settlement of the Litigation.
6.3 The Settling Parties further agree that the denial, in whole or in part, of any Fee and
Expense Application by Lead Counsel shall in no way affect the enforceability, validity or finality of
the Settlement or this Underwriter Defendants Stipulation, nor shall any order or proceeding relating
solely to an award of attorneys’ fees and expenses, or any appeal from any order relating thereto,
affect or delay the finality of the Order and Final Judgment approving the Settlement.
6.4 In the event that the Effective Date does not occur, or the Order and Final Judgment
or the order granting the Fee and Expense Award is reversed or modified, or this Underwriter
Defendants Stipulation is canceled or terminated for any other reason, and in the event that the Fee
and Expense Award has been paid to any extent, then Plaintiffs’ Counsel shall be severally obligated
to repay to the Escrow Account the reversed portion of the fees and expenses, with interest, less any
Notice and Administration Costs referred to in ¶2.8 actually paid or incurred. Each such Plaintiffs’
Counsel’s law firm, as a condition of receiving such fees and expenses, on behalf of itself and each
partner, shareholder or member of it, agrees that the law firm and its partners, shareholders, and/or
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members are subject to the jurisdiction of the Court for the purposes of enforcing the provisions of
this paragraph.
6.5 The Underwriter Defendants shall have no obligation to pay any fees, expenses, costs,
or interest that the Court may award to Lead Counsel, Plaintiffs’ Counsel, and/or any other counsel
or Person. The Released Underwriter Defendant Parties shall have no responsibility for, and no
liability whatsoever with respect to, any payment to Lead Counsel, Plaintiffs’ Counsel, and/or any
other counsel or Person who receives payment from the Settlement Fund.
6.6 The Released Underwriter Defendant Parties shall have no responsibility for, and no
liability whatsoever with respect to, the allocation among Lead Counsel, Plaintiffs’ Counsel, and/or
any other counsel or Person who may assert some claim thereto, of any Fee and Expense Award that
the Court may grant in the Litigation.
7. Conditions of Settlement
7.1 The Effective Date of the Underwriter Defendants Stipulation shall be conditioned on
the occurrence of all of the following events:
(a) the Court has entered the Notice Order, as required by ¶3.1 hereof;
(b) the Underwriter Defendants have made their contributions to the Settlement
Fund, as required by ¶2.1 above;
(c) the Underwriter Defendants have not exercised their option to terminate the
Settlement pursuant to the provisions of this Underwriter Defendants Stipulation;
(d) the Lead Plaintiffs have not exercised their option to terminate the Settlement
pursuant to the provisions of this Underwriter Defendants Stipulation;
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(e) the Court has approved the Settlement as described herein, following notice to
the Class Members and the Settlement Hearing, as prescribed by Rule 23 of the Federal Rules of
Civil Procedure;
(f) the Court has entered the Order and Final Judgment, or a judgment
substantially in the form of Exhibit B attached hereto;
(g) in accordance with 15 U.S.C. §78u-4(f)(7)(A), any and all claims for
contribution are permanently barred and discharged if the claim or claims: (a) arise out of the
Litigation or any Released Claim; and (b) are filed by any Person against any Underwriter
Defendant; and
(h) the Order and Final Judgment has become Final, as defined in ¶1.16 hereof.
7.2 If the Settlement contemplated by this Underwriter Defendants Stipulation is
approved by the Court, the Settling Parties shall request that the Court enter an Order and Final
Judgment, substantially in the form attached hereto as Exhibit B, including, among other things, the
releases, bar orders, and judgment reduction provisions provided for therein, and an express
determination pursuant to Federal Rule of Civil Procedure 54(b) that there is no just reason for delay
of its entry.
7.3 The Order and Final Judgment shall contain a bar order, substantially in the form set
forth in Exhibit B that: (a) permanently bars, enjoins, and restrains any person or entity from
commencing, prosecuting, or asserting any Barred Claims against any of the Released Underwriter
Defendant Parties, whether as claims, cross-claims, counterclaims, third-party claims, or otherwise,
and whether asserted in the Action or any other proceeding, in the Court, in any federal or state
court, or in any other court, arbitration proceeding, administrative agency, or other forum in the
United States or elsewhere; and (b) permanently bars, enjoins, and restrains the Released
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Underwriter Defendant Parties from commencing, prosecuting, or asserting any Barred Claims
against any person or entity, whether as claims, cross-claims, counterclaims, third-party claims or
otherwise, and whether asserted in the Action or any other proceeding, in the Court, in any federal or
state court, or in any other court, arbitration proceeding, administrative agency, or other forum in the
United States or elsewhere.
7.4 The Order and Final Judgment shall contain a judgment reduction provision,
substantially in the form set forth in Exhibit B, providing that any final verdict or judgment that may
be obtained by or on behalf of the Class Members against any Person subject to the bar order shall be
reduced by the greater of: (i) an amount that corresponds to the percentage of responsibility of the
Underwriter Defendants for common damages; or (ii) the amount paid by or on behalf of the
Underwriter Defendants to the Class Members for common damages.
7.5 This is not a claims-made settlement. Upon the occurrence of the Effective Date, no
Underwriter Defendant, other Released Underwriter Defendant Party, or any other Person who or
which paid any portion of the Settlement Amount shall have any right to the return of the Settlement
Fund or any portion thereof for any reason whatsoever. Upon the occurrence of all of the events
referenced in ¶7.1 hereof, any and all remaining interest or right of the Underwriter Defendants in or
to the Settlement Fund, if any, shall be absolutely and forever extinguished. If all of the conditions
specified in ¶7.1 hereof are not met, then this Underwriter Defendants Stipulation shall be cancelled
and terminated subject to ¶2 hereof, unless Lead Counsel and counsel for the Underwriter
Defendants mutually agree in writing to proceed with the Settlement.
8. No Admission of Wrongdoing
8.1 Neither this Underwriter Defendants Stipulation (whether or not consummated),
including the Exhibits hereto, the Plan of Allocation to be proposed by Lead Plaintiffs (or any other
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plan of allocation that may be approved by the Court), the negotiations leading to the execution of
this Underwriter Defendants Stipulation, nor any proceedings taken pursuant to or in connection
with this Underwriter Defendants Stipulation and/or approval of the Settlement (including any
arguments proffered in connection therewith):
(a) shall be offered against any of the Released Underwriter Defendant Parties as
evidence of, or construed as, or deemed to be evidence of (i) any presumption, concession, or
admission by any of the Released Underwriter Defendant Parties with respect to the truth of any fact
alleged by Lead Plaintiffs or any member of the Class, the validity of any claim that was or could
have been asserted by Lead Plaintiffs or any member of the Class, or the deficiency of any defense
that has been or could have been asserted by the Underwriter Defendants in this Action or in any
other litigation, or (ii) any liability, negligence, fault, or other wrongdoing of any kind of any of the
Released Underwriter Defendant Parties or in any way referred to for any other reason as against any
of the Released Underwriter Defendant Parties, in any civil, criminal, or administrative action or
proceeding, other than such proceedings as may be necessary to effectuate the provisions of this
Underwriter Defendants Stipulation;
(b) shall be offered against any of the Lead Plaintiffs or the Class Members, as
evidence of, or construed as, or deemed to be evidence of (i) any presumption, concession or
admission by any of the Lead Plaintiffs or the Class Members that any of their claims are without
merit, that any of the Released Underwriter Defendant Parties had meritorious defenses, or that
damages recoverable against the Underwriter Defendants under the Complaint would not have
exceeded the Settlement Amount, or (ii) any liability, negligence, fault, or wrongdoing of any kind,
or in any way referred to for any other reason as against any of the Lead Plaintiffs or the Class
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Members, in any civil, criminal, or administrative action or proceeding, other than such proceedings
as may be necessary to effectuate the provisions of this Underwriter Defendants Stipulation; or
(c) shall be construed against any of the Released Underwriter Defendant Parties,
Lead Plaintiffs, or Class Members as an admission, concession, or presumption that the
consideration to be given hereunder represents the amount which could be or would have been
recovered against the Underwriter Defendants after trial; provided, however, that if this Underwriter
Defendants Stipulation is approved by the Court, the Settling Parties and the Released Underwriter
Defendant Parties and their respective counsel may refer to it to effectuate the protections from
liability granted hereunder or otherwise to enforce the terms of the Settlement.
9. Miscellaneous Provisions
9.1 The Settling Parties: (a) acknowledge that it is their intent to consummate this
Underwriter Defendants Stipulation; and (b) agree to cooperate to the extent reasonably necessary to
effectuate and implement all terms and conditions of this Underwriter Defendants Stipulation and to
exercise their best efforts to accomplish the foregoing terms and conditions of this Underwriter
Defendants Stipulation.
9.2 This Underwriter Defendants Stipulation, the Exhibits attached hereto, and the
Supplemental Agreement constitute the entire agreement between the Settling Parties as to the
subject matter hereof and supersede any prior or contemporaneous written or oral agreements or
understandings between the Settling Parties. No representations, warranties, or inducements have
been made to any party concerning this Underwriter Defendants Stipulation, its Exhibits, or the
Supplemental Agreement other than the representations, warranties, and covenants contained and
memorialized in such documents.
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9.3 Except as otherwise provided for herein, each Settling Party shall bear his, her, or its
own costs.
9.4 The Settling Parties intend this Settlement to be a final and complete resolution of all
disputes between them with respect to the Litigation. The Settlement compromises all claims that
were contested and shall not be deemed an admission by any Settling Party as to the merits of any
claim or defense. The Settling Parties agree that the amount paid to the Settlement Fund and the
other terms of the Settlement were negotiated in good faith by the Settling Parties, and reflect a
settlement that was reached voluntarily after consultation with competent legal counsel. Lead
Plaintiffs and Plaintiffs’ Counsel and the Underwriter Defendants and their counsel agree not to
assert in any forum or in any statement made to any media representative (whether or not for
attribution) that this Action was brought by Lead Plaintiffs or defended by the Underwriter
Defendants in bad faith or without a reasonable basis, nor will they deny that the Action was
commenced, prosecuted, and defended in good faith and is being settled voluntarily after
consultation with competent legal counsel.
9.5 Except as otherwise provided for herein, all agreements made and orders entered
during the course of the Litigation relating to the confidentiality of information shall survive this
Underwriter Defendants Stipulation.
9.6 The MOU, dated December 23, 2014, shall remain confidential after this Underwriter
Defendants Stipulation is filed with the Court.
9.7 All of the Exhibits to this Underwriter Defendants Stipulation are material and
integral parts hereof and are fully incorporated herein by this reference.
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9.8 This Underwriter Defendants Stipulation may be amended or modified only by a
written instrument signed by or on behalf of all Settling Parties or their respective successors-in-
interest.
9.9 Each counsel or other Person executing this Underwriter Defendants Stipulation or
any of its Exhibits on behalf of any party hereto hereby warrants that such Person has the full
authority to do so.
9.10 This Underwriter Defendants Stipulation may be executed in one or more
counterparts. All executed counterparts and each of them shall be deemed to be one and the same
instrument. A complete set of executed counterparts shall be filed with the Court.
9.11 This Underwriter Defendants Stipulation shall be binding upon, and inure to the
benefit of, the successors and assigns of the Settling Parties.
9.12 The Court shall retain jurisdiction with respect to implementation and enforcement of
the terms of this Underwriter Defendants Stipulation, and the Settling Parties submit to the
jurisdiction of the Court for purposes of implementing and enforcing the Settlement embodied in this
Underwriter Defendants Stipulation.
9.13 The waiver by one party of any breach of this Underwriter Defendants Stipulation by
any other party shall not be deemed a waiver by any other party or a waiver of any other prior or
subsequent breach of this Underwriter Defendants Stipulation.
9.14 This Underwriter Defendants Stipulation, the Exhibits attached hereto, and the
Supplemental Agreement shall be considered to have been negotiated, executed, and delivered, and
to be wholly performed, in the State of New York, and the rights and obligations of the parties to this
Underwriter Defendants Stipulation shall be construed and enforced in accordance with, and
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governed by, the internal, substantive laws of the State of New York without giving effect to that
State’s choice-of-law principles.
9.15 The headings herein are used for the purpose of convenience only and are not meant
to have legal effect.
9.16 Pending approval of the Court of this Underwriter Defendants Stipulation and its
Exhibits, other than by agreement of the Settling Parties, all proceedings in this Action against the
Underwriter Defendants shall be stayed and the Lead Plaintiffs and all Class Members shall be
barred and enjoined from prosecuting any of the Released Claims against any of the Released
Underwriter Defendant Parties.
9.17 This Underwriter Defendants Stipulation shall not be construed more strictly against
one party than another merely by virtue of the fact that it, or any part of it, may have been prepared
by counsel for one of the Settling Parties, it being recognized that it is the result of arm’s-length
negotiations between the Settling Parties, and the Settling Parties have contributed substantially and
materially to the preparation of this Underwriter Defendants Stipulation.
IN WITNESS WHEREOF, the parties hereto have caused the Underwriter Defendants
Stipulation to be executed, by their duly authorized attorneys, dated August 4, 2015.
ROBBINS GELLER RUDMAN & DOWD LLP SAMUEL H. RUDMAN DAVID A. ROSENFELD
DAVID A. ROSENFELD
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Case 1:12-cv-07948-SAS Document 234 Filed 08/06/15 Page 37 of 38
999215_7
CERTIFICATE OF SERVICE
I hereby certify that on August 6, 2015, I caused the foregoing Stipulation of Settlement with
the Underwriter Defendants to be served electronically on all ECF participants.
s/ Ellen Gusikoff Stewart
ELLEN GUSIKOFF STEWART
Case 1:12-cv-07948-SAS Document 234 Filed 08/06/15 Page 38 of 38
EXHIBIT A
Case 1:12-cv-07948-SAS Document 234-1 Filed 08/06/15 Page 1 of 15
1054863_1
UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK
x In re OSG SECURITIES LITIGATION
This Document Relates To:
ALL ACTIONS.
: : : : : : x
Civil Action No. 1:12-cv-07948-SAS
CLASS ACTION
[PROPOSED] ORDER PRELIMINARILY APPROVING SETTLEMENT WITH THE UNDERWRITER DEFENDANTS AND PROVIDING FOR NOTICE
EXHIBIT A
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WHEREAS, an action is pending before this Court styled In re OSG Securities Litigation,
Civil Action No. 1:12-cv-07948-SAS (the “Action”);
WHEREAS, Lead Plaintiffs Stichting Pensioenfonds DSM Nederland, Indiana Treasurer of
State, and Lloyd Crawford, on behalf of themselves and each of the Class Members, and Citigroup
Global Markets Inc., Deutsche Bank Securities Inc., DNB Markets, Inc. (f/k/a DnB NOR Markets,
Inc.), Goldman, Sachs & Co., HSBC Securities (USA) Inc., ING Financial Markets LLC and
Morgan Stanley & Co. LLC (f/k/a Morgan Stanley & Co. Incorporated) (collectively, the
“Underwriter Defendants”) have determined to settle all claims asserted against the Underwriter
Defendants in this Action with prejudice on the terms and conditions set forth in the Stipulation of
Settlement with the Underwriter Defendants dated August 4, 2015 (the “Underwriter Defendants
Stipulation”) subject to the approval of this Court (the “Underwriter Defendants Settlement”);
WHEREAS, Lead Plaintiffs have made an application, pursuant to Federal Rule of Civil
Procedure 23(e), for an order preliminarily approving the Underwriter Defendants Settlement in
accordance with Underwriter Defendants Stipulation, certifying the Class for the purposes of the
Underwriter Defendants Settlement only, and allowing notice to the Class Members as more fully
described herein;
WHEREAS, the Court has read and considered: (a) the Complaint filed in this Action on
February 18, 2014; (b) Lead Plaintiffs’ motion for preliminary approval of the Underwriter
Defendants Settlement, and the papers filed and arguments made in connection therewith; and (c) the
Underwriter Defendants Stipulation and the exhibits attached thereto; and
WHEREAS, unless otherwise defined herein, all capitalized terms used herein shall have the
same meanings as set forth in the Underwriter Defendants Stipulation.
