1:08-cv-00574-SS Document 298 02/09/12 Page 1 of 35 UNITED...
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Case 1:08-cv-00574-SS Document 298 Filed 02/09/12 Page 1 of 35
UNITED STATES DISTRICT COURT WESTERN DISTRICT OF TEXAS
AUSTIN DIVISION
hi re ArthroCare Corporation Securities No. 1:08-cv-00574-SS
Litigation Class Action
STIPULATION AND AGREEMENT OF SETTLEMENT
This Stipulation of Settlement dated as of February 9, 2012 (the "Stipulation") is entered
into by and among the following Settling Parties 1 to the above-titled action (the "Action"): (i)
Lead Plaintiff DeKalb County Pension Fund ("Lead Plaintiff," on behalf of itself and each of the
Class Members), and (ii) Defendants ArthroCare Corporation ("ArthroCare" or the "Company"),
Michael Baker, and Michael Gluk ("Individual Defendants," or collectively, "Defendants"), by
and through their respective counsel.
This Stipulation is intended by the Settling Parties to fully, finally, and forever resolve,
discharge, and settle the Settled Claims against Defendants and their Related Persons upon and
subject to the terms and conditions hereof and subject to the approval of the Court.
WHEREAS:
A. On July 25, 2008, a class action complaint was filed against ArthroCare and
certain individual defendants in this Court, alleging false and misleading statements and
omissions in violation of §§ 10(b) and 20(a) of the Securities Exchange Act of 1934 (the
"Exchange Act") and Rule lOb-S promulgated by the Securities and Exchange Commission
("SEC") under the statute. The complaint alleged, inter al/a, that those defendants made public
statements that were materially false and misleading with respect to the true nature of
1 Unless otherwise indicated, capitalized terms are defined in ¶ 1 below, which is titled "Definitions."
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ArthroCare's business and failed to disclose numerous fraudulent and improper practices within
the Company, thus causing the Company to file materially false and misleading financial
statements. 2 Pursuant to the Private Securities Litigation Reform Act of 1995 (the "PSLRA"),
notice to the public was issued setting forth the deadline by which putative class members could
move the Court to be appointed to act as lead plaintiff.
B. On December 10, 2008, the Court appointed the DeKalb County Pension Fund as
Lead Plaintiff, and members of Chitwood Harley Flames LLP as Lead Counsel, and Tom
Cunningham of Cunningham Darlow LLP as Liason Counsel in this case.
C. On December 18, 2009, Lead Plaintiff filed the operative complaint in this
Action, the Consolidated Class Action Complaint ("Complaint"), asserting claims under §
10(b) of the Exchange Act and Rule lob-S against ArtbroCare, Michael Baker, Michael Gluk,
and external audit firm PriceWaterhouseCoopers ("PwC"), and under § 20(a) of the Exchange
Act against Baker, Gluk, former Senior Vice President John Raffle, and former Vice President
David Applegate.
D. All defendants moved to dismiss the Complaint, and on July 20, 2010, the Court
granted in part and denied in part the defendants' motions to dismiss, dismissing claims against
them based on events that occurred prior to December 11, 2007, as well as claims against David
Applegate, John Raffle, and PwC.
E. On September 3, 2010, Defendants answered the Complaint.
2 On November 25, 2008, the Court ordered the case Mcllvaine v. ArthroCare Corp. et aL, No. 08-CB-80343, which had been transferred from the Southern District of Florida, consolidated with the present case.
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F. On August 30, 2011, following complete briefing on Lead Plaintiffs motion for
class certification and oral argument held on July 15, 2011, the Court certified the Plaintiff
Class and appointed Chitwood Harley Flames LLP as Class counsel.
G. During the course of the litigation there were numerous motions filed by the
parties and a number of hearings held by the Court. On October 10, 2011, ArthroCare filed its
Motion for Summary Judgment, or Alternatively Partial Summary Judgment, on Corporate
Scienter.
H. During the course of the litigation, Lead Plaintiff and Defendants conducted
extensive discovery, including including propounding and responding to numerous requests for
production of doucuments, propounding and responding to numerous interrogatories, service of
numerous third party subpoenas for documents and deposition testimony, review by Lead
Plaintiff of more than ten million pages of documents produced by Defendants and third parties.
Lead Plaintiff took 24 depositions. Additionally, Lead Plaintiff defended six depositions taken
by Defendants. Lead Plaintiff determined it necessary to engage the services of investigators
and U.S. Marshalls to attempt service of subpoenas on certain witnesses.
I. On May 20, 2011, Lead Plaintiff submitted an expert report addressing the issues
of market efficiency and damages. Additionally, on November 3, 2011, Lead Plaintiff submitted
three expert reports addressing accounting issues, coding isssues, billing practices, and damages.
J. Lead Plaintiff and Defendants participated in three mediation sessions with the
Honorable Daniel Weinstein (Ret.) in California on October 18, 2010, August 9, 2011 and
November 19, 2011, respectively. On November 19, 2011, the parties were able to reach an
agreement in principle to settle the Action for Seventy Four Million Dollars ($74 million) to be
paid by ArthroCare.
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K. Defendants expressly deny any and all allegations of wrongdoing, fault, liability
or damages whatsoever, deny that they committed any violation of law, and believe that the
Action has no merit. This Stipulation shall in no way be construed or deemed to be evidence of,
or an admission or concession on the part of any of the Defendants with respect to, any claim of
fault or liability or wrongdoing or damage whatsoever, or any infirmity in the defenses that
Defendants have, or could have, asserted. The Settling Parties recognize, however, that this
litigation has been filed by Lead Plaintiff and defended by Defendants in good faith, that no
party has violated Rule 11 of the Federal Rules of Civil Procedure, and that the litigation is
being voluntarily settled on terms that each party believes to be reasonable considering the
merits of its claims or defenses and taking into account the expense and uncertainty of
continued litigation. This Stipulation shall not be construed or deemed to be a concession by
Lead Plaintiff of any infirmity in the claims asserted in the Action.
L. Lead Counsel represents that it has conducted an extensive investigation relating
to the claims and the underlying events and transactions alleged in the Complaint. Lead
Counsel represents that it has analyzed evidence adduced during its investigation and in
discovery and has researched the applicable law with respect to the claims of Lead Plaintiff and
the Class against Defendants, as well as the potential defenses thereto.
M. Based upon its investigation, Lead Counsel has concluded that the terms and
conditions of this Stipulation are fair, reasonable and adequate to Lead Plaintiff and the Class,
and in their best interests, and has agreed to settle the claims raised in the Action pursuant to the
terms and provisions of this Stipulation, after considering (i) the substantial benefits that Lead
Plaintiff and the members of the Class will receive from resolution of the Action as against the
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Defendants, (ii) the attendant risks of litigation, and (iii) the desirability of permitting the
Settlement to be consummated as provided by the terms of this Stipulation.
