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• _ r-,' UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF ALABAMASOUTHERN DIVISION 02 JAI! -1 PR ?: 5;
j i rj -Frde •CILRT
N.D. OF AL .F3A
)STATE OF WISCONSIN INVESTMENT BOARD, )KENNETH D. BUSH, EDWARD E. EUBANK, JR., )and JOHN MICHAEL, suing on behalf of themselves )and all others similarly situated, )
) CV 99-BU-3097-SPlaintiffs, ) and
) CV 99-BU-3129-SVS.
)
DELOITTE & TOUCHE LLP, STEVEN H. BARRY, )AND KAREN BAKER, )
)
Defendants. ))
STIPULATION AND AGREEMENT OF SETTLEMENT
This Stipulation and Agreement of Settlement dated as of December 21, 2001 (the
"Settlement Stipulation") is submitted pursuant to Rule 23 of the Federal Rules of Civil Proce-
dure. Subject to the approval of the Court, this Settlement Stipulation is entered into among
plaintiffs State of Wisconsin Investment Board, Kenneth D. Bush, Edward E. Eubank, Jr., and
John Michael and the Class (as hereinafter defined) and Defendants Deloitte & Touche LLP
("Deloitte"), Steven H. Barry, and Karen Baker (collectively "Defendants").
WHEREAS:
A. This action is a consolidation of three putative class actions filed on behalf of
purchasers of Just For Feet, Inc. ("JFF") common stock, captioned State of Wisconsin
Investment Board v. Ruttenberg, No. CV 99-BU-3097, Massey v. Ruttenberg, No. CV 99-BU-
3129, and Lane v. Ruttenberg, No. CV 99-BU-3307-S, pending in or removed to the United
States District Court for the Northern District of Alabama, Southern Division (the "Court");
B. By Order dated July 3, 2001, the Court severed the consolidated action insofar as
directed against Defendants from the consolidated action insofar as directed against co-
defendants Harold Ruttenberg, Eric L. Tyra, Peter Berman, Cooper Evans, Patrick Lloyd, Don-
Allen Ruttenberg, Michael Lazarus, Helen Rockey, Scott C. Wynne, Randall L. Haines, and
Adam Gilburne, and the consolidated action insofar as directed against Defendants is hereinafter
referred to as the "Action";
C. The operative complaint in the Action is the Consolidated Class Action
Complaint dated June 15, 2000 (the "Complaint");
D. The Complaint alleges against Defendants violations of sections 10(b) and 18 of
the Securities Exchange Act of 1934 and state law claims for common law fraud and deceit and
professional negligence;
E. By Order dated January 12, 2001, the Court dismissed the state law claims, but
denied Defendants' motions to dismiss the federal securities claims;
F. By Order dated July 3, 2001, the Court certified a class of all persons and entities
who purchased common stock ofJFF between May 5, 1997 and November 1, 1999, excluding
from the Class: (1) Deloitte & Touche LLP, Steven H. Barry, Karen Baker, Harold Ruttenberg,
Eric Tyra, Peter Berman, Cooper Evans, Patrick Lloyd, Don-Allen Ruttenberg, Michael Lazarus,
Helen Rockey, Scott C. Wynne, Randall L Haines, and Adam Gilburne; (2) members of their
families; (3) their subsidiaries or affiliates; (4) their shareholders, partners, officers, directors,
employees, or controlling persons; (5) any entity in which any of them has a controlling interest;
(6) sitting magistrates, judges, justices, and their respective spouses and children; (7) counsel for
plaintiffs and their respective spouses and children; and (8) the legal representatives, heirs,
successors or assigns of any such excluded person;
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G. The State of Wisconsin Investment Board, John Michael, Edward E. Eubank, Jr.
and Kenneth D. Bush (collectively the "Representative Plaintiffs") have been appointed to
represent the Class in the Action;
H. Discovery has been completed in the Action, and has included, inter alia, (i) -
inspection by Plaintiffs' Counsel of more than 1,000,000 pages of documents produced by, or
otherwise relating to, JFF; (ii) the taking and defending of 26 depositions; (iii) consultation with
experts in the fields of damages, commercial lending, and auditing/accmmting and the
preparation of expert reports; and (iv) review of .IFF's public filings; •
I. Defendants deny any wrongdoing whatsoever;
J. Plaintiffs' Counsel have conducted an extensive investigation relating to the
claims and the underlying events and transactions alleged in the Complaint;
K. Plaintiffs' Counsel have conducted arm's length negotiations with counsel for
Defendants with respect to a settlement of the Action with a view to achieving the best relief
possible consistent with the interests of the Class; and
L. Based upon their investigation and pretrial discovery as set forth above, Plaintiffs'
Counsel have concluded that the terms and conditions of this Settlement Stipulation are fair,
reasonable, and adequate to the Class, and in its best interests, and have agreed to settle the
Action after considering (a) the substantial benefits that the Class will receive from settlement of
the Action, (b) the attendant risks of litigation, and (c) the desirability of pamitting the
Settlement to be consummated as provided by the terms of this Settlement Stipulation;
NOW, THEREFORE, it is hereby STIPULATED AND AGREED, by and among the
parties to this Settlement Stipulation, through their respective attorneys, subject to approval of
the Court pursuant to Rule 23(e) of the Federal Rules of Civil Procedure, that all Settled Claims
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(as defined below) as against the Released Parties (as defined below) shall be compromised,
settled, released and dismissed with prejudice, upon and subject to the following terms and
conditions:
CERTAIN DEFINITIONS
1. As used in this Settlement Stipulation, the following tenns have the following
meanings:
(a) "Authorized Claimant" means a Class Member who submits a timely
•-and valid Proof of Claim form to the Claims Administrator.
(b) "Claims Administrator" means the fmn of The Garden City Group,
which shall administer the Settlement.
(c) "Class" and "Class Members" means all persons and entities who
purchased common stock of Just For Feet, Inc., between May 5, 1997 and November 1, 1999,
inclusive, excluding (1) Deloitte & Touche LLP, Steven II. Hairy, Karen Baker, Harold
Ruftenberg, Eric Tyra, Peter Berman, Cooper Evans, Patrick Lloyd, Don-Allen Ruttenberg,
Michael Lazairus, Helen Rockey, Scott C. Wynne, Randall L. Haines, and Adam Gilbume; (2)
members of their families; (3) their subsidiaries or affiliates; (4) their shareholders, partners,
officers, directors, employees, or controlling persons; (5) any entity in which any of them has a
controlling interest; (6) sitting magistrates, judges, justices, and their respective spouses and
children; (7) counsel for plaintiffs and their respective spouses and children; and (8) the legal
representatives, heirs, successors or assigns of any such excluded person. Also excluded from
the Class are any putative Class Members who exclude themselves by filing a request for
exclusion in accordance with the requirements set forth in the Notice, as hereinafter defined.
The "Class" includes the Class Members collectively as well as each Class Member acting
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•
•(d) "Class Representatives" means the State of Wisconsin Investment Board,
Kenneth D. Bush, Edward E. Eubank, Jr., and John Michael.
(e) "Class Period" means the period from May 5, 1997 through November 1,
1999, inclusive.
(f) "Court" means the United States District Court for the Northern District
of Alabama, Southern Division.
(g) "Defendants" means Deloitte & Touche LLP, Steven H. Barry, and Karen
Baker.
(h) "Effective Date of Settlement" or "Effective Date" means the date upon
which the settlement contemplated by this Settlement Stipulation shall become effective, as set
forth below.
(i) "Final Order and Judgment" means the proposed order to be entered
approving the Settlement Stipulation substantially in the form attached hereto as Exhibit B.
(j) "Notice" means the Notice of Class Certification and Settlement of Class
Action, which is to be sent to members of the Class substantially in the form attached hereto as
Exhibit 1 to Exhibit A.
(k) "Plaintiffs' Counsel" means the law firms of Ragsdale & Wheeler, LLC;
Cauley Geller Bowman & Coates, LLP; Grant & Eisenhofer, P.A.; and Haskell Slaughter Young
& Rediker, L.L.C.
(1) "Preliminary Order" means the order preliminarily approving the
Settlement and directing notice thereof to the Class substantially in the form attached hereto as
Exhibit A.
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)
(m) "Publication Notice" means the Summary Notice of Pendency of Class
Action, Proposed Settlement and Settlement Hearing in the form attached as Exhibit 3 to
Exhibit A.
(n) "Released Parties" means Deloifte & Touche USA LLP (formerly known
as Deloitte & Touche LLP, Deloitte & Touche, and Deloitte Haskins & Sells), Deloitte &
Touche LLP (formerly known as D&T Partners LLP), Deloitte Consulting Holding LLC, and
Deloitte Consulting L.P., successor to Deloitte Consulting LLC (formerly known as Deloitte &
Touche Consulting Group LLC), and their past, present and future parent companies,
subsidiaries, divisions, related or affiliated entities, predecessors (including without limitation
Touche Ross & Co.) and successors, their respective present and former directors, officers,
partners (including Steven H. Barry), principals, members, stockholders, owners, employees
(including Karen Baker), agents, servants, subrogees, insurers and attorneys, and their respective
representatives, heirs, executors, spouses, personal representatives, administrators, successors,
transferees and assigns.
(o) "Settled Claims" means any and all claims (including Unknown Claims)
against the Released Parties relating in any way to the purchase or other acquisition of JFF •
common stock during the Class Period, anything alleged (or that could have been alleged)
against the Released Parties in the Action, anything relating in any way to the allegations of the
Complaint, or any violation of law in connection therewith (but excluding any claims to enforce
the terms of the Settlement).
'(p) "Settled Defendants' Claims" means any and all claims, rights or causes
of action or liabilities whatsoever, including both known and Unknown Claims, that were or
could have been asserted by Defendants against the Class, the Class Representatives, or any of
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their past, present and future parent companies, subsidiaries, divisions, related or affiliated
entities, predecessors and successors, their respective present and former directors, officers,
partners, principals, members, stockholders, owners, employees, agents, servants, subrogees,
insurers and attorneys (including Plaintiffs' Counsel), and their respective representatives, heirs, .
executors, spouses, personal representatives, administrators, successors, transferees and assigns,
in connection with, arising out of, or relating in any way to the institution, prosecution, or
settlement of the Action or the Settled Claims (but excluding any claims to enforce the terms of
the Settlement).
(q) "Settlement" means the settlement contemplated by this Settlement
Stipulation.
(r) "Settlement Fairness Hearing" means the hearing to be held before the
Court as to final approval of the Settlement.
(s) "Unknown Claims" means any and all Settled Claims which any Class
Member does not know or suspect to exist in his, her, or its favor at the time of the release of the
Released Parties, and any Settled Defendants' Claims which any Defendant does not know or
suspect to exist in his, her, or its favor, which if known by him, her, or it might have affected his,
her, or its decision(s) with respect to the Settlement. With respect to any and all Settled Claims
and Settled Defendants' Claims, the parties agree that upon the Effective Date, the Class and
Defendants expressly waive all provisions, rights, and benefits conferred by any law of any state
or territory of the United States, or principle of common law pursuant to, or which is similar,
comparable, or equivalent to, Cal. Civ. Code 1542, which provides:
A general release does not extend to claims which the creditor doesnot know or suspect to exist in his favor at the time of executingthe release, which if known by him must have materially affectedhis settlement with the debtor.
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The inclusion of "Unknown Claim? in the definition of Settled Claims and Settled Defendants'
Claims was separately bargained for and was a key element of the Settlement.
RELEASE AND BAR OF FURTHER PROSECUTION OF CLAIMS
2. The obligations incurred pursuant to this Settlement Stipulation shall be in full
and final disposition of the Action and any and all Settled Claims as against all Released Ptuties
and any and all Settled Defendants' Claims. It is an important element to Defendants'
participation in the Settlement that the Released Parties obtain the fidlest possible release from
further liability to any Class Member relating to the Settled Claims, and it is the intention of the
parties to this Settlement Stipulation that all further risk and liability of Defendants and the
Released Parties relating to the Settled Claims be hereby eliminated.
3. (a) Upon the Effective Date of the Settlement, the Class Members on behalf
of themselves, their heirs, executors, administrators, predecessors, successors and assigns,
thereby release and will be deemed to release and forever discharge the Released Parties from all
Settled Claims, and shall thereby forever be enjoined from prosecuting any Settled Claims
against any of the Released Parties.
(b) Upon the Effective Date of the Settlement, each of the Defendants, on
behalf of themselves and the Released Parties, thereby releases and will be deemed to release and
forever discharge each and every Settled Defendants Claim, and shall thereby forever be
enjoined from prosecuting the Settled Defendants' Claims.
(c) Upon the Effective Date of the Settlement, all claims for contribution
arising out of the Action are thereby barred: (i) against Defendants; and (ii) by Defendants
against any person or entity other than a person or entity whose liability to Class Members has
been extinguished pursuant to this Settlement Stipulation or the Final Order arid Judgment.
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)
4. (a) Following the Effective Date of the Settlement, any verdict or judgment
by Class Members against any other person or entity whose claims for contribution are barred or
otherwise rendered unenforceable pursuant to this Settlement Stipulation or the Final Order and
Judgment shall be reduced by the greater of: (i) $7,400,000; or (ii) any proportionate share of
liability found to be borne by Defendants; provided, however, that there shall be no such
reduction in the amount of the proceeds received pursuant to the settlement which has been
reached between Representative Plaintiffs, the Class Members, and certain former employees,
officers and/or directors ofJust For Feet, Inc., which settlement is described and defined as the
"JFF Settlement" in the Notice.
(b) In the event that any Defendant is made a party to any present or future
action or proceeding by any person or entity against whom claims arising out of or relating to
anything alleged in this Action are made by Class Members, and such action or proceeding
against the Defendant is not terminated with finality pursuant to this Settlement Stipulation or the
Final Order and Judgment, the Class Members agree to a reduction in the verdict, judgment or
determination against such other person or entity in favor of the Class Members so as to
eliminate any further recovery by such other person or entity from the Defendant. It is the intent
of the parties that in no event shall Defendants (or their insurers) be called upon to pay, directly
or indirectly, more than the $7,400,000 provided by this Settlement Stipulation in connection
with any pending or future action or proceeding commenced, prosecuted, or threatened against
any other person or entity by the Class.
(c) The Class agrees that, upon settlement of any future (i.e., not presently
pending) action, proceeding, or claim against any other person or entity arising out of the subject
matter of the Action, the Class will obtain a release in favor of the Released Parties of any and all
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claims (including both known and Unknown Claims) that were or could have been asserted
against any of the Released Parties in any way relating to the allegations of the Complaint, any
purchases or sales of IFF common stock during the Class Period, or any violation °flaw in
connection therewith.
THE SETTLEMENT CONSIDERATION
5. Defendants shall pay $7,400,000 (the "Cash Settlement Amount") by January 5,
2002, to settle all claims herein. The amounts to be paid and any interest earned thereon shall be
referred to as the "Settlement Fund."