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NOW, THEREFORE, IT IS HEREBY ORDERED:
1. The Court hereby preliminarily approves the Underwriter Defendants Settlement, as
embodied in the Underwriter Defendants Stipulation, as being fair, reasonable, and adequate to the
Class, subject to further consideration at the Settlement Hearing to be conducted as described below.
2. A hearing (the “Settlement Hearing”) shall be held before this Court on ________,
2015, at ________ _.m., at the Daniel Patrick Moynihan United States Courthouse, 500 Pearl Street,
New York, NY 10007-1312, Courtroom 15C, for the following purposes: (a) to determine whether
the proposed Underwriter Defendants Settlement embodied by the Underwriter Defendants
Stipulation is fair, reasonable, and adequate to the Class; and (b) to determine whether the Court
should (1) enter the Order and Final Judgment approving the Underwriter Defendants Settlement;
(2) approve the Plan of Allocation; and (3) determine an award of attorneys’ fees and expenses to
Plaintiffs’ Counsel and to the Lead Plaintiffs. At the Settlement Hearing, the Court will also hear
any objections by Class Members to the Underwriter Defendants Stipulation or Plan of Allocation or
any award of fees and expenses to Plaintiffs’ Counsel or to the Lead Plaintiffs and consider such
other matters as the Court may deem appropriate.
3. Pursuant to Rule 23 of the Federal Rules of Civil Procedure, the Court preliminarily
certifies, for purposes of the Underwriter Defendants Settlement only, a Class defined as all Persons
who or which purchased or otherwise acquired (a) Overseas Shipholding Group, Inc.’s (“OSG”)
8.125% Senior Notes Due 2018 (the “Senior Notes”), pursuant or traceable to OSG’s March 2010
registration statement and prospectus supplement for the Senior Notes; and/or (b) OSG’s common
stock during and inclusive of the period October 29, 2007 through October 19, 2012 (the “Class
Period”). Excluded from the Class are:
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(a) Persons who timely and validly request exclusion from the Class in
accordance with the requirements set forth herein and in the Notice of Pendency and Proposed
Partial Settlements of Class Action, Motion for Attorneys’ Fees and Settlement Fairness Hearing
(“Notice”) to be sent to Class Members pursuant to this Order;
(b) Defendants in the Action, G. Allen Andreas (“Andreas”), and their respective
successors and assigns; past and current officers and directors of OSG and the Underwriter
Defendants and PricewaterhouseCoopers LLP and Ernst & Young LLP during the Class Period;
(c) members of the immediate families of the Individual Defendants and Andreas;
(d) the legal representatives, heirs, successors, or assigns of the Individual
Defendants and Andreas; and
(e) any entity in which any of the above excluded Persons have or had a majority
ownership interest.
4. For purposes of the proposed Underwriter Defendants Settlement only, the Court
finds that the prerequisites for a class action under Rules 23(a) and (b)(3) of the Federal Rules of
Civil Procedure have been satisfied in that: (a) the members of the Class are so numerous that
joinder of all Class Members in the Action would be impracticable; (b) there are questions of law
and fact common to the Class that predominate over any individual questions; (c) the claims of the
Lead Plaintiffs are typical of the claims of the Class; (d) Lead Plaintiffs and their counsel have fairly
and adequately represented and protected the interests of Class Members; and (e) a class action is
superior to other available methods for the fair and efficient adjudication of the Action.
5. Pursuant to Rule 23(c) of the Federal Rules of Civil Procedure, the Court appoints for
purposes of settlement only the firm Gilardi & Co. LLC (“Claims Administrator”) to supervise and
administer the notice procedure as well as the processing of Claims as more fully set forth below:
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(a) Not later than ten (10) days after the entry of this Order, OSG shall cause its
transfer agent to provide to Lead Counsel and/or the Claims Administrator, in an electronic format
acceptable to the Claims Administrator, a list of names and addresses of all record holders of OSG
Senior Notes and common stock during the Class Period (the “Class List”);
(b) Not later than __________, 2015 (the “Notice Date”), Lead Counsel and/or
the Claims Administrator shall cause a copy of the Notice and the Proof of Claim form (“Proof of
Claim”), substantially in the forms annexed hereto, to be mailed by First-Class Mail to all potential
Class Members who or which may be identified with reasonable effort and to be posted on the
Claims Administrator’s website at www.osgsecuritieslitigation.com;
(c) Not later than __________, 2015, the Claims Administrator shall cause the
Summary Notice to be published once in the national edition of Investor’s Business Daily and once
over a national newswire service; and
(d) Not later than twenty-eight (28) calendar days before the Settlement Hearing,
Lead Counsel shall serve on the Underwriter Defendants’ counsel and file with the Court proof, by
affidavit or declaration, of such mailing and publishing.
6. Nominees who purchased or otherwise acquired OSG Senior Notes or common stock
during the Class Period for the benefit of another Person shall be requested to send the Notice and
Proof of Claim to such beneficial owners of OSG Senior Notes or common stock within ten (10)
calendar days after receipt thereof, or send a list of the names and addresses of such beneficial
owners to the Claims Administrator within ten (10) calendar days of receipt thereof, in which event
the Claims Administrator shall promptly mail the Notice and Proof of Claim to such beneficial
owners.
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7. The form and content of the notice program described herein, and the methods set
forth herein for notifying the Class of the Underwriter Defendants Settlement and its terms and
conditions, the Fee and Expense Application, and the Plan of Allocation meet the requirements of
Rule 23 of the Federal Rules of Civil Procedure, Section 21D(a)(7) of the Securities Exchange Act
of 1934, 15 U.S.C. §78u-4(a)(7), as amended by the Private Securities Litigation Reform Act of
1995, and due process, constitute the best notice practicable under the circumstances, and shall
constitute due and sufficient notice to all Persons entitled thereto.
8. All fees, costs, and expenses incurred in identifying and notifying members of the
Class shall be paid from the Settlement Fund as set forth in the Underwriter Defendants Stipulation,
and in no event shall any of the Released Underwriter Defendant Parties bear any responsibility for
such fees, costs, or expenses.
9. All Class Members (except Persons who request exclusion pursuant to ¶13 below)
shall be bound by all determinations and judgments in the Action concerning the Underwriter
Defendants Settlement, including, but not limited to, the Releases provided for therein, whether
favorable or unfavorable, to the Class, regardless of whether such Persons seek or obtain by any
means, including, without limitation, by submitting a Proof of Claim or any similar document, any
distribution from the Settlement Fund or the Net Settlement Fund.
10. Class Members who wish to participate in the Underwriter Defendants Settlement
shall complete and submit the Proof of Claim in accordance with the instructions contained therein.
Unless the Court orders otherwise, all Proofs of Claim must be postmarked or submitted
electronically no later than __________, 2015. Any Class Member who does not submit a Proof of
Claim within the time provided (a) shall be deemed to have waived his, her, or its right to be
excluded from the Class; (b) shall be forever barred from requesting exclusion from the Class in this
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or any other proceeding; and (c) shall be forever barred from sharing in the distribution of the
proceeds of the Net Settlement Fund, unless otherwise ordered by the Court, but shall nevertheless
be bound by the provisions of the Underwriter Defendants Stipulation, the Releases contained
therein, and the Order and Final Judgment. Notwithstanding the foregoing, Lead Counsel shall have
the discretion to accept late-submitted claims for processing by the Claims Administrator so long as
distribution of the Net Settlement Fund is not materially delayed thereby. Plaintiffs’ Counsel shall
not incur any liability for declining to accept any late-submitted claim.
11. The Proof of Claim submitted by each Class Member must satisfy the following
conditions, unless otherwise ordered by the Court: (i) it must be properly completed, signed and
submitted in a timely manner in accordance with the provisions of the preceding subparagraph; (ii) it
must be accompanied by adequate supporting documentation for the transactions reported therein, in
the form of broker confirmation slips, broker account statements, an authorized statement from the
broker containing the transactional information found in a broker confirmation slip, or such other
documentation as is deemed adequate by Lead Counsel or the Claims Administrator; (iii) if the
person executing the Proof of Claim is acting in a representative capacity, a certification of his/her
current authority to act on behalf of the Class Member must be included in the Proof of Claim; and
(iv) the Proof of Claim must be complete and contain no material deletions or modifications of any
of the printed matter contained therein and must be signed under penalty of perjury.
12. Any Class Member who or which does not request exclusion from the Class may
enter an appearance in the Action at his, her, or its own expense, individually or through counsel of
his, her, or its own choice, by filing with the Clerk of the Court and delivering a notice of appearance
to both Lead Counsel and Underwriter Defendants’ counsel, at the addresses set forth in ¶15 below,
such that it is received no later than twenty-one (21) calendar days prior to the Settlement Hearing,
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or as the Court may otherwise direct. Any Class Member who or which does not enter an
appearance will be represented by Lead Counsel.
13. Any Class Member may, upon request, be excluded or “opt out” from the Class. Any
such Person must submit to the Claims Administrator a request for exclusion (“Request for
Exclusion”), which must be mailed or delivered such that it is received no later than twenty-one (21)
days prior to the Settlement Hearing, to the address designated in the Notice. A Request for
Exclusion must be signed and state: (a) the name, address, and telephone number of the Person
requesting exclusion, and in the case of entities the name and telephone number of the appropriate
contact person; (b) the Person’s purchases, acquisitions and sales of OSG Senior Notes pursuant or
traceable to OSG’s March 2010 registration statement and prospectus supplement for the Senior
Notes, and/or OSG common stock between October 29, 2007 and October 19, 2012, inclusive,
including the dates, number of OSG Senior Notes or common shares purchased, acquired or sold,
and price paid or received for each such purchase, acquisition, or sale; and (c) that such Person
wishes to be excluded from the Class. All Persons who submit valid and timely Requests for
Exclusion in the manner set forth in this paragraph shall have no rights under the Underwriter
Defendants Stipulation, shall not share in the distribution of the Net Settlement Fund, and shall not
be bound by the Underwriter Defendants Stipulation or any final judgment. A Request for Exclusion
shall not be effective unless it is made in writing, provides all the required information, and is
received within the time stated above, or is otherwise accepted by the Court.
14. Lead Counsel shall cause to be provided to the Underwriter Defendants’ counsel
copies of all Requests for Exclusion, and any written revocation of Requests for Exclusion, as
expeditiously as possible and in any event not less than fourteen (14) days prior to the Settlement
Hearing set forth in ¶2.
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15. Any Class Member who does not request exclusion from the Class may file a written
objection to the proposed Underwriter Defendants Settlement and show cause, if he, she, or it has
any cause, why the proposed Underwriter Defendants Settlement should not be approved as fair,
reasonable and adequate, why a judgment should not be entered thereon, why the Plan of Allocation
should not be approved, or why any Fee and Expense Application should not be granted; provided,
however, that no Class Member or any other Person shall be heard or entitled to contest the approval
of the terms and conditions of the proposed Underwriter Defendants Settlement, or, if approved, the
Order and Final Judgment to be entered thereon approving the same, or the order approving the Plan
of Allocation, or any Fee and Expense Award, unless that Class Member or other Person has filed a
written objection with the Court and served copies of any papers and briefs on Robbins Geller
Rudman & Dowd LLP, Ellen Gusikoff Stewart, 655 West Broadway, Suite 1900, San Diego, CA
92101; and Shearman & Sterling LLP, Adam S. Hakki and Elizabeth J. Stewart, 599 Lexington
Avenue, New York, NY 10022-6069, on or before __________, 2015; and said objections, papers,
and briefs are filed with the Clerk of the United States District Court for the Southern District of
New York, on or before ___________, 2015. Any Class Member who or which does not make his,
her, or its objection in the manner provided herein shall be deemed to have waived such objection
and shall forever be barred and foreclosed from making any objection to the fairness,
reasonableness, or adequacy of the proposed Underwriter Defendants Settlement as incorporated in
the Underwriter Defendants Stipulation, to the Plan of Allocation, and to the Fee and Expense
Application or the Fee and Expense Award, unless otherwise ordered by the Court. Attendance at
the Settlement Hearing is not necessary. However, Persons wishing to be heard orally in opposition
to approval of the Underwriter Defendants Settlement, the Plan of Allocation, and/or the Fee and
Expense Application are required to indicate in their written objection their intention to appear at the
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hearing. Class Members do not need to appear at the Settlement Hearing or take any action if they
do not oppose any aspect of the Underwriter Defendants Settlement.
16. Any objections, filings, and other submissions by the objecting Class Member: (a)
must state the name, address, and telephone number of the Person objecting and must be signed by
the objector; (b) must contain a statement of the Class Member’s objection or objections, and the
specific reasons for each objection, including any legal and evidentiary support the Class Member
wishes to bring to the Court’s attention; and (c) must include documents sufficient to prove
membership in the Class, including the objecting Class Member’s purchases, acquisitions, and sales
of OSG Senior Notes pursuant or traceable to OSG’s March 2010 registration statement and
prospectus supplement for the Senior Notes, and/or OSG common stock between October 29, 2007
and October 19, 2012 inclusive, including the dates, number of OSG Senior Notes or common shares
purchased, acquired, or sold, and price paid or received for each such purchase, acquisition, or sale.
17. Lead Counsel and Underwriter Defendants’ counsel shall promptly furnish each other
with copies of any and all objections that come into their possession.
18. All funds held by the Escrow Agent shall be deemed and considered to be in custodia
legis of the Court, and shall remain subject to the jurisdiction of the Court, until such time as such
funds shall be distributed pursuant to the Underwriter Defendants Stipulation and/or further order(s)
of the Court.
19. All papers in support of the Underwriter Defendants Settlement, Plan of Allocation,
and any Fee and Expense Application shall be filed and served by Lead Counsel no later than
twenty-eight (28) calendar days prior to the Settlement Hearing, and any reply papers shall be filed
and served no later than seven (7) calendar days prior to the Settlement Hearing.
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20. The Released Underwriter Defendant Parties shall have no responsibility for the Plan
of Allocation or any Fee and Expense Application, and such matters will be considered separately
from the fairness, reasonableness, and adequacy of the Underwriter Defendants Settlement.
21. At or after the Settlement Hearing, the Court shall determine whether the Plan of
Allocation and any Fee and Expense Application proposed by Lead Counsel should be approved.
22. All reasonable expenses incurred in identifying and notifying Class Members as well
as administering the Settlement Fund shall be paid as set forth in the Underwriter Defendants
Stipulation. In the event the Court does not approve the Underwriter Defendants Settlement, or it
otherwise fails to become effective, neither Lead Plaintiffs nor any of their counsel shall have any
obligation to repay any amounts actually and properly incurred or disbursed pursuant to the
Underwriter Defendants Stipulation.