NOW, THEREFORE, IT IS HEREBY STIPULATED AND AGREED by and among the
Settling Parties, by and through their respective undersigned counsel, that, subject to the
approval of the Court, the Action and the Settled Claims and all matters encompassed within the
scope of the releases set forth or referenced herein, shall be fully, finally and forever
compromised, settled, released, relinquished, waived and discharged, and the Action shall be
dismissed with prejudice, upon and subject to the terms and conditions of the Settlement, as
follows:
1. As used in this Stipulation, the following terms shall have the meanings specified
below. In the event of any inconsistency between any definition set forth below and any
definition set forth in any other document related to the Settlement, the definition below shall
control.
(a) "ArthroCare's Counsel" means DLA Piper LLP (US).
(b) "Authorized Claimant" means a Class Member who submits a timely and valid
Proof of Claim Form to the Claims Administrator (in accordance with the requirements
established by the Court) that is approved for payment from the Net Settlement Fund.
(c) "Cash Settlement Amount" means the sum of Seventy Four Million Dollars
($74,000,000) in cash.
(d) "Claim" means a completed and signed Proof of Claim Form submitted to the
Claims Administrator in accordance with the instructions on the Proof of Claim Form.
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(e) "Claim Form" or "Proof of Claim Form" means the Proof of Claim Form and
Release (substantially in the form attached as Exhibit A-2 to the proposed Preliminary Order,
attached hereto as Exhibit A) that a Claimant must complete if that Claimant seeks to be eligible
to share in a distribution of the Net Settlement Fund.
(f) "Claimant" means a person or entity that submits a Claim Form to the Claims
Administrator seeking to be eligible to share in the proceeds of the Net Settlement Fund.
(g) "Claims Administrator" means the claims administrator selected by Lead
Counsel and approved by the Court, Rust Consulting.
(h) "Class" means all persons or entities who purchased or otherwise acquired the
publicly-traded securities of ArtbroCare, and all persons or entities who purchased or otherwise
acquired call options or who sold put options in ArtbroCare common stock, between December
11, 2007 and February 18, 2009, inclusive, and who suffered a loss thereby. Excluded from the
Class are the Defendants, current and former officers and directors of ArthroCare, members of
their immediate families and their legal representatives, heirs, successors or assigns, and any
entity in which Defendants have or had a controlling interest. Also excluded from the Class are
any persons who exclude themselves by filing a request for exclusion in accordance with the
requirements set forth in the Notice. There will be no other exclusions from the Class.
(i) "Class Member" means a person or entity that is a member of the Class who falls
within the definition of the Class set forth in ¶ (h) above.
(j) "Class Period" means the period between and including December 11, 2007 and
February 18, 2009.
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(k) "Class Distribution Order" means an order entered by the Court authorizing and
directing that the Net Settlement Fund be distributed, in whole or in part, to Authorized
Claimants.
(1) "Company" means ArthroCare.
(m) "Complaint" means the Consolidated Class Action Complaint filed by Lead
Plaintiff in the Action on December 18, 2009.
(n) "Court" means the United States District Court for the Western District of Texas.
(o) "Days" or "days" means calendar days unless otherwise specified.
(p) "Defendants" means ArtbroCare, Michael Baker and Michael Gluk.
(q) "Defendants' Counsel" means the law firms of DLA Piper LLP (US), Fenwick &
West LLP, and Locke Lord LLP.
(r) "Effective Date" means the date on which all of the following shall have
occurred and is conditioned on the occurrence of all of the following events: (i) the Court has
entered the Preliminary Approval Order; (ii) ArtbroCare has timely made or caused to be made
its contribution to the Settlement Fund, as required by ¶5 hereof; (iii) ArtbroCare has not
exercised its option to terminate the Settlement pursuant to ¶34 or ¶35 hereof; (iv) the Court has
approved the Settlement, following notice to the Class and a hearing, as prescribed by Rule 23
of the Federal Rules of Civil Procedure; (v) the Court has approved the Settlement and entered
the Judgment, substantially in the form annexed hereto as Exhibit B; and (vi) the Judgment has
become Final (as defined in paragraph 1(w) below).
(s) "Escrow Account" means an interest-bearing escrow account maintained by the
Escrow Agent, which account shall be under the exclusive control of Lead Counsel.
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(t) "Escrow Agent" means Chitwood Harley Flames LLP as Lead Counsel for Lead
Plaintiff and the Class.
(u) "Fee and Expense Application" means the application or applications submitted
to the Court by Lead Counsel seeking distribution from the Gross Settlement Fund of the Fee
and Expense Award.
(v) "Fee and Expense Award" means an award by the Court to Lead Plaintiff and
Lead Counsel of (i) reimbursement of expenses and costs incurred in connection with
prosecuting the Action (including reimbursement for time and expenses incurred by Lead
Plaintiff as allowed by law), (ii) attorneys' fees; and (iii) any interest on such attorneys' fees,
costs, and expenses at the same rate and for the same periods as earned by the Gross Settlement
Fund (until paid).
(w) "Final" means when the last of the following, with respect to the Judgment, shall
occur: (i) the expiration of the time to file a motion to alter or amend the Judgment under
Federal Rule of Civil Procedure 59(e) without any such motion having been filed; (H) the
expiration of the time in which to appeal the Judgment without any appeal having been taken,
which time shall be deemed to be within thirty (30) days following the entry of the Judgment,
unless the date to take such an appeal shall have been extended by Court order or otherwise, or
unless the 30th day falls on a weekend or a Court holiday, in which case the date for purposes of
this Stipulation shall be deemed to be the next business day after such 30th day; or (Hi) if a
motion to alter or amend the Judgment is filed under Federal Rule of Civil Procedure 59(e) or if
an appeal of the Judgment is taken, immediately after the determination of that motion or appeal
so that it is no longer subject to any further judicial review or appeal whatsoever, whether by
reason of affirmance by a court of last resort, lapse of time, voluntary dismissal of the appeal or
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otherwise, and in such a manner as to permit the consummation of the Settlement substantially
in accordance with the terms and conditions of this Stipulation. Any proceeding or order, or
any appeal or petition for a writ of certiorari pertaining solely to the issue of attorneys' fees and
reimbursement of costs or the Plan of Allocation of the Net Settlement Fund shall not in any
way delay or preclude the Judgment from becoming final and shall not be considered an appeal
within the meaning of this paragraph.
(x) "Final Approval Hearing" means the hearing set by the Court under Rule 23(e)
of the Federal Rules of Civil Procedure to consider final approval of the Settlement.