6. (a) The Settlement Fund, net of any Taxes (as described below) on the income
thereof, shall be used to pay (i) the costs of administration of the Settlement, including mailing
Notices, as referred to below, (ii) the attorneys' fee and expense award referred to below, and
(iii) the remaining administration expenses referred to below. The balance of the Settlement
Fund after the above payments shall be the "Net Settlement Fund" which shall be distributed to
the Authorized Claimants as provided below. Any sums required to be held in escrow hereunder
prior to the Effective Date shall be held by Plaintiffs' Counsel as Escrow Agent for the
Settlement Fund. All funds held by the Escrow Agent shall be deemed to be in the custody of
the Court, and shall remain subject to the jurisdiction of the Court, until such time as the funds
shall be distributed or returned to Deloitte pursuant to this Settlement Stipulation or further Order
of the Court. The Escrow Agent shall invest any funds in excess of $100,000 in short term
United States Agency or Treasury Securities or, if approved by the Representative Plaintiffs, in
money market funds with one or more of the one hundred largest banking institutions in the
United States, and shall collect and reinvest all interest accrued thereon. Any funds held in
escrow in an amount of less than $100,000 may be held in an interest-bearing bank account
insured by the FDIC. The parties hereto agree that the Settlement Fund is intended to be a
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Qualified Settlement Fund within the meaning of Treasury Regulation section 1.468B-1 and that
the Escrow Agent, as administrator of the Settlement Fund within the meaning of Treasury
Regulation section 1.468B-2(k)(3), shall be responsible for filing tax returns for the Settlement
Fund and paying from the Settlement Fund any taxes owed with respect to the Settlement Fund.
(b) All (1) taxes on the income of the Settlement Fund, and (ii) expenses and
costs incurred in connection with the taxation of the Settlement Fund (including, without
limitation, expenses of tax attorneys and accountants) (collectively "Taxes") shall be paid out of
the Settlement Fund, and shall be considered to be a cost of administration of the Settlement and
shall be timely paid by the Escrow Agent without prior order of the Court.
ADMINISTRATION
7. The Claims Administrator shall administer the Settlement under Plaintiffs'
Counsel's supervision and subject to the jurisdiction of the Court. Except as stated herein,
Defendants shall have no responsibility for the administration of the Settlement and shall have no
liability to the Class in connection with such administration. Defendants shall cooperate in the
administration of the Settlement to the extent reasonably necessary to effectuate its terms.
8. Plaintiffs' Counsel may expend from the Settlement Fund, without further
approval from Defendants or the Court, up to the sum of $100,000 to pay the reasonable costs
and expenses associated with the administration of the Settlement, including, without limitation,
the costs of identifying members of the Class and effecting notice thereto. Such amounts shall
include, without limitation, the actual costs of publication, printing and mailing the Notice,
reimbursements to nominee owners for forwarding notice to their beneficial owners, and the
administrative expenses incurred and fees charged by the Claims Administrator in connection
with providing notice and processing the submitted claims. Prior to the Settlement Fairness
Hearing, and at the time of filing proof of mailing and publication, Plaintiffs' Counsel shall
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provide to Defendants a list of the names and addresses of those to which or whom notice was
mailed.
ATTORNEYS' FEES AND EXPENSES
9. Plaintiffs' Counsel will apply to the Court for an award from the Settlement Fund
of attorneys' fees not to exceed 25% of the Settlement Fund and reimbursement of expenses,
plus interest. Defendants shall take no position on any such application. Such attorneys' fees,
expenses, and interest as are awarded by the Court shall be paid from the Settlement Fund to
Plaintiffs' Counsel promptly after such award, notwithstanding the existence of any timely filed
objections thereto, or potential for appeal therefrom, or collateral attack on the Settlement, -
subject to Plaintiffs' Counsel's obligation to make appropriate repayments to the Settlement
Fund plus accrued interest at the same net rate as is earned by the Settlement Fund, if and when;
as a result of any appeal or further proceedings on remand, or successful collateral attack, the fee
or cost award is reduced or reversed.
10. In the event that there are fee and expense applications that have not been ruled
upon by the Court as of the date for distribution of the Settlement Fund to the Authorized
Claimants, then the amount to be distributed to Authorized Claimants on that date shall be
reduced by the total amount of all fees and expenses requested in any and all outstanding fee and
expense applications, and such amount shall be maintained in the Settlement Fund for payment
of any eventual fee and expense award(s). If the fee and expense award(s) ultimately awarded
by the Court are less than the amount that has been maintained in the Settlement Fund for
payment of such award(s), then any remaining balance in the Settlement Fund shall be promptly
distributed to Authorized Claimants in accordance with the Plan of Allocation.
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DISTRIIIUTION TO AUTHORIZED CLAIMANTS
11. The Claims Administrator shall determine each Authorized Claimant's pro rata
share of the Net Settlement Fund based upon each Authorized Claimant's "Recognized Claim"
(as defined in the "Plan of Allocation" described in the Notice annexed hereto as Exhibit 1 to
Exhibit A, or in such other plan of allocation as the Court approves).
12. The Plan of Allocation proposed in the Notice is not a necessary term of this
Settlement Stipulation and it is not a condition of this Settlement Stipulation that that Plan of
Allocation be approved.
13. Each Authorized Claimant shall be allocated a pro rata share of the Net
Settlement Fund based on his or her Recognized Claim compared to the total "Recognized
Claims" of all accepted claimants. This is not a claims-made settlement. Defendants shall not be
entitled to get back any of the settlement monies once the Settlement becomes final. The
Defendants shall have no involvement in reviewing or challenging claims.
CLAIMS PROCEDURE AND ADMINISTRATION OF THE SETTLEMENT
14. Any member of the Class who does not submit a valid "Proof of Claim" will not
be entitled to receive any of the proceeds frorri the Net Settlement Fund but will otherwise be
bound by all of the terms of this Settlement Stipulation, including the terms of the Final Order
and Judgment to be entered in the Action and the releases provided for herein, and will be barred
from bringing any action against the Released Parties concerning the Settled Claims.•
15. Plaintiffs' Counsel shall be responsible for supervising the administration of the
Settlement and disbursement of the Net Settlement Fund by the Claims Administrator. Except
for their obligation to provide the Settlement Fund, Defendants shall have no liability, obligation
or responsibility for the administration of the Settlement or disbursement of the Net Settlement
Fund. Plaintiffs' Counsel shall have the right, but not the obligation, to waive what they deem to
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Be formal or technical defects in any Proofs of Claim submitted in the interests of achieving
justice.
16. For purposes of determining the extent, if any, to which a Class Member shall be
entitled to be treated as an "Authorized Claimant," the following conditions shall apply:
(a) Each Class Member shall be required to submit a Proof of Claim (see
attached Exhibit 2 to Exhibit A), supported by such documents as are designated therein,
including proof of loss by the Class Member making a claim (hereinafter "Claimant'), or such
•other documents or proof as Plaintiffs' Counsel, in their discretion, may deem acceptable;
(b) All Proofs of Claim must be postmarked and/or received by the Claims
Administrator by the date specified in the Notice unless such period is extended by Order of the
Court. Any Class Member who fails to submit a Proof of Claim by such date shall be forever
barred from receiving any payment pursuant to this Settlement Stipulation (unless, by Order of
the Court, a later submitted Proof of Claim by such Class Member is approved), but shall in all
other respects be bound by all of the terms of this Settlement Stipulation including the terms of
the Final Order and Judgment and the releases provided for herein, and will be barred from
bringing any action against the Released Parties concerning the Settled Claims;
(c) Each Proof of Claim shall be submitted to and reviewed by the Claims
Administrator, under the supervision of Plaintiffs' Counsel, who shall determine in accordance
with this Settlement Stipulation the extent, if any, to which each claim shall be allowed, subject_
to review by the Court;
(d) Proofs of Claim that do not meet the submission requirements may be
rejected. Prior to rejection of a Proof of Claim, the Claims Administrator shall communicate
with the Claimant in order to remedy the curable deficiencies in the Proof of Claims submitted.
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)
The Claims Administrator, under supervision of Plaintiffs' Counsel, shall notify, in a timely
fashion and in writing, all Claimants whose Proofs of Claim they propose to reject in whole or in
part, setting forth the reasons therefor, and shall indicate in such notice that the Claimant whose
claim is to be rejected has the right to review by the Court if the Claimant so desires and
complies with the requirements of subparagraph (e) below;
(e) If any Claimant whose claim has been rejected in whole or in part desires
to contest such rejection, the Claimant must, within twenty days 4er the date of mailing of the
notice required in subparagraph (d) above, serve upon the Claims Administrator a notice and
statement of reasons indicating the Claimant's grounds for contesting the rejection along with
any supporting documentation, and requesting a review thereof by the Court. If a dispute
concerning a claim cannot be otherwise resolved, Plaintiff? Counsel shall thereafter present the
request for review to the Court
17. Each Claimant shall be deemed to have submitted to the jurisdiction of the Court,
and the claim will be subject to investigation and discovery under the Federal Rules of Civil
Procedure, provided that such investigation and discovery shall be limited to that Claimant's
status as a Class Member and the validity and amount of the Claimant's claim. No discovery
shall be allowed on the merits of the Action or Settlement in connection with processing of the
Proofs of Claim.
18. Payment pursuant to this Settlement Stipulation shall be deemed final and
conclusive against all Class Members. All Class Members whose claims are not approved by the
Court shall be barred from participating in distributions from the Net Settlement Fund, but
otherwise shall be bound by all of the tenns of this Settlement Stipulation and the Settlement,
including the terms of the Final Order and Judgment and the releases provided for herein, and
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will be barred from bringing any action against the Released Parties concerning the Settled
Claims.
19. All proceedings with respect to the administration, processing and determination
of claims and the determination of all controversies relating thereto, including disputed questions
•of law and fact with respect to the validity of claims, shall be subject to the jurisdiction of the
Court.
20. The Net Settlement Fund shall be distributed to Authorized Claimants by the
Claims Administrator only after the Effective Date and after: (i) all claims have been processed,
and all Claimants whose claims have been rejected or disallowed, in whole or in pert, have been•
notified and provided the opportunity to be heard concerning such rejection or disallowance; (ii)
all objections with respect to all rejected or disallowed claims have been resolved by the Court,
and all appeals therefrom have been resolved or the time therefor has expired; (iii) all matters
with respect to attorneys' fees, costs, and disbursements have been resolved by the Court, all
appeals therefrom have been resolved or the time therefor has expired; and (iv) all costs of
administration have been paid.
TERMS OF PRELIMINARY ORDER IN CONNECTIONWITH SETTLEMENT PROCEEDINGS
21. Concurrently with their application for preliminary approval by the Court of the
•Settlement contemplated by this Settlement Stipulation, the Class and Defendants jointly shall
apply to the Court for entry of a Preliminary Order substantially in the form annexed hereto as
Exhibit A.
TERMS OF FINAL ORDER AND JUDGMENT
22. If the Settlement contemplated by this Settlement Stipulation is approved by the
Court, counsel for the parties shall request that the Court enter a Final Order and Judgment
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)
substantially in the form annexed hereto as Exhibit B. The Settlement is expressly conditioned
upon, among other things, the entry of a Final Order and Judgment substantially in the form
annexed hereto as Exhibit B.
SUPPLEMENTAL AGREEMENT
23. Simultaneously herewith, Representative Plaintiffs and Defendants are executing
a "Supplemental Agreement" setting forth certain conditions under which this Settlement
Stipulation may be withdrawn or terminated at the discretion of Defendants if potential Class
Members who purchased in excess of a certain number of shares ofJFF common stock exclude
themselves from the Class. The Supplemental Agreement shall not be filed with the Court unless
a dispute regarding the Settlement arises in which event it shall be filed with the Court under seal
to the extent the Court so permits. In the event of a withdrawal from this Settlement Stipulation.
pursuant to the Supplemental Agreement, this Settlement Stipulation shall become null and void
and of no further force and effect.
EFFECTIVE DATE OF SETTLEMENT, WAIVER OR TERMINATION
24. The Effective Date of Settlement shall be the date when all the following shall
have occurred:
(a) entry of the Preliminary Order in all material respects in the form annexed .
hereto as Exhibit A;
(b) approval by the Court of the Settlement, following notice to the Class and
a hearing, as prescribed by Rule 23 of the Federal Rules of Civil Procedure; and
(c) entry by the Court of a Final Order and Judgment, in all material respects
in the form set forth in Exhibit 13 annexed hereto, and the expiration of any time for appeal or
review without the Final Order and Judgment being changed in any material respect.
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)
25. Counsel for Defendants or Plaintiffs' Counsel shall have the right to terminate the
Settlement and this Settlement Stipulation by providing written notice of their election to do so
("Termination Notice") to all other signatories hereto within forty-five days of the later of: (a)
written notice of the Court's unwillingness to enter the Preliminary Order in any material
respect; (b) written notice of the Court's unwillingness to approve this Settlement Stipulation or
any material part of it; (c) written notice of the Court's unwillingness to enter the Final Order
and Judgment in any material respect; or (d) written notice that the Final Order and Judgment has
been modified or reversed in any material respect by the Court of Appeals or the United States
Supreme Court.
26. Except as otherwise provided herein, in the event the Settlement is terminated or
fails to become effective for any reason, then, within ten days after service of the Termination
Notice, any portion of the Settlement Fund previously provided by Defendants, together with any
interest earned thereon, less any Taxes due with respect to such income, and less costs of
administration and notice actually incurred and paid or payable from the Settlement Fund, shall
be returned to Defendants, and the parties to this Settlement Stipulation shall be deemed to have
reverted to their respective status in the Action as of the date hereof and, except as otherwise ex-
pressly provided, the parties shall proceed in all respects as if this Settlement Stipulation and any
related orders had not been entered.
NO ADMISSION OF WRONGDOING
•27. Defendants deny engaging in any wrongdoing whatsoever. Defendants believe
that they confomied to professional standards in every respect and that Deloitte's audit reports
were properly issued. Defendants also contend that any losses to plaintiffs were a natural
consequence of undertaking the risk of investing in the stock market and were in no way caused
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by Defendants. Defendants are entering the Settlement solely to avoid the expense of further
litigation and so that they might turn their attention to their ongoing professional responsibilities.
28. This Settlement Stipulation, whether or not consummated, and any proceedings
taken pursuant to it:
(a) shall not be referred to or used by anyone against Defendants or the Class
as evidence of wrongdoing;
(b) shall not be construed against Defendants or the Class as an admission or
concession that the consideration to be given hereunder represents the amount that could have
been recovered after trial; and
(c) shall not be construed as, or received in evidence as, an admission,
concession or presumption against the Class or any member thereof that any of their claims are
without merit or that damages recoverable under the Complaint would not have exceeded the
Settlement Fund.
MISCELLANEOUS PROVISIONS
29. All of the exhibits attached hereto are hereby incorporated by reference as though
fully set forth herein.