23. If the Underwriter Defendants Settlement is terminated as provided in the
Underwriter Defendants Stipulation, the Underwriter Defendants Settlement is not approved, or the
Effective Date of the Underwriter Defendants Settlement otherwise fails to occur, this Order shall be
vacated, rendered null and void, and be of no further force and effect, except as otherwise provided
by the Underwriter Defendants Stipulation, and this Order shall be without prejudice to the rights of
Lead Plaintiffs, the other Class Members, or the Underwriter Defendants, and the Lead Plaintiffs and
Underwriter Defendants shall revert to their respective positions in the Action on December 23,
2014, as provided in the Underwriter Defendants Stipulation.
24. Neither this Order, the Underwriter Defendants Stipulation (whether or not
consummated), including the exhibits thereto, the Plan of Allocation to be proposed by Lead
Plaintiffs (or any other plan of allocation that may be approved by the Court), nor any of their terms
or provisions, nor any of the negotiations or proceedings leading to the execution of the Underwriter
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Defendants Stipulation, nor any proceedings taken pursuant to or in connection with the Underwriter
Defendants Stipulation and/or approval of the Underwriter Defendants Settlement (including any
arguments proffered in connection therewith): (a) shall be offered against any of the Released
Underwriter Defendant Parties as evidence of, or construed as, or deemed to be evidence of (i) any
presumption, concession, or admission by any of the Released Underwriter Defendant Parties with
respect to the truth of any fact alleged by Lead Plaintiffs, the validity of any claim that was or could
have been asserted by Lead Plaintiffs or any member of the Class, or the deficiency of any defense
that has been or could have been asserted by the Underwriter Defendants in this Action or in any
other litigation, or (ii) any liability, negligence, fault, or other wrongdoing of any kind of any of the
Released Underwriter Defendant Parties or in any way referred to for any other reason as against any
of the Released Underwriter Defendant Parties in any civil, criminal, or administrative action or
proceeding, other than such proceedings as may be necessary to effectuate the provisions of the
Underwriter Defendants Stipulation; (b) shall be offered against any Lead Plaintiffs or Class
Members as evidence of, or construed as, or deemed to be evidence of (i) any presumption,
concession, or admission by any Lead Plaintiffs or Class Members that any of their claims are
without merit, that any of the Released Underwriter Defendant Parties had meritorious defenses, or
that damages recoverable against the Underwriter Defendants under the Complaint would not have
exceeded the Settlement Amount, or (ii) any liability, negligence, fault, or wrongdoing of any kind,
or in any way referred to for any other reason as against any Lead Plaintiffs or Class Members, in
any civil, criminal, or administrative action or proceeding, other than such proceedings as may be
necessary to effectuate the provisions of the Underwriter Defendants Stipulation; or (c) shall be
construed against any Lead Plaintiffs or Class Members or Released Underwriter Defendant Parties
as an admission, concession, or presumption that the consideration to be given under the Underwriter
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Defendants Settlement represents the amount which could be or would have been recovered against
the Underwriter Defendants after trial; provided, however, that if the Underwriter Defendants
Stipulation is approved by the Court, the Lead Plaintiffs and the Underwriter Defendants and the
Released Underwriter Defendant Parties and their respective counsel may refer to it to effectuate the
protections from liability granted thereunder or otherwise to enforce the terms of the Underwriter
Defendants Settlement. The Released Underwriter Defendant Parties, Lead Plaintiffs, Class
Members, and each of their counsel may file the Underwriter Defendants Stipulation and/or the
Order and Final Judgment in any action that may be brought against them in order to support a
defense or counterclaim based on the principles of res judicata, collateral estoppel, release, good
faith settlement, judgment bar or reduction, or any other theory of claim preclusion or issue
preclusion or similar defense or counterclaim.
25. Unless otherwise ordered by the Court, all proceedings in the Action against the
Underwriter Defendants are stayed, except as may be necessary to implement the Underwriter
Defendants Settlement or comply with the terms of the Underwriter Defendants Stipulation or other
agreement of Lead Plaintiffs and the Underwriter Defendants. Pending final determination of
whether the Underwriter Defendants Settlement should be approved, neither the Lead Plaintiffs nor
any Class Member, either directly, representatively, or in any other capacity, shall commence or
prosecute against any of the Released Underwriter Defendant Parties any action or proceeding in any
court or tribunal asserting any of the Released Claims.
26. The Court reserves the right to alter the time or the date of the Settlement Hearing
without further notice to the Class Members, provided that the time or the date of the Settlement
Hearing shall not be set at a time or date earlier than the time and date set forth in ¶2 above, and
retains jurisdiction to consider all further applications arising out of or connected with the proposed
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Underwriter Defendants Settlement. The Court may approve the Underwriter Defendants
Settlement, with such modifications as may be agreed to by Lead Plaintiffs and the Underwriter
Defendants, if appropriate, without further notice to the Class. The Court reserves the right to enter
the Order and Final Judgment approving the Underwriter Defendant Settlement regardless of
whether it has approved the Plan of Allocation, Plaintiffs’ Counsel’s request for an award of
attorneys’ fees and expenses and the payment of time and expenses of Lead Plaintiffs in their
representation of the Class.
IT IS SO ORDERED.
DATED: ___________________ _________________________________________ THE HONORABLE SHIRA A. SCHEINDLIN UNITED STATES DISTRICT JUDGE
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EXHIBIT A-1
Case 1:12-cv-07948-SAS Document 234-2 Filed 08/06/15 Page 1 of 21
1028192_5
UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK
x In re OSG SECURITIES LITIGATION
This Document Relates To:
ALL ACTIONS.
: : : : : : x
Civil Action No. 1:12-cv-07948-SAS
CLASS ACTION
NOTICE OF PENDENCY AND PROPOSED PARTIAL SETTLEMENTS OF CLASS ACTION, MOTION FOR ATTORNEYS’ FEES AND SETTLEMENT FAIRNESS HEARING
EXHIBIT A-1
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TO: ALL PERSONS WHO OR WHICH PURCHASED OR OTHERWISE ACQUIRED
OVERSEAS SHIPHOLDING GROUP, INC.’S (“OSG” OR THE “COMPANY”)
8.125% SENIOR NOTES DUE 2018 (THE “SENIOR NOTES”) PURSUANT AND/OR
TRACEABLE TO OSG’S MARCH 2010 REGISTRATION STATEMENT AND
PROSPECTUS SUPPLEMENT FOR THE SENIOR NOTES AND/OR OSG’S
COMMON STOCK DURING THE PERIOD OCTOBER 29, 2007 THROUGH
OCTOBER 19, 2012, INCLUSIVE
PLEASE READ THIS NOTICE CAREFULLY AND IN ITS ENTIRETY. YOUR RIGHTS MAY BE AFFECTED BY PROCEEDINGS IN THIS ACTION. PLEASE NOTE THAT IF YOU ARE A CLASS MEMBER, YOU MAY BE ENTITLED TO SHARE IN THE PROCEEDS OF THE PARTIAL SETTLEMENTS DESCRIBED IN THIS NOTICE. TO CLAIM YOUR SHARE OF THE PROCEEDS OF THE SETTLEMENTS, YOU MUST SUBMIT A VALID PROOF OF CLAIM AND RELEASE FORM (“PROOF OF CLAIM”) POSTMARKED OR SUBMITTED
ONLINE ON OR BEFORE [INSERT DATE].
This Notice of Pendency and Proposed Partial Settlements of Class Action, Motion for Attorneys’ Fees and Settlement Fairness Hearing (“Notice”) has been sent to you pursuant to Rule 23 of the Federal Rules of Civil Procedure and Orders of the United States District Court for the Southern District of New York (the “Court”). The purpose of this Notice is to inform you of the pendency of this class action and the proposed partial settlements (the “Partial Settlements”) of the action entitled In re OSG Securities Litigation, Civil Action No. 1:12-cv-07948-SAS (the “Action”) and of the hearing to be held by the Court to consider the fairness, reasonableness, and adequacy of each of the settlements comprising the Partial Settlements as well as counsel’s application for fees, costs, and expenses, including reimbursement to Lead Plaintiffs for their time and expenses incurred in representing the Class. This Notice describes the rights you may have in connection with your participation in the Partial Settlements, what steps you may take in relation to the Partial Settlements and this class action, and, alternatively, what steps you must take if you wish to be excluded from the Partial Settlements and this Action.
Unless otherwise stated, all terms used in this Notice shall have the same meanings as set forth in the Stipulations of Settlement filed with the Court.
YOUR LEGAL RIGHTS AND OPTIONS IN THESE PARTIAL SETTLEMENTS
SUBMIT A CLAIM FORM The only way to get a payment. Proof of Claim forms must be postmarked or submitted online on or before [Insert Date].
EXCLUDE YOURSELF Get no payment. This is the only option that allows you to ever be part of any other lawsuit against the Settling Defendants1 or any
1 The Settling Defendants are: Alan R. Batkin, Thomas B. Coleman, Charles A. Fribourg, Stanley Komaroff, Solomon N. Merkin, Joel I. Picket, Ariel Recanati, Oudi Recanati, Thomas F. Robards, Jean-Paul Vettier, Michael J. Zimmerman, Morten Arntzen, and Myles R. Itkin (collectively, the “Individual Defendants”); Citigroup Global Markets Inc., Deutsche Bank Securities Inc., DNB Markets, Inc. (f/k/a DnB NOR Markets, Inc.), Goldman, Sachs & Co., HSBC Securities (USA) Inc., ING Financial Markets LLC, and Morgan Stanley & Co. LLC (f/k/a Morgan Stanley & Co.
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other Released Persons about the legal claims in this case. Exclusions must be received on or before [Insert Date].
OBJECT Write to the Court about why you do not like any or all of the partial settlements comprising the Partial Settlements, the Plan of Allocation, and/or the request for attorneys’ fees, costs, and expenses. You will still be a member of the Class. Objections must be received by the Court and counsel on or before [Insert Date].
GO TO A HEARING Ask to speak in Court about the fairness of the Partial Settlements or any portion thereof. Requests to speak must be received by the Court and counsel on or before [Insert Date].
DO NOTHING Get no payment. Give up your rights.
SUMMARY OF THIS NOTICE
Statement of Class Recovery
Pursuant to the Partial Settlements described herein, a minimum $31,250,000 settlement fund has been established. This settlement fund (the “Settlement Fund”) consists of: (i) $10,500,000 to be paid by the Individual Defendants; (ii) $4,000,000 to be paid by the Underwriter Defendants; (iii) $1,750,000 to be paid by PwC; and (iv) a minimum of $15,000,000 from the settlement of Class Members’ claim in the bankruptcy court, which also includes a contingent right to 15% of the net proceeds of OSG’s professional liability action against Proskauer Rose LLP and certain individual defendants (the “Bankruptcy Court Settlement”).2 Lead Plaintiffs estimate that there were approximately 26.3 million shares of OSG common stock which may have been damaged during the Class Period and 226,000 damaged Senior Notes; therefore the average recovery under the Partial Settlements is roughly $0.13 per common damaged share and $56.00 per $1,000 in Senior Notes,
Incorporated) (collectively, the “Underwriter Defendants”); and PricewaterhouseCoopers LLP (“PwC”). Defendant Ernst & Young LLP (“E&Y”) is not a settling defendant.
2 The Bankruptcy Court Settlement, less fees and expenses, will also be distributed to Class Members who submit valid claims as a result of a settlement reached on behalf of the Class in OSG’s bankruptcy proceedings. That settlement was approved by the bankruptcy court in July 2014 and is being distributed pursuant to the plan of allocation set forth herein. The specific terms of the Bankruptcy Court Settlement provide for Class Members to receive: (i) $7 million in cash, which has already been paid; (ii) 15% of the Net Proceeds of the Debtors’ professional liability action against Proskauer Rose LLP and certain individual defendants (the “Professional Liability Action”); (iii) $5 million in cash, payable by a reorganized OSG upon resolution of the Professional Liability Action; (iv) $3 million in cash, payable by a reorganized OSG on the first anniversary of the effective date of the Amended Equity Plan; (v) proceeds of any of the Debtors’ residual interests in certain director and officer insurance policies; and (vi) any remaining cash in a $2 million reserve, after accounting for satisfaction or resolution of other subordinated claims.
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before deduction of any taxes on the income thereof, notice and administration costs and the attorneys’ fees, costs, and expenses as determined by the Court. A Class Member’s actual recovery will be a proportion of the Net Settlement Fund determined by that claimant’s Recognized Loss as compared to the total Recognized Losses of all Class Members who submit acceptable Proofs of Claim. An individual Class Member may receive more or less than this estimated average amount depending on the number of claims submitted, when during the Class Period a Class Member purchased or acquired OSG common stock or the Senior Notes, the purchase price paid, and whether those shares or Senior Notes were held at the end of the Class Period or sold during the Class Period, and, if sold, when they were sold and the amount received. See Plan of Allocation as set forth at pages ___ below for more information on your Recognized Loss.
Statement of Potential Outcome of Case
Lead Plaintiffs and the Settling Defendants do not agree on whether Lead Plaintiffs would have prevailed on the merits of their claims against the Settling Defendants, nor do they agree on the average amount of damages per OSG common share or Senior Notes that would be recoverable if the Lead Plaintiffs prevailed on each claim alleged. Among other things, the Settling Defendants deny that: (i) they violated the federal securities laws; (ii) they made false or misleading statements; or (iii) damages were suffered by members of the Class as a result of their alleged conduct.
Statement of Attorneys’ Fees, Costs, and Expenses Sought
Lead Counsel will apply to the Court for an award of attorneys’ fees not to exceed thirty percent (30%) of the Settlement Fund, plus costs and expenses not to exceed $400,000.00, plus interest earned on both amounts at the same rate as earned by the Settlement Fund. Since the Action’s inception, Lead Counsel have expended considerable time and effort in the prosecution of this litigation on a contingent fee basis and advanced the expenses of the litigation in the expectation that if they were successful in obtaining a recovery for the Class they would be paid from such recovery. In this type of litigation it is customary for counsel to be awarded a percentage of the common fund recovery as their attorneys’ fees. In addition, Lead Plaintiffs may seek reimbursement of up to $10,000 each for their time and expenses incurred in representing the Class. The requested fees, costs, and expenses amount to an average of approximately $0.04 per damaged common share and $18.00 per Senior Note. The average cost per damaged share will vary depending on the number of acceptable Proofs of Claim submitted.
Further Information
For further information regarding the Action, this Notice or to review the Stipulations of Settlement for the various settlements comprising the Partial Settlements, please contact the Claims Administrator toll-free at 1-877-236-9485, or www.osgsecuritieslitigation.com.
You may also contact representatives of counsel for the Class: Rick Nelson, Shareholder Relations, Robbins Geller Rudman & Dowd LLP, 655 West Broadway, Suite 1900, San Diego, CA 92101,1-800-449-4900, www.rgrdlaw.com.
Please Do Not Call the Court or Defendants with Questions About the Partial Settlements.
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Reasons for the Partial Settlements
Lead Plaintiffs’ principal reason for the Partial Settlements is the substantial immediate cash benefit to be provided to the Class without the risk or delays inherent in further litigation. This benefit must be compared to the risk that no recovery might be achieved after a contested trial and likely appeals, possibly years into the future. The Settling Defendants deny all allegations of wrongdoing or liability whatsoever and are entering into the Partial Settlements solely to eliminate the uncertainty, burden, and expense of further protracted litigation.
BASIC INFORMATION
1. Why did I get this notice package?
You or someone in your family may have purchased or acquired OSG common stock during the period from October 29, 2007, through and including October 19, 2012 (“Class Period”); or purchased or acquired the Senior Notes.