(y) "Gross Settlement Fund" or "ArthroCare Settlement Fund" means the sum of
Seventy Four Million Dollars ($74,000,000) in cash, which ArthroCare shall pay or cause to be
paid at the times and in the manner specified in ¶ 5 herein, and any interest earned thereon.
(z) "Individual Defendants" means Michael Baker and Michael Gluk.
(aa) "Judgment" means an order of judgment and dismissal approving the Settlement
to be rendered by the Court substantially in the form attached hereto as Exhibit B.
(bb) "Lead Counsel" means the law firm of Chitwood Harley Flames LLP.
(cc) "Lead Plaintiff' or "DeKalb" means the DeKalb County Pension Fund.
(dd) "Litigation Expenses" means the reasonable costs and expenses incurred by Lead
Counsel in connection with commencing and prosecuting the Action, for which Lead Counsel
intends to apply to the Court for reimbursement from the Gross Settlement Fund, as well as the
reimbursement for time and expenses incurred by Lead Plaintiff.
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(cc) "Net Settlement Fund" means the Gross Settlement Fund less: (i) any Taxes; (ii)
any Notice and Administration Costs; (iii) any Litigation Expenses awarded by the Court; and
(iv) any attorneys' fees awarded by the Court.
(fl) "Notice" means the Notice of Pendency and Proposed Settlement of Class
Action to be approved by the Court and sent to members of the Class, containing the general
terms of the Settlement, the general terms of the Fee and Expense Application and the date of
the Settlement Hearing, substantially in the form attached as Exhibit A-i to the proposed
Preliminary Approval Order attached hereto as Exhibit A.
(gg) "Notice and Administration Costs" means the costs, fees and expenses that are
incurred by the Claims Administrator in connection with (i) providing notice to the Class; and
(H) administering the Claims process.
(hh) "Plaintiffs' Counsel" means Lead Counsel and all other counsel who, at the
direction and under the supervision of Lead Counsel, represent Class Members in the Action.
(H) "Plan of Allocation" means the proposed plan of allocation of the Net Settlement
Fund described in the Notice.
(ii) "Preliminary Approval Order" means the order for which Lead Plaintiff shall
apply to the Court, requesting preliminary approval of the Settlement and directing that Notice
be provided to the Class, substantially in the form attached hereto as Exhibit A.
(kk) "Related Parties" means, as to the Company and the Individual Defendants, their
respective past or present heirs, executors, estates, administrators, predecessors, successors,
assigns, parents, subsidiaries, associates, affiliates, employers, employees, agents, spouses, any
members of an Individual Defendants' immediate family, or any trust of which any Individual
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Defendant is the settler or which is for the benefit of any Individual Defendant and/or
member(s) of his family, insurers, reinsurers, directors, managing directors, officers, partners,
principals, members, managing members, board members, attorneys, Defendants' Counsel,
accountants, outside auditors, financial and other advisors, investment bankers, underwriters,
lenders, and any other representatives of any of these persons or entities.
(11) "Release" means the release contained in ¶J 2-4 below and substantially in the
form contained in the Judgment.
(mm) "Released Parties" means the Company and the Individual Defendants, and their
Related Parties.
(nn) "Released Parties' Claims" means any and all claims, rights, causes of action,
liabilities or any other matters, whether known or Unknown Claims, foreseen or unforeseen,
whether arising under federal, state, common or foreign law, that have been or could have been
asserted in the Action or any forum by the Released Parties or their attorneys against Lead
Plaintiff, the Class Members or their attorneys, which arise out of or relate in any way to the
institution, prosecution or settlement of the Action (except for claims to enforce the Settlement).
(oo) "Settled Claims" means any and all claims, rights, causes of action, liabilities or
any other matters, whether known or Unknown Claims, foreseen or unforeseen, whether arising
under federal, state, common or foreign law, that (a) Lead Plaintiff or any other member of the
Class asserted in the Action or could have asserted in any forum, that arise out of, are based
upon or relate in any way to the allegations, transactions, facts, matters or occurrences,
disclosures, representations or omissions involved, set forth or referred to in the Action; or (b)
relate in any way to any violation of state, federal or any foreign jurisdiction's securities or
other laws, any misstatement, omission or disclosure (including in financial statements), any
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breach of duty, any negligence or fraud, or any other alleged wrongdoing or misconduct by the
Released Parties relating in any way to the purchase or other acquisition of the publicly-traded
securities of ArthroCare, or the purchase or other acquisition of call options or sale of put
options in ArthroCare common stock, by members of the Class during the Class Period.
Notwithstanding the foregoing, "Settled Claims" does not include claims relating to the
enforcement of the Settlement.
(pp) "Settlement" means this Stipulation of Settlement and the settlement contained
herein.
(qq) "Settling Parties" means (i) Defendants ArthroCare, Michael Baker and Michael
Gluk, and (ii) Lead Plaintiff on behalf of itself and the Class Members.
(r) "Stipulation" means this Stipulation of Settlement.
(ss) "Summary Notice" means the Summary Notice of Pendency and Proposed
Settlement of Class Action in substantially the form attached as Exhibit A-3 to the proposed
Preliminary Approval Order, attached hereto as Exhibit A, and to be published as set forth in the
Preliminary Approval Order.
(U) "Taxes" means: (i) all federal, state and/or local taxes of any kind on any
income earned by the Gross or Net Settlement Fund; and (ii) the reasonable expenses and costs
incurred by Lead Counsel in connection with determining the amount of, and paying, any taxes
owed by the Gross or Net Settlement Fund (including, without limitation, reasonable expenses
of tax attorneys and accountants).
(uu) "Unknown Claims" means any and all Settled Claims that the Lead Plaintiff
and/or Class Member does not know or suspect to exist in his, her or its favor at the time of the
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release of the Released Parties, and any Released Parties' Claims that the Released Parties or
their attorneys do not know or suspect to exist in his, her or its favor, which if known by him,
her or it might have affected his, her or its settlement with and release of the Released Parties
(or Lead Plaintiff, as appropriate), or might have affected his, her or its decision not to object to
this Settlement or not exclude himself, herself or itself from the Class. With respect to any and
all Settled Claims and Released Parties' Claims, the Settling Parties stipulate and agree that,
upon the Effective Date, Lead Plaintiff shall expressly and each of the Class Members shall be
deemed to have, and by operation of the Judgment shall have, expressly waived the provisions,
rights, and benefits conferred by California Civil Code § 1542, to the extent this provision may
apply, 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.