30. If(i) a case is commenced with respect to any Defendant under Title 11 of the
-United States Code (bankruptcy), or a trustee, receiver or conservator is appointed under any
similar law, and (ii) a court of competent jurisdiction enters a final order determining that the
transfer of money to the Settlement Fund or any portion thereof by or on behalf of any Defendant
was a preference, voidable transfer, fraudulent transfer or similar transaction and that any portion
thereof is to be returned, and (iii) such amount is not promptly deposited to the Settlement Fund
by others, then, at the election of Plaintiffs' Counsel, the parties shall jointly move the Court to
vacate and set aside this Settlement Stipulation and the Final Order and Judgment entered
- 19 -
. -
•Pursuant hereto, and the parties shall be restored to their respective positions in the litigation as
of the date hereof and any cash amounts in the Escrow shall be returned as provided above.
31. The parties to this Settlement Stipulation intend the Settlement to be a final and
complete resolution of all disputes asserted or which could have been asserted by the Class
against the Released Parties with respect to the Settled Claims. Accordingly, the Class and
Defendants agree not to assert in any fonnn that the litigation was brought by the Class or
defended by Defendants in bad faith or without a reasonable basis. The parties hereto shall
assert no claims of any violation of Rule 11 of the Federal Rules of Civil Procedure relating to
the Action. The parties agree that the amount paid and the other terms of the Settlement were
negotiated at arm's length in good faith by the parties, and that they reflect a settlement that was
reached voluntarily after consultation with experienced legal counsel.
32. This Settlement Stipulation may not be modified or amended, nor may any °fits
provisions be waived, except by a writing signed by all parties hereto or their successors-in-
interest.
33. The administration and consununation of the Settlement shall be under the
authority of the Court and the Court shall retain jurisdiction for the purpose of entering orders
providing for awards of attorneys' fees and expenses to Plaintiffs' Counsel and enforcing the
terms of this Settlement Stipulation.
34. The waiver by one party of any breach or condition of this Settlement Stipulation
shall not be deemed a waiver of any other prior or subsequent breach or condition.
35. This Settlement Stipulation and its exhibits and the Supplemental Agreement
constitute the entire agreement among the parties concerning the Settlement, and no
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„
representations, warranties, or inducements have been made other than those contained and
memorialized in such documents.
36. This Settlement Stipulation may be executed in one or more counterparts. All
executed counterparts and each of them shall be deemed to be one and the same instrument.
37. This Settlement Stipulation shall be binding upon, and inure to the benefit of, the
successors and assigns of the parties hereto.
38. The construction, interpretation, operation, effect and validity of this Settlement
Stipulation, and all documents necessary to effectuate it, shall be governed by the internal laws
of the State of Alabama without regard to conflicts °flaws, except to the extent that federal law
governs.
39. This Settlement Stipulation shall not be construed more strictly against one party
than another merely by virtue of the fact that it, or any part of it, may have been prepared by
counsel for one of the parties, it being recognized that it is the result of arm's-length negotiations
between the parties and all parties have contributed substantially and materially to the
preparation of this Settlement Stipulation.
40. All counsel and any other person executing this Settlement Stipulation and any of
the exhibits hereto, or any related settlement documents, represent that they have the full
authority to do so and that they have the authority to take appropriate action required or
permitted to be taken pursuant to the Settlement Stipulation to effectuate its terms.
41. The parties agree to cooperate fully with one another in seeking Court approval of
the Preliminary Order, the Settlement Stipulation, and the Final Order and Judgment and to
promptly agree upon and execute all such other documentation as may be reasonably required to
-21 -
,,. .._,. ,. ) )
obtain final approval. The parties also agree to extensions of time with respect to pleadings and
other court filings as are appropriate in the context of this Settlement Stipulation.
DATED: December 21, 2001RAGSDALE & WHEELER, L.L.C.
By: 44 ....."...i...__M. Clay : . gsdal - , Esq.
550 Farley Buil • '1 g
1929 Third Avenue NorthBirmingham, Alabama 35203(205) 251-4775
HASICELL SLAUGHTER YOUNG &REDIKER, L.L.C.
By: i L. 4,Al‘e-lyee..."-(X4A---
1111
- ichael Rediker, Esq.omas L. Krebs, Esq.
' 1, 1 ' • Soutb/Harbert Building1901 Sixth Avenue NorthBirmingham, Alabama 35203(205) 251-1000
GRANT & EISENHOFER, P.A.
& .BY: a , , : . 7 j' A...—
Stuart A Grant, Esq. i• Megan 5 . McIntyre, Esq.1220 N. Market Street, Suite 500Wilmington, Delaware 19801(302) 622-7000
CAULEY GELLER BOWMAN & COATES,LLP
By: -Cjtr-LiLig-1,„ 5- 64,-, 5/40T ,,,./t1,-,-.--.4-•,$,-- -Steven E. Cauley, E .Curtis L. Bowman, Esq.W. Todd Ver Weire, Esq.
P.O. Box 25438
-22 -
Little Rock, Arkansas 72221-5438(501) 312-8500
Co-Lead Counsel for Plaintiffs
BALCH & BINGHAM
By: Mic ael L. Edwards, Esq.Lee H. Zell, Esq.
1710 Sixth Avenue NorthBirmingham, Alabama 35203-2015(205) 251-8100
WILLICIE FARR & GALLAGHER
ABy: AAA IA -
Michael R. Y g, Esq.787 Seventh Avenue ---New York, New York 10019-6099(212) 728-8000
Attorneys for Defendants Deloitte & Touche LLP,Steven 11. Barry, & Karen Baker
981901.6
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. -
UNITED STATES DISTRICT COURTNORTHERN DISTRICT OF ALABAMA
SOUTHERN DIVISION
STATE OF WISCONSIN INVESTMENT)BOARD, KENNETH P. BUSH, EDWARD E.)EUBANK, and JOHN MICHAEL, on behalf of )themselves and all others similarly situated, )
)Plaintiffs, )
vs. )) CASE NUMBER
HAROLD RU'TTENBERG, ERIC L. TYRA, )PETER BERMAN, COOPER EVANS, ) CV 99-BU-3097-SPATRICK LLOYD, DON-ALLEN )RUTTENBERG, MICHAEL LAZARUS, )HELEN ROCKEY, SCOTT C. WYNNE, )RANDALL L. HAINES, ADAM )GILBURNE, DELOITTE & TOUCHE LLP, ) •STEVEN H. BARRY, and KAREN BAKER, )
)Defendants. )
))
GEORGE W. MASSEY, on behalf of himself) CASE NUMBERand all others similarly situated, )
) CV 99-BU-3129-SPlaintiffs, )
vs. ))
HAROLD RUTTENBERG, ERIC L. TYRA, )PETER BERMAN, COOPER EVANS, )HELEN M. ROCKEY and PATRICK LLOYD,)
)Defendants. )
•
ORDER PRELIMINARILY APPROVINGSETTLEMENT AND PROVIDING FOR NOTICE
(EXHIBIT A TO STIPULATION OF SETTLEMENT)
- 1 -.17k'
)
•WHEREAS, by Order dated July 3, 2001, the Court certified the above-captioned actions
(the "Litigation") as a class action under Rules 23(a) and 23(b)(3) of the Federal Rules of Civil
Procedure, but notice of the pendency of the Litigation has not yet been given to the certified
class;
WHEREAS, the parties having made application, pursuant to Rule 23 of the Federal
Rules of Civil Procedure, for an order approving the settlement of the Litigation in accordance
with the Stipulation of Settlement between the plaintiff Class and former Just For Feet, Inc.
office's, directors and/or employees Harold Ruttenber& Eric L. Tyra, Peter Berman, Cooper
Evans, Patrick Lloyd, Don Allen Ruttenberg, Michael Lazarus, Helen Rockey, Scott C. Wynne,
Randall L. Haines, Adam Gilbume, Robert C. Wabler, Alex M. Bond and Edward S. Croft, HI,
dated as of December 21, 2001 (the "JFF Stipulation"), and the Stipulation and Agreement of
Settlement between the plaintiff Class and defendants Deloitte & Touche LLP, Steven H. Bany
and Karen Baker, dated as of December 21, 2001 (the "Deloitte Stipulation"), which, together
with the Exhibits annexed thereto set forth the terms and conditions for a proposed settlement of •
the Litigation and for dismissal of the Litigation with prejudice upon the terms and conditions set .
forth therein; and the Court having read and considered the JFF Stipulation and the Deloitte
Stipulation, and the Exhibits annexed thereto; and
WHEREAS, unless otherwise stated herein, all defined terms contained herein shall have
the same meanings as set forth in the Notice of Class Certification and Settlement of Class
Action (the "Notice"), which is attached as an Exhibit to each of the JFF Stipulation and the
Deloitte Stipulation;
NOW THEREFORE, IT IS HEREBY ORDERED:
1. The Court does hereby preliminarily approve the JFF Stipulation and the Deloitte
Stipulation (together, the "Stipulations") and the Settlement set forth therein as being fair, just,
reasonable and adequate as to the Class Members, subject to further consideration at the
Settlement Hearing described below.
2. A hearing (the "Settlement Hearing') shall be held before this Court on Febmaty
21, 2002 at 2:30 p.m. at the United States Courthouse, 1729 Fifth Avenue, Birmingham,
Alabama, 35203 to determine whether the proposed Settlement of the Litigation on the terms and
conditions provided for in the Stipulations is fair, just, reasonable and adequate as to the Class
and should be approved by the Court; whether judgments as provided in the Stipulations should
be entered herein; whether the proposed Plan of Allocation should be approved; and to determine
the mount of fees and expenses that should be awarded to Representative Plaintiffs and their
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Counsel. The Court may adjourn the Settlement Hearing without further notice to Members of
the Class.
3. The Court approves, as to form and content, the Notice of Class Certification and
Settlement of Class Action (the "Notice"), the Proof of Claim and Release form (the "Proof of
Claim"), and Summary Notice annexed as Exhibits A-1, A-2 and A-3 to each of the .IFF
Stipulation and the Deloitte Stipulation and finds that the mailing and distribution of the Notice
and publishing of the Summary Notice substantially in the manner and form set forth in 14 of-this Order meet the requirements of Rule 23 of the Federal Rules of Civil Procedure and due
process, and is the best notice practicable under the circumstances and shall constitute due and -
sufficient notice to all Persons entitled thereto.
4. Representative Plaintiffs' Counsel are hereby authorized to retain the firm of:
The Garden City Group, Inc., P.O. Box 8835, Melville, New York 11747-8835 ("Claims
Administrator") to supervise and administer the notice procedure as well as the processing of
claims as more fully set forth below:
(a) Not later than , 2002 (the "Notice Date"), Representative .
Plaintiffs' Counsel shall cause a copy of the Notice and ihe Proof of Claim, substantially in the
forms annexed as Exhibits A-1 and A-2 hereto, to be mailed by first class mail to all Class
Members who can be identified with reasonable effort;
(b) Not later than , 2002, Representative Plaintiffs' Counsel
shall cause the Summary Notice to be published twice in the Investors' Business Daily; and
(c) At least seven (7) calendar days prior to the Settlenient Hearing,
Representative Plaintiffs' Counsel shall serve on Defendants' counsel and file with the Court
proof, by affidavit or declaration, of such mailing and publishing.
5. Nominees who purchased or acquired the common stock of Just For Feet for the
benefit of another Person during the period beginning May 5, 1997 through and including
November I, 1999, shall be requested to send the Notice and the Proof of Claim to all such
beneficial owners of such Just For Feet stock within ten (10) days after receipt thereof, or send a
list of the names and addresses of such beneficial owners to the Claims Administrator within ten
(10) days of receipt thereof in which event the Claims Administrator shall promptly mail the
Notice and Proof of Claim to such beneficial owners.
6. All Members of the Class who do not timely and validly exclude themselves from
the class shall be bound by all determinations and judgments in the Litigation concerning the
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settlement, including, but not limited to, the releases provided for therein, whether favorable or
unfavorable to the Class.
7. Persons who wish to exclude themselves from the Class shall request exclusion
within the time and in the manner set forth in the Notice, including mailing or delivering a
written exclusion request such that it is received on or before February 6, 2002 by each of the
following:
Just For Feet Securities LitigationThe Garden City GroupP.O. Box 8835Melville, New York 11747-8835
M. Clay Ragsdale, Esq.RAGSDALE & WHEELER, LLCThe Farley Building Suite 550Birmingham, Alabama 35203
J. Michael Rediker, Esq.HASKELL SLAUGHTER YOUNG & REDIKER, LLC1200 AmSouth/Harbert Building1901 - 6th Avenue NorthBirmingham, AL 35203
John B. Missing, Esq.BROBECK, PHLEGER & HARRISON, LLP1333 H. Street N.W., Suite 800Washington, D.C. 20005
Michael J. Malone, Esq.KING & SPALDING1185 Avenue of the AmericasNew York, NY 10036-4003
Lee H. Zell, Esq.BALCH & BINGHAlvl, LLP710 Sixth Avenue NorthBirmingham, AL 35203-2015
Unless the Court orders otherwise, no request for exclusion shall be valid unless it is made
within the time and in the manner set forth in the Notice.
8. Class Members who wish to participate in the Settlement shall complete and
submit Proof of Claim forms in accordance with the instnictions contained therein. Unless the
-4-
Court orders otherwise, all Proof of Claim forms must be submitted to the Claims Administrator
no later than ninety (90) days from the Notice Date. Any Class Member who does not timely
submit a Proof of Claim within the time provided for, shall be. barred from sharing in the
distribution of the proceeds of the Settlement Funds, unless otherwise ordered by the Court.9. Any Member of the Class may enter an appearance in the Litigation, at their own
expense, individually or through counsel of their own choice. Any Class Member who does not
enter an appearance will be represented by Representative Plaintiffs' Counsel.
10. All proceedings in the Litigation are stayed until further order of the Court, except
as may be necessary to implement the Settlement or comply with the terms of the Stipulations.
Pending final determination of whether the Settlement should be approved, neither the
Representative Plaintiffs nor any Class Member, either directly, representatively, or in any other
capacity, shall commence or prosecute against any of the Released Persons, any action or
proceeding in any court or tribunal assertMg any of the Released Claims.
11. Any Member of the Class may appear and show cause, if he, she or it has any
such cause, why the proposed Settlement of the Litigation should or should not be approved as
fair, just, reasonable and adequate, or why a judgment should or should not be entered thereon,
why the Plan of Allocation should or should not be approved, or why attorneys' fees and
expenses should or should not be awarded to counsel for the Representative Plaintiffs; provided,
however, that no Class Member or any other Person shall be heard or entitled to contest the
approval of the terms and conditions of the proposed settlement, or, if approved, the judgment to
be entered thereon approving the same, or the order approving the Plan of Allocation, or the
attorneys' fees and expenses to be awarded to counsel for the Representative Plaintiffs, unless
that person has filed written objections and copies of any papers and briefs with the Clerk of the
Court for the Northern District of Alabama, Southern Division, on or before February 11, 2002,
and unless copies of such written objection papers and briefs are received by each of the
following by the February 12,2002:
M. Clay Ragsdale, Esq.RAGSDALE & WHEELER, LLC550 Farley Building •.1929 Third Avenue NorthBirmingham, AL 35203Telephone: (205) 251-4775
-5-
•
•, )
Facsimile: (205) 251-4777
J. Michael Rediker, Esq.HASKELL SLAUGHTER YOUNG & REDIKER, L.L.C.1200 AmSouth/Harbert Building1901 Sixth Avenue NorthBirrningham, AL
Luther M. DOTI, Jr., Esq.
