Opinion
SHIRLI FABBRI WEISS (Bar No. 079225), DAVID F. GROSS (Bar No. 083547), DAVID PRIEBE (Bar No. 148679), DLA PIPER LLP (US), East Palo Alto, CA, Attorneys for Nominal Defendant TRIDENT MICROSYSTEMS, INC.
JOHN D. PERNICK (Bar No. 155468), BINGHAM McCUTCHEN LLP, San Francisco, CA, Attorneys for THE SPECIAL LITIGATION COMMITTEE OF THE BOARD OF DIRECTORS OF TRIDENT MICROSYSTEMS, INC.
AMENDED ORDER PRELIMINARILY APPROVING PARTIAL DERIVATIVE SETTLEMENT AND PROVIDING FOR NOTICE
JEREMY FOGEL, District Judge.
WHEREAS, the Settling Parties have made application, pursuant to Federal Rule of Civil Procedure 23.1, for an order (i) preliminarily approving the proposed settlement (the "Settlement") of the above-captioned shareholder derivative action (the "Federal Derivative Action") and the related derivative action pending in the Superior Court of the State of California for the County of Santa Clara entitled Limke v. Lin, et al., No. 1:07-cv-080390 (the "State Derivative Action") (collectively, the "Derivative Actions"), in accordance with a Stipulation of Partial Settlement, dated October 20, 2009, and the Exhibits thereto (the "Stipulation"), and (ii) approving for distribution of the Notice of Partial Derivative Settlement (the "Notice");
WHEREAS, the Stipulation sets forth the terms and conditions of the Settlement;
WHEREAS, the Settlement appears to be the product of serious, informed, non-collusive negotiations and falls within the range of possible approval;
WHEREAS, all capitalized terms contained herein shall have the same meanings as set forth in the Stipulation (in addition to those capitalized terms defined herein); and
WHEREAS, this Court, having considered the Stipulation and the Exhibits annexed thereto and having heard the arguments of the Settling Parties at the preliminary approval hearing:
NOW THEREFORE, IT IS HEREBY ORDERED:
1. This Court does hereby preliminarily approve, subject to further consideration at the Settlement Hearing described below, the Stipulation and the terms of the Settlement set forth therein.
2. A hearing (the "Settlement Hearing") shall be held before this Court on March 26, 2010 at 9:00 a.m. in Courtroom 3, 5th Floor, United States District Court for the Northern District of California, San Jose Division, 280 South First Street, San Jose, CA 95113, to determine whether:
(a) the terms and conditions of the Settlement provided for in the Stipulation are fair, reasonable, adequate, and in the best interests of Trident and current Trident shareholders; and
(b) an order and judgment as provided for in ¶ 1.9 of the Stipulation should be entered.
3. The Court approves, as to form and content, the Notice annexed as Exhibit A-1 hereto, and finds that the filing of the Stipulation and publication of the Notice substantially in the manner and form set forth in ¶ 4.2 of the Stipulation, meets the requirements of Federal Rule of Civil Procedure 23.1 and due process, is the best notice practicable under the circumstances, and shall constitute due and sufficient notice to all Persons entitled thereto of all matters relating to the Settlement.
4. Not later than ten (10) business days following entry of this Order, Trident shall cause the Stipulation and the Notice, substantially in the form annexed as Exhibit A-1 hereto, to be published on its website, such that visitors to the website home page will readily find a hyperlink to the Notice.
5. Not later than ten (10) business days following entry of this Order, Trident shall cause a copy of the Stipulation to be filed with the Securities and Exchange Commission via a Form 8-K.
6. Not later than ten (10) business days following entry of this Order, Trident shall cause a copy of the Notice, substantially in the form annexed as Exhibit A-1 hereto, to be published once in Investor's Business Daily.
7. All costs incurred in the filing of the Stipulation and publication of the Notice shall be paid by Trident and Trident shall undertake all administrative responsibility for filing the Stipulation and publication of the Notice.
8. At least fourteen (14) calendar days prior to the Settlement Hearing, Trident's counsel shall serve on Federal Co-Lead Counsel and file with the Court proof, by affidavit or declaration, of such filing of the Stipulation and publication of the Notice.
9. All current Trident shareholders shall be bound by all orders, determinations, and judgments in the Federal Derivative Action concerning the Settlement, whether favorable or unfavorable to current Trident shareholders.
10. Pending final determination of whether the Settlement should be approved, no current Trident shareholder shall commence or prosecute against any of the Individual Settling Defendants or their Related Persons any action or proceeding in any court or tribunal asserting any of the Released Claims.
11. All papers in support of the Settlement shall be filed with the Court and served at least seven (7) calendar days prior to the Settlement Hearing.
