How Will My Claim Be Calculated?

The Settlement provides $9,000,000 in cash for the benefit of the Settlement Class.  The Settlement Amount and any interest it earns constitute the Settlement Fund.  The Settlement Fund, after deduction of Court-approved attorneys’ fees and litigation expenses, Notice and Administration Expenses, Taxes, and any other fees or expenses approved by the Court, is the Net Settlement Fund.  If the Settlement is approved by the Court, the Net Settlement Fund will be distributed to eligible Authorized Claimants—i.e., members of the Settlement Class who timely submit valid Claim Forms that are accepted for payment by the Court—in accordance with this proposed Plan of Allocation or such other plan of allocation as the Court may approve.  The Court may approve this proposed Plan of Allocation, or modify it, without additional notice to the Settlement Class.  Any order modifying the Plan of Allocation will be posted on this website.

The objective of the Plan of Allocation is to distribute the Net Settlement Fund equitably among those Settlement Class Members who suffered economic losses as a proximate result of the alleged wrongdoing.  The Plan of Allocation is not a formal damage analysis, and the calculations made in accordance with the Plan of Allocation are not intended to be estimates of, or indicative of, the amounts that Settlement Class Members might have been able to recover after a trial.  Nor are the calculations in accordance with the Plan of Allocation intended to be estimates of the amounts that will be paid to Authorized Claimants, because the Net Settlement Fund will be less than the total losses alleged to be suffered by Settlement Class Members.  The computations under the Plan of Allocation are only a method to weigh, in a fair and equitable manner, the claims of Authorized Claimants against one another for the purpose of making pro rata allocations of the Net Settlement Fund.  The Plan of Allocation provides that you will be eligible to participate in the distribution of the Net Settlement Fund only if you have a Recognized Claim as defined below.

To design this Plan, Lead Counsel has conferred with Plaintiff’s damages expert.  This Plan is intended to be generally consistent with an assessment of the damages that Plaintiff and Lead Counsel believe were recoverable in the Action under the Securities Act.  The formulas below are based on, among other factors, (i) the prices of newly issued Spectrum common stock on July 16, 2018, the date the stock began to trade publicly on the New York Stock Exchange; and (ii) the $57.51 closing price of Spectrum common stock on April 9, 2019, the date this Action was commenced.  Shares purchased or acquired after April 9, 2019, are not eligible for a recovery.

An individual Settlement Class Member’s recovery will depend on, for example: (i) whether the claimant purchased or acquired shares pursuant or traceable to the Registration Statement; (ii) the total number and value of claims submitted; (iii) when the claimant purchased or acquired Spectrum common stock; and (iv) whether and when the claimant sold his, her, or its shares of common stock.

Defendants, their respective counsel, and all other Released Defendant Parties will have no responsibility or liability for the investment of the Settlement Fund, the distribution of the Net Settlement Fund, the Plan of Allocation or the payment of any claim.  Plaintiff, Lead Counsel, and anyone acting on their behalf, likewise will have no liability for their reasonable efforts to execute, administer, and distribute the Settlement.  

 CALCULATION OF RECOGNIZED LOSS AMOUNTS

The Claims Administrator will calculate a “Recognized Loss Amount” as set forth below for each purchase of Spectrum common stock pursuant or traceable to the Registration Statement that is listed in the Claim Form and for which adequate documentation is provided.

The sum of a claimant’s Recognized Loss Amounts will be the claimant’s “Recognized Claim.”  The Net Settlement Fund will be distributed to Authorized Claimants on a pro rata basis based on the relative size of their Recognized Claims.  Specifically, a “Distribution Amount” will be calculated for each Authorized Claimant, which shall be the Authorized Claimant’s Recognized Claim divided by the total Recognized Claims of all Authorized Claimants.  To the extent a claimant had a gain from his, her, or its overall transactions in Spectrum common stock pursuant or traceable to the Registration Statement, the value of his, her, or its Recognized Claim will be zero.

Formulas for Calculation of Recognized Loss Amounts

Intraday high price on date of merger (July 16, 2018):                 $83.25 per share

Closing price on date Action filed (April 9, 2019):                         $57.51 per share

1.         For shares of Spectrum common stock received on or about July 16, 2018, in exchange for an equal number of shares of Old Spectrum common stock in connection with the merger transaction, and:

a.         sold on or before April 9, 2019, the claim per share is the price per share of the stock received (not to exceed $83.25)[1] minus the sales price per share.

b.         retained as of the close of trading on April 9, 2019, the claim per share is the price per share of the stock received (not to exceed $83.25) minus $57.51.

2.         For shares of Spectrum common stock purchased or acquired on the open market between July 16, 2018, and November 18, 2018, and:

a.         sold on or before April 9, 2019, the claim per share is (i) the purchase price per share (not to exceed $83.25) minus the sales price per share, (ii) multiplied by 0.10.[2]

b.         retained as of the close of trading on April 9, 2019, the claim per share is (i) the purchase price per share (not to exceed $83.25) minus $57.51, (ii) multiplied by 0.10.