MAYNARD, COOPER & GALE, P.C.2400 AmSouth/Harbert Plaza
•1901 Sixth Avenue NorthBirmingham, AL 35203
Crawford S. McGivaren, Jr., Esq.Cabaniss, Johnston, Gardner,Dumas & O'Neal • ,Park Place Tower, Suite 7002001 Park Place North
•P.O. Box 830612Birmingham, AL 35283-0612
William J. Baxley, Esq.BAXLEY, DILLARD, DAUPHIN & MCKNIGHT2008 Third Avenue SouthBirmingham, AL 35233
• James W. Gewin, Esq.BRADLEY ARANT ROSE & WHITE, LLP2001 Park Place, Suite 1400Birmingham, AL 35203-2736
W. Stancil Starnes, Esq.STARNES & ATCHISON, LLP100 Brookwood Place, Seventh FloorBirmingham, AL 35209
Lee H. Zell, Esq.BALCH & BINGHAM, LLP710 Sixth Avenue NorthBirmingham, AL 35203-2015
Any Member of the Class who does not make his, her or its objection in the manner provided
shall he deemed to have waived such objection and shall forever be foreclosed from making any
-6-
)
objection to the fairness, justness, reasonableness or adequacy of the proposed settlement as
incorporated in the Stipulations, to the Plan of Allocation, and to the award of attorneys' fees and
expenses to the Representative Plaintiffs or their counsel, unless otherwise ordered by the Court.
12. The transfer of the Settlement Funds to the Escrow Agent in accordance with the
terms and conditions of the Stipulations is approved. Subject to Court order and the terms of the
•Stipulations, the only Persons who shall have any right to any portion of the Settlement Funds
are Class Members, plaintiffs in the State Court Actions (with respect to the JFF Settlement Fund
only) and counsel to the Representative Plaintiffs.
13. All finds held by the Escrow Agent shall remain subject to the jurisdiction of the
Court, until such time as such funds shall be distributed pursuant to the Stipulations and/or
further order(s) of the Court.
14. All motions and papers in support of the Settlements, the Plan of Allocation, and
any application by counsel for the Representative Plaintiffs for attorneys' fees or reimbursement
of expenses shall be filed and served at least seven calendar days prior to the Settlement Hearing.
15. Neither Defendants nor Defendant? counsel shall have any responsibility for the
Plan of Allocation or any application for reimbursement of attorneys' fees or reimbursement of
expenses submitted by Representative Plaintiffs' Counsel, and such matters will be considered
separately from the fairness, justne.ss, reasonableness and adequacy of the Settlement.
16. At or after the Settlement Hearing, the Court shall determine whether the Plan of
Allocation proposed by Representative Plaintiffs' Counsel and any application for attorneys' fees
OT reimbursement of expenses shall be approved.
17. All reasonable costs incurred in identifying and notifying Class Members, as well
as in administering the Settlement Funds, shall be paid as set forth in the Stipulations. In the
event the Settlement is not approved by the Court, or otherwise fails to become effective, neither
the Representative Plaintiffs nor any of their counsel shall have any obligation to repay to
Defendants or the .IFF Defendants' Insurers the reasonable and actual costs of class notice and of
administration.
18. The Court reserves the right to adjourn the date of the Settlement Hearing without
further notice to the Members of the Class, and retains jurisdiction to consider all further
applications arising out of or connected with the proposed settlement. The Court may approve
the Settlement, with such modifications as may be agreed to by the parties, if appropriate,
without further notice to the Class.
-7-
IT IS SO ORDERED.
DATED:
THE HONORABLE H. DEAN =TRAMUNITED STATES DISTRICT JUDGE
-8-
"•
*
UNITED STATES DISTRICT COURTNORTHERN DISTRICT OF ALABAMA
SOUTHERN DIVISION
STATE OF WISCONSIN INVESTMENT )BOARD, KENNETH P. BUSH, EDWARD E.)EUBANK, and JOHN MICHAEL, on behalf of)themselves and all others similarly situated, )
) -
Plaintiffs, )vs. )
) CASE NUMBERHAROLD RUTIENBERG, ERIC L. TYRA, )PETER BERMAN, COOPER EVANS, ) CV 99-BU-3097-SPATRICK LLOYD, DON-ALLEN )RUTTENBERG, MICHAEL LAZARUS, )HELEN ROCICEY, SCOTT' C. WYNNE, )RANDALL L. HAINES, ADAM )GILBURNE, DEL0T1TE & TOUCHE LLP, )STEVEN H. BARRY, and KAREN BAKER, )
)Defendants. )
))
GEORGE W. MASSEY, on behalf of himself)and all others similarly situated, )
) CASE NUMBERPlaintiffs, )
) CV 99-BU-3129-Svs. )
)HAROLD RUTTENBERG, ERIC L. TYRA, )PETER BERMAN, COOPER EVANS, )HELEN M. ROCKEY and PATRICK LLOYD,)
)Defendants. ) •
NOTICE OF CLASS CERTIFICATIONAND SETTLEMENT OF CLASS ACTION
(EXHIBIT A-1 TO STIPULATION OF SETTLEMENT)
-1-
'(‘'
• .1 -
TO: ALL PERSONS WHO PURCHASED JUST FOR FEET INC. ("Just for Feet")COMMON STOCK DURING THE PERIOD MAY 5, 1997 THROUGH NOVEMBER1, 1999, INCLUSIVE.
PLEASE READ THIS NOTICE CAREFULLY AND IN ITS ENTIRETY. THIS
NOTICE RELATES TO BOTH THE CERTIFICATION OF A CLASS AND A PROPOSED
SETTLEMENT OF THIS CLASS ACTION AND, IF YOU ARE A CLASS MEMBER,
CONTAINS IMPORTANT INFORMATION AS TO YOUR RIGHTS CONCERNING THE. -
SETTLEMENT AS FURTHER DESCRIBED BELOW. IF YOU ARE A MEMBER OF THE
CLASS AND DO NOT OPT OUT, YOU WILL BE BOUND BY THE RELEASE WHETHER
OR NOT YOU SUBMIT A CLAIM. IF YOU ARE A MEMBER OF THE CLASS AND DO
NOT OPT OUT, YOU WILL BE BOUND BY THE SETTLEMENT AND ANY JUDGMENTS
IN THIS ACTION.
YOU ARE HEREBY NOTIFIED, that the United States District Court for the Northern
District of Alabama (the "Court"), has determined that this lawsuit (the "Litigation") should
proceed as a class action on behalf of all persons and entities who purchased common stock of
Just for Feet between May 5, 1997 and November 1, 1999, inclusive, and who have suffered a
loss. Excluded from the Class are (1) the Defendants, (2) members of the families of the
Defendants, (3) the subsidiaries or affiliates of any Defendant, (4) any person or entity who is (or
was during the Class Period) a shareholder, partner, officer, director, employee or controlling
person of any Defendant, (5) any entity in which any Defendant has a controlling interest, and
(6) the legal representatives, heirs, successors or assigns of any such excluded person. This
Notice is being sent to you, in part, pursuant to Rule 23(c) of the Federal Rules of Civil
Procedure, to advise you of the pendency and nature of this Litigation and your rights in
connection with it.
YOU ARE HEREBY FURTHER NOTIFIED, pursuant to an Order of the Court and Rule
23 of the Federal Rules of Civil Procedure, that two proposed settlements of the Litigation have
been reached (one between the plaintiff Class and former Just For Feet, Inc. officers, directors,
-2-
and/or employees Harold Ruttenberg, Eric L. Tyra, Peter Berman, Cooper Evans, Patrick Lloyd,
Don Allen Ruttenberg, Michael Lazarus, Helen Rockey, Scott C. Wynne, Randall L. Haines,
Adam Gilburne, Robert C. Wabler, Alex M. Bond and Edward S. Croft, Ill (the "IFF
Settlement"), and one between the plaintiff Class and defendants Deloitte & Touche LLP, Steven
H. Barry and Karen Baker (the "Deloitte Settlement")). The JFF Settlement and the Deloitte
Settlement (collectively, the "Settlement") are subject to approval by the Court. One of the
purposes of this notice is to inform you of the proposed Settlement and of the hearing to be held
by the Court to consider the fairness, reasonableness and adequacy of the Settlement. This
notice describes the rights you may have in relation to the Settlement and this Litigation.
•NATURE OF THE ACTION
The following actions were filed in or transferred to the United States District Court for
the Northern District of Alabama, Southern Division, as class actions on behalf of persons who
purchased the common stock of Just for Feet during a defined period of time:
Peter H. Burke, et aL v. Harold Ruttenberg, et al. Case No.: CV 99-BU-3097-S,
George W. Massey, et al. v. Harold Ruttenberg, et aL Case No.: CV 99-BU-3 129-S
Donald L. Lane, et al. v. Harold Ruttenberg, et at Case No. CV 99-BU-3307-S
In general, the plaintiffs have asserted claims for alleged violations of the federal
securities laws. The plaintiffs allege, among other things, that the Defendants disseminated false
and misleading information during the Class Period regarding, among other things, Just for
Feet's financial condition and prospects, which had the result of artificially inflating the market
price of Just for Feet's common stock, causing those who purchased such stock during the Class
Period to make such purchases at inflated prices. The complaints seek damages for persons who
sustained a loss upon the sale of shares purchased during the Class Period or who still hold their
shares purchased during the Class Period. The defendants include certain former officers,
directors and/or employees of Just for Feet, as well as Deloitte & Touche LLP (Just for Feet's
former independent auditor) and two representatives of Deloitte & Touche LLP.
By order dated February 3, 2000, the above actions were consolidated, and they are
referred to herein collectively as the "Litigation." The Court also appointed lead plaintiffs, lead
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.7?
counsel and special counsel for the proposed class on May 19, 2000.
On June 15, 2000, the Representative Plaintiffs filed their Consolidated Class Action
Complaint (the "Complaint"). The Complaint sought, inter alia, remedies for alleged violations
by all defendants of §10(b) of the Securities Exchange Act of 1934 (the "Exchange Act") and
Rule 10b-5 promulgated thereunder, and remedies for certain defendants' alleged violations of
state common law and of §§ 18 and 20(a) of the Exchange Act.
On or about July 27, 2000, Defendants filed motions to dismiss plaintiffs' Complaint
The Representative Plaintiffs thereafter filed their opposition and objections to the motions and
Defendants filed their reply memoranda. On January 12, 2001, the Court dismissed plaintiffs'
state law claims but denied Defendants' motion to dismiss the federal securities claims.
Defendants thereafter filed Answers in which they denied all allegations of wrongdoing.
The parties engaged in extensive and substantial fact discovery, including the production,
review and analysis of over 1,000,000 pages of documentation produced by Defendants and
several third parties, as well as the taking of 26 depositions. Representative Plaintiffs retained
experts in the areas of damages, commercial lending and auditing/accounting. Defendants
engaged experts in the areas of auditing/accounting, business, and damages. Both the
Representative Plaintiffs' experts and Defendants' experts prepared detailed expert reports.
The Court certified the Class on July 3, 2001. Also on July 3, 2001, the Court bifurcated
the Litigation into two separate actions, one against the former officers, directors and/or
employees of Just for Feet, and one against Deloitte & Touche LLP and its representatives.
EFFECT OF CLASS DETERMINATION
If you are a member of the Class as defined herein, your legal rights with respect to the
claims asserted against the Defendants will be determined in this action and you will be bound
by any order or judgment that the Court has entered or will enter with respect to the Class, unless
you timely request to be excluded from the Class in the manner set forth below. If you choose to
be excluded from the Class, you will not be bound by the outcome of this Litigation but you will
also not be entitled to share in any recovery in the Litigation (INCLUDING THE
SETTLEMENT DESCRIBED BELOW), if any recovery is achieved.
-4-
THE SETTLEMENT
During the course of the Litigation, the Representative Plaintiffs and the defendants who
were former officers, directors and/or employees of Just for Feet (the "IFF Defendants") held
settlement discussions with the assistance of private mediators. With the assistance of these
intermediaries, these Parties were able to reach the JFF Settlement. The Representative Plaintiffs
then engaged in settlement discussions with Deloitte & Touche LLP, Steven IL Barry and Karen
Baker (the "Deloitte Defendants") and reached the Deloitte Settlement. The Settlement would
resolve all claims asserted in the Litigation.
The proposed JFF Settlement creates a fund in the amount of approximately $25,500,000
in cash, plus interest that accrues on the fund prior to distribution. The proposed Deloitte
Settlement creates a fund in the amount of $7,400,000 in cash, plus interest that accrues on the
fund prior to distribution. Your recovery from these funds will depend on a number of variables,
including the number of shares of Just for Feet common stock you purchased during the period
May 5, 1997 to November 1, 1999 (the "Class Period") the timing of your purchases and any
sales, the number of claims submitted by eligible claimants, and the amount of Court approved
attorneys' fees, litigation costs and administrative expenses deducted from the fimds. Depending
on the number of eligible shares purchased by Class Members who file completed proofs of
claim in the Settlement and subject to variation due to factors discussed in the preceding
sentence, the average distribution per share from the Settlement is estimated at approximately
$1.30 before deductions of Court-approved fees and expenses.
Representative Plaintiffs and Defendants do not agree on the average amount of damages
per share that Would have been recoverable if the Representative Plaintiffs were to have
prevailed on each claim alleged. The issues on which the parties disagree include among other
things: (1) whether the statements made or facts allegedly omitted were material, false,
misleading or otherwise actionable under the securities laws; (2) the appropriate economic model
for determining the amount by which Just for Feet common stock was allegedly artificially
inflated (if at all) during the Class Period; (3) the amount by which Just for Feet common stock
-5-
)
was allegedly artificially inflated (if at all) during the Class Period; (4) the effect of various
- market forces influencing the trading price of Just for Feet common stock at various times during
the Class Period; (5) the extent to which external factors, such as general market and industry
conditions, influenced the trading price of Just for Feet common stock at various times during the
Class Period; (6) the extent to which specific, non-fraud factors influenced the trading price of
Just for Feet common stock at various times during the Class Period; (7) the extent to which the
various matters that Representative Plaintiffs alleged were materially false or misleading
influenced (if at all) the trading price of Just for Feet common stock at various times during the
Class Period; and (8) the extent to which the various allegedly adverse material facts that
Representative Plaintiffs alleged were omitted influenced (if at all) the trading price of Just for
Feet common stock at various times during the Class Period.
