UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF GEORGIA
| In re EBIX, INC. DERIVATIVE LITIGATION
| File No. 1:13-CV-62-RWS
SUMMARY NOTICE OF PROPOSED SETTLEMENT OF DERIVATIVE ACTION
TO: ALL CURRENT RECORD HOLDERS AND BENEFICIAL OWNERS OF COMMON STOCK OF EBIX, INC. (“EBIX”)
PLEASE READ THIS SUMMARY NOTICE CAREFULLY AND IN ITS ENTIRETY AS YOUR RIGHTS MAY BE AFFECTED BY PROCEEDINGS IN THE LITIGATION.
YOU ARE HEREBY NOTIFIED that the above-captioned consolidated stockholder derivative litigation (the “Federal Action”), as well as the stockholder derivative litigation pending in the Fulton County, Georgia, Superior Court entitled In re Ebix. Inc. Shareholder Derivative Action, Case No. 2011CV205276 (the “State Action”) (collectively, the “Actions”), are being settled on the terms set forth in the Stipulation of Settlement dated as of September 23, 2014 (the “Stipulation” or “Settlement”). This Notice is provided by Order of the United States District Court for the Northern District of Georgia (the “Federal Court”).
The Actions assert various derivative claims on behalf of Ebix, Inc. (“Ebix” or the “Company”) against the Individual Defendants for alleged violations of state and federal law. The claims asserted in the Actions are based on similar allegations and primarily relate to purported breaches of fiduciary duties by the Individual Defendants. Specifically, the Actions allege that the Individual Defendants breached their fiduciary duties by, among other things, engaging in certain misconduct related to the Company’s payment of taxes, financial reporting, and internal controls. Defendants have denied and continue to deny each and all of the claims and allegations of wrongdoing asserted in the Actions.
This summary should be read in conjunction with, and is qualified in its entirety by reference to, the text of the Stipulation. As set forth therein, the terms of the Settlement include the adoption, implementation, and/or maintenance of the following corporate governance measures:
- the appointment of an independent director as either Chairman or “Lead Independent Director” separate and in addition to the board chairman;
- increasing the number of directors on the Corporate Governance Committee to three (3) independent directors;
- retaining an independent auditor in India that is approved by the Public Company Accounting Oversight Board or affiliated with a member firm;
- creating a “Director of Internal Audit” and separately a “Director of Internal Tax” positions both of whom shall report directly to the Audit Committee (notwithstanding the foregoing, the Director of Internal Audit and the Director of Internal Tax may have additional responsibilities and functions within Ebix); and
- appointing a Trading and Compliance Officer to evaluate and monitor the Company’s insider trading policies and practices (notwithstanding the foregoing, the Trading Compliance Officer may have additional responsibilities and functions within Ebix).
On December 2, 2014, at 9:30 a.m., a hearing (the “Settlement Hearing”) will be held at the U.S. District Court for the Northern District of Georgia, Atlanta Division, Courtroom 2105, to determine whether the proposed Settlement of the Actions on the terms and conditions provided for in the Stipulation is fair, reasonable, and adequate and should be approved; whether the Final Order and Judgment as provided in the Stipulation should be entered; and to determine the amount of fees and expenses that should be awarded to Plaintiffs’ Counsel (under the terms of the Stipulation, the maximum amount of aggregate fees and expenses that will be sought by Plaintiffs' Counsel to resolve the Actions is six hundred ninety thousand dollars ($690,000.00). You may enter an appearance before the Federal Court, at your own expense, individually or through counsel of your choice. If you want to object at the Settlement Hearing, then you must first comply with the procedures for objecting, which are set forth in the Stipulation and its accompanying exhibits.
This Summary Notice provides a condensed overview of certain provisions of the Stipulation and the full Notice of Proposed Settlement of Derivative Action (the “Full Notice”). It is not a complete statement of the events of the Actions or the terms set forth in the Stipulation. For additional information about the claims asserted in the Actions and the terms of the proposed Settlement, you may inspect the Stipulation and other papers filed in the Federal Action at the U.S. District Court Clerk’s office at any time during regular business hours. In addition, copies of the Stipulation and the Full Notice are available on the investor relations section of the Company’s website, as well as on the websites of Cohen Milstein Sellers & Toll, PLLC and Federman & Sherwood (click here). Inquiries regarding the proposed Settlement also may be made to counsel for the Federal Plaintiffs: David A. Bain, Law offices of David A. Bain, LLC, 1050 Promenade II, 1230 Peachtree Street, NE, Atlanta, Georgia 30309, Tel: (404) 724-9990, Fax: (404) 724-9986; or Richard A. Speirs, Cohen Milstein Sellers & Toll PLLC, 88 Pine Street, 14th Floor, New York, New York 10005, Tel: (212) 838-7797, Fax: (212) 838-7745.
If you are a Current Ebix Shareholder, you will be bound by the Order and Final Judgment of the Court granting final approval to the Settlement, and shall be deemed to have waived the right to object (including the right to appeal) and forever shall be barred, in this proceeding or in any other proceeding, from raising such objection. Any objection to any aspect of the Settlement must be filed with the Clerk of the Federal Court no later than November 18, 2014, in accordance with the procedures set forth in the Full Notice.
PLEASE DO NOT CONTACT THE FEDERAL COURT OR THE CLERK’S OFFICE
REGARDING THIS SUMMARY NOTICE
Posted on Mon, October 13, 2014
by K. Lynn Nunn filed under