3.         For shares of Spectrum common stock purchased or acquired on the open market between November 19, 2018, and April 9, 2019, and

a.         sold on or before April 9, 2019, the claim per share is (i) the purchase price per share (not to exceed $83.25) minus the sales price per share, (ii) multiplied by 0.05.[3]

b.         retained as of the close of trading on April 9, 2019, the claim per share is (i) the purchase price per share (not to exceed $83.25) minus $57.51, (ii) multiplied by 0.05.

ADDITIONAL PROVISIONS

Spectrum common stock (CUSIP: 84790A105) is the only security eligible for recovery under the Plan of Allocation.  Purchases or acquisitions of Old Spectrum common stock (CUSIP: 84763R101) or HRG securities are not eligible transactions under the Plan of Allocation.

For purposes of determining whether a claimant has a Recognized Claim, if a Settlement Class Member has more than one purchase/acquisition or sale of publicly traded Spectrum common stock, all purchases/acquisitions and sales shall be matched on a First In/First Out (FIFO) basis.  Sales will be matched first against shares of Spectrum stock received in exchange for shares of Old Spectrum stock, and then against purchases/acquisitions in chronological order, beginning with the earliest purchase/acquisition made between July 16, 2018, and April 9, 2019.

Purchases or acquisitions and sales of Spectrum common stock shall be deemed to have occurred on the “contract” or “trade” date as opposed to the “settlement” or “payment” date.  The receipt or grant by gift or inheritance of Spectrum common stock shall not be deemed a purchase, acquisition, or sale of these shares of Spectrum common stock for the calculation of an Authorized Claimant’s Recognized Claim, nor shall the receipt or grant be deemed an assignment of any claim relating to the purchase/acquisition of such shares of such Spectrum common stock unless (i) the donor or decedent purchased or otherwise acquired such shares of Spectrum common stock pursuant or traceable to the Registration Statement; (ii) no Claim Form was submitted by or on behalf of the donor, on behalf of the decedent, or by anyone else with respect to such shares of Spectrum common stock; and (iii) it is specifically so provided in the instrument of gift or assignment.

In accordance with the Plan of Allocation, the Recognized Loss Amount on any portion of a purchase or acquisition that matches against (or “covers”) a “short sale” is zero.  The Recognized Loss Amount on a “short sale” that is not covered by a purchase or acquisition is also zero.  In the event that a claimant has an opening short position in Spectrum common stock as of July 16, 2018, the earliest purchases or acquisitions thereafter shall be matched against such opening short position in accordance with the FIFO matching described above and any portion of such purchases or acquisition that covers such short sales will not be entitled to recovery.  In the event that a claimant newly establishes a short position after July 16, 2018, the earliest subsequent purchase or acquisition shall be matched against such short position on a FIFO basis and will not be entitled to a recovery.

The Net Settlement Fund will be allocated among all Authorized Claimants whose prorated payment is $10.00 or greater.  If the prorated payment to any Authorized Claimant calculates to less than $10.00, it will not be included in the calculation and no distribution will be made to that Authorized Claimant.

Payment according to this Plan of Allocation will be deemed conclusive against all Authorized Claimants.  Recognized Claims will be calculated as defined herein by the Claims Administrator and cannot be less than zero.

Distributions will be made to eligible Authorized Claimants after all claims have been processed and after the Court has finally approved the Settlement.  No Person shall have any claim of any kind against the Defendants or their related parties with respect to the investment or distribution of the Settlement Fund.  If there is any balance remaining in the Net Settlement Fund (whether by reason of tax refunds, uncashed checks, or otherwise) after at least six (6) months from the date of initial distribution of the Net Settlement Fund, the Claims Administrator shall, if feasible and economical after payment of Notice and Administration Expenses, Taxes, and attorneys’ fees and expenses, if any, redistribute such balance among Authorized Claimants who have cashed their initial checks in an equitable and economic fashion.  Any balance that still remains in the Net Settlement Fund after re-distribution(s), which is not feasible or economical to reallocate, after payment of outstanding Notice and Administration Expenses, Taxes, and attorneys’ fees and expenses, if any, shall be disposed of as follows.  At least 50% of any such residual balance must be disbursed to the Wisconsin Trust Foundation, Inc. (“WisTAF”), to support direct delivery of legal services to persons of limited means in non-criminal matters.  The law authorizes the Court to disburse the remainder of any residual balance to WisTAF for purposes that have a relationship to the objectives of this Action or that promote the interests of the Settlement Class.

Payment pursuant to the Plan of Allocation or such other plan as may be approved by the Court shall be conclusive against all Authorized Claimants.  No person shall have any claim against Plaintiff, any of Plaintiff’s Counsel, Claims Administrator, or other agent designated by Lead Counsel, arising from determinations or distributions to claimants made substantially in accordance with the Settlement Agreement, the Plan of Allocation approved by the Court, or further orders of the Court.  Plaintiff, Defendants, their respective counsel, and all other Released Parties shall have no responsibility for or liability whatsoever for the investment or distribution of the Settlement Fund, the Net Settlement Fund, the Plan of Allocation, or the determination, administration, calculation, or payment of any Claim Form or non-performance of the Claims Administrator, the payment or withholding of taxes owed by the Settlement Fund, or any losses incurred in connection therewith.

Each claimant is deemed to have submitted to the jurisdiction of the Circuit Court of the State of Wisconsin, Dane County, with respect to his, her, or its claim.