Upon the Effective Date, Lead Plaintiff shall expressly, and each of the Class Members
shall be deemed to have, and by operation of the Judgment shall have, expressly waived any and
all provisions, rights, and benefits conferred by any law of jurisdiction or any state or territory
of the United States, or principle of common law, which is similar, comparable or equivalent to
California Civil Code § 1542. The Settling Parties acknowledge, and Class Members by law
and operation of the Judgment shall be deemed to have acknowledged, that the inclusion of
"Unknown Claims" in the definition of Settled Claims and Released Parties' Claims was
separately bargained for and was a material element of the Settlement.
RELEASE OF CLAIMS
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2. The obligations incurred pursuant to this Stipulation shall be in full and final
disposition of the Action as against Defendants, and shall fully and finally release any and all
Settled Claims as against all Released Parties and shall also act as a release against Lead
Plaintiff, together with its officers, directors, employees, agents and attorneys, and all other
Class Members for any and all Released Parties' Claims.
3. Pursuant to the Judgment, upon the Effective Date, Lead Plaintiff and each of the
Class Members shall be deemed by operation of law to have fully, finally and forever released,
relinquished, waived, discharged and dismissed each and every Settled Claim and shall forever
be enjoined from prosecuting any or all Settled Claims against any Released Party.
4. Pursuant to the Judgment, upon the Effective Date, Defendants and each of the
other Released Parties shall be deemed by operation of law to have fully, finally and forever
released, relinquished, waived, discharged and dismissed each and every of the Released
Parties' Claims and shall forever be enjoined from prosecuting any or all of the Released
Parties' Claims against Lead Plaintiff, its officers, directors, employees, agents and attorneys,
and all other Class Members.
THE SETTLEMENT CONSIDERATION
5. In consideration of the Settlement of the Settled Claims against Defendants and
the other Released Parties, ArthroCare shall pay or cause to be paid the Cash Settlement
Amount at the following times and in the following manner:
(a) Within ten (10) business days following the entry of the Preliminary Approval
Order, ArthroCare will pay, or cause to be paid, Two Hundred and Fifty Thousand Dollars
($250,000) into an interest-bearing escrow account established by Lead Counsel, as Escrow
Agent for the Settlement Fund, in the name of the ArthroCare Settlement Fund. This portion of
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the total Cash Settlement Amount shall be used for the purpose of providing notice of the
Settlement to Class Members and to administer the Settlement.
(b) Within ten (10) business days following the entry of the Preliminary Approval
Order, ArthroCare shall pay, or cause to be paid to Lead Counsel, as Escrow Agent for the
Settlement Fund, the additional sum of Seventy Three Million Seven Hundred and Fifty
Thousand Dollars ($73,750,000) as the balance of the Gross Settlement Fund. No portion of this
Seventy Three Million Seven Hundred and Fifty Thousand Dollars shall be released from the
Gross Settlement Fund until the settlement becomes Final, except as provided in paragraphs 16-
18.
(c) This is not a claims-made settlement, and if all conditions under the Stipulation of
Settlement are satisfied and the Settlement becomes Final, no portion of the Gross Settlement
Fund will be returned to Defendants.
6. The interest earned on the Gross Settlement Fund shall be for the benefit of the
Class if the Settlement becomes Final. If the Settlement does not become Final and the
Settlement is terminated, the interest earned on the Settlement Fund shall be for the benefit of
ArthroCare and paragraphs 32-37 below shall govern. If the Cash Settlement Amount is not paid
to the Escrow Agent no later than ten (10) business days after entry of the Preliminary Approval
Order, Lead Plaintiff reserves the right to either: (i) move to enforce the Settlement; or (ii)
terminate the Settlement, in which case paragraphs 32-37 below shall govern.
ISSUANCE OF CAFA NOTICE
7. Within 10 days of the filing of this Stipulation with the Court, Defendants shall
issue notice to the appropriate federal and state officials, including the states' attorneys general,
as set forth in the Class Action Fairness Act, 28 U.S.C. § 1715.
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USE OF SETTLEMENT FUND AND ISSUANCE OF NOTICE
8. The Gross Settlement Fund shall be used to pay any: (i) Taxes; (ii) Notice and
Administration Costs pursuant to paragraph 14 below and as otherwise approved by the Court;
(iii) attorneys' fees awarded by the Court; (iv) Litigation Expenses awarded the Court; and (v)
other Court-approved deductions. The balance remaining in the Gross Settlement Fund shall be
distributed to Authorized Claimants as provided below.
9. The Net Settlement Fund shall be distributed to Authorized Claimants as
provided herein. Defendants shall have no responsibility or liability for the maintenance or
distribution of the Net Settlement Fund pursuant to this Settlement. Except as provided herein
or pursuant to orders of the Court, the Net Settlement Fund shall remain in the Escrow Account
prior to the Effective Date. All funds held by the Escrow Agent shall be deemed to be in the
custody of the Court and shall remain subject to the jurisdiction of the Court until such time as
the funds shall be distributed or returned pursuant to the terms of this Stipulation and/or further
order of the Court. The Escrow Agent shall invest any funds in excess of U.S. $250,000 in
United States Treasury Bills having maturities of 180 days or less, or money market mutual
funds comprised of investments secured by the full faith and credit of the United States
Government, or an account fully insured by the United States Government Federal Deposition
Insurance Corporation (FDIC). Any funds held in escrow in an amount of less than U.S.
$250,000 may be held in an interest-bearing account insured by the FDIC or money market
mutual funds comprised of investments secured by the full faith and credit of the United States
Government or fully insured by the United States Government. All risks related to the
investment of the Settlement Fund shall be borne by the Settlement Fund.
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10. The parties hereto agree that the Settlement Fund is intended to be a Qualified
Settlement Fund within the meaning of Treasury Regulation § 1.46813-1 and that Lead Counsel,
as administrator of the Gross Settlement Fund within the meaning of Treasury Regulation §
1.468B-2(k)(3), shall be solely responsible for filing or causing to be filed all informational and
other tax returns as may be necessary or appropriate (including, without limitation, the returns
described in Treasury Regulation § 1.468B-2(k)) for the Gross Settlement Fund. Such returns
shall be consistent with this paragraph and in all events shall reflect that all taxes on the income
earned on the Gross Settlement Fund shall be paid out of the Gross Settlement Fund as provided
by paragraph 11 below. Lead Counsel shall also be solely responsible for causing payment to
be made from the Gross Settlement Fund of any Taxes owed with respect to the Gross
Settlement Fund. Upon written request, ArthroCare will provide promptly to Lead Counsel the
statement described in Treasury Regulation § 1.468B-3(e). Lead Counsel, as administrator of
the Gross Settlement Fund within the meaning of Treasury Regulation §1.46813-2(k)(3), shall
timely make such elections as are necessary or advisable to carry out this paragraph, including,
as necessary, making a "relation back election," as described in Treasury Regulation § 1.468B-
1(j), to cause the Qualified Settlement Fund to come into existence at the earliest allowable
date, and shall take or cause to be taken all actions as may be necessary or appropriate in
connection therewith.