The Representative Plaintiffs believe that the proposed Settlement is a very good
recovery and is in the best interests of the Class. There are significant risks associated with
continuing to litigate and proceeding to trial. For example, although the Representative Plaintiffs
and their counsel believe that the evidence supports their claims against the JFF Defendants in
the Litigation, they also believe that the potential damages on those claims greatly exceeds the
JFF Defendants' ability to satisfy an eventual judgment and the available insurance coverage.
The Representative Plaintiffs and their counsel have also taken into consideration the fact that
the costs of the JFF Defendants' defense of this action are paid out of the available insurance
coverage, thus reducing (and perhaps exhausting) the coverage that remains available to pay an
eventual judgment. Thus, absent the JFF Settlement, the Class could well win the case at trial but
be able to collect little, if anything, from the JFF Defendants. In addition, the Class faced the
possibility that many of the claims in this case could have been disposed of pursuant to JFF
Defendants' motions for summary judgment before trial. In addition, there was a risk that the
Class would not have prevailed on their claims against the Defendants even if those claims
eventually went to trial, in which case the Class would receive nothing. Additionally, the
potential proceeds of the insurance coverage were subject to possible substantial reductions due
to the existence of a number of other pending state and federal cases pending against the JFF -
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,)
Defendants, including a class action brought on behalf of the holders of $200 million of Just For
- Feet Notes issued in April, 1999, and several individual suits, and due to the assertion of claims
by the bankruptcy trustee of Just For Feet. Further, had the case proceeded to trial and assuming
the Representative Plaintiffs had been able to establish liability of the Defendants, the amount of
damages recoverable by Class Members would have been subject to rigorous attack by the
Defendants. Recoverable damages are limited to losses caused by conduct actionable under
applicable securities laws and, had the Litigation gone to trial, Defendants would have tried to
prove that all or most of the losses (if any) of Class Members were caused by non-actionable
market, industry or other general economic factors. The proposed Settlement eliminates these
risks and provides an immediate recovery for Class members.
Representative Plaintiffs' Counsel have not received any payment for their services in
prosecuting this Litigation on behalf of the Representative Plaintiffs and the members of the
Class, nor have they been reimbursed for out-of-pocket expenses. If the JFF Settlement and/or
the Deloitte Settlement are approved by the Court, counsel for the Representative Plaintiffs will
apply to the Court for attorneys' fees of not more than 25% of the Settlement Funds.
Representative Plaintiffs and their Counsel also plan to seek reimbursement from the Settlement
Funds of litigation expenses and such other sums as are awarded to the Representative Plaintiffs
directly related to their service on the Lead Plaintiffs' Committee, together not to exceed
$1,700,000. If the amount requested by counsel is approved by the Court, the average cost per
share would be approximately $0.37.
This Notice is not intended to be, and should not be construed as, an expression of any
opinion by the Court with respect to the truth of the allegations in the Litigation or the merits of
the claims or defenses asserted. This Notice is to advise you of the Litigation, the certification of
the Class, and the proposed Settlement, and of your rights in connection therewith.
A settlement hearing will be held on Febuary 21, 2002, at 2:30 P.M., before the
Honorable H. Dean Buttrarn, United States District Judge, at the United States Courthouse,
Northern District of Alabama, 1729 Fifth Avenue, Binningharn, Alabama (the "Settlement
Hearing"). The purpose of the Settlement Hearing will be to determine: (1) whether the
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)
Settlement should be approved as fair, just, reasonable and; (2) whether the proposed plan to
distribute the settlement proceeds (the "Plan of Allocation") is fair, just, reasonable, and
adequate; (3) whether the application by plaintiffs' counsel for an award of attorneys' fees and
expenses should be approved; and (4) whether the Litigation should be dismissed with prejudice.
The Court may adjourn or continue the Settlement Hearing without further notice to the Class.
For further information regarding the Settlement, you may contact M. Clay Ragsdale,
Ragsdale & Wheeler, LLC, 1929 3 rd Ave. N. Farley Building, Suite 550, Birmingham, Alabama
35203, (877) 704-1487 or J. Michael Redilcer, Haskell Slaughter Young & Rediker, LLC, 1200
AmSouth/Harbert Building, 1901 - 6th Avenue North, Birmingham, AL 35203, (205) 251-1000.
CERTAIN DEFINITIONS
As used in this Notice, the following terms have the meanings specified below:
1. "Class" means the class certified by the Court by Order dated July 3, 2001,
consisting of all persons and entities who purchased common stock of Just For Feet between
May 5, 1997 and November 1, 1999, inclusive, and who have suffered a loss. Excluded from the
Class are (1) the Defendants, (2) members of the families of the Defendants, (3) the subsidiaries
or affiliates of any Defendant, (4) any person or entity who is (or was during the Class Period) a
shareholder, partner, officer, director, employee or controlling person of any Defendant, (5) any
entity in which any Defendant has a controlling interest, and (6) the legal representatives, heirs,
successors, or assigns of any such excluded person.
2. "Class Members" means all members of the Class, whether acting collectively or
individually.
3. "Class Period" means the period commencing on May 5, 1997 through November
1, 1999, inclusive.
4. "Defendants" means the JFF Defendants and the Deloitte Defendants,
collectively.
5. "Deloitte Defendants" means Deloitte & Touche LLP, Steven H. Bany, and
Karen Baker.
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6. "JFF Defendants" means Harold Ruttenberg, Eric Tyra, Peter Berman, Cooper
Evans, Patrick Lloyd, Don-Allen Ruttenberg, Michael Lazarus, Helen Rockey, Scott C. Wynne,
Randall Haines, Adam Gilburne, Robert Wabler, Alex Bond, and Edward Croft.
7. "Person" means an individual, corporation, 'limited liability corporation,
professional corporation, limited liability partnership, partnership, limited partnership,
association, joint stock company, estate, legal representative, trust, unincorporated association,
government or any political subdivision or agency thereof, and any business or legal entity and
their spouses, heirs, predecessors, successors, representatives, or assignees.
8. "Related Parties" as to the IFF Defendants means each of their present or former
agents, attorneys, accountants, financial advisors, commercial bank lenders, investment bankers,
underwriters, insurers, representatives, affiliates, associates, parents, subsidiaries, general and
limited partners and partnerships, heirs, executors, administrators, successors and assigns, except
that none of the Deloitte Defendants shall be considered Related Parties of any of the JFF
Defendants. "Related Parties" as to the Deloifte Defendants means Deloitte & Touche USA LLP
(formerly known as Deloitte & Touche LLP, Deloitte & Touche, and Deloitte Haskins & Sells),
Deloitte & Touche LLP (formerly known as D&T Partners LLP), Deloitte Consulting Holding
LLC, and Deloitte Consulting L.P., successor to Deloitte Consulting LLC (formerly known as
Deloitte & Touche Consulting Group LLC), and their past, present and future parent companies,
subsidiaries, divisions, related or affiliated entities, predecessors (including without limitation
Touche Ross & Co.) and successors, their respective present and former directors, officers,
partners (including Steven H. Barry), principals, members, stockholders, owners, employees
(including Karen Baker), agents, servants, subrogees, insurers and attorneys, and their respective
representatives, heirs, executors, spouses, personal representatives, administrators, successors,
transferees and assigns.
9. "Released Persons" means each and all of the Defendants, all other former
officers, directors, and employees of Just For Feet who are covered by the Insurance Policies,
and their Related Parties.
10. "Representative Plaintiffs" means State of Wisconsin Investment Board, Kenneth
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Bush, John Michael, and Edward Eubank, whom the Court has appointed as co-lead plaintiffs on
behalf of the Class.
11. "Settling Parties" means Representative Plaintiffs and Defendants.
12. "State Court Actions" means, collectively, the following five actions which are
also being settled with respect to the JFF Defendants as part of the JFF Settlement: William D.
Cannon v. Harold Ruttenberg, et al., Case No. CV-2000-079-G, pending in the Circuit Court for
Marshall County, Alabama; John A. Gasser, et al. v. Harold Ruttenberg,, et al., Civil Action No.
CV 2000-253, pending in the Circuit Court for Shelby County, Alabama; Abraham Goodhart v.
Harold Ruttenberg, Civil Action No. CV 0002420, pending in the Circuit Court for Jefferson
County, Alabama; Robert E. Oyster v. Harold Ruttenberg, et al., Civil Action No. CV 0004663,
•pending in the Circuit Court for Jefferson County, Alabama; and Tara Capital Partners 1, L.P., et
al. v. Deloitte & Touche, LLP, et al., Cause No. 0001732, pending in the District Court of Dallas
County, Texas, 95th Judicial District.
CLAIMS OF THE REPRESENTATIVE PLAINTIFFSAND BENEFITS OF SETTLEMENT
Representative Plaintiffs believe that the claims asserted in the Litigation have merit.
They also believe that the proposed Settlement will provide a significant monetary benefit to
Class Members. In addition, Representative Plaintiffs and their counsel recognize and
acknowledge the length of continued proceedings necessary to prosecute the Litigation against
the Defendants through trial and appeals and the drain that such continued litigation will have on
the insurance policies available to cover any eventual judgment against the JFF Defendants.
Representative Plaintiffs and their counsel also have taken into account the uncertain outcome
and the risk of any litigation, especially in complex actions such as the Litigation, as well as the
difficulties and delays inherent in such litigation. Representative Plaintiffs and their counsel also
are mindful of the inherent problems of proof under, and possible defenses to, the violations
asserted in the Litigation. Based on their evaluation, Representative Plaintiffs and their counsel
have determined that the Settlement is in the best interests of the Representative Plaintiffs and
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'
the Class.
DEFENDANTS' DENIALS OF 'WRONGDOING AND LIABILITY
The Defendants have denied and continue to deny each and all of the claims and
contentions alleged by the Representative Plaintiffs M the Litigation. The Defendants expressly
have denied and continue to deny all charges of wrongdoing or liability against them arising out
of any of the conduct, statements, acts or omissions alleged, or that could have been alleged, in
the Litigation. The Defendants also have denied and continue to deny, inter alia, the allegations
that the Representative Plaintiffs or the Class have suffered damage or that the Representative
Plaintiffs or the Class were harmed by the conduct alleged in the Litigation. -
Nonetheless, the Defendants have concluded that further conduct of the Litigation would
be protracted and expensive, and that it is desirable that the Litigation against them be fully and
finally settled in the manner and upon the tenns and conditions set forth in the Stipulation. The
Defendants also have taken into account the uncertainty and risks inherent in any litigation,
especially in complex cases like the Litigation. The Defendants have, therefore, determined that
it is desirable and beneficial to them that the Litigation against them be settled in the manner and
upon the terms and conditions set forth in the Stipulations.
THE RIGHTS OF CLASS MEMBERS
If you are a Class Member, you may receive the benefit of and you will be bound by the
terms of the proposed Settlement described in this Notice, upon approval of the Settlement by the
Court.
If you are a Class Member, you have the following options:
I. You may file a Proof of Claim as described below. If you choose this option, you
will remain a Class Member, you will share in the proceeds of the proposed Settlement if your
claim is timely and valid and if the proposed Settlement is finally approved by the Court, and
you will be bound by the Judgment(s) and releases described below.
2. You may elect to be excluded from the Class. If you exclude yourself from the
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Class, you will not participate in the settlement, and you will not receive the benefits of the
- settlement. You will not be bound by the judgments to be entered in the Litigation dismissing
the Defendants, and none of your claims will be released in connection with the Settlement. If
you want to be excluded from the Class, you must mail or deliver, such that it is received on or
before February 6, 2002, a written request for exclusion to each of the following:
Just For Feet Securities LitigationThe Garden City GroupP.O. Box 8835Melville, New York 11747-8835
M. Clay Ragsdale, Esq.RAGSDALE & WHEELER, LLCThe Farley Building Suite 550Birmingham, Alabama 35203
J. Michael Rediker, Esq.HASKELL SLAUGHTER YOUNG & REDIKER, LLC1200 AmSouth/Harbert Building1901 - 6th Avenue NorthBirmingham, AL 35203
John B. Missing, Esq.BROBECK, PHLEGER & HARRISON, LLP1333 H. Street N.W., Suite 800Washington, D.C. 20005
-Michael J. Malone, Esq.KING & SPALDING1185 Avenue of the AmericasNew York, NY 10036-4003
Lee H. Zell, Esq.BALCH & BINGHAM, LLP
- 710 Sixth Avenue NorthBirmingham, AL 35203-2015
This request for exclusion must be signed by you and must contain the following information:
(a) your name and address, and the name and address of the record holder of your
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)
Just For Feet stock if different from your own;
(b) the number of shares of Just For Feet stock you bought or otherwise acquired
from May 5, 1997 through and including November 1, 1999, the date of each purchase or
acquisition, and the purchase or acquisition price; and
(c) the number of shares of the foregoing Just For Feet stock that you sold, the date of
each sale, and the sale price.
In your exclusion request, please include the reference Just For Feet Securities
Litigation.
3. If you have not requested to be excluded from the Class, you may object to the
Settlement and/or the application of plaintiffs' counsel for an award of attorneys' fees and -
reimbursement of expenses in the manner set forth below. The filing of a Proof of Claim by a
Class Member does not preclude a Class Member from objecting to the Settlement. However, if
your objection is rejected you will be bound by the Settlement and the Judgment(s) (described
below) just as if you had not objected.
4. You may do nothing at all. If you choose this option, and if you have not
previously requested in writing to be excluded from the Class, you will not share in the proceeds
of the Settlement, but you will be bound by any and all determinations or judgments in the
Litigation in connection with the Settlement entered into or approved by the Court, whether
favorable or unfavorable to the Class including, without limitation, the Judgment(s) described
below, and you shall be deemed to have, and by operation of the Judgment(s) shall have fully
released all of the Released Claims (defined below) against the Released Persons.
If you are a Class Member, you may, but are not required to, enter an appearance through
counsel of your own choosing at your own expense. If you do not do so, you will be represented
by the law firms which have been appointed by the Court as co-lead counsel for the
Representative Plaintiffs and the Class.
TERMS OF THE PROPOSED SETTLEMENT
Settlements have been reached in the Litigation between the Representative Plaintiffs and
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)
the Defendants which are embodied in (1) a Stipulation of Settlement between the
- Representative Plaintiffs (on behalf of themselves and all Class member) and the JFF
Defendants, dated as of December 21, 2001 (the "JFF Stipulation"), and (2) a Sfipulation and
Agreement of Settlement between the Representative Plaintiffs (On behalf of themselves and all
Class member) and the Deloitte Defendants, dated as of December 21, 2001 (the "Deloitte
Stipulation"), both of which are on file with the Court (together, the "Stipulations"). The
settlements set forth in the Stipulations would resolve and extinguish all claims in the Litigation,
and would result in dismissal of the Litigation with prejudice. The Representative Plaintiffs and
their counsel, on the basis of, among other things, a thorough investigation of the facts and the
law relating to the acts, events, and conduct complained of and the subject matter of the
Litigation, have concluded that the proposed Settlement is fair to and in the best interests of the
Class.
