Dear Sir or Madam:
We are in receipt of your e-mail inquiring how the amount of your settlement
distribution check was calculated.
Each approved claimant received a pro-rata amount of the net Settlement Fund
based on their weighted approved number of shares of Class Securities
traded, except that every claimant with one or more valid claims was paid,
in total, a minimum recovery of $25.
A total number of approved shares was calculated for each claim based on the
verified number of shares of Class Securities traded during the Class
Period. Unless the claimant was previously notified in writing of a
challenge to a claim, the verified number of approved shares was the total
number of shares of Class Securities identified from the Proof of Claim.
The approved shares were then weighted, depending on whether the claimant
was an "Institution" or not. The Plan of Distribution weighted claims by
non-institutional (retail) Class members by a factor of 1.5 in favor of such
retail investors. This weighting factor takes into account the average
difference in effective spreads between institutional and non-institutional
trades, as well as differences in commission structure, and the fact that
claimants were not required to exclude trades made through Instinet and
Posit. If the claimant was not an "Institution" within the meaning of the
NASD Manual - Conduct Rules, Rule 3110(c)(4), and so certified on their
Proof of Claim form, all such claimant's approved shares were weighted
(multiplied) by 1.5. All Institutional claimants' approved shares were
weighted (multiplied) by 1.0.
Page 2.
The total of all weighted approved shares was then divided into the amount
of the net Settlement Fund to determine the per share recovery amount.
As a result of the calculations, non-Institutional claimants (more than 85%
of the claimants) were paid approximately 2.473¢ per approved share, and
Institutional claimants were paid approximately 1.649¢ per approved share.
If this resulted in an entitlement of less than $25.00 (for all the
claimant's claims), the claimant was paid the $25 minimum instead of the per
share amount.
These per share recoveries are excellent in terms of their relationship to
the reported damages per share suffered by Class members. It has been
reported in the press that actual damages were approximately 2¢ per share.
In most settlements, plaintiffs receive only a portion of their damages. By
comparison, class members here are recovering approximately full damages.
We trust this responds to your inquiry. If you have any further questions,
please contact us by sending e-mail to questions@nasdaqlitigation.com.
Very truly yours,
HEFFLER-RUDOLPH
Claims Administrator |