11. All Taxes shall be paid out of the Gross Settlement Fund, and shall be timely
paid by the Escrow Agent and without prior Order of the Court. Any tax returns prepared for
the Gross Settlement Fund (as well as the election set forth therein) shall be consistent with the
previous paragraph and in all events shall reflect that all Taxes (including any interest or
penalties) on the income earned by the Gross Settlement Fund shall be paid out of the Gross
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Settlement Fund as provided herein. The Gross Settlement Fund shall indemnify and hold all
Released Parties harmless for any Taxes and related expenses of any kind whatsoever
(including, without limitation, taxes payable by reason of any such indemnification).
ArthroCare shall notify the Escrow Agent promptly if ArthroCare receives any notice of any
claim for Taxes relating to the Gross Settlement Fund.
12. The Claims Administrator shall discharge its duties under Lead Counsel's
supervision and subject to the jurisdiction of the Court. Except as otherwise expressly provided
herein, the Released Parties shall have no responsibility whatsoever for the administration of the
Settlement and shall have no liability whatsoever to any person, including, but not limited to,
the Class Members, in connection with any such administration.
13. Lead Counsel shall cause the Claims Administrator to mail the Notice and Proof
of Claim to those members of the Class at the address of each such person as set forth in the
records of ArthroCare (or its transfer agent(s)), or who otherwise may be identified through
further reasonable effort. Lead Counsel will cause to be published the Summary Notice
pursuant to the terms of the Preliminary Approval Order or whatever other form or manner
might be ordered by the Court. For the purpose of identifying and providing notice to the Class,
within five (5) business days of the date of entry of the Preliminary Approval Order, ArthroCare
shall provide or cause to be provided to the Claims Administrator (at no cost to the Settlement
Fund, Lead Counsel or the Claims Administrator) its security holder lists (consisting of security
holder names and addresses), in electronic form.
14. Lead Counsel may pay from the ArthroCare Settlement Fund (which will
initially contain $250,000), without further approval from ArthroCare or further order of the
Court, all reasonable Notice and Administration Costs. Such costs and expenses shall include,
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without limitation, the actual costs of publication, printing and mailing the Notice,
reimbursements to nominee owners for forwarding the Notice to their beneficial owners, the
administrative expenses actually incurred and fees reasonably charged by the Claims
Administrator in connection with providing Notice and processing the submitted claims. In the
event that the Settlement is terminated pursuant to the terms of this Stipulation, all Notice and
Administration Costs properly paid or incurred, including any related fees, shall not be returned
or repaid to ArthroCare, its insurance carriers or any person or entity who or which paid any
portion of the Gross Settlement Fund.
15. The Released Parties shall have no responsibility for, interest in, or liability
whatsoever with respect to the maintenance, investment or distribution of the Gross Settlement
Fund, the establishment or maintenance of the Escrow Account, the establishment or
administration of the Plan of Allocation, the determination, administration, or calculation of
claims, the payment or withholding of Taxes, the distribution of the Net Settlement Fund, the
administration of the Settlement, or any losses incurred in connection with such matters.
Defendants take no position with respect to the provisions of this Stipulation governing those
issues. The Released Parties shall have no further or other liability or obligations to Lead
Plaintiff, Lead Counsel or any member of the Class with respect to the Settled Claims, except as
expressly stated in this Stipulation.
ATTORNEYS' FEES AND LITIGATION EXPENSES
16. Lead Counsel will apply to the Court for an award of attorneys' fees and
reimbursement of Litigation Expenses, which may include reimbursement of the time and
expenses of DeKalb in accordance with 15 U.S.C. § 78u-4(a)(4). Defendants shall not take any
position with respect to any such applications or resulting awards. Such matters are not the
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subject of any agreement between Defendants and Lead Plaintiff, or their counsel, except as set
forth in this Stipulation.
17. Any attorneys' fees and Litigation Expenses that are awarded by the Court shall
be paid to Lead Counsel, with the Court's approval, immediately upon award, notwithstanding
the existence of any timely filed objections thereto, or potential for appeal therefrom, or
collateral attack on the Settlement or any part thereof, subject to Lead Counsel's obligation to
make appropriate refunds or repayments to the Gross Settlement Fund, plus accrued interest at
the same net rate as is earned by the Gross Settlement Fund, if the Settlement is terminated
pursuant to the terms of this Stipulation or if, as a result of any appeal or further proceedings on
remand, or successful collateral attack, the award of attorneys' fees and/or Litigation Expenses
is reduced or reversed. Lead Counsel shall make the appropriate refund or repayment in full no
later than five (5) business days after receiving from Defendants' Counsel or from a court of
appropriate jurisdiction notice of the termination of the Settlement or notice of any reduction of
the award of attorneys' fees and/or Litigation Expenses. An award of attorneys' fees and/or
Litigation Expenses is not a necessary term of this Stipulation and is not a condition of this
Stipulation. Lead Plaintiff and Lead Counsel may not cancel or terminate the Stipulation or the
Settlement based on this Court's or any appellate court's ruling with respect to attorneys' fees
and/or Litigation Expenses.
18. Subject to any limits imposed by the Court or as a matter of law, Lead Counsel
shall have the sole authority to allocate the Court-awarded attorneys' fees and Litigation
Expenses amongst Plaintiffs' Counsel in a manner which Lead Counsel, in good faith, believes
reflects the contributions of such counsel to the prosecution and settlement of the Action.
Defendants and the other Released Parties shall have no responsibility for the allocation among
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Plaintiffs' Counsel, and/or any other person or entity who may assert some claim thereto, of any
award of attorneys' fees or Litigation Expenses that the Court may make in the Action, and
Defendants take no position with respect to such matters.
CLAIMS ADMINISTRATOR
19. The Claims Administrator shall administer the process of receiving, reviewing
and approving or denying claims under Lead Counsel's supervision and subject to the
jurisdiction of the Court. Other than ArtbroCare's obligation to provide its shareholder transfer
records, as provided herein, none of the Released Parties shall have any responsibility for the
administration of the Settlement or the claims process. ArthroCare and ArthroCare's Counsel
shall cooperate in the administration of the Settlement to the extent reasonably necessary to
effectuate its terms.
20. The Claims Administrator shall receive Claims and administer them according to
the Plan of Allocation, as proposed by Lead Plaintiff and approved by the Court, or according to
such other Plan of Allocation as the Court approves. The proposed Plan of Allocation is
described in the Notice attached as Exhibit A-i to the proposed Preliminary Approval Order
attached hereto as Exhibit A.
