STATES UNITED DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK x 05 Civ . 8626 (GEL ) In re REFCO, INC . SECURITIES LITIGATION :
DECLARATION OF MEGAN D . McINTYRE IN SUPPORT OF LEAD PLAINTIFFS' MOTION FOR (I) PRELIMINAR Y APPROVAL OF PARTIAL SETTLEMENT WITH DEFENDANT BAWAG, (II) PRELIMINARY CERTIFICATION OF CLASS FOR PURPOSES OF SETTLEMENT, (III) PRELIMINARY APPROVAL OF FORM AND MANNER OF NOTICE, AND SCHEDUL ING A FINAL APPROVAL HEARIN G I, Megan D. McIntyre, declare as follows pursuant to 28 U .S.C. 1746 : 1 . I am a director of Grant & Eisenhofer P .A., co-counsel for Lead Plaintiffs in thi s action. I make this declaration in support of Lead Plaintiffs' Motion For (I) Preliminar y Approval Of Partial Settlement With Defendant BAWAG, (II) Preliminary Certification Of Clas s For Purposes Of Settlement, (III) Preliminary Approval Of Form And Manner Of Notice, And (IV) Scheduling A Final Approval Hearing . 2. The exhibits to this declaration are true and correct copies of the followin g documents : Exhibit A Notice of Pendency and Partial Settlement of Class Action dated February 4, 2005 , relating to a settlement with defendant Bank of America Corp . in the matter known as In re Enron Corporation Securities Litigation , C.A. No. H-0 1-3624 (S .D. Tex.), as printed from the claims administrator's website : www . gilardi .com/pdf/enro5not .pdf Exhibit B Order of Final Judgment and Dismissal as to Bank of America, entered on October 19, 2005 in the ma tter known as In re Enron Corporation Securities Litigation , C.A. No . H-01-3624 (S.D . Tex .), as printed from that court ' s electronic document fi ling system.
I hereby declare under penalty of perjury that the foregoing is true and correct. Executed in Wilmington, Delaware on September 8, 2006
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Is! Megan D . McIntyre Megan D . McIntyre
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CERTIFICATE OF SERVICE I hereby certify that on September 8, 2006 , the attached document was filed with the Clerk of Court using CM/ECF which will send noti fication of such filings to the following parties: Isl Megan D. McIntyre Meg an D. McIntyre Bradley E . Lerman, Esquire Bruce Roger Braun, Esquire Linda T. Coberly, Esquire WINSTON & STRAW N 35 West Wacker Drive Chicago, IL 6060 1 Emails: blerman@winston .co~n bbraun@winston .com, lcoberly(winston .com Counsel to Defendant Grant Thornton LL P Stuart I. Friedman, Esquire Ivan O. Kline, Esquire Elizabeth D . Meacham, Esquire FRIEDMAN & WITTENSTEIN P .C . 600 Lexington Avenu e New York, NY 1002 2 Emails : sfriedmang friedmanwittenstein .com , emeachamg friedmanwittenstein .cam , [e-mail] Counsel to William Sexton Richard E . Nathan , Esquire NATHAN LAW FIRM 123 South June Street Los Angeles, CA 90004 Email : [e-mail] Counsel to Dennis Klejna
David Emilio Mollon, Esquire James David Reich, Jr ., Esquire Beth A. Tchlinguirian, Esquire WINSTON & STRAWN LLP 200 Park Avenu e
New York, NY 10166
Emails : jreich(aiwinston.com, dmoll on winston.com Counsel to Defendant Grant Thornton LLP Helen B. Kim, Esquire BAKER HOSTETLE R 333 South Grand Avenue, Suite 1800 Los Angeles, CA 9007 1 Email : hkim bakerlaw .com Lead Counsel to Dennis Klejna Holly K. Kulka, Esq . HELLER EHRMAN WHITE & MCAULIFFE, LLP Times Square Tower 7 Times Square New York, NY 10036 Email : hkulLca@hewm .com Counsel to Phillip Silverman
Mark D . Powers, Esquire BAKER HOSTETLER 666 Fifth Avenue
New York, NY 10103
Email : [e-mail] Counsel to Dennis Klejn a Melissa Sarafa, Esquire Norman L . Eisen, Esquire ZUCKERMAN SPAEDER LLP 1540 Broadway, Suite 1604 New York, NY 1003 6 Email : msarafa@zuckerman .com Counsel to Tone Grant
John V. H. Pierce , Esquire Robert Bruce McCaw, Esquire Dawn M . Wilson, Esquire Lori A . Martin, Esquire Michael L . Feinberg, Esquire Michael H . Park, Esquire WILMER, CUTLER & PICKERING 399 Park Avenue New York, NY 10022 Emails: robert.mccaw@wilmerhale .com, jolm .pierce@wilmerhale . com, lori .martin ,wilmerhale .com, dawn .wilson@wilmerhale .com, michael .feinberg@wilmerhate .com Michael.park@wilmerhale . com
Counsel to Defendants Credit Suisse First Boston LLC, Goldman Sachs & Co., Bank of America Securities LLC, Merrill Lynch Pierce Fenner & Smith Inc., Deutsche Bank Securities Inc., JP Morgan Securities Inc., Sandler O'Neil Partners LP, HSBC Securities (USA) Inc., William Blair & Company LLC, Harris Nesbitt Corp., Samuel A . Ramirez & Company, Muriel Siebert & Co., Inc., The Williams Capital Group, Utendahl Capital Partners and CMG Institutional Trading LLC
Greg A . Danilow, Esquire Robert Francis Carangelo, Esquire WEIL, GOTSHAL & MANGES LLP 767 Fifth Avenue
New York, NY 1015 3
Counsel to Defendants Thomas H. Lee, David Y. Harkins, Scott L . Jaeckel, Scott A . Schoen, Nathan Gantcher, Leo R. Breitman, Ronald L. O'Kelley, Thomas H. Lee Partners, L .P ., Thomas HLee Equity Fund V L.P ., Thomas H. Lee Parallel Fund V., L.P., Thomas.,. H Lee Equity (Cayman) Fund V L.P., THL Equity ., Advisors V., LLC, Thomas H. Lee Investors Limited Partnership, The 1997 Thomas H. Lee Nominee Trust Email : greg .danilow@weil .com c robert .carangelo weil .co m
Barbara Moses, Esquire Rachel Marissa Korenblat, Esquire MORVILLO, ABRAMOWITZ, GRAND, IASON ANELLO &BOHRER, P .C .