The following description of the proposed Settlement of the Litigation is only a summary,
and reference is made to the text of the Stipulation, on file with the Court, for a full statement of
its provisions:
1. The JFF Settlement will result in the creation of a settlement fund consisting of
approximately $25,500,000 in cash plus any interest that may accrue thereon prior to distribution
(the "JFF Settlement Fund). An additional $10 million has been set aside in a reserve (the
"Reserve") for payment of certain defense costs, judgments, and other costs associated with
other litigation against certain of the JFF Defendants. To the extent there is any balance
remaining in the Reserve after payment of such costs, three-quarters (3/4) of such balance shall
be added to the JFF Settlement Fund. There can be no assurance that any of the Reserve will
remain for distribution to the JFF Settlement Fund.
2. The Deloitte Settlement will result in the creation of a settlement fund consisting
of $7,400,000 in cash plus any interest that may accrue thereon prior to distribution (the
"Deloitte Settlement Fund).
3. Upon approval of the Stipulation by the Court and entry of judgment(s) that
becomes final judgment(s) and upon satisfaction of the other conditions to the Settlement,
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described below, the IFF Settlement Fund and the Deloitte Settlement Funds (together, the
- "Settlement Funds") will be distributed as follows:
(a) To pay costs and expenses in connection with providing notice to the
members of the Class and administering the Settlement on behalf Of the Class;
(b) To pay Representative Plaintiffs and their aftomeys such fees, expenses
and costs, with interest thereon (the "Fee and Expense Award"), as are allowed by the Court;
(c) To pay the reasonable costs incurred in the preparation of any tax returns
required to be filed on behalf of the Settlement Funds as well as the taxes (and any interest and
penalties determined to be due thereon) owed by reason of the earnings of the Settlement Funds,
including all Taxes and Tax Expenses as defined in the Stipulations; and
(d) Subject to the approval by the Court of the Plan of Allocation described
below, the balance of the Settlement Funds (the "Net Settlement Fund"), shall be distributed to
Class Members who submit valid, timely Proof of Claim forms ("Authorized Claimants").
4. The proposed Plan of Allocation provides for distribution of the Net Settlement
Fund to Authorized Claimants as follows:
(a) Each Person claiming to be an Authorized Claimant shall be required to
submit a separate Proof of Claim and Release signed under penalty of perjury and supported by
such documents as specified in the Proof of Claim as are reasonably available to the Authorized
Claimant.
(b) All Proof of Claim forms must be postmarked or received by April 1,
2002, addressed as follows:
Just For Feet Securities LitigationThe Garden City GroupP.O. Box 8835Melville, New York 11747-8835
Unless otherwise ordered by the Court, any Class Member who fails to submit a properly
completed and signed Proof of Claim within such period, or such other period as may be ordered
by the Court, shall be forever barred from receiving any payments pursuant to the Stipulations,
but will in all other respects be subject to the provisions of the Stipulations and the final
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judgment(s) entered by the Court.•
(c) To the extent there are sufficient funds in the Net Settlement Fund, each
Authorized Claimant will receive an amount equal to the Authorized Claimant's claim, as
defined below. If, however, the amount in the Net Settlement Fund is not sufficient to permit
payment of the total claim of each Authorized Claimant, then each Authorized Claimant shall be
paid that percentage of the Net Settlement Fund that each Authorized Claimant's claim is of the
total of the claims of all Authorized Claimants.
(d) Each Class Member's claim shall be calculated as follows:
(i) Shares ofJust for Feet stock that were purchased prior to May 5, 1997 or
after November 1, 1999, shall not be included in any claim calculations.
(ii) For each share of Just for Feet stock purchased or sold during the Class
Period, the price inflation on the date of purchase or sale shall be deemed to be as follows:
Date Inflation per share
•From May 5, 1997 - March 20, 1998 $6.29
From March 23, 1998 - July 7, 1998 $7.50 + (([number of trading daysinto the period 1]/85)*$6.50)
From July 8, 1998 - October 19, 1998 $14.00 - (([number of trading daysinto the period1/73)*$4.00)
October 20, 1998 - January 21, 1999 $12.00
January 22, 1999 - May 24, 1999 $ 8.00
May 25, 1999- July 27, 1999 $ 4.00
July 28, 1999 - September 20, 1999 $ 3.00
September 21, 1999- October 27, 1999 $ 1.50
October 28, 1999 - November 1, 1999 $ 1.05
For purposes of this calculation, March 23, 1998 is the first trading day into the period.2
For purposes of this calculation, July 8, 1998 is the first trading day into the period.
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)
(iii) Each share ofJust for Feet stock that was purchased by a Class Member
during the Class Period and still held by such Class Member at the end of the Class Period (i.e.,
the close of trading on November 1, 1999) shall be treated as if sold for $O, and the Class
Member shall be deemed to have suffered a loss on that share equal to the amount of inflation
paid on the date of purchase, as determined in subsection (ii) above.
(iv) For each share ofJust for Feet stock that was purchased by a Class
Member during the Class Period and then sold by such Class Member during the Class Period,
the profit/loss associated with that share shall equal the amount of inflation paid on the date of
purchase minus the amount of inflation received on the date of sale, both as determined in
subsection (ii) above. If the result is a positive number, the Class Member shall be deemed to
have suffered a loss on that share. If the result is a negative number, the Class Member shall be
deemed to have realized a profit on that share.
(v) The date of purchase or sale is the "contract" or "trade" date as
distinguished from the "settlement" date.
(vi) For Class Members who made multiple purchases or multiple sales during
the Class Period, the first-in, first-out ("FIFO") method will be applied to both purchases and
sales for purposes of calculating a claim. Under the FIFO method, sales during the Class Period
will be matched in chronological order, first against shares held at the beginning of the Class
Period and then against shares purchased during the Class Period. Shares purchased prior to the
beginning of the Class Period will not be used in the calculation of a claim.
(vii) All profits shall be subtracted from all losses to determine the net claim of
each Class Member. Only if a Class Member had a net loss, after all profits from transactions in
Just for Feet common stock during the Class Period are subtracted from all losses, will such
Class Member be eligible to receive a distribution from the Net Settlement Fund.
(viii) The Court has reserved jurisdiction to allow, disallow or adjust the claim
of any Class Member on equitable grounds.
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5. Payment pursuant to the Plan of Allocation set forth above shall be conclusive
against all Authorized Claimants, No Person shall have any claim against the Representative
Plaintiffs or their counsel or any claims administrator or other agent designated by the
Representative Plaintiffs or their counsel, or against Defendants, Defendants' counsel or
Defendants' Insurers, based on distributions made substantially in accordance with the
Stipulations and the Settlement contained therein, the Plan of Allocation, or further orders of the
Court. All Class Members who fail to complete and file a valid and timely Proof of Claim and
Release shall be barred from participating in distributions from the Settlement Funds (unless
otherwise ordered by the Court), but otherwise shall be bound by all of the terms of the
Stipulations, including the terms of any judgment(s) entered and the releases given. .
6. To share in the Settlement Funds, you must submit a valid Proof of Claim and
Release on the form enclosed with this Notice no later than April 1, 2002, to the address set forth
in the attached Proof of Claim form.
7. The Settlement Funds, less any deductions for fees and costs allowed by the
Court, taxes due and other deductions pursuant to the temis of the Stipulations, shall be
maintained by the Escrow Agent for the benefit of the Class, as provided in the Stipulations.
CONDITIONS FOR SETTLEMENT
The Settlement is conditioned upon the occurrence of certain events described in the
Stipulations. Those events include, among other things: (1) entry of the Judgment(s) by the
Court, as provided for in the Stipulations; and (2) expiration of the time to appeal from or alter or
amend the Judgment(s). The JFF Settlement is also conditioned upon the dismissal of the State
Court Actions with prejudice. If, for any reason, any one of the conditions described in the
Stipulations is not met, the Stipulation(s) might be terminated and, if terminated, will become
null and void, and the parties to the Stipulation(s) will be restored to their respective positions
prior to the respective Settlements.
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-
)DISMISSAL AND RELEASES
1. If the Settlement is approved by the Court, the Court will enter judgments which
in substance will have the following effects. First, all Class Member claims against Defendants
and the Related Parties relating to the Litigation or Just For Feet will be released and the
Litigation will be dismissed with prejudice. Second, Defendants will be precluded from suing
the Representative Plaintiffs or their lawyers in connection with the Litigation. Third,
constraints will be placed upon the ability of Defendants to sue each other. Fourth, Defendants
will be given certain protections against lawsuits by others in connection with Just For Feet,
resulting in the possibility of a reduction in the recovery by any Class Member who sues anyone
else who then tries to sue a Defendant. (This is a meant to be only a general description of the
dismissal, release, and bar order provisions of the Settlement, and anyone interested in more
detail is invited to study the Stipulations themselves.)
2. The Court shall retain jurisdiction over implementation of the Settlement,
disposition of the Settlement Funds, hearing and determining Representative Plaintiffs' counsel's
application(s) for attorneys' fees, costs, interest and expenses (including fees and costs of
experts), and enforcing and administering the Stipulations, including any releases executed in
connection therewith.
3. The judgments will provide that all Class Members who do not validly and timely
request to be excluded from the Class shall be deemed to have released and forever discharged
all released claims (to the extent Members of the Class have such claims) against all Defendants.
NOTICE TO BANKS, BROKERS, AND OTHER NOMINEES
Banks, brokerage firms, institutions, and other Persons who are nominees who purchased
the common stock of Just for Feet for the beneficial interest of other Persons as of any day from
May 5, 1997 through and including November 1, 1999, are requested within ten (10) days of
receipt of the Notice, to (1) provide the Claims Administrator with the names and addresses of
such beneficial purchasers, or to (2) forward a copy of this Notice to each such beneficial
purchaser and provide the Claims Administrator with written confirmation that this Notice has
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been so forwarded. Representative Plaintiffs' Counsel offer to reimburse your reasonable costs
and expenses of complying with this provision upon submission of appropriate documentation.
Additional postage pre-paid copies of the Notice may be obtained from the Claims Administrator
for forwarding to such beneficial owners. All such correspondence to the Claims Administrator
should be addressed as follows:
Just For Feet Securities LitigationThe Garden City GroupP.O Box 8835Melville, New York 11747-8835Toll-free line: 1-800-809-8639
4-
ATTORNEYS' FEES, COSTS AND/OR EXPENSES OFPLAINTIFFS' COMMITTEE AND ITS ATTORNEYS
To date, plaintiffs' counsel have not received any payment for their services in
conducting this Litigation on behalf of the Representative Plaintiffs and the members of the
Class, nor have counsel been reimbursed for their out-of-pocket expenses. The Representative
Plaintiffs and their counsel in the Litigation will apply to the Court at the conclusion of the
Hearing described below, for an award a attorneys' fees of not to exceed 25% of the Settlement
Funds. The Representative Plaintiffs and their counsel will also apply to the Court for
reimbursement of litigation expenses which were advanced in connection with the Litigation and
such other sums as are allowed to the Representative Plaintiffs directly relating to their
representation of the Class, together not to exceed $1,700,000. Such sums as may be granted by
the Court will be paid from the Settlement Funds. Class Members are not personally liable for
any fees or expenses awarded by the Court.
The fee requested by plaintiffs' counsel will compensate them for their efforts in
achieving the Settlement Funds for the benefit of the class, and for their risk in undertaking this
case on a contingent basis. If approved by the Court, the fee requested would be within the range •
of fees awarded to plaintiffs' counsel under similar circumstances in litigation of this type.
-20-
THE HEARING ON THE PROPOSED SETTLEMENT
A hearing (the "Hearing") will be held before the Honorable II. Dean Buttram at the
United States Courthouse, 1729 Fifth Avenue, Birmingham, Alabama, at 2:30 P.M., on February
21, 2002, for the purpose of determining: (1) whether the proposed Settlement is fair, reasonable
and adequate and whether it should be approved by the Court; (2) whether the proposed Plan of
Allocation is fair, just, reasonable and adequate; (3) .whether applications of Representative
Plaintiffs' Counsel for an award of attorneys' fees, costs and expenses should be approved; and
(4) whether Judgment(s) should be entered dismissing the Litigation with prejudice. The
Hearing may be adjourned from time to time by the Court at the Hearing or any adjourned
session thereof without further notice.
Any member of the Class who has not requested exclusion may appear at the Hearing to
show cause why the proposed Settlement should not be approved, or the Litigation should not be
dismissed with prejudice, and to present any opposition to the Plan of Allocation or the
application of Representative Plaintiffs or their counsel for attorneys' fees, costs and expenses;
provided, however, that no such Person shall be heard, unless his or her objection or opposition
is made in writing and is filed, together with copies of all other papers and briefs by him or her
with the Court no later than February 11, 2002, and received (by fax or otherwise) on or before
February 12, 2002, by each of the following:
M. Clay Ragsdale, Esq.RAGSDALE & WHEELER, LLC550 Farley Building1929 Third Avenue NorthBirmingham, AL 35203Telephone: (205) 251-4775Facsimile: (205) 251-4777
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,)
J. Michael Rediker, Esq.HASKELL SLAUGHTER YOUNG & REDUCER, L.L.C.1200 AmSouth/Hatbert Building1901 Sixth Avenue NorthBirmingham, ALTelephone: (205) 251-1000Facsimile: (205) 324-1133
Luther M. Dorr, Jr., Esq.MAYNARD, COOPER & GALE, P.C.2400 AmSouth/Harbert Plaza1901 Sixth Avenue NorthBirmingham, AL 35203Telephone: (205) 254-1000Facsimile: (205) 254-1999
Crawford S. McGivaren, Jr., Esq.CABANISS, JOHNSTON, GARDNER, DUMAS & O'NEALPark Place Tower, Suite 7002001 Park Place NorthP.O. Box 830612Birmingham, AL 35283-0612Telephone: (205) 716-5200Facsimile: (205) 716-5389
William J. Baxley, Esq.BAXLEY, DILLARD, DAUPHIN & MCKNIGHT2008 Third Avenue SouthBirmingham, AL 35233Telephone: (205)271-1100Facsimile: (205) 271-1108
James W. Gewin, Esq.BRADLEY ARANT ROSE & WHITE, LLP2001 Park Place, Suite 1400Birmingham, AL 35203-2736Telephone: (205) 521-8352Facsimile: (205) 521-8713
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W. Stancil Starnes, Esq.STARNES & ATCHISON, LLP100 Brookwood Place, Seventh FloorBirmingham, AL 35209Telephone: (205) 868-6000Facsimile: (205) 868-6099
Lee IL Zell, Esq. -BALCH & BINGHAM, LLP710 Sixth Avenue NorthBirmingham, AL 35203-2015Telephone: (205) 251-8100Facsimile: (205) 226-8798
Unless otherwise ordered by the Court, any member of the Class who does not make his or her
objection or opposition in the manner provided shall be deemed to have waived all objections
and opposition to the fairness, reasonableness and adequacy of the proposed Settlement, the Plan
of Allocation, or the request of Representative Plaintiffs or their counsel for attorneys' fees, costs
and expenses.