21. The allocation of the Net Settlement Fund among Authorized Claimants is a
matter separate and apart from the proposed Settlement between Defendants and Lead Plaintiff,
and any decision by the Court concerning the Plan of Allocation shall not affect the validity or
finality of the proposed Settlement. The Plan of Allocation described in the Notice is not a
necessary term of this Stipulation, and it is not a condition of this Stipulation that any particular
plan of allocation be approved by the Court. Lead Plaintiff and Lead Counsel may not cancel or
terminate the Stipulation or the Settlement based on this Court's or any appellate court's ruling
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with respect to the Plan of Allocation or any plan of allocation in this Action. Neither
Defendants nor any other Released Party shall have any responsibility or liability whatsoever
for allocation of the Net Settlement Fund, nor shall Defendants object to the Plan of Allocation
proposed by Lead Plaintiff.
22. Any Class Member who does not timely submit a valid Claim Form will not be
entitled to receive any distribution from the Net Settlement Fund but will nevertheless be bound
by all of the terms of this Stipulation and Settlement, including the terms of the Judgment to be
entered in the Action and the releases provided for herein, and will be permanently barred and
enjoined from bringing any action, claim or other proceeding of any kind against any Released
Party concerning any Settled Claim.
23. Lead Counsel shall be responsible for supervising the administration of the
Settlement and disbursement of the Net Settlement Fund. Neither Defendants nor any other
Released Party shall have any liability, obligation or responsibility whatsoever for the
administration of the Settlement or disbursement of the Net Settlement Fund. Neither
Defendants nor any other Released Party shall be permitted to review, contest or object to any
Claim Form or any decision of the Claims Administrator or Lead Counsel with respect to
accepting or rejecting any Claim Form or Claim for payment by a Class Member.
24. All Claim Forms must be submitted by the date set by the Court in the
Preliminary Approval Order and specified in the Notice, unless such deadline is extended by
Order of the Court. Any Class Member who fails to submit a Claim Form by such date shall be
forever barred from receiving any distribution from the Net Settlement Fund or payment
pursuant to this Stipulation (unless, by Order of the Court, late-filed Claim Forms are accepted),
but shall in all other respects be bound by all of the terms of this Stipulation and the Settlement,
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including the terms of the Judgment and the releases provided for herein, and they will be
permanently barred and enjoined from bringing any action, claim or other proceeding of any
kind against any Released Party concerning any Settled Claim. A Claim Form shall be deemed
to be 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.
25. Each Claimant shall be deemed to have submitted to the jurisdiction of the Court
with respect to the Claimant's Claim, including, but not limited to, the releases provided for in
the Judgment, and the Claim will be subject to investigation and discovery under the Federal
Rules of Civil Procedure, provided that such investigation and discovery shall be limited to that
Claimant's status as a Class Member and the validity and amount of the Claimant's Claim. No
discovery shall be allowed on the merits of this Action or this Settlement in connection with the
processing of Claim Forms; provided, however, that Defendants may verify whether specific
persons who opt out of the Class have submitted Claim Forms.
26. Lead Counsel will apply to the Court, on notice to Defendants, for a Class
Distribution Order: (i) approving the Claims Administrator's administrative determinations
concerning the acceptance and rejection of the Claims submitted; and (ii) if the Effective Date
has occurred, directing payment of the Net Settlement Fund to Authorized.
27. Payment pursuant to the Class Distribution Order shall be final and conclusive
against any and all Class Members. All Class Members whose Claims are not approved by the
Court shall be barred from participating in distributions from the Net Settlement Fund, but
otherwise shall be bound by all of the terms of this Stipulation and the Settlement, including the
terms of the Judgment to be entered in this Action and the releases provided for therein, and
they will be permanently barred and enjoined from bringing any action against any and all
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Released Parties concerning any and all of the Settled Claims. Authorized Claimants will be
entitled to only one check, negotiable within 60 days of the date of the check.
28. All proceedings with respect to the administration, processing and determination
of Claims and the determination of all controversies relating thereto, including disputed
questions of law and fact with respect to the validity of Claims, shall be subject to the
jurisdiction of the Court.
TERMS OF THE JUDGMENT
29. If the Settlement contemplated by this Stipulation is approved by the Court, Lead
Counsel and Defendants' Counsel shall request that the Court enter a Judgment, substantially in
the form annexed hereto as Exhibit B, including, among other things, the releases provided for
therein.
NO ADMISSION OF WRONGDOING
30. Whether or not the Settlement is approved by the Court, and whether or not the
Settlement is consummated, the fact and terms of this Stipulation, including exhibits, all
negotiations, discussions, drafts and proceedings in connection with the Settlement, and any act
performed or document signed in connection with the Settlement:
(a) shall not be offered or received against any of the Released Parties as evidence
of, or construed as, or deemed to be evidence of any presumption, concession or admission by
any of the Released Parties with respect to the truth of any fact alleged by Lead Plaintiff or the
validity of any claim that was or could have been asserted against any of the Released Parties in
this Action or in any litigation, in this or any other court, administrative agency, arbitration
forum or other tribunal, or of any liability, negligence, fault or other wrongdoing of any kind of
any of the Released Parties to Lead Plaintiff, the Class or anyone else;
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(b) shall not be offered or received against any of the Released Parties as evidence of
a presumption, concession or admission of any fault, misrepresentation or omission with respect
to any statement or written document approved or made by any of the Released Parties, or
against the Released Parties as evidence of any infirmity in the claims or defenses that have
been or could have been asserted in the Action;
(c) shall not be offered or received against any of the Released Parties as evidence of
a presumption, concession or admission with respect to any liability, negligence, fault or
wrongdoing of any kind, or in any way referred to for any other reason or purpose as against
any of the Released Parties, in any other civil, criminal or administrative action or proceeding,
other than such proceedings as may be necessary to effectuate the provisions of this Stipulation;
provided, however, that if this Stipulation is approved by the Court, Defendants or any other
Released Party may file this Stipulation and/or the Judgment in any action for any purpose,
including, but not limited to, in order to support a defense or counterclaim based on principles
of res judicata, collateral estoppel, release and discharge, good faith settlement, judgment bar or
reduction or any other theory of claim preclusion or issue preclusion or similar defense or
counterclaim;
(d) shall not be construed against any of the Released Parties, Lead Plaintiff or any
other Class Member(s) as an admission, concession or presumption that the consideration to be
given hereunder represents the amount which could be or would have been recovered after trial;
and
(e) shall not be construed against Lead Plaintiff or any other Class Members as an
admission, concession or presumption that any of his or her claims are without merit.