565 Fifth Ave .
New York, NY 10017 Counsel to Robert Trosten Emails : bmoses.maglaw.com Ykorenblat@maglaw .com
I hereby certify that on September 8, 2006, the attached document was sent via Overnight Mail to the following parties : Matthew Sava , Esquire Yoram Jacob Miller, Esquir e SHAPIRO FORMAN ALLEN SAVA & MCPHERSON LLP 380 Madison Avenu e New York, New York 1001 7 Counsel to Defendant Gerald Sherer and Joseph J. Murphy Michael T . Hannafan, Esquire Blake T. Hannafan, Esquire Nicholas A. Pavich, Esquir e MICHAEL T . HANNAFAN & ASSOCIATES One East Wacker Drive, Suite 120 8
Chicago, IL 6060 1
Counsel to Defendant Tone N. Grant
Jeffrey T . Golenbock, Esquire Adam C . Silverstein , Esquire GOLENBOCK EISEMAN ASSOR BELL & PESKOE LLP 437 Madison Avenu e New York, NY 10022-7302
Counsel to Defendants Refco Group Holdings, Inc ., Phillip Bennett and The Phillip R . Bennett Three Year Annuity Trust
Richard Soto, Esquire Hunton & Williams LLP 200 Park Avenue, 53rd Floor New York, New York 10166 Counsel to Santo Maggio
Westminster-Refco Management LLC Andrew Levander, Esquire One World Financial Center DECHERT LLP 200 Liberty Street, Tower A 30 Rockefe ller Plaza
New York, New York 10281 New York, NY 10112-220 0
Email : andrew .levander@ dechert.com Counsel to BAWAG P.S.K Bank fur Arbeit and Wirtschaft and Osterreichische Postsparkasse Aktiengesellschaft. Refco Managed Futures LLC One World Financial Center 200 Liberty Street, Tower A New York, New York 10281
E XHIBIT A
UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISIO N
In re ENRON CORPORATION SECURITIES LITIGATION This Document Relates To :
MARK NEWBY, et al ., Individually and On Behalf of All Others Similarly Situated, Plaintiffs, vs. ENRON CORP ., et al ., Defendants. Civil Action No . H-01-3624 (Consolidated ) CLASS ACTIO N
THE REGENTS OF THE UNIVERSITY OF S CALIFORNIA, et al ., Individually and On Behalf of All Others Similarly Situated, Plaintiffs, vs. KENNETH L. LAY, et al ., Defendants.
WASHINGTON STATE INVESTMENT BOARD, et al ., zil On Behalf of Themselves and All Others Similarly Situated,
Plaintiffs, vs.
KENNETH L. LAY, et al ., Defendants .
NOTICE OF PENDENCY AND PARTIAL SETTLEMENT OF CLASS ACTIO N TO : (1) ALL PERSONS WHO PURCHASED OR ACQUIRED PUBLICLY TRADED EQUITY OR DEBT SECURITIES OF ENRON CORPORATION (INCLUDING ALL SECURITIES ISSUED BY ENRON-RELATED ENTITIES, THE VALUE OR REPAYMENT OF WHICH WAS DEPENDENT ON THE CREDIT, FINANCIAL CONDITION, ORABILITYTO PAY OF ENRON CORPORATION) ("PUBLICLY TRADED SECURITIES"AS FURTHER DEFINED BELOW) DURING THE PERIOD FROM OCTOBER 19, 1998 THROUGH AND INCLUDING NOVEMBER27, 2001 ; AND (2)ALL STATES OR POLITICAL SUBDIVISIONS THEREOF OR STATE PENSION PLANS THAT PURCHASED FROM DEFENDANTS ENRON' S 6 .40 % NOTES DUE 7/15/06 OR 6 .95% NOTES DUE 7/15/28 AND THAT AUTHORIZE THE PROSECUTION OF THEIR CLAIMS PURSUANT TO THE TEXAS SECURITIES AC T This Notice of Pendency and Partial Settlement of Class Action (the "Notice ") is given pursuant to Rule 23 of the Federal Rules of Civil Procedure to inform you of the proposed partial settlement of these Actions (the "Settlement") and the hearing (the "Settlement Hearing") to be held by the United States District Court for the Southern District of Texas (the "Court") to consider thefairness, reasonableness and adequacy of the Settlement as set forth in the Stipulation of Settlement among the Representative Plaintiffs and BofA (as further defined below), dated as of October28 , 2004 ( the "Stipulation"), on file with the Court . All capitalized terms not defined prior to their use in this Notice have the meanings set forth in Section VIII, below.
I . STATEMENT OF PLAINTIFFS' RECOVER Y The Settlement will result in the creation of a cash settlement fund in the aggregate principal amount of Sixty-Nine Million Dollars ($69,000,000) plus any interest that may accrue thereon (the "Gross Settlement Fund"), which, subject to deduction fqr costs of notice and administration and certain taxes and tax related expenses and for attorneys' fees, costs and expenses as approved by the Court, will be available for distribution to Settlement Class Members (as defined below) . As described more fully below, the amount of any distribution to Settlement Class Members on a per share basis will depend on future Court proceedings and it is therefore not possible to estimate the amount of any such distribution at the present time . See Section Xl .