The Court directed that this Notice be sent to Class Members because they have a right to know about the Partial Settlements of this class action lawsuit, and about all of their options, before the Court decides whether to approve the Partial Settlements. If the Court approves the Partial Settlements and after objections and appeals, if any, are resolved, the Claims Administrator appointed by the Court will make the payments provided for in the Partial Settlements.
This Notice explains the class action lawsuit, the Partial Settlements, Class Members’ legal rights, what benefits are available, who is eligible for them, and how to get them.
The Court in charge of the Action is the United States District Court for the Southern District of New York, and the case is known as In re OSG Securities Litigation, Civil Action No. 1:12-cv-07948-SAS. The case has been assigned to the Honorable Shira A. Scheindlin. The pension funds and individual representing the Class are the “Lead Plaintiffs,” and the companies and individuals they sued and who have now settled are called the Settling Defendants.
2. What is this lawsuit about?
This litigation was commenced on October 24, 2012. Lead Plaintiffs alleged that there were untrue and misleading statements made in the Registration Statement OSG filed in connection with its sale of $300 million of Senior Notes to the public on March 24, 2010, and false and misleading statements made during the Class Period by Defendants Arntzen and Itkin. These alleged statements included specific representations concerning, among other things, the Company’s income taxes; accounting policies; controls and procedures; internal controls over financial reporting; tax benefits purportedly received by the Company; guidance on future tax benefits; how financial statements were prepared in conformity with Generally Accepted Accounting Principles; and guidance on future results.
On November 14, 2012, OSG and its affiliated debtors filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware.
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The parties have engaged in extensive motion practice and deposition and document discovery, and on November 20, 2014, attended a formal mediation session before the Honorable Layn R. Phillips (Ret.), a retired United States District Court Judge. Following that mediation, and after arm’s-length negotiations, the Settling Parties reached their agreements-in-principle to resolve the Action on the terms set forth herein.
Settling Defendants deny each and all of the claims and contentions of wrongdoing alleged by Lead Plaintiffs in the litigation. Settling Defendants contend that they did not make any materially false or misleading statements, they disclosed all material information required to be disclosed by the federal securities laws and any alleged misstatements or omissions were not made with the requisite intent or knowledge of wrongdoing. Settling Defendants also contend that any losses suffered by members of the Class were not caused by any false or misleading statements by Settling Defendants and/or were caused by intervening events. The Settling Defendants also maintain that they have meritorious defenses to all claims that were raised or could have been raised in the Action.
3. Why is this a class action?
In a class action, one or more people called the plaintiff sues on behalf of people who have similar claims. All of the people with similar claims are referred to as a class or class members. One court resolves the issues for all class members, except for those who exclude themselves from the class.
4. Why are there settlements?
The Court has not decided in favor of the Settling Defendants or of the Class. Instead, the Settling Parties agreed to the settlements comprising the Partial Settlements to avoid the distraction, costs and risks of further litigation, and Lead Plaintiffs agreed to the settlements comprising the Partial Settlements in order to ensure that Class Members will receive compensation. Continuing to litigate the case against the Settling Defendants would require all parties to expend substantial resources. If the Action continued against the Settling Defendants, fact discovery would be extremely expensive, each party would likely engage expert witnesses, and Lead Plaintiffs believe much of the proof would be highly technical, making the outcome of any trial unpredictable. Lead Plaintiffs and Lead Counsel believe the Partial Settlements are in the best interest of all Class Members in light of the real possibility that continued litigation could result in no recovery at all.
The Settling Defendants have denied the claims asserted against them in the Action and deny having engaged in any wrongdoing or violation of law of any kind whatsoever. The Settling Defendants have agreed to the Partial Settlements solely to eliminate the burden and expense of continued litigation. Accordingly, the Partial Settlements may not be construed as an admission of any wrongdoing by the Settling Defendants.
The proposed Settlement Amount is based on proposals made to the parties by Judge Phillips, who mediated this case. His recommendation was based on his neutral evaluation of the case and the risks facing all parties at that point in time. He made his recommendation based on his review and consideration of all of the orders issued to date in the case, the evidence and arguments offered by all parties, and the substantial risks to all parties that the future litigation landscape
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presented. Judge Phillips is of the opinion that: “the proposed Partial Settlements are the result of vigorous arms’ length negotiations by the Parties.” Moreover, based on his extensive discussions with all parties and their counsel and the information made available to him both before and during the mediation sessions, his opinion is that “the settlements were negotiated in good faith and are fair and reasonable.” He has indicated that he “strongly support[s] the approval of the Partial Settlements in all respects.”
WHO IS IN THE PARTIAL SETTLEMENTS
To see if you will get money from the Partial Settlements, you first have to decide if you are a Class Member.
5. How do I know if I am part of the Partial Settlements?
The Court directed that everyone who fits this description is a Class Member: all Persons
who or which purchased or otherwise acquired (a) OSG’s 8.125% Senior Notes Due 2018 (the
“Senior Notes”) pursuant and/or traceable to OSG’s March 2010 registration statement and
prospectus supplement for the Senior Notes; and/or (b) OSG’s common stock during and inclusive of the period October 29, 2007 through October 19, 2012, except those Persons and entities that are excluded, as described below.
6. Are there exceptions to being included?
Excluded from the Class are the Defendants, G. Allen Andreas (“Andreas”) and their respective successors and assigns; past and current officers, directors, partners or employees of OSG and the Underwriter Defendants and PwC and E&Y during the Class Period; members of the immediate families of the Individual Defendants and Andreas, the legal representatives, heirs, successors, or assigns of the Individual Defendants, and Andreas, and any entity in which any of the above excluded Persons have or had a majority ownership interest. Also excluded from the Class are those Persons who timely and validly request exclusion from the Class in accordance with the requirements set by the Court and this Notice.
If one of your mutual funds owned OSG common stock or Senior Notes, that alone does not make you a Class Member. You are a Class Member only if you directly purchased or acquired OSG common stock during the Class Period or OSG Senior Notes pursuant and/or traceable to OSG’s March 2010 Registration Statement and Prospectus Supplement. Contact your broker to see if you purchased or acquired OSG common stock or the Senior Notes.
If you sold OSG common stock or the Senior Notes during the Class Period, that alone does not make you a Class Member. You are a Class Member only if you purchased or acquired OSG common stock or Senior Notes, as described above.
7. What if I am still not sure if l am included?
If you are still not sure whether you are included, you can ask for free help. You can contact the Claims Administrator toll-free at 1-877-236-9485, or you can fill out and return the Proof of Claim form enclosed with this Notice package, to see if you qualify.
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THE BENEFITS OF THE PARTIAL SETTLEMENTS – WHAT YOU GET
8. What do the Partial Settlements provide?
In exchange for the release of the Released Claims against each of the Settling Defendants (defined below) as well as dismissal of the Action as against the Settling Defendants, the Settling Defendants have agreed that payments of a total of $16,250,000 will be made by the Settling Defendants (or on their behalf) to be divided, after taxes, fees, and expenses, pro rata among all Class Members who send in a valid Proof of Claim form. This amount is in addition to the minimum of $15,000,000, less fees and expenses, obtained in the Bankruptcy Court Settlement.
9. How much will my payment be?
Your share of the fund will depend on several things, including, how many Class Members submit timely and valid Proof of Claim forms, the total Recognized Losses represented by the valid Proof of Claim forms that Class Members send in, the number of shares of OSG common stock or the amount of Senior Notes you purchased or acquired, how much you paid, when you purchased or acquired, and if you sold your securities and for how much.
By following the instructions in the Plan of Allocation, you can calculate what is called your Recognized Loss. It is unlikely that you will get a payment for all of your Recognized Loss. After all Class Members have sent in their Proof of Claim forms, the payment you get will be a part of the Net Settlement Fund equal to your Recognized Loss divided by the total of everyone’s Recognized Losses. See the Plan of Allocation at pages ___ hereof for more information on your Recognized Loss.
HOW YOU GET A PAYMENT – SUBMITTING A CLAIM FORM
10. How can I get a payment?
To qualify for a payment, you must submit a Proof of Claim form. A Proof of Claim form is enclosed with this Notice or it may be downloaded at www.osgsecuritieslitigation.com. Read the instructions carefully, fill out the Proof of Claim form, include all the documents the form asks for, sign it, and mail or submit it online so that it is postmarked or received no later than [insert date]. The claim form may be submitted online at www.osgsecuritieslitigation.com.
11. When would I get my payment?
The Court will hold a Settlement Hearing on _____________, 2015, to decide whether to approve the Partial Settlements. If the Court approves the Partial Settlements or any portion thereof after that, there might be appeals. It is always uncertain whether these appeals can be resolved, and resolving them can take time, perhaps more than a year. It also takes time for all the Proofs of Claim to be processed. Please be patient.
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12. What am I giving up to get a payment or to stay in the Class?
Unless you exclude yourself, you will remain a Class Member, and that means that, if the Partial Settlements are approved, you will give up all “Released Claims” (as defined below), including “Unknown Claims” (as defined below), against the various “Released Persons” (as defined below):
• “Released Claims” with respect to the Individual Defendants Stipulation means any and all claims, rights, remedies, demands, liabilities and causes of action of every nature and description (including but not limited to any claims for damages, punitive damages, compensation, restitution, disgorgement, rescission, interest, injunctive relief, attorneys’ fees, expert or consulting fees, obligations, debts, losses, and any other costs, expenses or liabilities of any kind or nature whatsoever), whether legal, statutory or equitable in nature to the fullest extent the law permits their release in this Action, whether known or “Unknown Claims” (as defined below), whether arising under federal, state, common or foreign law, whether class or individual in nature, that Lead Plaintiffs, or any other Class Member (a) alleged in any complaint filed or sought to be filed in the Action or (b) could have asserted in any forum or proceeding that (i) arise out of or are based upon or are related to, directly or indirectly, the facts, events, transactions, acts, occurrences, statements, representations, misrepresentations, omissions, which were or could have been alleged by any member of the Class in the Action, and that (ii) arise out of the purchase or acquisition, holding, sale or disposition of the Senior Notes or OSG common stock purchased or acquired during the Class Period by Lead Plaintiffs or any member of the Class, provided however, that the Released Claims shall not include the right to enforce the Individual Defendants Stipulation.
• “Released Claims” with respect to the PwC Stipulation means any and all claims, rights, remedies, demands, liabilities and causes of action of every nature and description (including but not limited to any claims for damages, punitive damages, compensation, restitution, disgorgement, rescission, interest, injunctive relief, attorneys’ fees, expert or consulting fees, obligations, debts, losses, and any other costs, expenses or liabilities of any kind or nature whatsoever), whether legal, statutory or equitable in nature to the fullest extent the law permits their release in this Action, whether known or “Unknown Claims” (as defined below), whether arising under federal, state, common or foreign law, whether class or individual in nature, that Lead Plaintiffs, or any other Class Member (a) alleged in any complaint filed or sought to be filed in the Litigation or (b) could have asserted in any forum or proceeding that (i) arise out of or are based upon or are related to, directly or indirectly, the facts, events, transactions, acts, occurrences, statements, representations, misrepresentations, omissions, which were or could have been alleged by any member of the Class in the Litigation, and that (ii) arise out of the purchase or acquisition, holding, sale or disposition of any OSG securities, including the Senior Notes or common stock, purchased or acquired during the Class Period by Lead Plaintiffs or any member of the Class, provided however, that the Released Claims shall not include the right to enforce the PwC Stipulation.
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• “Released Claims” with respect to the Underwriter Defendants Stipulation means any and all claims (including “Unknown Claims” as defined below) against the Underwriter Defendants and their Related Underwriter Defendant Persons (as defined below), arising out of, relating to, or in connection with both (i) the facts, events, transactions, acts, occurrences, statements, representations, misrepresentations, or omissions which were or could have been alleged in the Litigation, and (ii) the purchase or acquisition, holding, sale or disposition of all securities issued by OSG, including, but not limited to, the Senior Notes or common stock, during the Class Period.
• “Released Persons” means each and all of the Released Individual Defendant Parties, the Released PwC Parties, and the Released Underwriter Defendant Parties.
• “Defendants’ Claims” means all Individual Defendants’ Claims, PwC’s Claims, and Settled Underwriter Defendants’ Claims.
• “Unknown Claims” with respect to the Released Persons means (a) any Released Claims that Lead Plaintiffs or any Class Member does not know or suspect to exist in his, her or its favor at the time of the release of the Released Persons, which, if known by him, her or it, might have affected his, her or its settlement with and release of the Released Persons, or might have affected his, her or its decision(s), with respect to the Partial Settlements; and (b) any Defendants’ Claims that any Settling Defendant does not know or suspect to exist in his, her or its favor at the time of the release of the Lead Plaintiffs, Class Members and Plaintiffs’ Counsel, which, if known by him, her or it, might have affected his, her or its settlement with and release of the Lead Plaintiffs, Class Members and Plaintiffs’ Counsel, or might have affected his, her or its decision(s) with respect to the Partial Settlements. With respect to any and all Released Claims and Defendants’ Claims, the Settling Parties stipulate and agree that, upon the Effective Date, Lead Plaintiffs and the Settling Defendants shall expressly waive, and each of the Class Members and the Settling Defendants shall be deemed to have, and by operation of the Final Judgments and Orders of Dismissal with Prejudice shall have, expressly waived any and all provisions, rights, and benefits conferred by California Civil Code §1542 and any law of any state or territory of the United States, or principle of common law, which is similar, comparable, or equivalent to California Civil Code §1542, which provides:
A general release does not extend to claims which
the creditor does not know or suspect to exist in his or her
favor at the time of executing the release, which if known
by him or her must have materially affected his or her
settlement with the debtor.
Lead Plaintiffs and Class Members may hereafter discover facts in addition to or different from those that any of them now knows or believes to be true related to the subject matter of the Released Claims, but Lead Plaintiffs shall expressly and each Class Member, upon the Effective Date, shall be deemed to have, and by operation of the Final Judgments and Orders of Dismissal with Prejudice shall have, fully, finally,
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and forever settled and released any and all Released Claims, known or unknown, suspected or unsuspected, contingent or non-contingent, disclosed or undisclosed, matured or unmatured, which now exist, or heretofore have existed upon any theory of law or equity now existing or coming into existence in the future, including, but not limited to, conduct that is negligent, intentional, with or without malice, or a breach of any duty, law or rule, without regard to the subsequent discovery or existence of such different or additional facts. Similarly, the Settling Defendants may hereafter discover facts in addition to or different from those that any of them now knows or believes to be true related to the subject matter of the Defendants’ Claims, but each Settling Defendant shall expressly and, upon the Effective Date, shall be deemed to have, and by operation of the Final Judgments and Orders of Dismissal with Prejudice shall have, fully, finally, and forever settled and released any and all Defendants’ Claims, known or unknown, suspected or unsuspected, contingent or non-contingent, disclosed or undisclosed, matured or unmatured, which now exist, or heretofore have existed upon any theory of law or equity now existing or coming into existence in the future, including, but not limited to, conduct that is negligent, intentional, with or without malice, or a breach of any duty, law or rule, without regard to the subsequent discovery or existence of such different or additional facts. The Settling Parties acknowledge, and Lead Plaintiffs, the Class Members, and the Settling Defendants shall be deemed by operation of the Final Judgments and Orders of Dismissal with Prejudice to have acknowledged, that the inclusion of “Unknown Claims” in the definition of Released Claims and Defendants’ Claims was separately bargained for and is a key element of the Partial Settlements of which these releases are a part.