12. Any current record holders and beneficial owners of common stock of Trident as of March 26, 2010 may appear and show cause, if he, she or it has any reason why the terms of the Settlement should not be approved as fair, reasonable, and adequate, or why a judgment should not be entered thereon, provided, however, unless otherwise ordered by the Court, no current Trident shareholder shall be heard or entitled to contest the approval of all or any of the terms and conditions of the Settlement, or, if approved, the Federal Judgment to be entered thereon approving the same, unless that Person has, at least fourteen (14) days prior to the Settlement Hearing, filed with the Clerk of the Court at the address listed below and served on the following counsel (delivered by hand or sent by first class mail) appropriate proof of stock ownership, along with written objections, including the basis therefore, and copies of any papers and briefs in support thereof:
Counsel for Federal Plaintiffs Counsel for State Plaintiff Counsel for Trident by Its Special Litigation CommitteeAny current Trident shareholder who does not make his, her or its objection in the manner provided herein shall be deemed to have waived such objection and shall forever be foreclosed from making any objection to the fairness, reasonableness, or adequacy of the Settlement as incorporated in the Stipulation, unless otherwise ordered by the Court, but shall otherwise be bound by the Federal Judgment to be entered and the releases to be given.
13. The Court reserves the right to adjourn the date of the Settlement Hearing or modify any other dates set forth herein without further notice to current Trident shareholders, and retains jurisdiction to consider all further applications arising out of or connected with the Settlement. The Court may approve the Settlement, with such modifications as may be agreed to by the Settling Parties, if appropriate, without further notice to current Trident shareholders.
IT IS SO ORDERED.
NOTICE OF PARTIAL DERIVATIVE SETTLEMENT
EXHIBIT A-1
TO: ALL CURRENT RECORD HOLDERS AND BENEFICIAL OWNERS OF THE COMMON STOCK OF TRIDENT MICROSYSTEMS, INC. ("TRIDENT" OR THE "COMPANY") AS OF JANUARY 31, 2010
PLEASE TAKE NOTICE that the above-captioned shareholder derivative litigation (the "Litigation"), as well as the action in Santa Clara Superior Court entitled Limke v. Lin, et al., Santa Clara Superior Court Case No. 1:07cv080390 (collectively, the "Derivative Actions"), are being settled with Glen Antle, Jung-Herng Chang, Shyur-Jen Paul Chien, Yasushi Chikagami, Charles Dickerson, John S. Edmunds, Richard Hegberg, Peter Jen, James Lindstrom, Gerry Liu, Leonard Liu, John Luke, Amir Mashkoori, Millard Phelps, W. Steven Rowe, and Richard Silverman on the terms set forth in a Stipulation of Partial Settlement dated October 20, 2009 (the "Stipulation"). The terms of the settlement set forth in the Stipulation (the "Settlement") include: (1) cash payments by certain Trident officers totaling $1,744,909; (2) the waiver by certain Trident officers to claims against the Company with a value of $2,232,847.97 as determined by the SLC; and (3) Trident's payment of Plaintiffs' Counsel's expenses in the amount of $750,000.
This Notice should be read in conjunction with, and is qualified in its entirety by reference to, the text of the Stipulation, which has been filed with the Federal Court and on a Form 8K filed with the Securities and Exchange Commission. The Stipulation can also be viewed at www.tridentmicro.com. All capitalized terms herein have the same meanings as set forth in the Stipulation.
IF YOU ARE A CURRENT OWNER OF TRIDENT COMMON STOCK, YOUR RIGHTS MAY BE AFFECTED BY PROCEEDINGS IN THE LITIGATION.
On March 26, 2010, at 9:00 a.m., a hearing (the "Settlement Hearing") will be held before the United States District Court for the Northern District of California, San Jose Division, Robert F. Peckham Federal Building and United States Courthouse, 280 South First Street, San Jose, CA 95113, to determine: (1) whether the terms of the Settlement should be approved as fair, reasonable, and adequate; and (2) whether the Derivative Actions should be dismissed on the merits and with prejudice.
Any shareholder of Trident that objects to the Settlement of the Derivative Actions shall have a right to appear and to be heard at the Settlement Hearing, provided that he, she, or it is a shareholder of record or beneficial owner as of March 26, 2010. Any shareholder of Trident who satisfies this requirement may enter an appearance through counsel of such shareholder's own choosing and at such shareholder's own expense or may appear on their own. However, no shareholder of Trident shall be heard at the Settlement Hearing unless no later than fourteen (14) days prior to the date of the Settlement Hearing, such shareholder has filed with the Court and delivered to Plaintiffs' Counsel and the Special Litigation Committee's counsel, a written notice of objection, their ground for opposing the Settlement, and proof of both their status as a shareholder and the dates of stock ownership in Trident. Only shareholders who have filed and delivered valid and timely written notices of objection will be entitled to be heard at the Settlement Hearing unless the Court orders otherwise.
If you wish to object to the Settlement, you must file a written objection setting forth the grounds for such an objection with the Court at the address below on or before March 12, 2010, with service on the following parties on or before March 12, 2010:
Counsel for Federal Plaintiffs Counsel for State Plaintiff Counsel for Trident by Its Special Litigation CommitteeInquiries may be made to Plaintiffs' Counsel: Rick Nelson, c/o Shareholder Relations, Coughlin Stoia Geller Rudman & Robbins LLP, 655 West Broadway, Suite 1900, San Diego, CA 92101; telephone XXX-XXX-XXXX.