II . STATEMENT OF POTENTIAL OUTCOM E
Representative Plaintiffs and BofA do not agree on the average amount of damages per share that would have been recoverable from BofA if Representative Plaintiffs were to have prevailed on each claim asserted . The issues on which the parties disagree include : (1) whether BofA engaged in conduct that would give rise to any liability to the Settlement Class under the federal securities laws, Texas common law, or any other laws ; (2) whether BofA has valid defenses to any such claims of liability ; (3) the appropriate economic model for determining the amount by which the PubliclyTraded Securitieswere allegedly artificially inflated (if at all) during the Settlement Class Period ; (4) the amount by which the Publicly Traded Securities were allegedly artificially inflated (if at all) during the Settlement Class Period ; (5) the effect of various marketforces influencing the trading price of Publicly Traded Securities at various times during the Settlement Class Period ; (6)the extent to which external factors, such as general market conditions, influenced the trading price of Publicly Traded Securities atvarious times during the Settlement Class Period ; (7) the extent to which the various matters that Representative Plaintiffs alleged were materially false or misleading influenced (if at all) the trading price of Publicly Traded Securities at various times during the Settlement Class Period ; (8) the extent to which the various allegedly adverse material facts that Representative Plaintiffs alleged were omitted influenced (if at all) the trading price of the Publicly Traded Securities at various times during the Settlement Class Period ; (9) whether the statements made or facts allegedly omitted were false, material or otherwise actionable under the federal securities or other laws .
III . STATEMENT OF ATTORNEYS' FEES AND EXPENSES SOUGH T
At a future date, upon further notice to the Settlement Class, counsel for the Representative Plaintiffs will apply to the Court for an award of attorneys' fees from the Gross Settlement Fund . No attorneys' fees are being sought at this time . However, the Stipulation provides for the allocation of Six Million Nine Hundred Thousand Dollars ($6,900,000) (the "Expense Fund") of the Gross Settlement Fund for reimbursement of expenses incurred and expected to be incurred by Plaintiffs' Settlement Counsel in prosecuting the Actions . The Court will be asked to approve the establishment of the Expense Fund at the Settlement Hearing . IV. REASONS FOR SETTLEMENT The Representative Plaintiffs and their counsel believe that this Settlement is fair, reasonable, and adequate to the Members of the Settlement Class . The Representative Plaintiffs and their counsel have reached this conclusion after investigating and considering, among other things, the strengths and weaknesses of the Representative Plaintiffs' claims against BofA and BofA's defenses to those claims, the fact that BofA has been dismissed from certain of the Actions by Court Order dated December 20, 2002, the uncertainties of this complex litigation, and the benefit provided by the Settlement to the Members of the Settlement Class . See Section VII . V. IDENTIFICATION OF ATTORNEYS' REPRESENTATIVE S Any questions regarding the Settlement should be directed to Plaintiffs' Settlement Counsel or their staff : RICK NELSO N LERACH COUGHLIN STOIA GELLER RUDMAN & ROBBINS LLP 401 B Street, Suite 160 0
San Diego , CA 92101-4297 Telephone: [phone]
PLEASE READ THIS NOTICE CAREFULLY . THIS NOTICE RELATES TOA PROPOSED PARTIAL SETTLEMENT OF THESE ACTIONS AND, IF YOU AREA SETTLEMENT CLASS MEMBER, CONTAINS IMPORTANT INFORMATION AS TO YOUR RIGHTS CONCERNING THE SETTLEMENT AS FURTHER DESCRIBED BELOW . EXCLUSION DEADLINE : REQUESTS FOR EXCLUSION MUST BE FILED SO AS TO BE RECEIVED NO LATER THAN MARCH 28, 2005 . SECURITIES BROKERS AND OTHER NOMINEES : PLEASE SEE THE INSTRUCTIONS ON PAGE 7 BELOW .
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VI . BACKGROUND OF THE LITIGATIO N BofA has been named as a defendant in the Newby Action . BofA moved to dismiss the Newby Action on the ground that the complaint failed to state a claim upon which relief could be granted because plaintiffs failed to allege facts that would sustain a claim that BofA engaged in any actionable conduct . On December 20, 2002, the Court granted BofA's motion to dismiss all claims asserted against it under the Securities Exchange Act of 1934 (the "1934 Act") . BofA contends that this ruling necessarily requires dismissal of any 1934 Act claims that might be pursued against BofA in the Actions or in any of the other consolidated and coordinated actions .
VII. BACKGROUND OF THE SETTLEMEN T
Counsel for the Representative Plaintiffs have conducted an investigation relating to the claims and underlying events alleged in the complaints . Counsel for the Representative Plaintiffs also have conducted considerable formal and informal discovery in the Actions and in related litigation and have analyzed the evidence obtained therein, and have researched the applicable law with respect to the claims alleged in the complaints and the potential defenses thereto .
The Representative Plaintiffs, by their counsel, have conducted arm's-length negotiations with counsel for BofA with a view toward settling the issues in dispute and achieving the best result possible consistent with the interests of the Settlement Class .
Based upon their investigation, counsel for the Representative Plaintiffs have concluded that the terms of the Settlement as set forth in the Stipulation are fair, reasonable, and adequate to the Representative Plaintiffs and the Settlement Class, and in the best interest of the Representative Plaintiffs and the Settlement Class, and have agreed to settle the Actions as to BofA pursuant to the terms and provisions of the Stipulation, after considering (1) the benefits that the Representative Plaintiffs and the Settlement Class will receive from the Settlement ; (ii) the attendant risks of litigation ; and (iii) the desirability of permitting the Settlement to be consummated as provided by the terms of the Stipulation . BofA has denied and continues to deny each and all of the claims and allegations of wrongdoing made by the Representative Plaintiffs in the Actions and maintains furthermore that it has meritorious defenses . BofA has expressly denied and continues to deny all charges of wrongdoing or liability against it arising out of any of the conduct, statements, acts or omissions alleged, or that could have been alleged, in the Actions, and BofA vigorously contends that many of the factual allegations of the complaints relating to BofA were materially inaccurate . BofA also has denied and continues to deny, inter alia, the allegations that the Representative Plaintiffs or the Settlement Class Members were harmed by BofA's conduct alleged in the Actions. Pursuant to the terms of the Stipulation, the Stipulation shall in no event be construed or deemed to be evidence of or an admission or concession by BofA with respect to any claim of any fault or liability or wrongdoing or damage whatsoever . Nonetheless, BofA has concluded that further conduct of the Actions would be protracted and expensive, and that it is desirable that the Actions be fully and finally settled in the manner and upon the terms and conditions set forth in the Stipulation . BofA also has taken into account the uncertainty and risks inherent in any litigation, especially in complex cases like the Actions. BofA has, therefore, determined that it is desirable and beneficial to it that the Actions be settled in the manner and upon the terms and conditions set forth in the Stipulation . THIS NOTICE IS NOT INTENDED TO BE, AND SHOULD NOT BE CONSTRUED AS, AN EXPRESSION OF ANY OPINION BY THE COURT W ITH RESPECT TO THE TRUTH OF THE ALLEGATIONS IN THE ACTIONS OR THE MERITS OF THE CLAIMS OR DEFENSES ASSERTED . THIS NOTICE IS SOLELY TO ADVISE YOU OF THE PENDENCY OF THE ACTION AND THE PROPOSED PARTIAL SETTLEMENT THEREOF AND OF YOUR RIGHTS IN CONNECTION THEREWITH.