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CONDITIONS OF SETTLEMENT, EFFECT OF DISAPPROVAL, CANCELLATION, WAIVER, OR TERMINATION
31. Within thirty (30) days of (a) the Court's entry of an order expressly declining
to enter the Preliminary Approval Order in any material respect; (b) the Court's refusal to
approve this Stipulation or any material part of it; (c) the Court's declining to enter the
Judgment in any material respect; or (d) the date upon which the Judgment is modified or
reversed in any material respect and represents a Final decision on the matter, Defendants and
Lead Plaintiff each shall have the right to terminate the Settlement and this Stipulation, by
providing written notice to the other of an election to do so. However, any decision with
respect to an application for attorneys' fees or Litigation Expenses, with respect to the Court's
findings and conclusions pursuant to Section 211)(c)(1) of the Exchange Act, as amended by the
PSLRA, 15 U.S.C. § 78u-4(c)(1), or with respect to any plan of allocation, shall not be
considered material to the Settlement and shall not be grounds for termination.
32. Except as otherwise provided herein, in the event the Settlement is terminated, is
not approved by the Court, or fails to become effective in accordance with its terms, the
Settlement termination shall be without prejudice, and none of the terms shall be effective or
enforceable, and the facts of the Settlement shall not be admissible in any trial of this Action,
and the Settling Parties shall be deemed to have reverted to their respective status in this Action
as of November 18, 2011. In such event, the terms and provisions of the Stipulation, with the
exception of paragraphs 30(a) through 30(e), and 48 shall be null and void and shall have no
further force or effect. In such event, the Settling Parties shall proceed in all respects as if this
Stipulation and any related orders had not been entered, and any portion of the Settlement
consideration previously paid or caused to be paid by ArthroCare, including, but not limited to,
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any funds disbursed in payment of Litigation Expenses and attorneys' fees, together with any
interest earned or appreciation thereon, less any Taxes paid or due with respect to such income,
and less Notice and Administration Costs incurred and paid or payable, shall be returned to
ArthroCare within (5) business days after written notification of such event by ArthroCare to
Lead Counsel as Escrow Agent for the Gross Settlement Fund. In such event, the Stipulation
shall not be used in this Action or in any other proceeding for any purpose, and any judgment or
order entered by the Court in accordance with the terms of the Stipulation shall be treated as
vacated, nunc pro tunc.
33. No order of the Court or modification or reversal on appeal of any order of the
Court concerning the Plan of Allocation or the amount of any attorneys' fees, costs, expenses,
and interest awarded by the Court to any of plaintiffs' counsel shall constitute grounds for
cancellation or termination of the Stipulation.
34. Upon the occurrence of all of the events referenced in paragraph 1(r) hereof, any
and all remaining interest or right of the Defendants in or to the Settlement Fund, if any, shall be
absolutely and forever extinguished. if the settlement does not become final as defined in
¶1(w), then the Stipulation shall be canceled and terminated unless Lead Counsel and counsel
for the Defendants mutually agree in writing to proceed with the Stipulation.
35. ArthroCare shall have the option to terminate the settlement in the event that
Class Members who purchased in the aggregate more than the specified number of shares of
ArthroCare common stock during the Class Period choose to exclude themselves from the
Class, as set forth in a separate agreement (the "Supplemental Agreement") executed between
Lead Counsel and ArthroCare's counsel. The Supplemental Agreement will not be filed with
the Court unless a dispute among the Settling Parties concerning its interpretation or application
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arises and in that event, the Supplemental Agreement shall be filed and maintained by the Court
under seal.
36. Unless otherwise ordered by the Court, in the event the Stipulation shall
terminate, or be canceled, or shall not become effective for any reason, within five (5) business
days after written notification of such event is sent by counsel for the Defendants or Lead
Counsel to the Escrow Agent, the Settlement Fund, less expenses which have either been
disbursed pursuant to paragraphs 10, 11, and 14 hereof, or are determined by the Court to be
chargeable to the Settlement Fund, shall be refunded by the Escrow Agent directly to the
entities that provided the funds based on their pro rata contribution to the Settlement Fund. The
Escrow Agent or its designee shall apply for any tax refund owed on the Settlement Fund and
pay the proceeds, after deduction of any fees or expenses incurred in connection with such
application(s) for refund, pursuant to written instructions from Defendants' counsel.
37. If the Effective Date does not occur, or if the Stipulation is terminated pursuant
to its terms, neither Lead Plaintiff nor any of its counsel shall have any obligation to repay any
amounts actually and properly disbursed pursuant to paragraphs 10, 11, and 14. In addition, any
expenses already incurred pursuant to paragraphs 10, 11, and 14 hereof at the time of such
termination or cancellation but which have not been paid, shall be paid by the Escrow Agent in
accordance with the terms of the Stipulation prior to the balance being refunded in accordance
with paragraph 36 hereof.
MISCELLANEOUS PROVISIONS
38. The exhibits attached hereto are hereby incorporated by reference as though fully
set forth herein: proposed Preliminary Approval Order, (with its attached exhibits, consisting of
the Notice, Proof of Claim Form, and Summary Notice) and proposed Judgment.
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39. If a case is commenced in respect of ArthroCare under Title 11 of the United
States Code (Bankruptcy), or a trustee, receiver, conservator or other fiduciary is appointed
under any similar law, and in the event of the entry of a final order of a court of competent
jurisdiction determining the payment of the Cash Settlement Fund or any portion thereof by or
on behalf of Defendants or an insurer to be a preference, voidable transfer, fraudulent transfer or
similar transaction and any portion thereof is required to be returned, and such amount is not
promptly deposited to the Gross Settlement Fund by others, then, at the election of Lead
Counsel, the parties shall jointly move the Court to vacate and set aside the releases given and
the Judgment entered in favor of Defendants and the other Released Parties pursuant to this
Stipulation, which releases and Judgment shall be null and void, and the parties shall be restored
to their respective positions in the litigation immediately prior to the Effective Date of the
Settlement, and any cash amounts in the Settlement Fund or paid to Lead Counsel shall be
returned as provided in Paragraph 36 above.
40. ArthroCare warrants as to itself that, as to the payments made by or on behalf of
it, at the time of such payment made pursuant to Paragraph 5 above, it was not insolvent, nor
will the payment required to be made by or on behalf of it render it insolvent, within the
meaning of and/or for the purposes of the United States Bankruptcy Code, including §§ 101 and
547 thereof. This representation is made by ArthroCare and not by ArtbroCare's Counsel.
