WAYNE, Pa.-LAWFUEL – Law News Network – The following statement was issued today by The Weiser Law Firm, P.C.:
A settlement of shareholder’s derivative action captioned Siegel v. Alexander, et al., Case No. CV-05-664 (NVW) pending in the United States District Court for the District of Arizona related to Hypercom Corporation has been reached subject to the Court’s final approval. The following describes the history of the litigation, the settlement terms, and the procedures a shareholder must follow to enter any appearance in the litigation.
TO: PERSONS WHO OWNED HYPERCOM CORPORATION
(“HYPERCOM ” OR THE “COMPANY”) COMMON STOCK
AS OF AUGUST 31, 2006
YOU ARE HEREBY NOTIFIED, pursuant to Federal Rule of Civil Procedure 23.1 and an Order of the Court (the “Court”), that the above-captioned action is a shareholder’s derivative action brought on behalf of Hypercom, and that the proposed settlement (the “Settlement”) of the above-captioned action along with a related shareholder derivative action involving Hypercom captioned Hong v. Alexander, Case No. CV 2005-007093, filed in the Superior Court of Maricopa County, Arizona (collectively, the “Actions”), has been reached, subject to Court approval. A final hearing will be held before the Honorable Neil Wake at the United States District Court for the District of Arizona, Sandra Day O’Connor Courthouse, 401 W. Washington St., Phoenix, AZ 85003-2118, Courtroom 504 on November 9, 2006 at 1:30 p.m., among other things, to determine whether the Settlement of the Actions should be approved by the Court as fair, reasonable and adequate and whether a judgment should be entered dismissing the Actions and releasing and barring claims that were or could have been asserted in the Actions (the “Settlement Hearing”). The Court will also rule upon Plaintiffs’ Counsel’s application for an award of attorneys’ fees and reimbursement of expenses at the Settlement Hearing.
IF YOU HELD HYPERCOM COMMON STOCK AS OF AUGUST 31, 2006 AND YOU CONTINUE TO HOLD THOSE SHARES AS OF THE DATE OF THE FINAL HEARING, YOUR RIGHTS MAY BE AFFECTED BY THE SETTLEMENT OF THE ACTIONS.
Generally, the Plaintiffs in the Actions alleged that Hypercom’s current and/or former officers and directors (collectively, “Defendants”) breached their fiduciary duties in connection with their management and oversight of the Company. Specifically, Plaintiffs claimed that Defendants failed to establish reasonable internal controls and that the failure to do so eventually caused the Company to restate its previously-issued financial statements for the first three quarters of 2004. Plaintiffs claimed that these alleged breaches of fiduciary duties caused the Company to suffer damages.
Defendants have denied and continue to deny that they breached their fiduciary duties to Hypercom or that Hypercom has suffered harm as a result of their conduct. Notwithstanding the foregoing, the Settling Parties have concluded that further litigation of the Actions would be protracted and expensive, and that it is in the Company’s best interests to settle the Actions on the terms specified in the stipulation of settlement (the “Stipulation”) on file with the Court. Generally, the Stipulation provides that the Company will adopt a series of corporate governance enhancements that will materially strengthen the Company’s internal controls and Board oversight of the Company’s business. In connection with the Settlement of the Actions, Defendants have also agreed to pay Plaintiffs’ Counsel’s fees and reimburse their expenses in the amount of $170,000.00, which must be approved by the Court.
You have the right to appear in the Actions. Unless otherwise ordered by the Court, no current Hypercom stockholder or any Person shall be heard or shall be entitled to contest the approval of the Settlement, or Plaintiffs’ Counsel’s fee request, and no papers, briefs, pleadings or other documents submitted by any current Hypercom stockholder or any other Person shall be received and considered, unless, no later than seven (7) days prior to the Settlement Hearing that Person has caused to be filed written objections, stating all supporting bases and reasons, with: (a) Clerk of the Court, United States District Court for the District of Arizona, Sandra Day O’Connor U.S. Courthouse, 401 W. Washington St., Suite 130 SPC 1, Phoenix, AZ 85003-2118; and has served copies of all such papers at the same time upon the following by first-class mail on (b) Plaintiffs’ Settlement Counsel, Robert B. Weiser, Esq., The Weiser Law Firm, P.C., 121 N. Wayne Avenue, Suite 100, Wayne, Pennsylvania 19087; and (c) Defendants’ Counsel, Nicole M. Healy, Esq., Wilson Sonsini Goodrich & Rosati, Professional Corporation, 650 Page Mill Road, Palo Alto, California 94340-1050.
Attendance at the Settlement Hearing is not necessary in order for the objection to be considered by the Court; however, Persons wishing to be heard orally in opposition to the approval of the Settlement are required to indicate in their written objection their intention to appear at the hearing. Thus, every objection must contain: (1) the Person’s name, address and telephone number; (2) the number of shares of Hypercom common stock the Person owns; (3) the date(s) of purchase of such shares, and a statement as to whether the Person will own such shares as of the date of the Settlement Hearing; (4) a detailed statement of the basis for the Person’s objections to or comments upon the Settlement, Plaintiffs’ Counsel’s request for attorneys’ fees and reimbursement of expenses, or any other matter before the Court; (5) any supporting papers, including all documents and writings that the person desires the Court to consider; (6) a representation as to whether the Person intends to appear the Settlement Hearing; (7) a representation as to whether the Person plans on calling any witness[es] at the Settlement Hearing; and (8) the identities of any witnesses the Person plans to call at the Settlement Hearing.
Any current Hypercom stockholder who does not make his, her or its objection in the manner provided for in the preceding paragraph shall be deemed to have waived such objection and shall forever be foreclosed from making any objections to the fairness, adequacy, or reasonableness of the Settlement, or Plaintiffs’ Counsel’s fee request.
This notice is only a summary of the Settlement terms described in detail in the Stipulation. A more-detailed notice describing the Actions and the Settlement was mailed to all current Hypercom stockholders. Alternatively, you can contact Plaintiffs’ Settlement Counsel identified above at 1-866-934-7372 to obtain a copy of the more-detailed notice. All of the relevant papers in the Actions are also on file with Clerk of Court identified above.