If you remain a member of the Class, all of the Court’s orders will apply to you and legally bind you.
EXCLUDING YOURSELF FROM THE PARTIAL SETTLEMENTS
If you do not want a payment from the Partial Settlements, and you want to keep the right to sue the Settling Defendants and their respective Released Persons, on your own, about the legal issues in this case, then you must take steps to remove yourself from the Partial Settlements. This is called excluding yourself – or is sometimes referred to as “opting out.”
The Individual Defendants, Underwriter Defendants, and PwC have the right to terminate the Partial Settlements as they relate to them if valid requests for exclusion are received from Persons entitled to be members of the Class in an amount that exceeds an amount agreed to by Lead Plaintiffs and the Individual Defendants, Underwriter Defendants, or PwC, respectively.
13. How do I get out of the proposed Partial Settlements?
To exclude yourself from the Class, you must send a letter by First-Class Mail stating that you “request exclusion from the Class in the Overseas Shipholding Group Securities Litigation.” Your letter must include the date(s), price(s), and number(s) of all purchases and sales of OSG common stock during the Class Period and/or Senior Notes pursuant and/or traceable to the March 2010 Registration Statement and Prospectus Summary. In addition, you must include your name,
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address, telephone number, and your signature. You must submit your exclusion request so that it is received no later than [insert date] to:
Overseas Shipholding Group Securities Litigation
c/o Gilardi & Co. LLC Claims Administrator
P.O. Box 8040 San Rafael, CA 94912-8040
If you ask to be excluded, you will not get any payment, and you cannot object to the Partial Settlements. You will not be legally bound by anything that happens in this lawsuit, and you may be able to sue the Settling Defendants and their respective Released Persons in the future.
14. If I do not exclude myself, can I sue the Settling Defendants and their respective
Released Persons for the same thing later?
No. Unless you exclude yourself, you give up any rights you may have to sue the Settling Defendants and their respective Released Persons for any and all Released Claims. If you have a pending lawsuit against the Released Persons speak to your lawyer in that case immediately. You must exclude yourself from this Action to continue your own lawsuit. Remember, the exclusion deadline is [insert date].
15. If I exclude myself, can I get money from the Partial Settlements?
No. If you exclude yourself, you may not send in a Proof of Claim to ask for any money. But you may have the right to sue or be part of a different lawsuit against the Settling Defendants and their respective Released Persons.
THE LAWYERS REPRESENTING YOU
16. Do I have a lawyer in this case?
The Court ordered that the law firm of Robbins Geller Rudman & Dowd LLP represent the Class Members, including you. These lawyers are called Lead Counsel. If you want to be represented by your own lawyer, you may hire one at your own expense.
17. How will the lawyers be paid?
Lead Counsel will move the Court for an award of attorneys’ fees in an amount not greater than thirty percent (30%) of the Settlement Fund and for expenses and costs in an amount not to exceed $400,000.00 in connection with the litigation, plus interest on such fees, costs, and expenses at the same rate earned by the Settlement Fund. Lead Counsel’s application for an award of fees and expenses consists of the fees and expenses of Lead Counsel and additional Plaintiffs’ Counsel, Pomerantz LLP and Lowenstein Sandler LLC. These law firms performed work on behalf of the Class and will submit declarations to the Court documenting their time and expenses in support of Lead Counsel’s application. In addition, Lead Plaintiffs may seek reimbursement of up to $10,000
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each for their time and expenses incurred in representing the Class. Such sums as may be approved by the Court will be paid from the Settlement Fund.
OBJECTING TO THE PARTIAL SETTLEMENTS
18. How do I tell the Court that I object to the proposed Partial Settlements?
If you are a Class Member, you can object to the Partial Settlements or any portion thereof, the proposed Plan of Allocation, the amount of reimbursement sought by Lead Plaintiffs, and/or Lead Counsel’s fee, cost, and expense application. The Court’s evaluation of the fairness, reasonableness and adequacy of each of the three partial settlements that the Class has reached with the Underwriter Defendants, PwC and the Individual Defendants shall be conducted separately. Accordingly, any order of the Court that disapproves or requires a material modification of the terms of any of the three partial settlements will not necessarily result in the disapproval of another partial settlement. Class members may accordingly object to fewer than all of the partial settlements. You can write to the Court setting out your objection. The Court will consider your views. To object, you must send a signed letter saying that you object to all or part of the Partial Settlements in the Overseas Shipholding Group Securities Litigation. Be sure to include your name, address, telephone number, and your signature, identify the date(s), price(s), and number(s) of shares of OSG common stock or Senior Notes you purchased or acquired and sold during the Class Period, identify the portion of the Partial Settlements to which you are objecting, and state the reasons why you object to the proposed Partial Settlements or portions thereof. Your objection must be filed with the Court and mailed or delivered to each of the following addresses such that it is received no later than
[insert date]:
COURT LEAD COUNSEL SETTLING DEFENDANTS’
COUNSEL
Clerk of the Court United States District Court Southern District of New York Daniel Patrick Moynihan United States Courthouse 500 Pearl Street New York, NY 10007
Ellen Gusikoff Stewart ROBBINS GELLER RUDMAN & DOWD LLP 655 West Broadway, Suite 1900 San Diego, CA 92101
Adam S. Hakki Elizabeth J. Stewart SHEARMAN & STERLING LLP 599 Lexington Avenue New York, NY 10022-6069
Richard A. Rosen PAUL, WEISS, RIFKIND, WHARTON & GARRISON LLP 1285 Avenue of the Americas New York, NY 10019-6064
Scott B. Schreiber ARNOLD & PORTER LLP 399 Park Avenue New York, NY 10022-4690
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David H. Kistenbroker
DECHERT LLP 1095 Avenue of the Americas New York, NY 10036-6797
Miles N. Ruthberg Jamie L. Wine Kevin M. McDonough LATHAM & WATKINS LLP 885 Third Avenue New York, NY 10022-4834
19. What is the difference between objecting and excluding myself?
Objecting is simply telling the Court that you do not like something about any or all of the Partial Settlements. You can object only if you stay in the Class. Excluding yourself is telling the Court that you do not want to be part of the Class. If you exclude yourself, you have no basis to object because the case no longer affects you.
THE COURT’S SETTLEMENT HEARING
The Court will hold a hearing to decide whether to approve the Partial Settlements. You may attend and you may ask to speak, but you do not have to.
20. When and where will the Court decide whether to approve the proposed Partial
Settlements?
The Court will hold a Settlement Hearing at__: _____ __.m., on ______day, __________, 2015, at the United States District Court for the Southern District of New York, Daniel Patrick Moynihan United States Courthouse, 500 Pearl Street, New York 10007 in Courtroom 15C. At the hearing the Court will consider whether the Partial Settlements are fair, reasonable, and adequate. If there are objections, the Court will consider them. The Court will listen to people who have asked to speak at the hearing. The Court may also decide how much to pay to Lead Counsel. After the Settlement Hearing, the Court will decide whether to approve the Partial Settlements. We do not know how long these decisions will take. You should be aware that the Court may change the date and time of the Settlement Hearing without another notice being sent to Class Members. If you want to attend the hearing, you should check with Lead Counsel beforehand to be sure that the date and/or time has not changed.
21. Do I have to come to the hearing?
No. Lead Counsel will answer questions the Court may have. But, you are welcome to come at your own expense. If you send an objection, you do not have to come to Court to talk about it. As long as you mailed your written objection on time, the Court will consider it. You may also pay
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your own lawyer to attend, but it is not necessary. Class Members do not need to appear at the hearing or take any other action to indicate their approval.
22. May I speak at the hearing?
If you object to the Partial Settlements or any portion thereof, you may ask the Court for permission to speak at the Settlement Hearing. To do so, you must include with your objection (see question 18 above) a statement saying that it is your “Notice of Intention to Appear in the Overseas
Shipholding Group Securities Litigation.” Persons who intend to object to the Partial Settlements or any portion thereof, the Plan of Allocation, and/or the application for an award of attorneys’ fees, costs, and expenses and desire to present evidence at the Settlement Hearing must include in their written objections the identity of any witnesses they may call to testify and exhibits they intend to introduce into evidence at the Settlement Hearing. You cannot speak at the hearing if you exclude yourself.
IF YOU DO NOTHING
23. What happens if I do nothing at all?
If you do nothing, you will get no money from the Partial Settlements. But, unless you exclude yourself, you will not be able to start a lawsuit, continue with a lawsuit, or be part of any other lawsuit against the Released Persons about the legal issues in this case, ever again.
GETTING MORE INFORMATION
24. Are there more details about the proposed Partial Settlements?
This Notice summarizes the Partial Settlements. More details are in the Stipulation of Settlement with PwC, the Stipulation of Settlement with the Individual Defendants, and the Stipulation of Settlement with the Underwriter Defendants and in the Stipulation Resolving Anticipated Objections to the Debtors’ Proposed Plan of Reorganization (collectively, the “Settlement Agreements”). You can get copies of these documents and obtain answers to common questions regarding the Partial Settlements by contacting the Claims Administrator toll-free at 1-877-236-9485. A copy of the Settlement Agreements are also available on the Settlement website at www.osgsecuritieslitigation.com.
25. How do I get more information?
For even more detailed information concerning the matters involved in this Action, reference is made to the Settlement Agreements, to the pleadings in support of the Partial Settlements, to the Orders entered by the Court and to the other papers filed in the Action, which will be posted on the Settlement website at www.osgsecuritieslitigation.com, and which may be inspected at the Office of the Clerk of the United States District Court for the Southern District of New York, Daniel Patrick Moynihan United States Courthouse, 500 Pearl Street, New York, New York 10007, during regular business hours. For a fee, all papers filed in this Action are available at www.pacer.gov.
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PLAN OF ALLOCATION OF NET SETTLEMENT FUND AMONG
CLASS MEMBERS
The Settlement Fund, less all taxes, approved costs, fees, and expenses (the “Net Settlement Fund”) shall be distributed to Class Members who submit timely and valid Proof of Claim forms to the Claims Administrator (“Authorized Claimants”).
The Claims Administrator shall determine each Authorized Claimant’s pro rata share of the Net Settlement Fund based upon each Authorized Claimant’s “Recognized Loss” calculated using the Court-approved Plan of Allocation. The Recognized Loss formula (below) is not intended to estimate the amount a Class Member might have been able to recover after a trial; nor to estimate the amount that will be paid to Authorized Claimants pursuant to the Partial Settlements. The Recognized Loss formula is the basis upon which the Net Settlement Fund will be proportionately allocated to the Authorized Claimants. The Court may approve the Plan of Allocation, or modify it, without additional notice to the Class. Any order modifying the Plan of Allocation will be posted on the Settlement website at: www.osgsecuritieslitigation.com.
The Plan of Allocation was created with the assistance of a consulting damages expert who analyzed the movement of OSG’s common stock and Senior Notes after the alleged disclosures.
The calculation of claims below is not an estimate of the amount you will receive. It is a formula for allocating the Net Settlement Fund among all Authorized Claimants. Furthermore, the Net Settlement Fund shall be distributed based on the respective proportion of the aggregate funds provided by the Settling Defendants to settle the common stock claims and/or the Senior Note claims. Specifically, the $4,000,000 paid by the Underwriter Defendants, $1,750,000 paid by PwC, and $6,900,000 from the Individual Defendants are exclusively being paid for the benefit of the purchasers of the Senior Notes (less all taxes, approved costs, fees, and expenses) and will not be allocated at all to the purchasers of OSG’s common stock. Taking into account the burden of proof for the different claims, $3,600,000 of the settlement proceeds received from the Individual Defendants will be allocated to the claims against defendants on behalf of the purchasers of OSG’s common stock. The funds received or to be received from the Bankruptcy Court Settlement, which are intended to settle both common stock and Senior Note purchaser claims, will be divided between both sets of purchasers using a ratio of 45% and 55%, respectively. In the event additional funds are contributed to settle the remaining outstanding and unsettled claims for the benefit of both purchasers of the Senior Notes and purchasers of OSG’s common stock, the distribution to Authorized Claimants shall be determined in a similar matter. Furthermore, if any of the formulas set forth below yield an amount less than $0.00 the claim per share is $0.00.
Common Stock Claims
CUSIP: 690368105
For shares of Overseas Shipholding common stock purchased on or between October 29, 2007 through October 19, 2012, the claim per share shall be as follows:
a) If sold on or between October 29, 2007 through October 19, 2012, the claim per share shall be the lesser of (i) the inflation in Table A at time of purchase less the inflation in Table A at time of sale, and (ii) the difference between the purchase price and the sales price; and
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b) If retained at the close of trading on October 19, 2012, or if sold thereafter, the claim per share shall be the lesser of: (i) the inflation in Table A at time of purchase, and (ii) the difference between the purchase price less the sales price.
TABLE A
Period
Begin End Inflation
10/29/07 10/11/12 $4.96
10/12/12 10/15/12 $4.26
10/16/12 10/16/12 $2.91
10/17/12 10/19/12 $2.50
Claims for the March 2010 Public Offering of Senior Notes
CUSIP: 690368AH8
Initial Public Offering Price: $985.63 per Senior Note Closing price on the date the lawsuit was filed3: $305.00 per Senior Note
For Senior Notes acquired pursuant to, and traceable to, the Company’s offering
prospectus dated March 24, 2010, and 1) sold prior to October 16, 2012, the claim per Senior Note is zero. 2) sold on or between October 16, 2012 through March 20, 2013, the claim per Senior Note is the lesser of (i) the purchase price less the sales price, and (ii) $985.63 less $305.00.
3) retained at the close of trading on March 20, 2013, the claim per Senior Note is zero.
In the event a Class Member has more than one purchase, acquisition or sale of OSG common stock or Senior Notes during the Class Period, all purchases, acquisitions and sales within the Class Period shall 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 or acquisitions in chronological order, beginning with the earliest purchase or acquisition made during the Class Period.
3 First Class Action Complaint for Violations of the Federal Securities Laws filed on October 24,
2012.
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A purchase, acquisition or sale of OSG common stock or Senior Notes shall be deemed to have occurred on the “contract” or “trade” date as opposed to the “settlement” or “payment” date. All purchase, acquisition and sale prices shall exclude any fees and commissions. The receipt or grant by gift, devise or operation of law of OSG common stock or Senior Notes during the Class Period shall not be deemed a purchase, acquisition or sale of OSG common stock or Senior Notes for the calculation of a claimant’s Recognized Loss nor shall it be deemed an assignment of any claim relating to the purchase or acquisition of such shares or notes unless specifically provided in the instrument of gift or assignment. The receipt of OSG common stock or Senior Notes during the Class Period in exchange for securities of any other corporation or entity shall not be deemed a purchase, acquisition or sale of OSG common stock or Senior Notes.
To the extent a claimant had a gain from his, her, or its overall transactions in OSG common stock or Senior Notes during the Class Period, the value of the claim will be zero. The date of covering a “short sale” is deemed to be the date of purchase or acquisition of shares. The date of a “short sale” is deemed to be the date of sale of shares. In accordance with the Plan of Allocation, however, the Recognized Loss on “short sales” is zero. In the event that a claimant has an opening short position in OSG common stock, the earliest Class Period purchases or acquisitions shall be matched against such opening short position and not be entitled to a recovery until that short position is fully covered.