VIII . DEFINITION S
As used in this Notice, the following terms have the meanings specified below . Any capitalized terms not specifically defined in this Notice shall have the meanings set forth for such terms in the Stipulation . In the event of any inconsistency between any definition set forth below or elsewhere in this Notice and any definition set forth in the Stipulation, the definition set forth in the Stipulation shall control . "Action" means the Newby Action, Civil Action No . H-01-CV-3624 (S .D . Tex .). 2 . "Actions" means the Newby Action, Washington State Investment Board, eta!. v. Kenneth L . Lay, et al., Civil Action No . H-02-CV-3401 (S .D . Tex .) (the "WSIB Action") ; The Regents of the University of California v. RoyalBankof Canada, eta!., Civil No . H-04-0087 (S . D. Tex .); The Regents of the University of California v. Milbank Tweed, eta!., Civil No . H-04-0088 (S .D . Tex .) ; and The Regents of the University of California v. Toronto-Dominion Bank, at al., Civil No. 03-5528 (S .D. Tex .) . 3 . "Authorized Claimant" means any Settlement Class Member who is entitled to a distribution from the Gross Settlement Fund pursuant to the terms of the Stipulation, any Plan of Allocation, or any order of the Court .
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4 . `BofA" means Bank of America Corp . and Banc of America Securities LLC, along with their direct and indirect present and former parents, subsidiaries, divisions, affiliates, attorneys, accountants, insurers, predecessors and successors and all of their current and former members, officers, directors, principals, shareholders, employees and agents and each and all of the heirs, executors, administrators, spouses, assigns and/or bankruptcy estates of such persons, in each instance only in their capacity as such, and any person or entity in which any of the above has or had a controlling interest or which is orwas related to or affiliated with any of the above, but excluding the Non-Settling Defendants in the Actions.
5. "Court" means the United States District Court for the Southern District of Texas, Houston Division .
6 . "Defendants" means each and all of the defendants that have been or may be named in any of the complaints in the Actions . 7 . "Effective Date" means the first date by which all of the events and conditions specified in paragraph 7 .1 of the Stipulation have occurred and have been met, respectively .
8 . "Enron" means Enron Corporation and all of its past and present parents, subsidiaries, divisions, joint ventures, predecessors, successors, assigns, related or affiliated entities, and any entity in which any of them has a controlling interest .
9 . "Expense Fund" means a principal amount not to exceed Six Million Nine Hundred Thousand Dollars ($6,900,000) plus any interest that may accrue thereon . The Expense Fund shall be paid from, and not in addition to, the Gross Settlement Fund . 10 . "Judgment" means a judgment to be rendered by the Court, substantially in the form attached to the Stipulation as Exhibit B .
11 . "Lead Plaintiff' means The Regents of the University of California .
12 . "Newby Action" means the actions brought on behalf of all purchasers (and their beneficiaries) of any publicly traded equity and debt securities of Enron Corporation, as defined in that action, from October 19,1998 through November27, 2001, inclusive (excluding Defendants, the officers and directors of Enron, and members of their immediate families or their successors, heirs, and legal representatives), proceeding as a consolidated action captioned Newby, eta!. v. Enron Corp ., of aL, No. H-01-CV-3624 (S . D . Tex .) . 13 . "Non-BofA Defendants" means the defendants other than BofA that have been named in the complaints in the Actions . 14 . "Non-Settling Defendants" means each and all of the current Defendants except BofA . 15 . "Notice and Claims Administrator" means Gilardi & Co . LLC or its successors . 16 . "Person" means an individual, corporation, limited liability corporation, professional corporation, limited liability partnership, partnership, limited partnership, 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 any spouses, heirs, predecessors, successors, representatives, or assignees of any of the foregoing .
17 . "Plaintiffs' Settlement Counsel" means Lerach Coughlin Stoia Geller Rudman & Robbins LLP (and any successors thereof), William S . Lerach, Keith F . Park, Helen J . Hodges, 401 B Street, Suite 1600, San Diego, California 92101 .
18 . "Plan of Allocation" means any plan or formula of allocation of the Gross Settlement Fund, to be approved by the Court upon further notice to the Settlement Class, whereby the Net Settlement Fund shall in the future be distributed to Authorized Claimants . Any Plan of Allocation is not part of the Stipulation and BofA shall have no responsibility or liability with respect thereto . 19. "Proof of Claim and Release" means the form to be sent to Settlement Class Members, upon further order(s) of the Court, by which Settlement Class Members may make claims against the Settlement Fund for damages allegedly incurred by reason of their investment(s) in the Publicly Traded Securities . 20 . "Released Claims" means any and all claims, demands, rights, liabilities and causes of action (including "Unknown Claims" as defined below) of any nature whatsoever (excluding claims under ERISA), asserted under federal, state or local law, including without limitation claims under the Securities Exchange Act of 1934 and the Securities Act of 1933, that Representative Plaintiffs and/or any Settlement Class Member have, had, or may have against BofA based on, arising out of, or related to, directly or indirectly, purchases or other acquisitions of any Publicly Traded Securities, including stock, notes and foreign debt securities, during the Settlement Class Period and all acts, facts, statements, or omissions that were or could have been alleged in the Actions. 21 . "Representative Plaintiffs" means the Lead Plaintiff and the named plaintiffs in the WSIB Action . 22 . "Settlement Amount" means the principal amount of Sixty-Nine Million Dollars ($69,000,000) . 23 . "Settlement Class" means (i) all Persons ( and their beneficiaries ) who purchased or acquired any publicly traded equity or debt securities of Enron between October 19, 1998 and November 27, 2001, inclusive, and including purchasers of 4
all securities issued by Enron-related entities during the Settlement Class Period, the value or repayment of which was dependent on the credit, financial condition, or ability to pay of Enron Corporation (collectively, the "Publicly Traded Securities")', and (ii) all states or political subdivisions thereof or state pension plans that purchased from Defendants Enron's 6 .40% Notes due 7/15/06 or 6 .95% Notes due 7/15/28, and that authorize the prosecution of their claims pursuant to the Texas Securities Act. Excluded from the Settlement Class are Defendants, the officers and directors of Enron, and members of their immediate families or their successors, heirs, and legal representatives . Also excluded from the Settlement Class are those Persons who timely and validly request exclusion from the Settlement Class, to the extent that they are able to do so under Rule 23 of the Federal Rules of Civil Procedure, pursuant to this Notice .