EXAMINATION OF PAPERS AND INQUIRIES
This Notice contains only a summary of the Litigation and the terms of the proposed
Settlement. For a more detailed statement of the matters involved in the Litigation, reference is
made to the pleadings, to the Stipulations, and to other papers filed in this action which may be
inspected at the Office of the Clerk, United States District Court, Northern District of Alabama,
Southern Division, 1729 Fifth Avenue, Birmingham, Alabama, during business hours of each
business day.
DO NOT CONTACT THE COURT REGARDING THIS NOTICE.
If you have any questions about the Settlement or the matters contained in this Notice,
you may contact any of the following representatives for the plaintiffs:
-23-
M. Clay Ragsdale, Esq.RAGSDALE 8.r. WHEELER, LLC550 Farley Building1929 Third Avenue NorthBirmingham, AL 35203(205) 251-4775
J. Michael Rediker, Esq.Thomas L. Krebs, Esq.HASKELL SLAUGHTER YOUNG & REDIKER, L.L.C.1200 AmSouth/Harbert Building1901 Sixth Avenue NorthBirmingham, AL 35203(205) 251-1000
DATED: BY ORDER OF THE UNITED STATESDISTRICT COURT FOR THE NORTHERNDISTRICT OF ALABAMA, SOUTHERNDIVISION
-24-
,„
" ) ,
•
UNITED STATES DISTRICT COURTNORTHERN DISTRICT OF ALABAMA
SOUTHERN DIVISION
STATE OF WISCONSIN INVESTMENT)BOARD, KENNETH P. BUSH, EDWARD E.)EUBANK, and JOHN MICHAEL, on behalf of)themselves and all others similarly situated, )
)Plaintiffs, )
vs. )) CASE NUMBER
HAROLD RU1TENBERG, ERIC L. TYRA, )PETER BERMAN, COOPER EVANS, ) CV 99-BU-3097-SPATRICK LLOYD, DON-ALLEN )RUTTENBERG, MICHAEL LAZA.RUS, )HELEN ROCKEY, SCOTT C. WYNNE, ) -RANDALL L HAINES, ADAM )GILBURNE, DEL0111 E & TOUCHE LLP, ) -
STEVEN H. BARRY, and KAREN BAKER, )) .
Defendants. ) )
))
GEORGE W. MASSEY, on behalf of himself )and all others similarly situated, )
)Plaintiffs, )
) CASE NUMBERvs. )
) CV 99-BU-3 129-5HAROLD RUTTENBERG, ERIC L. TYRA, )PETER BERMAN, COOPER EVANS, HELEN)M. ROCICEY and PATRICK LLOYD, )
)Defendants. )
)
PROOF OF CLAIM
(EXHIBIT A-2 TO STIPULATION OF SETTLEMENT)
TO: ALL PERSONS WHO PURCHASED THE COMMON STOCK OF JUST FOR FEET, INC.
("JUST FOR FEET" OR THE "COMPANY") DURING THE PERIOD MAY 5, 1997
THROUGH NOVEMBER I, 1999, INCLUSIVE.
If you purchased Just for Feet common stock during the period described above, have not f5
requested exclusion from the Class and are not a Defendant in this Litigation, or a member of the ,r\i
immediate family of any of the Defendants, an entity in which any of the Defendants has a 0
Pit_•
controlling interest, or the legal representatives, heirs, successors or assigns of any such excluded
party, you should read the accompanying Notice of Pendency of Class Action, Hearing on Proposed
Settlement and Attorneys' Fee Petition and Right to Share in Settlement Fund, as well as the
accompanying Notice of Proposed Settlement of Class Action (together, the "Notices") and complete
this Proof of Claim Form.
IN ORDER TO BE ELIGIBLE TO PARTICIPATE IN THE SETTLEMENTS DESCRIBED
IN THE ACCOMPANYING NOTICES, YOU MUST MAIL YOUR COMPLETED PROOF OF
CLAIM TO THE CLAIMS ADMINISTRATOR POSTMARKED ON OR BEFORE APRIL 1,
2002.
I. GENERAL INSTRUCTIONS
1. To recover as a member of the class based on your claims in the above-captioned
actions (the "Litigation"), you must complete and, on page 9 hereof, sign this Proof of Claim. If you
fail to file a properly addressed (as set forth in paragraph 3 below) Proof of Claim, your claim may
be rejected and you may be precluded from any recovery from the Settlement Fund(s) created in
connection with the proposed settlements of the Litigation.
2. Submission of this Proof of Claim, however, does not assure that you will share in
the proceeds of settlement in the Litigation.
3. YOU MUST MAIL YOUR COMPLETED AND SIGNED PROOF OF CLAIM
POSTMARKED ON OR BEFORE APRIL 1, 2002, ADDRESSED AS FOLLOWS:
Just For Feet Securities LitigationThe Garden City Group
P. 0. Box 8835Melville, New York 11747-8835
4. If you are NOT a member of the Class (as defined in the Notices), DO NOT submit
a Proof of Claim.
5. If you are a member of the Class and you do not timely request exclusion in
connection with the proposed settlement, you are bound by the terms of any judgment entered in the
Litigation, including the releases provided therein, WHETHER OR NOT YOU SUBMIT A PROOF
-2-
)
_ OF CLAIM.
II. CERTAIN DEFINITIONS
1. "Just for Feet" means Just for Feet Inc.
2. "Defendants" means Harold Ruttenberg, Eric Tyra, Peter Berman, Cooper Evans,
Patrick Lloyd, Don-Allen Ruttenber& Michael Lazarus, Helen Rockey, Scott C. Wynne, Randall
Haines, Adam Gilbume, Robert Wabler, Alex Bond, Edward Croft, Deloitte & Touche LLP, Steven
H. Barry, and Karen Baker.
III. CLAIMANT IDENTIFICATION
1. If you purchased Just for Feet common stock and held the certificate(s) in your name,
you are the beneficial purchaser as well as the record purchaser. If, however, you purchased Just for
Feet common stock and the certificate(s) were registered in the name of a third party, such as a
nominee or brokerage firm, you are the beneficial purchaser and the third party is the purchaser of
record.
2. Use Part I of this form entitled "Claimant Identification" to identify each purchaser
of record ("nominee"), if different from the beneficial purchaser ofJust for Feet stock which forms
the basis of this claim. THIS CLAIM MUST BE FILED BY THE ACTUAL BENEFICIAL
PURCHASER OR PURCHASERS, OR THE LEGAL REPRESENTATIVE OF SUCH •
PURCHASER OR PURCHASERS, OF THE JUST FOR FEET STOCK UPON WHICH THIS
CLAIM IS BASED.
3. All joint purchasers must sign this claim. Executors, administrators, guardians,
conservators and trustees must complete and sign this claim on behalf of persons represented by
them and their authority must accompany this claim and their titles or capacities must be stated. The
Social Security (or taxpayer identification) number and telephone number of the beneficial owner
may be used in verifying the claim. Failure to provide the foregoing information could delay
verification of your claim or result in rejection of the claim.
-3-
_ IV. CLAIM FORM
1. Use Part II of this form entitled "Schedule of Transactions in Just for Feet Common
Stock" to supply all required details of your transaction(s) in Just for Feet stock. If you need more
space or additional schedules, attach separate sheets giving all of the required information in
substantially the same form. Sign and print or type your name on each additional sheet.
2. On the schedules, provide all of the requested information with respect to all of your
purchases or acquisitions and all of your sales of Just for Feet which took place at any time
beginning May 5, 1997 through and including November 1, 1999 (the "Class Period"), whether such
transactions resulted in a profit or a loss. Failure to report all such transactions may result in the
rejection of your claim.
3. List each transaction in the Class Period separately and in chronological order, by
trade date, beginning with the earliest. You must accurately provide the month, day and year of each
transaction you list.
4. The date of covering a "short sale" is deemed to be the date of purchase of Just for
Feet stock. The date of a "short sale" is deemed to be the date of sale of.Just for Feet stock.
5. Broker confirmations or other documentation of your transactions in Just for Feet
stock should be attached to your claim. Failure to provide this documentation could delay
verification of your claim or result in rejection of your claim.
-4-
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF ALABAMA
In re State of Wisconsin Investment Board et al. v. Harold Ruttenberg et aL
Master File Nos.
CV 99-13U-3097-Sand
CV 99-BU-3129-S
PROOF OF CLAIM
Must be Postmarked No Later Than:April 1, 2002
Please Type or Print
PART I: CLAIMANT IDENTIFICATION
Beneficial Owner's Name (First, Middle, Last)
Street Address
City State Zip Code
Foreign Province Foreign Country
IndividualSocial Security Number orTaxpayer Identification Number Corporation/Other
(wniir) Area Code Telephone Number
(Imme) Area Code Telephone Number
Record Owner's Name (if different from beneficial owner listed above)
-5-
) )
PART II: SCHEDULE OF TRANSACTIONS IN JUST FOR FEET COMMON •STOCK
A. Number of shares of Just for Feet common stock held at the opening of trading onMay 5, 1997 :
B. Purchases or Acquisitions (May 5, 1997 through November 1, 1999, inclusive) ofJust for Feet common stock:
Trade Date(s) Number of Shares Purchase Price Per Aggregate CostMonth/Day/Year Purchased or Share (including
Acquired commissions, taxes,and fees)
1. $
2.
3. _ $
4.
IMPORTANT: Identify by number listed above all purchases in which you covered a"short sale":
C. Sales (May 5, 1997 through November 1, 1999, inclusive) of Just for Feetcommon stock:
Trade Date(s) Number of Shares Sales Price Per Share Net Proceeds (afterMonth/Day/Year Sold commissions, taxes,
and fees)
1.
2.
3.
4.
D. Number of shares ofJust for Feet common stock held at close of trading onNovember 1, 1999:
If you require additional space, attach extra schedules in the same format as above. Sign and
print your name on each additional page.
YOU MUST READ AND SIGN THE DECLARATION ON PAGE 9.
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,
PART III: SUBMISSION TO JURISDICTION OF COURT ANDACKNOWLEDGMENTS
I submit this Proof of Claim under the terms of the stipulations of settlement described in
the Notices. I also submit to the jurisdiction of the United States District Court for the Northern
District of Alabama, with respect to my claim as a Class Member and for purposes of enforcing
the releases set forth in the stipulations of settlement. I further acknowledge that I am bound by
and subject to the terms of any judgment that may be entered in the Litigation, including releases
of claims. I agree to furnish additional information to the Representative Plaintiffs' Counsel or
the Claims Administrator to support this claim if required to do so. I have not submitted any
other claim covering the same purchases or sales of Just for Feet common stock during the Class
Period and know of no other person having done so on my behalf.
PART IV: SUBSTITUTE FORM W-9
A. Request for Taxpayer Identification Number and Certification:
Enter name and taxpayer identification number (TIN) below for theBeneficial Owner(s). For most individuals, your TIN is yourSocial Security Number (SSN). For sole proprietors, you mustshow your individual name, but you may also enter your businessor "doing business as" name. You may enter either your SSN oryour Employer Identification Number (EIN). For other entities,your TIN is your EIN. The Internal Revenue Service requires suchtaxpayer identification number. If you fail to provide thisinformation, your claim may be rejected.
Name
Social Security Number (for individuals) or
Employer Identification Number (for estates,trust, corporations, etc.)
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•
)
B. For Payees Exempt from Backup Withholding:
If you are exempt from backup withholding, enter your correct TIN above and write
"exempt" on the following line:
C. Certification:
UNDER THE PENALTY OF PERJURY, I (WE) CERTIFY THAT:
1. The number shown on this form is my (our) correct TIN; and
2. I am (we are) NOT subject to backup withholding under the provisions of
Section 3406(a)(1)(C) of the Internal Revenue Code, because (a) I am (we are) exempt
from backup withholding; or (b) I (we) have not been notified by the Internal Revenue
Service that I am (we are) subject to backup withholding as a result of a failure to report .
all interest or dividends; or (c) the Internal Revenue Service has notified me (us) that I am
(we are) no longer subject to backup withholding.
NOTE: If you have been notified by the Internal Revenue Service that you are subject tobackup withholding, you must cross out the language that you are not subject tobackup withholding in the above certification.
SEE ENCLOSED FORM W-9 INSTRUCTIONS
The Internal Revenue Service does not require your consent to any provision of this document
other than the certification required to avoid backup withholding.
-8-
PART V: DECLARATION
I (we) hereby declare under penalty of perjury under the laws of the United States of
America that all of the information supplied by the undersigned on the above form is true, correct
and complete.
Executed this day of , (Month / Year) (City)
(State / Country)
(Sign your name here)
(Type or print your name here)
(Capacity of person(s) signing, e.g.,Beneficial Purchaser, Executor orAdministrator)
ACCURATE CLAIMS PROCESSING TAKES ASIGNIFICANT AMOUNT OF TIME.
THANK YOU FOR YOUR PATIENCE.
Reminder Checklist:
I. Please sign the above declaration.
2. Remember to attach supporting documentation, if available.
3. Do not send original or copies of stock certificates.
4. Keep a copy of your claim form for your records.
5. If you desire an acknowledgment of receipt of your claim form, please send itCertified Mail, Return Receipt Requested.
6. If you move, please send us your new address.
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UNITED STATES DISTRICT COURTNORTHERN DISTRICT OF ALABAMA
SOUTHERN DIVISION
STATE OF WISCONSIN INVESTMENT)BOARD, KENNETH P. BUSH, EDWARD E.)EUBANK, and JOHN MICHAEL, on behalf of ),themselves and all others similarly situated
)Plaintiffs, )
vs. ) CASE NUMBER)
HAROLD RUTIENBERG, ERIC L. TYRA, ), CV 99-BU-3097-S
PETER BERMAN, COOPER EVANS, )) CLASS ACTION -
PATRICK LLOYD, DON-ALLEN)
RUTTENBERG, MICHAEL LAZARUS, )HELEN ROCKEY, sayrr C. WYNNE, )RANDALL L. HAINES, ADAM )GILBURNE, DELOITTE & TOUCHE LLP, ) •
STEVEN H. BARRY, and KAREN BAKER' ))
)Defendants. )
)))
GEORGE W. MASSEY, on behalf of himself )and all others similarly situated, ) CASE NUMBER
)Plaintiffs, ) CV 99-BU-3129-S
)vs. ) CLASS ACTION
)HAROLD RUTTENBERG, ERIC L. TYRA, )PETER BERMAN, COOPER EVANS, )HELEN M. ROCKEY and PATRICK LLOYD,)
)Defendants. )
)
SUMMARY NOTICE OF PENDENCY OF CLASS ACTION,PROPOSED SETTLEMENT AND SETTLEMENT HEARING
(EXHIBIT A-3 TO STIPULATION OF SETTLEMENT)
TO: ALL PERSONS WHO PURCHASED JUST FOR FEET INC. ("Just for Feet")COMMON STOCK DURING THE PERIOD MAY 5, 1997 THROUGH NOVEMBER1, 1999, INCLUSIVE:
)
YOU ARE HEREBY NOTIFIED that the United States District Court for the Northern
District of Alabama (the "Court") has determined that this lawsuit (the "Litigation") should
proceed as a class action on behalf of all persons and entities who purchased common stock of
Just for Feet between May 5, 1997 and November 1, 1999, inclusive and who have suffered a
loss (the "Class"). Excluded from the Class are (1) all of the defendants in the litigation
(collectively, the "Defendants'), (2) members of the families of the Defendants, (3) the
subsidiaries or affiliates of any Defendant, (4) any person or entity who is (or was during the
Class Period) a shareholder, partner, officer, director, employee or controlling person of any
Defendant, (5) any entity in which any Defendant has a controlling interest, and (6) the legal
representatives, heirs, successors or assigns of any such excluded person. This Notice is being
sent to you, in part, pursuant to Rule 23(c) of the Federal Rules of Civil Procedure to advise you
of the pendency and nature of this Litigation and your rights in connection with it and any
matters relating to the foregoing.