Payment according to the Plan of Allocation will be deemed conclusive against all Authorized Claimants. A Recognized Loss will be calculated as defined herein and cannot be less than zero. The Claims Administrator shall allocate to each Authorized Claimant a pro rata share of the Net Settlement Fund based on his, her, or its Recognized Loss as compared to the total Recognized Losses of all Authorized Claimants. No distribution shall be made to Authorized Claimants who would otherwise receive a distribution of less than $10.00. As is customary in plans of allocation for securities class action settlements, a de minimis threshold is set in order to preserve the overall Settlement Fund from the costs of claims that are likely to exceed the value of those claims. It has been determined by counsel for the Parties that $10.00 is a reasonable de minimis threshold. An Authorized Claimant that falls into this category may request to be excluded from this Action as described in paragraphs 13 through 15 of this Notice or otherwise be bound by the Partial Settlements despite receiving no payment.
Class Members who do not submit acceptable Proofs of Claim will not share in the Net Settlement Fund. The Partial Settlements and the Final Judgments and Orders of Dismissal with Prejudice dismissing this Action against the Settling Defendants will nevertheless bind Class Members who do not submit a request for exclusion and/or submit an acceptable Proof of Claim.
Please contact the Claims Administrator or Lead Counsel if you disagree with any determinations made by the Claims Administrator regarding your Proof of Claim. If you are unsatisfied with the determinations, you may ask the Court, which retains jurisdiction over all Class Members and the claims administration process, to decide the issue by submitting a written request.
The Settling Defendants, their respective counsel, and their respective Released Persons will have no responsibility or liability whatsoever for the investment of the Settlement Fund, the distribution of the Net Settlement Fund, the Plan of Allocation or the payment of any claim. Lead
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Plaintiffs and Lead Counsel, likewise, will have no liability for their reasonable efforts to execute, administer, and distribute the Partial Settlements.
Distributions will be made to Authorized Claimants after all claims have been processed and after the Court has finally approved the Partial Settlements. If any funds remain in the Net Settlement Fund by reason of un-cashed distribution checks or otherwise, then, after the Claims Administrator has made reasonable and diligent efforts to have Class Members who are entitled to participate in the distribution of the Net Settlement Fund cash their distributions, any balance remaining in the Net Settlement Fund after at least six (6) months after the initial distribution of such funds shall be used: (a) first, to pay any amounts mistakenly omitted from the initial disbursement; (b) second, to pay any additional settlement administration fees, costs, and expenses, including those of Lead Counsel as may be approved by the Court; and (c) finally, to make a second distribution to claimants who cashed their checks from the initial distribution and who would receive at least $10.00, after payment of the estimated costs, expenses, or fees to be incurred in administering the Net Settlement Fund and in making this second distribution, if such second distribution is economically feasible. These redistributions shall be repeated, if economically feasible, until the balance remaining in the Net Settlement Fund is de minimis, and such remaining balance shall then be distributed to a non-sectarian, not-for-profit organization identified by Lead Counsel.
SPECIAL NOTICE TO SECURITIES BROKERS AND OTHER NOMINEES
If you purchased or acquired OSG common stock (CUSIP: 690368105) or Senior Notes (CUSIP: 690368AH8) during the Class Period for the beneficial interest of an individual or organization other than yourself, the Court has directed that, WITHIN TEN (10) DAYS OF YOUR RECEIPT OF THIS NOTICE, you either (a) provide to the Claims Administrator the name and last known address of each person or organization for whom or which you purchased or acquired such securities during such time period or (b) request additional copies of this Notice and the Proof of Claim form, which will be provided to you free of charge, and within ten (10) days mail the Notice and Proof of Claim form directly to the beneficial owners of the securities referred to herein. If you choose to follow alternative procedure (b), upon such mailing, you must send a statement to the Claims Administrator confirming that the mailing was made as directed and retain the names and addresses for any future mailings to Class Members. You are entitled to reimbursement from the Settlement Fund of your reasonable expenses actually incurred in connection with the foregoing, including reimbursement of postage expense and the cost of ascertaining the names and addresses of beneficial owners. Your reasonable expenses will be paid upon request and submission of appropriate supporting documentation. All communications concerning the foregoing should be addressed to the Claims Administrator:
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Overseas Shipholding Group Securities Litigation
c/o Gilardi & Co. LLC Claims Administrator
P.O. Box 8040 San Rafael, CA 94912-8040
(1-877-236-9485) www.osgsecuritieslitigation.com
Dated: ____________________ BY ORDER OF THE COURT UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK
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EXHIBIT A-2
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1023530_3
UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK
x In re OSG SECURITIES LITIGATION
This Document Relates To:
ALL ACTIONS.
: : : : : : x
Civil Action No. 1:12-cv-07948-SAS
CLASS ACTION
PROOF OF CLAIM AND RELEASE
EXHIBIT A-2
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I. GENERAL INSTRUCTIONS
1. To recover as a member of the Class based on your claims in the action entitled In re
OSG Securities Litigation, Civil Action No. 1:12-cv-07948-SAS (the “Action”), you must complete
and, on page __ hereof, sign this Proof of Claim and Release (“Proof of Claim”). If you fail to file a
properly addressed (as set forth in paragraph 3 below) Proof of Claim form, postmarked or received
by the date shown below, your claim may be rejected and you may be precluded from any recovery
from the Net Settlement Fund created in connection with the proposed partial settlements of the
Action (the “Partial Settlements”).1
2. Submission of this Proof of Claim form, however, does not assure that you will share
in the proceeds of the Partial Settlements.
3. YOU MUST MAIL OR SUBMIT ONLINE YOUR COMPLETED AND SIGNED
PROOF OF CLAIM FORM, ACCOMPANIED BY COPIES OF THE DOCUMENTS
REQUESTED HEREIN, NO LATER THAN ________, 2015, TO THE COURT-APPOINTED
CLAIMS ADMINISTRATOR IN THIS CASE, AT THE FOLLOWING ADDRESS:
Overseas Shipholding Group Securities Litigation
Claims Administrator c/o Gilardi & Co. LLC
P.O. Box 8040 San Rafael, CA 94912-8040
www.osgsecuritieslitigation.com
If you are NOT a member of the Class (as defined in the Notice of Pendency and Proposed Partial
Settlements of Class Action, Motion for Attorneys’ Fees and Settlement Fairness Hearing (the
“Notice”)), DO NOT submit a Proof of Claim form.
1 Unless otherwise stated, all terms used in this Notice shall have the same meanings as set forth in the Stipulations of Settlement filed with the Court.
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4. If you are a member of the Class and you do not timely request exclusion from the
Class, you will be bound by the terms of any judgment entered in the Action, including the releases
provided therein, WHETHER OR NOT YOU SUBMIT A PROOF OF CLAIM FORM.
II. CLAIMANT IDENTIFICATION
If you purchased or acquired Overseas Shipholding Group, Inc.’s (“OSG”) 8.125% Senior
Notes Due 2018 (the “Senior Notes”) pursuant and/or traceable to OSG’s March 2010 registration
statement and prospectus supplement for the Senior Notes; and/or OSG common stock during and
inclusive of the period October 29, 2007 through October 19, 2012, and held the certificate(s) in
your name, you are the beneficial purchaser or acquirer as well as the record purchaser or acquirer.
If, however, you purchased or acquired such OSG securities and the shares were registered in the
name of a third party, such as a nominee or brokerage firm, you are the beneficial purchaser or
acquirer and the third party is the record purchaser or acquirer.
Use Part I of this form entitled “Claimant Identification” to identify each purchaser or
acquirer of record (“nominee”), if different from the beneficial purchaser or acquirer of the securities
which form the basis of this claim. THIS CLAIM MUST BE FILED BY THE ACTUAL
BENEFICIAL PURCHASER(S) OR ACQUIRER(S) OR THE LEGAL REPRESENTATIVE OF
SUCH PURCHASER(S) OR ACQUIRER(S) OF THE OSG SENIOR NOTES AND/OR COMMON
STOCK UPON WHICH THIS CLAIM IS BASED.
All joint purchasers or acquirers must sign this claim. Executors, administrators, guardians,
conservators and trustees must complete and sign this claim on behalf of persons represented by
them and their authority must accompany this claim and their titles or capacities must be stated. The
Social Security (or taxpayer identification) number and telephone number of the beneficial owner
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may be used in verifying the claim. Failure to provide the foregoing information could delay
verification of your claim or result in rejection of the claim.
If you are acting in a representative capacity on behalf of a Class Member (for example, as an
executor, administrator, trustee, or other representative), you must submit evidence of your current
authority to act on behalf of that Class Member. Such evidence would include, for example, letters
testamentary, letters of administration, or a copy of the trust documents.
NOTICE REGARDING ELECTRONIC FILES: Certain claimants with large numbers of
transactions may request to, or may be requested to, submit information regarding their transactions
in electronic files. All claimants MUST submit a manually signed paper Proof of Claim form listing
all their transactions whether or not they also submit electronic copies. If you wish to file your claim
electronically, you must contact the Claims Administrator at 1-877-236-9485 to obtain the required
file layout. No electronic files will be considered to have been properly submitted unless the Claims
Administrator issues to the claimant a written acknowledgement of receipt and acceptance of
electronically submitted data.
III. CLAIM FORM
Use Part II of this form entitled “Schedule of Transactions in OSG Common Stock” and Part
III of this form entitled “Schedule of Transactions in OSG 8.125% Senior Notes Due 2018” to
supply all required details of your transaction(s) in OSG common stock and Senior Notes. If you
need more space or additional schedules, attach separate sheets giving all of the required information
in substantially the same form. Sign and print or type your name on each additional sheet.
On the schedules, provide all of the requested information with respect to all of your
purchases and acquisitions and all of your sales of OSG common stock between October 29, 2007
and October 19, 2012, inclusive, and all of your purchases and acquisitions and all of your sales of
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the Senior Notes, whether such transactions resulted in a profit or a loss. You must also provide all
of the requested information with respect to all of the shares of OSG common stock you held at the
close of trading on October 28, 2007 and October 19, 2012, and all of the Senior Notes held at the
end of trading on October 19, 2012 and March 20, 2013. Failure to report all such transactions may
result in the rejection of your claim.
List these transactions separately and in chronological order, by trade date, beginning with
the earliest. You must accurately provide the month, day and year of each transaction you list.
For short-sale transactions, the date of covering a “short sale” is deemed to be the date of
purchase of OSG common stock, and the date of a “short sale” is deemed to be the date of sale of
OSG common stock.
For each transaction, you must provide, together with this claim form, copies of stockbroker
confirmation slips, stockbroker statements, or other documents evidencing your transactions in OSG
common stock and/or Senior Notes. If any such documents are not in your possession, please obtain
a copy or equivalent documents from your broker because these documents are necessary to prove
and process your claim. Failure to provide this documentation could delay verification of your claim
or result in rejection of your claim.
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UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
In re OSG Securities Litigation
Civil Action No. 1:12-cv-07948-SAS
PROOF OF CLAIM AND RELEASE
Must Be Postmarked or Received No Later Than:
__________, 2015
Please Type or Print
PART I: CLAIMANT IDENTIFICATION
Beneficial Owner’s Name (First, Middle, Last)
Street Address
City
State or Province
Zip Code or Postal Code
Country
Social Security Number or Taxpayer Identification Number
___________ Individual ___________ Corporation/Other
Area Code
Telephone Number (work)
Area Code
Telephone Number (home)
Record Owner’s Name (if different from beneficial owner listed above)
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PART II: SCHEDULE OF TRANSACTIONS IN OSG COMMON STOCK
A. Number of shares of OSG common stock held at the close of trading on October 28, 2007:
B. Purchases or acquisitions of OSG common stock between October 29, 2007 and
October 19, 2012, inclusive:
C. Sales of OSG common stock between October 29, 2007 and October 19, 2012,
inclusive:
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D. Number of shares of OSG common stock held at the close of trading on October 19, 2012:
E. Number of shares of OSG common stock held at the close of trading on March 20,
2013:
If you require additional space, attach extra schedules in the same format as above. Sign and
print your name on each additional page.
YOU MUST READ AND SIGN THE RELEASE ON PAGE __. FAILURE TO SIGN
THE RELEASE MAY RESULT IN A DELAY IN PROCESSING OR THE REJECTION OF
YOUR CLAIM.
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PART III: SCHEDULE OF TRANSACTIONS IN OSG 8.125% SENIOR NOTES DUE 2018 (CUSIP 690368H8)
Purchases or Acquisitions
Trade Date Month Day Year
Number of Shares/Units Purchased or
Acquired
Total Purchase or Acquisition
Price
Sales (March 25, 2010 – March 20, 2013, inclusive) of the Senior Notes:
Trade Date Month Day Year
Number of Shares/Units Sold
Total Sales Price
Number of Senior Notes held at the close of trading on March 20, 2013:
________________________
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If you require additional space, attach extra schedules in the same format as above. Sign and
print your name on each additional page.
YOU MUST READ AND SIGN THE RELEASE ON PAGE __. FAILURE TO SIGN
THE RELEASE MAY RESULT IN A DELAY IN PROCESSING OR THE REJECTION OF
YOUR CLAIM.
IV. SUBMISSION TO JURISDICTION OF COURT AND
ACKNOWLEDGMENTS
On behalf of myself (ourselves) and each of my (our) heirs, agents, executors, trustees,
administrators, predecessors, successors and assigns, I (we) submit this Proof of Claim form under
the terms of the Stipulation of Settlement with PricewaterhouseCoopers LLP, the Stipulation of
Settlement with the Underwriter Defendants, and the Stipulation of Settlement with the Individual
Defendants described in the Notice (collectively, the “Stipulations”). I (We) also submit to the
jurisdiction of the United States District Court for the Southern District of New York with respect to
my (our) claim as a Class Member and for purposes of enforcing the releases set forth herein. I (We)
further acknowledge that I am (we are) bound by and subject to the terms of the Stipulations and any
judgments that may be entered in the Action, including the releases and the covenants set forth
herein. I (We) agree to furnish additional information to the Claims Administrator to support this
claim if requested to do so. I (We) have not submitted any other claim in connection with the
purchase or acquisition of OSG Senior Notes or common stock during the Class Period and know of
no other person having done so on my (our) behalf.
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V. RELEASES
1. I (We) hereby acknowledge full and complete satisfaction of, and do hereby fully,
finally, and forever settle, release, and discharge from the Released Claims each and all of the
Released Persons.
2. “Released Individual Defendant Parties” means each and all of (1) the Individual
Defendants and their Related Individual Defendant Persons, and (2) Andreas and his Related
Individual Defendant Persons.
3. “Released PwC Parties” means each and all of the following:
PricewaterhouseCoopers LLP (“PwC”), PwC International Limited (“PwCIL”), each of the member
firms of PwCIL (together with PwC and PwCIL, the “PwC Entities”) and any of the PwC Entities’
past, present and future employees, directors, officers, partners, members, personnel, predecessors,
successors, assigns, insurers, attorneys, stockholders, agents, affiliates or subsidiaries in their
respective capacities as such.
4. “Released Underwriter Defendant Parties” means each and all of the Underwriter
Defendants and their Related Underwriter Defendant Persons.