24 . "Settlement Class Member" or "Member of the Settlement Class" mean a Person who falls within the definition of the Settlement Class . 25 . "Settlement Class Period" means the period commencing on October 19, 1998 through November27, 2001, inclusive .
26 . "Settling Parties" means, collectively, BofA and the Representative Plaintiffs (on behalf of themselves and each of the Settlement Class Members) . 27 . "Unknown Claims " means any Released Claim that any Representative Plaintiff or Settlement Class Member does not know or suspect to exist in his, her or its favor at the time of the release of BofA that if known by him, her or it, might have affected his , her or its settlement with and release of BofA, or might have affected his , her or its decision not to object to this Settlement or not to himself, exclude herself or itself from the Settlement Class . With respect to any and all Released Claims, the Settling Parties stipulate and agree that, upon the Effective Date, the Representative Plaintiffs shall expressly waive, and each of the Settlement Class Members shall be deemed to have waived and by operation of the Judgment shall have waived, the provisions , rights and benefits of 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 FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR . The Representative Plaintiffs shall expressly waive, and each of the Settlement Class Members shall be deemed to have waived and by operation of the Judgment shall have waived, any and all provisions, rights and benefits conferred by any law of any state or territory of the United States, or principle of common law, that is similar, comparable or equivalent to California Civil Code 1542 . The Representative Plaintiffs and Settlement Class Members may hereafter discover facts in addition to or different from those that any of them now knows or believes to be true with respect to the subject matter of the Released Claims, but each Representative Plaintiff shall expressly have, and each Settlement Class Member shall be deemed to have and by operation of the 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, whether or not concealed or hidden, that 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, reckless, 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 Representative Plaintiffs acknowledge, and the Settlement Class Members shall be deemed to have acknowledged, and by operation of the Judgment shall have acknowledged, that the foregoing waiver was separately bargained for and a key element of the Settlement of which this release is a part. IX . THE SETTLEMENT CLASS By Order dated February 4, 2005, the Court certified the Settlement Class pursuant to Rule 23(b)(3) of the Federal Rules of Civil Procedure, for the purpose of the Settlement only, and directed that this Notice be given to Members of the Settlement Class. If you fall within the definition of the Settlement Class set forth above at Section VIII, then you are a Settlement Class Member.
The Publicly Traded Securities include without limitation Enron's publicly traded debt and equity securities (including without limitation Enron's common stock, 7% Exchangeable Notes, 6 .625% Notes, 7 .375% Notes, 8 .375% Medium Term Notes, and Zero Coupon Convertible Senior Notes) as well as preferred securities issued by Enron, Enron Capital LLC 8% Cumulative Guaranteed Monthly Income Preferred Shares, Enron Capital Trust I Trust Originated Preferred Securities, Enron Capital Trust II Trust Originated Preferred Securities and Enron Capital Resources, L .P . 9% Cumulative Preferred Securities (collectively, the "Preferred Securities"), and Osprey $1,400,000,000 8 .31% Senior Secured Notes due 03, Yosemite $750,000,000 8 .25% Series 1999-A Linked Enron Obligations due 11/15/04, Yosemite 200,000,000 8 .75% Series 2000-A Linked Enron Obligations due 07, Enron Credit Linked Notes $500,000,000 8% due 05, Osprey $750,000,000 7 .797% Senior Secured Notes due 03 and 315,000,000 6 .375% Senior Secured Notes due 03, Enron Credit Linked Notes II $500,000,000 7 .375% due 06, Enron Euro Credit Linked Notes Trust 200,000,000 6 .5% due 06, Enron Sterling Credit Linked Notes Trust 125,000,000 7 .25% due 06, and Marlin Water Trust II and Marlin Water Capital Corp . II $475,000,000 6 .31% Senior Secured Notes and 515,000,000 6 .19% Senior Secured Notes (collectively, the "Foreign Debt Securities") . 5
X . THE RIGHTS OF SETTLEMENT CLASS MEMBERS If you area Settlement Class Member, you may receive the benefit of, and you will be bound by, the terms of the proposed Settlement described in Section Xl of this Notice, upon approval of the proposed Settlement by the Court . If you are a Member of the Settlement Class and if you do not wish to be included in the Settlement Class and do not wish to participate in the proposed Settlement described in this Notice, you may request to be excluded with respect to all Released Claims . To request to be excluded in accordance with the preceding paragraph, you must send a signed, written request to be excluded, postmarked no later than March 28, 2005, and addressed as follows :
In re Enron Corporation Securities Litigation (BofA) c/o Gilardi & Co . LL C P .O . Box 808054 Petaluma, CA 94975-8054
You must set forth the name of this action (In re Enron Corporation Securities Litigation, Civil Action No . H-01-3624 (Consolidated)), your name, address and telephone number, and state that you "request exclusion from the Settlement Class in In re Enron Corporation Securities Litigation, Civil Action No. H-01-3624 (Consolidated) ." You must also setforth the number and type of shares of Enron Publicly Traded Securities that you purchased and sold during the Settlement Class Period and the prices at which the shares were purchased and sold, along with the name and address of the record owner of such shares if different from your own . NO PERSON OR ENTITY MAY EXCLUDE HIMSELF, HERSELF, OR ITSELF FROM THE SETTLEMENT CLASS AFTER MARCH 28, 2005 . If you validly request exclusion from the Settlement Class (a) you will be excluded from the Settlement Class, (b) you will not share in the proceeds of the Settlement described herein, (c) you will not be bound by any judgment entered in the Actions insofar as such judgment relates to the Actions, and (d) you will not be precluded, by reason of your decision to request exclusion from the Settlement Class, from otherwise prosecuting an individual claim, if timely and otherwise valid, against BofA based on the matters complained of in the Actions . If you are a Settlement Class Member, you may, but are not required to, enter an appearance through counsel of your own choosing at your own expense, provided that such counsel must file an appearance on your behalf on or before March 28, 2005, and must serve copies of such appearance on the attorneys listed in Section XIV below. If you do not enter an appearance through counsel of your own choosing, you will be represented by Plaintiffs' Settlement Counsel .
