MagnaChip (MX) Announces Order and Final Judgment Issued in Derivative Action Suits
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MagnaChip (NYSE: MX) disclosed the following in a U.S. SEC filing on Monday:
Item 8.01. Other Events.
On October 18, 2016, following a hearing on October 14, 2016, the Superior Court of the State of California, Santa Clara County (the “Court”), entered an order and final judgment (the “Judgment”) granting final approval of the Stipulation of Settlement, dated January 22, 2016, providing for the settlement of the shareholder derivative actions titled Hemmingson, et al. v. Elkins, et al., No. 1-15-CV-278614 (PHK) (Cal. Super. Ct. Santa Clara Cnty.) (the “Hemmingson Action”) and Bushansky v. Norby, et al., No. 1-15-CV-281284 (PHK) (Cal. Super. Ct. Santa Clara Cnty.) (the “Bushansky Action” and together with the Hemmingson Action, the “Derivative Actions”), which named certain current and former officers and directors of MagnaChip Semiconductor Corporation (the “Company”), as well as a stockholder of the Company, as defendants, and named the Company as a nominal defendant.
As previously reported, the Court granted preliminary approval of the settlement in an order dated June 10, 2016. The settlement provides for the release and dismissal with prejudice of all pending claims asserted in the Derivative Actions, without attribution of liability or wrongdoing. In addition, once the settlement becomes effective, the settlement provides that $3 million previously placed into escrow, funded by insurance proceeds, will be payable to the Company, less (i) any applicable costs of such escrow account, (ii) $750,000 awarded by the court to the plaintiffs’ counsel for attorney’s fees and litigation expenses and (iii) the cost of providing notice of the settlement to the Company’s stockholders. The settlement also requires the Company to implement certain corporate governance measures.
The Judgment is subject to appeal. In the event that no appeal is filed, the settlement will become effective at the expiration of the appeal period, which is 60 days from October 18, 2016, the date the Judgment was entered by the Court.
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