5. “Released Claims” with respect to the Individual Defendants Stipulation means any
and all claims, rights, remedies, demands, liabilities and causes of action of every nature and
description (including but not limited to any claims for damages, punitive damages, compensation,
restitution, disgorgement, rescission, interest, injunctive relief, attorneys’ fees, expert or consulting
fees, obligations, debts, losses, and any other costs, expenses or liabilities of any kind or nature
whatsoever), whether legal, statutory or equitable in nature to the fullest extent the law permits their
release in this Action, whether known or “Unknown Claims” (as defined below), whether arising
under federal, state, common or foreign law, whether class or individual in nature, that Lead
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Plaintiffs, or any other Class Member (a) alleged in any complaint filed or sought to be filed in the
Action or (b) could have asserted in any forum or proceeding that (i) arise out of or are based upon
or are related to, directly or indirectly, the facts, events, transactions, acts, occurrences, statements,
representations, misrepresentations, omissions, which were or could have been alleged by any
member of the Class in the Action, and that (ii) arise out of the purchase or acquisition, holding, sale
or disposition of the Senior Notes or OSG common stock purchased or acquired during the Class
Period by Lead Plaintiffs or any member of the Class, provided however, that the Released Claims
shall not include the right to enforce the Individual Defendants Stipulation.
6. “Released Claims” with respect to the PwC Stipulation means any and all claims,
rights, remedies, demands, liabilities and causes of action of every nature and description (including
but not limited to any claims for damages, punitive damages, compensation, restitution,
disgorgement, rescission, interest, injunctive relief, attorneys’ fees, expert or consulting fees,
obligations, debts, losses, and any other costs, expenses or liabilities of any kind or nature
whatsoever), whether legal, statutory or equitable in nature to the fullest extent the law permits their
release in this Action, whether known or “Unknown Claims” (as defined below), whether arising
under federal, state, common or foreign law, whether class or individual in nature, that Lead
Plaintiffs, or any other Class Member (a) alleged in any complaint filed or sought to be filed in the
Action or (b) could have asserted in any forum or proceeding that (i) arise out of or are based upon
or are related to, directly or indirectly, the facts, events, transactions, acts, occurrences, statements,
representations, misrepresentations, omissions, which were or could have been alleged by any
member of the Class in the Action, and that (ii) arise out of the purchase or acquisition, holding, sale
or disposition of any OSG securities, including the Senior Notes or common stock, purchased or
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acquired during the Class Period by Lead Plaintiffs or any member of the Class, provided however,
that the Released Claims shall not include the right to enforce the PwC Stipulation.
7. “Released Claims” with respect to the Underwriter Defendants Stipulation means any
and all claims (including “Unknown Claims” as defined below) against the Underwriter Defendants
and their Related Underwriter Defendant Persons, arising out of, relating to, or in connection with
both (i) the facts, events, transactions, acts, occurrences, statements, representations,
misrepresentations, or omissions which were or could have been alleged in the Litigation, and (ii) the
purchase or acquisition, holding, sale or disposition of all securities issued by OSG, including, but
not limited to, the Senior Notes or common stock, during the Class Period.
8. “Individual Defendants’ Claims” means all claims (including, but not limited to,
Unknown Claims as defined below), demands, losses, rights and causes of action of any nature
whatsoever, that have been or could have been asserted in the Action or any forum by the Individual
Defendants or Andreas or any of them against the Lead Plaintiffs, Class Members and Plaintiffs’
Counsel which arise out of or relate in any way to the institution, prosecution, assertion, settlement,
or resolution of the Action, except for claims relating to enforcement of the Individual Defendants
Stipulation.
9. “PwC’s Claims” means all claims (including, but not limited to, Unknown Claims as
defined below), demands, losses, rights and causes of action of any nature whatsoever, that have
been or could have been asserted in the Litigation or any forum by the Released PwC Parties or any
of them against the Lead Plaintiffs, Class Members and Plaintiffs’ Counsel which arise out of or
relate in any way to the institution, prosecution, assertion, settlement, or resolution of the Litigation,
except for claims relating to enforcement of the PwC Stipulation.
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10. “Settled Underwriter Defendants’ Claims” means all claims (including, but not
limited to, “Unknown Claims” as defined below), demands, losses, rights, and causes of action of
any nature whatsoever, that have been or could have been asserted in the Litigation or any forum by
the Released Underwriter Defendant Parties or any of them against Lead Plaintiffs, Class Members
and Plaintiffs’ Counsel which arise out of or relate in any way to the institution, prosecution,
assertion, settlement, or resolution of the Litigation (except for claims to enforce the Partial
Settlements).
11. “Defendants’ Claims” means all Individual Defendants’ Claims, PwC’s Claims, and
Settled Underwriter Defendants’ Claims, as defined herein.
12. “Unknown Claims” with respect to the Released Persons means (a) any Released
Claims that Lead Plaintiffs or any Class Member does not know or suspect to exist in his, her or its
favor at the time of the release of the Released Persons, which, if known by him, her or it, might
have affected his, her or its settlement with and release of the Released Persons, or might have
affected his, her or its decision(s), with respect to the Partial Settlements; and (b) any Defendants’
Claims that any Settling Defendant does not know or suspect to exist in his, her or its favor at the
time of the release of the Lead Plaintiffs, Class Members and Plaintiffs’ Counsel, which, if known
by him, her or it, might have affected his, her or its settlement with and release of the Lead Plaintiffs,
Class Members and Plaintiffs’ Counsel, or might have affected his, her or its decision(s) with respect
to the Partial Settlements. With respect to any and all Released Claims and Defendants’ Claims, the
Settling Parties stipulate and agree that, upon the Effective Date, Lead Plaintiffs and the Settling
Defendants shall expressly waive, and each of the Class Members and the Settling Defendants shall
be deemed to have, and by operation of the Final Judgments and Orders of Dismissal with Prejudice
shall have, expressly waived any and all provisions, rights, and benefits conferred by California Civil
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Code §1542 and any law of any state or territory of the United States, or principle of common law,
which is similar, comparable, or equivalent to California Civil Code §1542, which provides:
A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.
Lead Plaintiffs and Class Members may hereafter discover facts in addition to or different from those
that any of them now know or believes to be true related to the subject matter of the Released
Claims, but Lead Plaintiffs shall expressly and each Class Member, upon the Effective Date, shall be
deemed to have, and by operation of the Final Judgments and Orders of Dismissal with Prejudice
shall have, fully, finally, and forever settled and released any and all Released Claims, known or
unknown, suspected or unsuspected, contingent or non-contingent, disclosed or undisclosed, matured
or unmatured, which now exist, or heretofore have existed upon any theory of law or equity now
existing or coming into existence in the future, including, but not limited to, conduct that is
negligent, intentional, with or without malice, or a breach of any duty, law or rule, without regard to
the subsequent discovery or existence of such different or additional facts. Similarly, the Settling
Defendants may hereafter discover facts in addition to or different from those that any of them now
knows or believes to be true related to the subject matter of Defendants’ Claims, but each Settling
Defendant shall expressly and, upon the Effective Date, shall be deemed to have, and by operation of
the Final Judgments and Orders of Dismissal with Prejudice shall have, fully, finally, and forever
settled and released any and all Defendants’ Claims, known or unknown, suspected or unsuspected,
contingent or non-contingent, disclosed or undisclosed, matured or unmatured, which now exist, or
heretofore have existed upon any theory of law or equity now existing or coming into existence in
the future, including, but not limited to, conduct that is negligent, intentional, with or without malice,
or a breach of any duty, law or rule, without regard to the subsequent discovery or existence of such
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different or additional facts. The Settling Parties acknowledge, and Lead Plaintiffs, the Class
Members, and the Settling Defendants shall be deemed by operation of the Final Judgments and
Orders of Dismissal with Prejudice to have acknowledged, that the inclusion of “Unknown Claims”
in the definition of Released Claims and Defendants’ Claims was separately bargained for and is a
key element of the Partial Settlements of which these releases are a part.
13. These releases shall be of no force or effect unless and until the Court approves the
Stipulations and the respective settlements comprising the Partial Settlements become effective on
the Effective Date.
14. I (We) hereby warrant and represent that I (we) have not assigned or transferred or
purported to assign or transfer, voluntarily or involuntarily, any claim or matter released pursuant to
this release or any other part or portion thereof.
15. I (We) hereby warrant and represent that I (we) have included information about all
of my (our) purchases, acquisitions and sales of OSG’s 8.125% Senior Notes Due 2018, pursuant or
traceable to OSG’s March 2010 registration statement and prospectus summary for the Senior Notes,
and the number of shares of OSG stock held by me (us) at the close of trading on October 28, 2007,
October 19, 2012, and March 20, 2013.
16. I (We) certify that I am (we are) not subject to backup withholding under the
provisions of Section 3406(a)(1)(C) of the Internal Revenue Code.
Note: If you have been notified by the Internal Revenue Service that you are subject to
backup withholding, please strike out the language that you are not subject to backup withholding in
the certification above.
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I declare under penalty of perjury under the laws of the United States of America that the
foregoing information supplied by the undersigned is true and correct.
THIS PROOF OF CLAIM FORM MUST BE SUBMITTED ONLINE OR MAILED NO LATER THAN _____ __, ____,
ADDRESSED AS FOLLOWS:
Overseas Shipholding Group Securities Litigation Claims Administrator c/o Gilardi & Co. LLC
P.O. Box 8040 San Rafael, CA 94912-8040 www.osgsecuritieslitigation.com
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EXHIBIT A-3
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1023623_4
UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK
x In re OSG SECURITIES LITIGATION
This Document Relates To:
ALL ACTIONS.
: : : : : : x
Civil Action No. 1:12-cv-07948-SAS
CLASS ACTION
SUMMARY NOTICE
EXHIBIT A-3
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TO: ALL PERSONS WHO PURCHASED OR OTHERWISE ACQUIRED OVERSEAS
SHIPHOLDING GROUP, INC.’s (“OSG”) 8.125% SENIOR NOTES DUE 2018
(THE “SENIOR NOTES”) PURSUANT AND/OR TRACEABLE TO OSG’S
MARCH 2010 REGISTRATION STATEMENT AND PROSPECTUS
SUPPLEMENT FOR THE SENIOR NOTES AND/OR OSG’S COMMON STOCK
DURING THE PERIOD OCTOBER 29, 2007 THROUGH OCTOBER 19, 2012,
INCLUSIVE
YOU ARE HEREBY NOTIFIED, pursuant to Orders of the United States District Court for
the Southern District of New York, that a hearing will be held on _______, 2015, at _______, before
the Honorable Shira A. Scheindlin, United States District Judge, at the United States District Court
for the Southern District of New York, Daniel Patrick Moynihan United States Courthouse, 500
Pearl Street, New York, NY 10007, for the purpose of determining: (1) whether the proposed partial
settlements (the “Partial Settlements”) of the case entitled In re OSG Securities Litigation, Civil
Action No. 1:12-cv-07948-SAS (the “Action”) for the principal amount of $16,250,000, plus interest
(the “Settlement Amount”), should be approved by the Court as fair, reasonable, and adequate;
(2) whether final judgments and orders of dismissal with prejudice should be entered by the Court
dismissing the Action with prejudice against Alan R. Batkin, Thomas B. Coleman, Charles A.
Fribourg, Stanley Komaroff, Solomon N. Merkin, Joel I. Picket, Ariel Recanati, Oudi Recanati,
Thomas F. Robards, Jean-Paul Vettier, Michael J. Zimmerman, Morten Arntzen, Myles R. Itkin,
Citigroup Global Markets Inc., Deutsche Bank Securities, Inc., DNB Markets, Inc. (f/k/a DnB NOR
Markets, Inc.), Goldman, Sachs & Co., HSBC Securities (USA) Inc., ING Financial Markets LLC
and Morgan Stanley & Co. LLC (f/k/a Morgan Stanley & Co. Incorporated), and
PricewaterhouseCoopers LLP); (3) whether the Plan of Allocation of the Settlement Amount, as well
as the Bankruptcy Court Settlement (valued at a minimum of an additional $15,000,000, plus
interest), is fair, reasonable, and adequate and should be approved; and (4) whether the application of
Lead Counsel for the payment of attorneys’ fees and expenses and reimbursement of up to $10,000
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to each of the Lead Plaintiffs for their time and expenses incurred in representing the Class should be
approved.1
IF YOU PURCHASED OR OTHERWISE ACQUIRED THE SENIOR NOTES AND/OR
OSG COMMON STOCK BETWEEN OCTOBER 29, 2007 AND OCTOBER 19, 2012,
INCLUSIVE, YOUR RIGHTS MAY BE AFFECTED BY THE PARTIAL SETTLEMENTS OF
THIS LITIGATION. If you have not received a detailed Notice of Pendency and Proposed Partial
Settlements of Class Action, Motion for Attorneys’ Fees and Settlement Fairness Hearing (“Notice”)
and a copy of the Proof of Claim and Release form, you may obtain copies by writing to Overseas
Shipholding Group Securities Litigation, Claims Administrator, c/o Gilardi & Co. LLC, P.O. Box
8040, San Rafael, CA 94912-8040, or on the internet at www.osgsecuritieslitigation.com. If you are
a Class Member, in order to share in the distribution of the Net Settlement Fund, you must submit a
Proof of Claim and Release form by mail or online no later than _______, 2015, establishing that
you are entitled to recovery. You will be bound by any judgment rendered in the Action unless you
request to be excluded, in writing, to the above address, received no later than _________________,
2015.
Any objection to the Partial Settlements or any portion thereof, the Plan of Allocation of the
proceeds of the settlements, or the fee and expense application must be received, not simply
postmarked, by each of the following recipients no later than _______, 2015:
CLERK OF THE COURT UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK Daniel Patrick Moynihan United States Courthouse 500 Pearl Street New York, NY 10007
1 Unless otherwise stated, all terms used in this Notice shall have the same meanings as set forth in the Stipulations of Settlement filed with the Court.
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Lead Counsel:
ROBBINS GELLER RUDMAN & DOWD LLP ELLEN GUSIKOFF STEWART 655 West Broadway, Suite 1900 San Diego, CA 92101
Counsel for the Individual Defendants:
PAUL, WEISS, RIFKIND, WHARTON & GARRISON LLP RICHARD A. ROSEN 1285 Avenue of the Americas New York, NY 10019-6064 ARNOLD & PORTER LLP SCOTT B. SCHREIBER 399 Park Avenue New York, NY 10022-4690 DECHERT LLP DAVID H. KISTENBROKER 1095 Avenue of the Americas New York, NY 10036-6797 Counsel for PricewaterhouseCoopers LLP: LATHAM & WATKINS LLP MILES N. RUTHBERG JAMIE L. WINE KEVIN M. McDONOUGH 885 Third Avenue New York, NY 10022-4834 Counsel for the Underwriter Defendants: SHEARMAN & STERLING LLP ADAM S. HAKKI ELIZABETH J. STEWART 599 Lexington Avenue New York, NY 10022-6069
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PLEASE DO NOT CONTACT THE COURT OR THE CLERK’S OFFICE
REGARDING THIS NOTICE. If you have any questions about the Partial Settlements, you may
contact Lead Counsel at the address listed above.
DATED: ___________, 2015 BY ORDER OF THE COURT UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK
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EXHIBIT B
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1018200_4
UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK
x In re OSG SECURITIES LITIGATION
This Document Relates To:
ALL ACTIONS.