XI, TERMS OF THE PROPOSED SETTLEMEN T
A settlement has been reached in the Actions between the Representative Plaintiffs and BofA, the terms and conditions of which are set forth in the Stipulation and the Exhibits thereto . The following description of the proposed Settlement is only a summary, and reference is made to the text of the Stipulation, on file with the Court, for a full statement of its provisions . A. The Settlement Fund The entire settlement fund (the "Gross Settlement Fund") consists of the aggregate principal amount of Sixty-Nine Million Dollars ($69,000,000) in cash, plus interest thereon, that has been placed into an interest-bearing account pursuant to the terms of the Stipulation . The Stipulation provides for the establishment of an Expense Fund in the amount of Six Million Nine Hundred Thousand Dollars ($6,900,000), which shall be paid from, and not in addition to, the Gross Settlement Fund . At the Settlement Hearing, the Court will be asked to approve the establishment of the Expense Fund . The Expense Fund will be used, subject to the Court's approval(s), to reimburse Plaintiffs' Settlement Counsel for the expenses that they have incurred and expect to incur in the prosecution of the Actions . A portion of the Gross Settlement Fund will also be used to pay for this Notice as well as taxes and tax return preparation expenses regarding the interest earned on the Gross Settlement Fund . After further notice to the Settlement Class and an opportunity to be heard, Plaintiffs' Settlement Counsel will seek approval by the Court of a Plan of Allocation that will govern the calculation of Settlement Class Members' claims against the Gross Settlement Fund . In the future, Settlement Class Members will be sent a Proof of Claim and Release form to establish their claims against the Gross Settlement Fund . Because of the aggregate amount of damages that Plaintiffs' Settlement Counsel assert were suffered by Settlement Class Members, it is not economically feasible to distribute the Gross Settlement Fund to Settlement Class Members at this time . Plaintiffs' Settlement Counsel anticipate that such distributions will occur in connection with additional recoveries against the remaining Defendants in the Actions .
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B . Release s If the proposed Settlement is approved by the Court, the Court will enter an order (the "Order of Final Judgment and Dismissal") that will dismiss the Actions with prejudice as to BofA . In addition, upon the Effective Date, the Representative Plaintiffs and each of the Settlement Class Members, on behalf of themselves, their successors and assigns, and any other Person claiming (now or in the future) through or on behalf of them, and regardless of whether any such Representative Plaintiff or Settlement Class Member ever seeks or obtains by any means, including, without limitation, by submitting a Proof of Claim and Release, any distribution from the Gross Settlement Fund, shall be deemed to have, and by operation of the Judgment shall have, fully, finally, and forever released, relinquished, and discharged all Released Claims against BofA and shall have covenanted not to sue BofA with respect to all such Released Claims, and shall be permanently barred and enjoined from instituting, commencing, or prosecuting any such Released Claim against BofA . In addition, subjectto certain limitations set forth in the Stipulation, BofA will release the Representative Plaintiffs, the Settlement Class Members and Plaintiffs' Settlement Counsel from any claims relating to the prosecution of the Actions . The Court shall retain jurisdiction over these Actions, including, without limitation, all matters with respect to implementation and enforcement of the terms of the Stipulation .
XII . NOTICE TO BANKS , BROKERS AND OTHER NOMINEE S
Banks, brokerage firms, institutions, and other persons who are nominees that purchased Enron Publicly Traded Securities forthe beneficial interest of other persons as of any date from October 19, 1998 through and including November 27, 2001 are requested to, within ten (10) calendar days of receipt of this Notice , ( 1) provide the Notice and Claims Administrator with the names and addresses of such beneficial purchasers (IF YOU HAVE NOT ALREADY DONE SO IN CONNECTION WITHTHE NOTICE TO SETTLEMENT CLASS MEMBERS SENT IN THE FALL OF 2003 REGARDING THE PARTIAL SETTLEMENT WITH ANDERSEN WORLDWIDE SOCIETE COOPERATIVE ("AWSC")), or (2) forward a copy of this Notice to each such beneficial purchaser and provide Plaintiffs ' Settlement Counsel with written confirmation that the Notice has been so forwarded . Upon submission of appropriate documentation , Plaintiffs' Settlement Counsel will reimburse your reasonable costs and expenses of complying with this provision (tothe extent you have not already been reimbursed for providing a list of beneficial purchasers in connection with the previous partial settlement with AWSC ) . Additional copies of this Notice may be obtained from th e Notice and Claims Administrator by writing to : In re Enron Corporation Securities Litigation (BofA) c/o Gilardi & Co. LL C P .O . Box 808054 Petaluma, CA 94975-8054
Correspondence to Plaintiffs' Settlement Counsel should be addressed as follows : WILLIAM S . LERACH KEITH F. PAR K
HELEN J . HODGES LERACH COUGHLIN STOIA GELLER RUDMAN & ROBBINS LL P 401 B Street Suite 160 0
San Diego, CA 92101-429 7
XIII . APPLICATION FOR ATTORNEYS' FEES AND EXPENSE S Plaintiffs' Settlement Counsel do not intend to apply for an award of attorneys' fees at this time . As noted above, however, Plaintiffs' Settlement Counsel will ask the Court at the Settlement Hearing to approve the establishment of the Expense Fund in the amount of Six Million Nine Hundred Thousand Dollars. Reimbursement of expenses from the Expense Fund will only occur upon further Court order . Any application for attorneys' fees and reimbursement of expenses not otherwise recovered from the Expense Fund will only occur after notice of that application has been given to the Settlement Class and an opportunity to be heard . Any such sums as awarded by the Court will be paid from the Gross Settlement Fund . XIV . THE SETTLEMENT HEARIN G A hearing (the "Settlement Hearing") will be held on April 11, 2005 at 10 :00, a .m ., before the Honorable Melinda Harmon, United States District Judge, at the United States District Court for the Southern District of Texas, Bob Casey United States Courthouse, 515 Rusk Avenue, Houston, Texas 77002, forthe purpose of determining (a) whetherthe proposed Settlement as set forth in the Stipulation is fair, reasonable and adequate and should be approved by the Court ; (b) whether an Order of Final Judgment and Dismissal, substantially in the form of Exhibit B to the Stipulation, should be entered herein ; and (c) whetherthe establishment of the Expense Fund should be approved . The Court may adjourn the Settlement Hearing from time to time and without further notice to the Settlement Class.