41. The Settling Parties intend this Settlement to be a final and complete resolution
of all disputes asserted or that could be asserted by the Lead Plaintiff or any other Class
Members against all Released Parties with respect to all Settled Claims. Accordingly, Lead
Plaintiff and Defendants agree not to assert in any forum that this Action was brought by Lead
Plaintiff or Lead Counsel, or defended by Defendants or Defendants' Counsel, in bad faith or
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without a reasonable basis. For the purpose of the Court's findings and conclusions pursuant to
Section 211)(c)(1) of the Exchange Act, as amended by the PSLRA, 15 U.S.C. § 78u-4(c)(1),
Lead Plaintiff and Defendants shall assert no claims of any violation of Rule 11 of the Federal
Rules of Civil Procedure relating to the prosecution, defense or settlement of this Action. The
Settling Parties agree that the amount paid and the other terms of this Settlement were
negotiated at arms' length and in good faith, including in connection with a mediation
conducted by a professional mediator, and reflect a settlement that was reached voluntarily after
consultation with experienced legal counsel.
42. This Stipulation, including the exhibits to this Stipulation, may not be modified
or amended, nor may any of its provisions be waived, except by a writing signed by all
signatories hereto or their successors-in-interest. Any condition in this Stipulation may be
waived by the party entitled to enforce the condition in a writing signed by that party or its
counsel. The waiver by any party of any breach of this Stipulation by any other party shall not
be deemed a waiver of the breach by any other party, or a waiver of any other prior or
subsequent breach of this Stipulation by that party or any other party. Without further order of
the Court, the parties may agree to reasonable extensions of time to carry out any of the
provisions of this Stipulation.
43. The headings herein are used for the purpose of convenience only and are not
meant to have legal effect.
44. The administration and consummation of this Settlement as embodied in this
Stipulation shall be under the authority of the Court, and the Court shall retain jurisdiction for
the purpose of, inter al/a, entering orders providing for the enforcement of the terms of this
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Stipulation, including, but not limited to, the releases provided for herein, and awards of
attorneys' fees and Litigation Expenses to Lead Counsel.
45. This Stipulation and its exhibits constitute the entire agreement among the
Settling Parties concerning this Settlement, and no representations, warranties or inducements
have been made by any Settling Party concerning this Stipulation and its exhibits other than
those contained and memorialized in such documents.
46. This Stipulation may be executed in one or more original, c-mailed and/or faxed
counterparts. All executed counterparts and each of them shall be deemed to be one and the
same instrument.
47. This Stipulation shall be binding upon, and inure to the benefit of, the successors
and assigns of the parties hereto.
48. All agreements made and orders entered during the course of the Action relating
to the confidentiality of information shall survive this Stipulation. The Settling Parties
acknowledge and agree that the Agreed Protective Order, entered December 1, 2010, shall
survive the Stipulation.
49. The construction, interpretation, operation, effect and validity of this Stipulation,
and all documents necessary to effectuate it, shall be governed by the internal laws of the State
of Texas without regard to conflicts of laws, except to the extent that federal law requires that
federal law govern.
50. This Stipulation shall not be construed more strictly against one Settling 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 arms'-length
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negotiations between the Settling Parties and their counsel, and all Settling Parties have
contributed substantially and materially to the preparation of this Stipulation.
51. All counsel and any other person executing this Stipulation and any of the
exhibits hereto, or any related Settlement documents, warrant and represent that they have the
full authority to do so and that they have the authority to take appropriate action required or
permitted to be taken pursuant to the Stipulation to effectuate its terms.
52. Lead Counsel and Defendants' Counsel agree to cooperate fully with one another
in seeking Court approval of the Preliminary Approval Order, the Stipulation and this
Settlement, and to use reasonable efforts to promptly agree upon and execute all such other
documentation as may be reasonably required to obtain final approval by the Court of the
Settlement.
53. The parties stipulate and agree that all litigation activity, except that
contemplated herein and in the Preliminary Approval Order, the Notice of Pendency of Class
Action and Proposed Settlement, and the Judgment, shall be stayed, and all hearings, deadlines,
and other proceedings in this action, except those related to effecting the Settlement, shall be
taken off the calendar.
IN WITNESS WHEREOF, the parties hereto have caused this Stipulation to be
executed, by their duly authorized attorneys as of February 9, 2012.
By: /5/ John F. Harnes Robert W. Killorin (Pro Hac Vice) Martin D. Chitwood (Pro Hac Vice) John F. Harnes (Pro Hac Vice) Meryl W. Roper (Pro Hac Vice) Ze'eva Kushner Banks (Pro Hac Vice) CHITWOOD HARLEY HARNES LLP
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2300 Promenade II 1230 Peachtree Street NE Atlanta, Georgia 30309 T: (404) 873-3900 F: (404) 876-4476
LEAD COUNSEL FOR LEAD PLAINTIFF DEKALB COUNTY PENSION FUND
Tom A. Cunningham CUNNINGHAM DARLOW LLP State Bar No. 5244700 909 Fannin, Suite 3700 Houston, Texas 77010 T: (713) 255-5500 F: (713) 255-5555
LIAISON COUNSEL FOR LEAD PLAINTIFF DEKALB COUNTY PENSION FUND
/s/ Robert W. Brownlie (with express permission Robert W. Brownlie (AdmittedPro Hac Vice) [email protected] Noah Katsell (AdmittedPro Hac Vice)
[email protected] PLA Piper LLP (US) 401 B Street, Suite 1700 San Diego, CA 92101-4297 Tel: (619) 699-2700 Fax: (619) 699-2701
Jennifer A. Lloyd (TX Bar #24013050) Jenny. Lloyddlapiper.eom Courtney Stewart (TX Bar #24042039) Courtney. [email protected] PLA Piper LLP (US) 401 Congress Ave., Suite 2500 Austin, Texas 78701 Tel: (512) 457-7000 Fax: (512) 457-7001 COUNSEL FOR ARTHROCARE CORP.
/s/ Jay L. Pomerantz (with express permission Jay L. Pomerantz (AdmittedPro Hac Vice)
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Tyler A. Baker (TX Bar #: 01595600) Erie J. Ball (AdmittedPro Hac Vice) FENWICK & WEST LLP 801 California Street Mountain View, CA 94041 Tel: (650) 988-8500 Fax: (650) 938-5200 COUNSEL FOR MICHAEL BAKER
/s/ Jason S. Lewis (with express permission Jason S. Lewis (TX Bar #: 2400755 1) David W. Klaudt (TX Bar #: 00796073) Jeffrey M. Benton (TX Bar #: 24050283) LOCKE LORD LLP 2200 Ross Ave., Suite 2200 Dallas, Texas 75201 Tel: (214) 740-8000 Fax: (214) 740-8800 COUNSEL FOR MICHAEL GLUK
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CERTIFICATE OF SERVICE
I certify that on this 9th day of February 2012, all counsel of record who are deemed to
have consented to electronic service are being served with a copy of this "Stipulation and
Agreement of Settlement" through the Court's CM/ECF system.
Is! John F. Harnes John F. Hames
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