YOU ARE HEREBY FURTHER NOTIFIED that two settlements of the Litigation have
been proposed, one between the plaintiff Class and former Just For Feet, Inc. employees,
officers, and/or directors Harold Ruttenberg, Eric L. Tyra, Peter Berman, Cooper Evans, Patrick
Lloyd, Don Allen Ruttenberg, Michael Lazarus, Helen Rockey, Scott C. Wynne, Randall L.
Haines, Adam Gilbunie, Robert C. Wabler, Alex M. Bond and Edward S. Croft, III (the "IrFF
Settlement"), and one between the plaintiff Class and defendants Deloitte & Touche LLP, Steven
H. Barry and Karen Baker (the "Deloitte Settlement"). Pursuant to an Order of the Court, a
hearing will be held on February 21, 2002, at 2:30 p.m., before the Honorable H. Dean Butiram,
at the United States Courthouse, 1729 Fifth Avenue, Birmingham, Alabama, for the purpose of
determining: (1) whether the proposed settlements (collectively, the "Settlement") of the above-
captioned Litigation should be approved by the Court as fair, just, reasonable and adequate; (2)
whether the Proposed Plan of Allocation of Settlement proceeds is fair, just, and adequate;
(3) whether the application of plaintiffs' counsel for an award of attorneys' fees and
-2-
414
reimbursement of expenses incurred in connection with this Litigation, together with interest
thereon, should be approved; and (4) whether the Litigation should be dismissed with prejudice.
If you purchased the common stock of Just for Feet during the period beginning May 5,
1997 through November 1, 1999, inclusive, your rights may be affected by this Litigation and the
Settlement. If you have not received a detailed Notice of Class Certification and Settlement of
Class Action (the "Notice") and a copy of the Proof of Claim and Release, you may obtain
copies by calling or writing to Just For Feet Securities Litigation, The Garden City Group, Inc,
P.O Box 8835, Melville, New York 11747-8835, toll free 1-800-809-8639. If you are a Class
Member, in order to share in the distribution of the Settlement Funds you must submit a Proof of
Claim and Release postmarked no later than April 1, 2002, establishing that you are entitled to a
recovery. If you do not exclude yourself from the Class, you will be bound by any judgment
rendered in the Litigation whether or not you make a claim.
If you exclude yourself from the Class, you will not participate in the Settlement, and you
will not receive the benefits of the Settlement. You will not be bound by the judgments to be
entered pursuant to the Settlement, and none of your claims will be released. If you want to be
excluded, you must mail or deliver, such that it is received on or before February 6, 2002, a
written request for exclusion to each of the following:
Just For Feet Securities LitigationThe Garden City GroupP.O. Box 8835Melville, New York 11747-8835Toll-free line: 1-800-809-8639
M. Clay Ragsdale, Esq.RAGSDALE & WHEELER, LLCThe Farley Building, Suite 5501929 31-d Ave NorthBirmingham, Alabama 35203
J. Michael Rediker, Esq.HASKELL SLAUGHTER YOUNG & REDIK.ER, LLC1200 AmSouth/Harbert Building1901 - 6th Avenue NorthBirmingham, AL 35203
-3-
John B. Missing, Esq.BROBECK, PHLEGER & HARRISON, LLP1333 H. Street N.W., Suite 800Washington, D.C. 20005
Michael J. Malone, Esq.KING & SPALDING1185 Avenue of the AmericasNew York, NY 10036-4003
Lee H. Zell, Esq.BALCH & BINGHAM, LLP710 Sixth Avenue NorthBirmingham, AL 35203-2015
The exclusion request must also comply with the other requirements set forth in the Notice
referred to above.
Any objection to the Settlement must be filed with the Court no later than February 11,
2002 and received by each of the following no later than February 12, 2002:
M. Clay RagsdaleRAGSDALE & WHEELER, LLC1929 Third Avenue North550 Farley BuildingBirmingham, AL 35203
J. Michael Rediker, Esq.HASICELL SLAUGHTER YOUNG & REDIKER, L.L.C.1200 AmSouth/Harbert Building1901 Sixth Avenue NorthBirmingham, AL 35203
Luther M. Dorr, Jr., Esq.MAYNARD, COOPER & GALE, P.C.2400 AmSouth/Harbert Plaza1901 Sixth Avenue NorthBirmingham, AL 35203
Crawford S. McGivaren, Jr., Esq.CABANISS, JOHNSTON, GARDNER,DUMAS & O'NEALPark Place Tower, Suite 7002001 Park Place NorthP.O. Box 830612Birmingham, AL 35283-0612
William J. Baxley, Esq.BAXLEY, DILLARD, DAUPHIN & MCKNIGHT2008 Third Avenue South
-4-
4 5
Birmingham, AL 35233
James W. Gewin, Esq.BRADLEY ARANT ROSE & WHITE, LLP2001 Park Place, Suite 1400Birmingham, AL 35203-2736
W. Stancil Starnes, Esq.STARNES & ATCHISON, LLP100 Brookwood Place, Seventh FloorBirmingham, AL 352092736
Lee H. Zell, Esq.BALCH & BINGHAM, LLP710 Sixth Avenue NorthBirmingham, AL 35203-2015
Any objection must also comply with the other requirements set forth in the Notice.
PLEASE DO NOT CONTACT THE COURT OR THE CLERK'S OFFICE REGARDINGTHIS NOTICE.
DATED: BY ORDER OF THE UNITED STATESDISTRICT COURT FOR THENORTHERN DISTRICT OF ALABAMA,SOUTHERN DIVISION
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UNITED STATES DISTRICT COURTNORTHERN DISTRICT OF ALABAMA
SOUTHERN DIVISION
)STATE OF WISCONSIN INVESTMENT BOARD, )KENNETH D. BUSH, EDWARD E. EUBANK, JR., )JOHN MICHAEL, suing on behalf of themselves and all )others similarly situated, )
)Plaintiffs, ) CV 99-BU-3097-S
) andVS. ) CV 99-BU-3129-S
)DELOITTE & TOUCHE LLP, STEVEN H. BARRY, )AND KAREN BAKER,
)
Defendants. ))
FINAL ORDER AND JUDGMENT
On the day of , 2002, a hearing having been held before this
Court to determine: (1) whether the terms and conditions of the Stipulation and Agreement of
Settlement dated December 21, 2001 (the "Settlement Stipulation") are fair, reasonable, and
adequate for the settlement of all claims asserted by the Class against defendants Deloitte &
Touche LLP, Steven H. Barry, and Karen Baker ("Defendants"); (2) whether judgment should be
entered dismissing the Consolidated Class Action Complaint dated June 15, 2000 (the
"Complaint"), on the merits and with prejudice, in favor of Defendants and as against all persons •
or entities who are members of the Class herein who have not requested exclusion therefrom;
(3) whether to approve the proposed Plan of Allocation as a fair and reasonable method to
allocate the settlement proceeds among the members of the Class; and (4) whether and in what
amount to award Plaintiffs' Counsel fees and reimbursement of expenses; and
jkl*---
The Court having considered all matters submitted to it at the hearing and otherwise; and
It appearing that a notice of the hearing substantially in the form approved by the Court
was mailed to all persons or entities reasonably identifiable who purchased the common stock of
Just For Feet, Inc. ("JFF") during the period from May 5, 1997 through November 1, 1999,
inclusive (the "Class Period"), except those persons or entities excluded from the definition of
the Class, and that a summary notice of the hearing substantially in the form approved by the
Court was published pursuant to the specifications of the Court, and that the only shareholders
requesting to be excluded from the Class are those on the list annexed hereto as Exhibit A; and
The Court having considered and determined the fairness and reasonableness of the
award of attorneys' fees and expenses requested;
NOW, THEREFORE, IT IS HEREBY ORDERED THAT:
1. The Court has jurisdiction over the subject matter of this Action, all Class
Members, and Defendants.
2. All capitalized terms used herein shall have the same meanings as in the
Settlement Stipulation.
3. The Settlement Stipulation is approved as fair, reasonable, and adequate, and the
Class Members and the parties are directed to consununate the Settlement Stipulation in
accordance with its terms.
4. This Action is hereby dismissed with prejudice and without costs.
5. The Class Members, on behalf of themselves, their heirs, executors,
-administrators, predecessors, successors, and assigns, hereby release and forever discharge
Deloitte & Touche USA LLP (formerly known as Deloitte & Touche LLP, Deloitte & Touche,
and Deloitte Haskins & Sells), Deloitte & Touche LLP (formerly known as D&T Partners LLP),
-2-
It1/4Nok
Deloifte Consulting Holding LLC, and Deloitte Consulting L.P., successor to Deloitte Consulting
LLC (formerly known as Deloitte & Touche Consulting Group LLC), and their past, present and
future parent companies, subsidiaries, divisions, related or affiliated entities, predecessors
(including without limitation Touche Ross & Co.) and successors, their respective present and
former directors, officers, partners (including Steven H. Bany), principals, members,
stockholders, owners, employees (including Karen Baker), agents, servants, subrogees, insurers
and attorneys, and their respective representatives, heirs, executors, spouses, personal
representatives, administrators, successors, transferees and assigns (the "Released Parties"), from
any and all claims (including Unknown Claims) against the Released Parties relating in any way
to the purchase or other acquisition of .TFF common stock during the Class Period, anything
alleged (or that could have been alleged) against the Released Parties in the Action, anything
relating in any way to the allegations of the Complaint, or any violation of law in connection
therewith (but excluding any claims to enforce the terms of the Settlement) (the "Settled
Claims").
6. The Class Members and their heirs, executors, administrators, predecessors,
successors and assigns, are hereby permanently barred and enjoined from instituting,
commencing, or prosecuting, either directly, indirectly, derivatively, or in any other capacity, the
Settled Claims against the Released Parties. The Settled Claims are hereby compromised,
settled, released, discharged, and dismissed on the merits and with prejudice.
7. Each of the Defendants, on behalf of themselves, their heirs, executors,
administrators, predecessors, successors, and assigns, hereby releases and forever discharges
each of the Class Members, the Class Representatives, and all of their past, present and future
parent companies, subsidiaries, divisions, related or affiliated entities, predecessors and
-3 -
• •
successors, their respective present and forrner directors, officers, partners, principals, members,
stockholders, owners, employees, agents, servants, subrogees, insurers and attorneys (including
Plaintiffs' Counsel), and their respective representatives, heirs, executors, spouses, personal
representatives, administrators, successors, transferees and assigns, from any and all claims,
rights or causes of action or liabilities whatsoever, whether known or unknown, that were or
could have been asserted by Defendants against such persons or entities in connection with,
arising out of, or relating in any way to the institution, prosecution, or settlement of the Action or
the Settled Claims (but excluding any claims to enforce the terms of the Settlement) (the "Settled
Defendants' Claims").
8. Defendants and their heirs, executors, administrators, predecessors, successors
and assigns, are hereby permanently barred and enjoined from instituting, co-mmencing or
prosecuting, either directly, indirectly, derivatively, or in any other capacity, the Settled
Defendants' Claims against the Class Members, the Class Representatives, and all of their past,
present and future parent companies, subsidiaries, divisions, related or affiliated entities,
predecessors and successors, their respective present and former directors, officers, partners,
principals, members, stockholders, owners, employees, agents, servants, subrogees, insurers and
attorneys (including Plaintiffs' counsel), and their respective representatives, heirs, executors,
spouses, personal representatives, administrators, successors, transferees and assigns. The
Settled Defendants' Claims are hereby compromised, settled, released, discharged and dismissed
on the merits and with prejudice.
9. Pursuant to the Private Securities Litigation Reform Act of 1995, the Court
hereby bars all claims for contribution arising out of the Action: (a) against Defendants; and
(b) by Defendants against any person or entity other than any person or entity whose liability to
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vait
t
the Class Members has been extinguished pursuant to the Settlement Stipulation or this Final
Order and Judgnent.
10. Any fiiture verdict or judgment by Class Members (which is defined to include
members of the Class acting individually) against any other person or entity whose claims for
contribution are barred or otherwise rendered unenforceable pursuant to the Settlement
Stipulation or this Final Order and Judgment shall be reduced by the greater of: (a) $7,400,000;
or (b) any proportionate share of liability found to be borne by Defendants; provided, however,
that there shall be no such reduction in the amount of proceeds received by Class Members
pursuant to the settlement which has been reached between the Representative Plaintiffs, the
Class Members, and certain former employees, officers and/or directors ofJust For Feet, Inc.,
which settlement is described and defined as the "JFF Settlement" in the Notice of Class
Certification and Settlement of Class Action.
11. The Court finds that all parties and their counsel have complied with each
requirement of Rule 11 of the Federal Rules of Civil Procedure as to all proceedings herein.
12. Neither this Final Order and Judgment, the Settlement Stipulation, nor any of the
negotiations, documents or proceedings connected with them shall be:
(a) referred or used by anyone against Defendants or against the Class as
evidence of wrongdoing;
(b) construed against Defendants or the Class as an admission or concession
that the consideration to be given hereunder represents the amount that could have been
recovered after trial; or
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'
(c) construed as, or received in evidence as, an admission, concession or
presumption against the Class or any of them that any of their claims were without merit or that
damages recoverable under the Complaint would not have exceeded the Settlement Fund.
13. The Plan of Allocation is approved as fair and reasonable, and Plaintiffs' Counsel
and the Claims Administrator are directed to administer the Settlement Stipulation in accordance
with its terms and provisions
14. Exclusive jurisdiction is hereby retained over the parties and the Class Members
for all matters relating to this action, including the administration, interpretation, effectuation or
-enforcement of the Settlement Stipulation and this Final Order and Judgment, and including any
application for fees and expenses incurred in connection with administering and distributing the
settlement proceeds to the members of the Class.
15. Without further order of the Court, the parties may agree to reasonable extensions
of time to carry out any of the provisions of the Settlement Stipulation.
16. There is no just reason for delay in the entry of this Final Order and Judgment and
irmnediate entry by the Clerk of the Court is directed pursuant to Rule 54(b) of the Federal Rules
of Civil Procedure.
Dated: Birmingham, Alabama , 2002
UNITED STATES DISTRICT JUDGE
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