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Any Settlement Class Member who has not requested exclusion may appear at the Settlement Hearing and be heard on any of the foregoing matters ; provided, however, that no such person shall be heard unless his, her or its objection is made in writing and is filed, together with proof of membership in the Settlement Class and copies of all other papers and briefs to be submitted by him, her or it to the Court at the Settlement Hearing, with the Court no later than March 28, 2005, and showing due proof of service on Plaintiffs' Settlement Counsel : WILLIAM S . LERACH KEITH F . PARK HELEN J . HODGES LERACH COUGHLIN STOIA GELLER RUDMAN & ROBBINS LLP 401 B Street, Suite 1600 San Diego , CA 92101-429 7
and upon the following counsel for BofA :
GREGORY MARKEL CADWALADER, WICKERSHAM & TAFT LL P One World Financial Center New York, NY 1028 1 Unless otherwise ordered by the Court, any Settlement Class Member who does not make his, her or its objection in the manner provided shall be deemed to have waived all objections to the foregoing matters .
XV. EXAMINATION OF PAPERS AND INQUIRIE S
This Notice contains only a summary of the terms of the proposed Settlement . For a more detailed statement of the matters involved in the Actions, reference is made to the pleadings, to the Stipulation and to other papers filed in the Actions, which may be inspected at the Office of the Clerk of the United States District Court, Bob Casey United States Courthouse, 515 Rusk Avenue, Houston, Texas 77002, during business hours of any business day . Inquiries regarding the Actions should be addressed to Plaintiffs' Settlement Counsel at the address set forth above . DO NOT CONTACT THE COURT REGARDING THIS NOTICE DATED : Februa ry 4 , 2005 BY ORDER OF THE COURT UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF TEXAS
EXHIBIT B
Case 4 :01-cv-03624 Document 4049 Filed 10/18/2005
Page 1 of 7
United st courts
Southern District of Texas EtJ i =Ftfitt
OCT 19 200 5
.Achael N . Milby, Cler k UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION
In re ENRON CORPORATION SECURITIES LITIGATION
Civil Action No . H-01-3624 (Consolidated) CLASS ACTIO N
This Document Relates To : MARK NEWBY, et al ., Individually and On Behalf of All Others Similarly Situated , Plaintiffs,
vs .
ENRON CORP., et al ., Defendants. THE REGENTS OF THE UNIVERSITY OF CALIFORNIA, et al ., individually and On Behalf of All Others Similarly Situated ,
Plaintiffs , vs .
KENNETH L. LAY, et al .,
Defendant s
[Caption continued on following page.] ORDER OF FINAL JUDGMENT AND DISMISSAL AS TO BANK OF AMERICA
Case 4 :01-cv-03624 Document 4049 Filed 10/18/2005 Page 2 of 7
WASHINGTON STATE INVESTMENT BOARD, et al ., On Behalf of Themselves and All Others Similarly Situated,
Plaintiffs,
vs . KENNETH L. LAY, et a! .,
Defendants .
Case 4 :01-cv-03624 Document 4049 Filed 10/18/2005 Page 3 of 7
This matter having come before the Court for hearing, pursuant to the Order of this Court ,
dated February 4, 2005, on the application of the Settling Parties for approval of the settlement (the "Settlement") set forth in the Stipulation of Settlement dated as of October 28, 2004 (the "Stipulation"), and due and adequate notice having been given to the Settlement Class (as defined in the Stipulation) as required in said Order, and the Court having considered all papers filed and proceedings had herein and otherwise being fully informed in the premises and good cause appearing therefore, IT IS HEREBY ORDERED, ADJUDGED AND DECREED that : 1 . This Order incorporates by reference the definitions in the Stipulation, and al l
capitalized terms used herein shall have the same meanings as set forth in the Stipulation . Notwithstanding anything in the Stipulation or any other document to the contrary, the exclusion
from the Settlement Class of Defendants shall not include Defendants who purchased or acquired any publicly traded equity or debt securities of Enron in a representative capacity, such as trustee, agent, custodian or otherwise, on behalf of Persons who are or were neither Defendants, officers or directors of Enron, nor members of their immediate families or their successors, heirs and lega l representatives .
2 . This Court has jurisdiction over the subject matter of the Actions and over all Members of the Settlement Class . 3 . The notice given to the Settlement Class of the Settlement and the other matters se t
forth in the Stipulation was the best notice practicable under the circumstances, including individual notice to all Members of the Settlement Class who could be identified through reasonable effort . Said notice provided due and adequate notice of these proceedings and of the matters set forth in the Stipulation, including the proposed Settlement, to all persons entitled to such notice, and said notice fully satisfied the requirements of Rule 23 of the Federal Rules of Civil Procedure and due process .