: : : : : : x
Civil Action No. 1:12-cv-07948-SAS
CLASS ACTION
[PROPOSED] FINAL JUDGMENT AND ORDER OF DISMISSAL WITH PREJUDICE – UNDERWRITER DEFENDANTS EXHIBIT B
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WHEREAS, a securities class action is pending in this Court styled In re OSG Securities
Litigation, Civil Action No. 1:12-cv-07948-SAS (the “Action” or “Litigation”);
WHEREAS, (a) Lead Plaintiffs Stichting Pensioenfonds DSM Nederland, Indiana Treasurer
of State, and Lloyd Crawford, on behalf of themselves and each of the Class Members, and (b)
Citigroup Global Markets Inc., Deutsche Bank Securities Inc., DNB Markets, Inc. (f/k/a DnB NOR
Markets, Inc.), Goldman, Sachs & Co., HSBC Securities (USA) Inc., ING Financial Markets LLC
and Morgan Stanley & Co. LLC (f/k/a Morgan Stanley & Co. Incorporated) (collectively, the
“Underwriter Defendants” and together with Lead Plaintiffs, the “Settling Parties”) have entered into
a Stipulation of Settlement with the Underwriter Defendants dated August 4, 2015 (the “Underwriter
Defendants Stipulation”), that provides for a complete dismissal with prejudice of the claims
asserted against the Underwriter Defendants in the Litigation on the terms and conditions set forth in
the Underwriter Defendants Stipulation, subject to the approval of the Court (the “Underwriter
Defendants Settlement”);
WHEREAS, unless otherwise defined in this Judgment, the capitalized terms herein shall
have the same meaning as they have in the Underwriter Defendants Stipulation;
WHEREAS, by Order dated ______ __, 2015 (the “Underwriter Defendants Preliminary
Approval Order”), the Court: (a) preliminarily approved the Underwriter Defendants Settlement; (b)
certified the Class solely for purposes of effectuating the Underwriter Defendants Settlement; (c)
ordered that notice of the proposed Underwriter Defendants Settlement be provided to potential
Class Members; (d) provided Class Members with the opportunity either to exclude themselves from
the Class or to object to the proposed Underwriter Defendants Settlement; and (e) scheduled a
hearing regarding final approval of the Underwriter Defendants Settlement;
WHEREAS, due and appropriate notice has been given to the Class;
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WHEREAS, the Court conducted a hearing on _____ __, 2015 (the “Settlement Hearing”) to
consider, among other things: (a) whether the terms and conditions of the Underwriter Defendants
Settlement are fair, reasonable and adequate to the Class, and should therefore be approved; and (b)
whether a judgment should be entered dismissing the Litigation with prejudice as against the
Underwriter Defendants; and
WHEREAS, the Court having reviewed and considered the Underwriter Defendants
Stipulation, all papers filed and proceedings held herein in connection with the Underwriter
Defendants Settlement, all oral and written comments received regarding the Underwriter
Defendants Settlement, and the record in the Litigation, and good cause appearing therefor;
NOW, THEREFORE, IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that:
1. Jurisdiction – This Court has jurisdiction over the subject matter of the Litigation,
and all matters relating to the Underwriter Defendants Settlement, as well as personal jurisdiction
over all of the Settling Parties and each of the Class Members.
2. Incorporation of Settlement Documents – This Judgment incorporates and makes a
part hereof: (a) the Underwriter Defendants Stipulation filed with the Court on July __, 2015; and
(b) the Notice of Pendency and Proposed Partial Settlements of Class Action, Motion for Attorneys’
Fees and Settlement Fairness Hearing (“Notice”) and the Summary Notice, both of which were filed
with the Court on July __, 2015.
3. Class Certification for Settlement Purposes – The Court hereby affirms its
determinations in the Underwriter Defendants Preliminary Approval Order certifying, for the
purposes of the Underwriter Defendants Settlement only, the Litigation as a class action pursuant to
Rules 23(a) and (b)(3) of the Federal Rules of Civil Procedure on behalf of a class consisting of all
Persons who or which purchased or otherwise acquired (a) OSG’s 8.125% Senior Notes Due 2018
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(the “Senior Notes”), pursuant or traceable to OSG’s March 2010 registration statement and
prospectus supplement for the Senior Notes; and/or (b) OSG’s common stock during and inclusive
of the period October 29, 2007 through October 19, 2012. Excluded from the Class are:
(a) the Defendants, G. Allen Andreas (“Andreas”) and their respective successors
and assigns;
(b) past and current officers and directors of OSG and the Underwriter
Defendants and PwC and E&Y during the Class Period;
(c) members of the immediate families of the Individual Defendants and Andreas;
(d) the legal representatives, heirs, successors, or assigns of the Individual
Defendants and Andreas;
(e) any entity in which any of the above excluded Persons have or had a majority
ownership interest; and
(f) any Person who timely and validly requested exclusion from the Class (see
Exhibit A hereto).
4. Adequacy of Representation – Pursuant to Rule 23 of the Federal Rules of Civil
Procedure, and for the purposes of the Underwriter Defendants Settlement only, the Court hereby
affirms its determinations in the Underwriter Defendants Preliminary Approval Order certifying
Lead Plaintiffs as class representatives for the Class and appointing Lead Counsel as class counsel
for the Class. Lead Plaintiffs and Lead Counsel have fairly and adequately represented the Class
both in terms of litigating the Action and for purposes of entering into and implementing the
Underwriter Defendants Settlement and have satisfied the requirements of Federal Rules of Civil
Procedure 23(a)(4) and 23(g), respectively.
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5. Notice – The Court finds that the dissemination of the Notice and the publication of
the Summary Notice: (a) were implemented in accordance with the Underwriter Defendants
Preliminary Approval Order; (b) constituted the best notice practicable under the circumstances; (c)
constituted notice that was reasonably calculated, under the circumstances, to apprise Class
Members of (i) the pendency of the Litigation; (ii) the effect of the proposed Underwriter Defendants
Settlement (including the Releases to be provided thereunder); (iii) their right to object to any aspect
of the Underwriter Defendants Settlement; (iv) their right to exclude themselves from the Class; and
(v) their right to appear at the Settlement Hearing; (d) constituted due, adequate, and sufficient notice
to all Persons entitled to receive notice of the proposed Underwriter Defendants Settlement; and (e)
satisfied the requirements of Rule 23 of the Federal Rules of Civil Procedure, the United States
Constitution (including the Due Process Clause), the Private Securities Litigation Reform Act of
1995, 15 U.S.C. §77z-1, as amended, and all other applicable laws and rules.
6. Final Settlement Approval and Dismissal of Claims – Pursuant to, and in
accordance with, Rule 23 of the Federal Rules of Civil Procedure, the Court hereby fully and finally
approves the Underwriter Defendants Settlement set forth in the Underwriter Defendants Stipulation
in all respects (including, without limitation: the amount of the Underwriter Defendants Settlement;
the Releases provided for therein, including the release of the Released Claims as against the
Released Underwriter Defendant Parties; and the dismissal with prejudice of the claims asserted
against the Underwriter Defendants in the Litigation), and finds that the Underwriter Defendants
Settlement is, in all respects, fair, reasonable, and adequate to the Class. The Settling Parties are
directed to implement, perform, and consummate the Underwriter Defendants Settlement in
accordance with the terms and provisions contained in the Underwriter Defendants Stipulation.
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7. All of the claims asserted against the Underwriter Defendants in the Litigation by
Lead Plaintiffs and the other Class Members are hereby dismissed with prejudice. The Settling
Parties shall bear their own costs and expenses, except as otherwise expressly provided in the
Underwriter Defendants Stipulation.
8. Binding Effect – The terms of the Underwriter Defendants Stipulation and of this
Judgment shall be forever binding on Underwriter Defendants, Lead Plaintiffs and all other Class
Members (regardless of whether or not any individual Class Member submits a Proof of Claim and
Release Form (“Proof of Claim”) or seeks or obtains a distribution from the Net Settlement Fund), as
well as their respective successors and assigns. [The Persons listed on Exhibit A hereto are excluded
from the Class pursuant to request and are not bound by the terms of the Underwriter Defendants
Stipulation or this Judgment.]
9. Releases – The Releases set forth in paragraphs 4.1, 4.2, and 4.3 of the Underwriter
Defendants Stipulation, together with the definitions contained in paragraph 1 of the Underwriter
Defendants Stipulation relating thereto, are expressly incorporated herein in all respects. The
Releases are effective as of the Effective Date. Accordingly, the Court orders that:
(a) Upon the Effective Date, Lead Plaintiffs and each Class Member shall be
deemed to have, and by operation of this Judgment shall have fully, finally, and forever released,
relinquished, and discharged all Released Claims against the Released Underwriter Defendant
Parties, whether or not such Class Member executes and delivers a Proof of Claim;
(b) Upon the Effective Date, each of the Released Underwriter Defendant Parties
shall be deemed to have, and by operation of this Judgment shall have fully, finally, and forever
released Lead Plaintiffs, Plaintiffs’ Counsel, and each and all of the Class Members from all Settled
Underwriter Defendants’ Claims;
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10. Notwithstanding paragraphs 9(a) – 9(b) above, nothing in this Judgment shall bar any
action by any of the Settling Parties to enforce or effectuate the terms of the Underwriter Defendants
Stipulation or this Judgment.
11. Bar Order – The Court hereby: (a) permanently bars, enjoins, and restrains any
Person from commencing, prosecuting, or asserting any Barred Claims against any of the Released
Underwriter Defendant Parties, whether as claims, cross-claims, counterclaims, third-party claims, or
otherwise, and whether asserted in the Litigation or any other proceeding, in this Court, in any
federal or state court, or in any other court, arbitration proceeding, administrative agency, or other
forum in the United States or elsewhere; and (b) permanently bars, enjoins, and restrains the
Underwriter Defendants from commencing, prosecuting, or asserting any Barred Claims against any
person or entity, whether as claims, cross-claims, counterclaims, third-party claims or otherwise, and
whether asserted in the Litigation or any other proceeding, in this Court, in any federal or state court,
or in any other court, arbitration proceeding, administrative agency, or other forum in the United
States or elsewhere.
12. Judgment Reduction – Any final verdict or judgment obtained by or on behalf of the
Class arising out of the Senior Notes offering against any Person subject to the Bar Order shall be
reduced by the greatest of: (i) an amount that corresponds to the percentage of responsibility of the
Underwriter Defendants for common damages; or (ii) the amount paid by or on behalf of the
Underwriter Defendants to the Class or Class Members for common damages. Without constituting
any admission of liability or damages for the Senior Notes offering, the amount paid by or on behalf
of the Underwriter Defendants with respect to common damages in the Senior Notes offering is
$4,000,000.00. No other amounts are being paid by the Underwriter Defendants to settle any claims
arising from the Senior Notes offering.
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13. Rule 11 Findings – The Court finds and concludes that the Settling Parties and their
respective counsel have complied in all respects with the requirements of Rule 11 of the Federal
Rules of Civil Procedure in connection with the institution, prosecution, defense, and settlement of
the Litigation.
14. No Admissions – Neither the Underwriter Defendants Stipulation (whether or not
consummated), including the exhibits thereto, the Plan of Allocation to be proposed by Lead
Plaintiffs (or any other plan of allocation that may be approved by the Court), the negotiations
leading to the execution of the Underwriter Defendants Stipulation, nor any proceedings taken
pursuant to or in connection with the Underwriter Defendants Stipulation and/or approval of the
Settlement (including any arguments proffered in connection therewith):
(a) shall be offered against any of the Released Underwriter Defendant Parties as
evidence of, or construed as, or deemed to be evidence of (i) any presumption, concession, or
admission by any of the Released Underwriter Defendant Parties with respect to the truth of any fact
alleged by Lead Plaintiffs or any member of the Class, the validity of any claim that was or could
have been asserted by Lead Plaintiffs or any member of the Class, or the deficiency of any defense
that has been or could have been asserted by the Underwriter Defendants in this Action or in any
other litigation, or (ii) any liability, negligence, fault, or other wrongdoing of any kind of any of the
Released Underwriter Defendant Parties or in any way referred to for any other reason as against any
of the Released Underwriter Defendant Parties, in any civil, criminal, or administrative action or
proceeding, other than such proceedings as may be necessary to effectuate the provisions of the
Underwriter Defendants Stipulation;
(b) shall be offered against any of the Lead Plaintiffs or the Class Members, as
evidence of, or construed as, or deemed to be evidence of (i) any presumption, concession or
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admission by any of the Lead Plaintiffs or the Class Members that any of their claims are without
merit, that any of the Released Underwriter Defendant Parties had meritorious defenses, or that
damages recoverable against the Underwriter Defendants under the Complaint would not have
exceeded the Settlement Amount, or (ii) any liability, negligence, fault, or wrongdoing of any kind,
or in any way referred to for any other reason as against any of the Lead Plaintiffs or the Class
Members, in any civil, criminal, or administrative action or proceeding, other than such proceedings
as may be necessary to effectuate the provisions of the Underwriter Defendants Stipulation; or
(c) shall be construed against any of the Released Underwriter Defendant Parties,
Lead Plaintiffs, or Class Members as an admission, concession, or presumption that the
consideration to be given hereunder represents the amount which could be or would have been
recovered against the Underwriter Defendants after trial; provided, however, that if the Underwriter
Defendants Stipulation is approved by the Court, the Settling Parties and the Released Underwriter
Defendant Parties and their respective counsel may refer to it to effectuate the protections from
liability granted hereunder or otherwise to enforce the terms of the Settlement.
15. Retention of Jurisdiction – Without affecting the finality of this Judgment in any
way, this Court retains continuing and exclusive jurisdiction over: (a) the Settling Parties for
purposes of the administration, interpretation, implementation, and enforcement of the Underwriter
Defendants Settlement; (b) the disposition of the Settlement Fund; (c) any motion for an award of
attorneys’ fees and/or Fee and Expense Application by Lead Counsel in the Litigation that will be
paid from the Settlement Fund; (d) any motion to approve a plan of allocation for the proceeds of the
Settlement Fund; and (e) the Class Members for all matters relating to the Underwriter Defendants
Settlement.
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16. Modification of the Agreement of Settlement – Without further approval from the
Court, Lead Plaintiffs and Underwriter Defendants are hereby authorized to agree to and adopt such
amendments or modifications of the Underwriter Defendants Stipulation or any exhibits attached
thereto to effectuate the Underwriter Defendants Settlement that: (a) are not materially inconsistent
with this Judgment; and (b) do not materially limit the rights of Class Members in connection with
the Underwriter Defendants Settlement. Without further order of the Court, Lead Plaintiffs and
Underwriter Defendants may agree to reasonable extensions of time to carry out any provisions of
the Underwriter Defendants Settlement.
17. Termination of Settlement – If the Underwriter Defendants Settlement is terminated
as provided in the Underwriter Defendants Stipulation or the Effective Date of the Underwriter
Defendants Settlement otherwise fails to occur, this Judgment shall be vacated, rendered null and
void and be of no further force and effect, except as otherwise provided by the Underwriter
Defendants Stipulation, and this Judgment shall be without prejudice to the rights of Lead Plaintiffs,
the other Class Members, and the Underwriter Defendants, and the Settling Parties shall revert to
their respective position in the Litigation on December 23, 2014, as provided in the Underwriter
Defendants Stipulation.
18. Entry of Final Judgment – There is no just reason to delay the entry of this
Judgment as a final judgment in this Action as against the Underwriter Defendants pursuant to Rule
54(b) of the Federal Rules of Civil Procedure. Accordingly, the Clerk of the Court is expressly
directed to immediately enter this final judgment as against the Underwriter Defendants.
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19. Extensions – Without further order of the Court, the Parties to the Underwriter
Defendants Stipulation may agree to reasonable extensions of time to carry out any of the provisions
of the Underwriter Defendants Stipulation.
IT IS SO ORDERED.
DATED: ________________________ ________________________________________ THE HONORABLE SHIRA A. SCHEINDLIN UNITED STATES DISTRICT JUDGE
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