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4. Nothing in the Stipulation, the Order Preliminarily Approving Settlement, entered o n February 4, 2005, or this Order of Final Judgment and Dismissal is to be construed as precluding any Person who remains a Settlement Class Member or who requests exclusion from the Settlement Class from either being a member of any other classes, subclasses or settlement classes certified by the Court in the Actions or opting out of or seeking exclusion from membership in any such classes . 5 . Pursuant to Rule 23 of the Federal Rules of Civil Procedure, this Court hereb y approves the Settlement as set forth in the Stipulation, finds that said Settlement is, in all respects , fair, reasonab l e and adequate with respect to the Settlement Class, and directs that the Settlement b e consummated in accordance with the terms and conditions set forth in the Stipulation . 6. This Court hereby dismisses the Actions in their entirety as to BofA and against th e Representative Plaintiffs and the Settlement Class, with prejudice and without costs (except a s otherwise provided in the Stipulation) .
7. Upon the Effective Date, the Representative Plaintiffs and each of the Settlemen t Class Members, on behalfofthemselves, their successors and assigns, and any other Person claiming (now or in the future) through or on behalf of them, and regardless of whether any such Representative Plaintiff or Settlement Class Member ever seeks or obtains by any means, including, without limitation, by submitting a Proof of Claim and Release, any distribution from the Gross Settlement Fund, shall be deemed to have, and by operation of this Order of Final Judgment and Dismissal shall have, fully, finally, and forever released, relinquished, and discharged all Released Claims against. BofA and shall have covenanted not to sue BofA with respect to all such Released Claims, and shall be permanently barred and enjoined from instituting, commencing, or prosecuting any such Released Claim against BofA . 8 . BofA agrees that, if there are any Non-Settling Defendant(s), BofA will, as part o f
any later settlement by Representative Plaintiffs with any such Non-Settling Defendant(s), provid e
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full and complete release of all claims against such Defendant(s) and any of its (their) partners, principals, officer or directors, to the extent they arise out of the claims in the Action, including but not limited to, claims for contribution, indemnity, malpractice, negligence or otherwise arising under federal or state law . The release set forth in the foregoing sentence shall be conditioned on Representative Plaintiffs obtaining comparable releases for BofA from any other Defendants i n Newby who settle with Representative Plaintiffs , 9. All Persons, including without limitation the other Defendants in the Actions and any
other persons or entities later named as Defendants in the Actions, are hereby permanently enjoined, barred and restrained from commencing, prosecuting or asserting any action, for contribution, indemnity or otherwise, against BofA seeking, as damages or otherwise, the recovery of all or any part of any liability or any settlement which they pay or are obligated to pay or agree to pay to the Settlement Class, as a result of such persons' participation in any acts, facts, statements or omissions that were or could have been alleged in the Actions (whether under the Securities Act of 1933 or the Securities Exchange Act of 1934, state law, foreign law or otherwise) as claims, . cross-claims, counterclaims, third-party claims or otherwise, whether asserted in the Actions in this Court or i n
any federal or state court or any other court, arbitration proceeding, administrative agency or other forum in the United States or elsewhere. 10 . Upon the Effective Date, all obligations of BofA to the Representative Plaintiffs and
the Settlement Class Members arising out of, based upon, or otherwise related to the transactions and occurrences that were alleged, or could have been alleged, on behalf of the Representative Plaintiffs and the Settlement Class Members in the complaints in the Actions shall be fully, finally, and forever discharged, and all Persons shall be permanently barred and enjoined from instituting, prosecuting, pursuing or litigating in any manner (regardless of whether such Persons purport to act individually, representatively, or in any other capacity and regardless of whether such Person s
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purport to allege direct claims, claims for contribution, indemnification, or reimbursement, or an y other claims) any such obligations . 11 . Any Person so barred and enjoined shall be entitled to appropriate judgment reductio n
in accordance with any applicable statutory or common law rule . In addition, nothing in this Orde r shall preclude any Person so barred and enjoined from developing evidence in discovery o r presenting evidence or arguments at trial in support of such a reduction .
12 . Upon the Effective Date, BofA shall be deemed to have, and by operation of thi s
Order of Final Judgment and Dismissal shall have, fully, finally and forever released, relinquished and discharged each and all of the Settlement Class Members and counsel to the Representative Plaintiffs from all claims (including Unknown Claims), arising out of, in any way relating to, or in connection with the institution, prosecution, assertion, settlement or resolution of the Actions or th e Released Claims except to enforce the releases and other terms and conditions contained in th e Stipulation . 13 . This Order of Final Judgment and Dismissal is a final judgment in the Actions as to all claims among BofA, on the one hand, and the Representative Plaintiffs and all Settlement Clas s
Members, on the other. This Court finds, for purposes of Rule 54(b) of the Federal Rules of Civi l
Procedure, that there is no just reason for delay and expressly directs entry ofjudgment as set forth herein. 14 . Without affecting the finality of this Order of Final Judgment and Dismissal in an y way, this Court retains continuing jurisdiction over (a) implementation of the Settlement ; (b) any award or distribution of the Gross Settlement Fund, including interest earned thereon; and (c) all other proceedings related to the implementation and enforcement of the terms of the Stipulation and/or the Settlement .
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15 . Pursuant to 21D(c)(1) of the Private Securities Litigation Reform Act of 1995, th e Court hereby finds that each Settling Party, and his, her, or its respective counsel, has complied with each requirement of Rule 11(b) of the Federal Rules of Civil Procedure as to all complaints, responsive pleadings, and dispositive motions related to the Released Claims, and that insofar as they relate to the Released Claims, the Actions were not brought for any improper purpose and are not unwarranted by existing law or legally frivolous . 16. In the event that the Effective Date does not occur, this Order of Final Judgment an d Dismissal shall be rendered null and void and shall be vacated nunc pro tune, and the provisions o f 7.5 of the Stipulation shall apply . 17 . Without further order of the Court, the parties may agree to reasonable extensions o f time to carry out any of the provisions of the Stipulation . IT IS SO ORDERED .
DATED .
0&-h
! F , ~131~ 1
.~, . THE HONORABLE MELINDA HARMON UNITED STATES DISTRICT JUDG E
S \Settlemem\Enron.set\llofA settlernentl4- 4 Final Judgment 00019849 .doc
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