Notice of Proposed Settlement
(May 26, 2006)
THIS NOTICE MAY AFFECT YOUR RIGHTS. PLEASE READ CAREFULLY.
WHO SHOULD READ THIS NOTICE
You should read this notice if you acquired common shares (or installment receipts) in Boliden Limited, as offered by a prospectus dated June 10, 1997 (the “Prospectus”), in one of the provinces of Canada other than New Brunswick or Alberta, and retained all or part of these shares on April 25, 1998. You will be a class member and, if settlement approval is given, you will be bound by the terms of the Settlement Agreement (defined below) unless you opt out.
The “Class” is defined as persons, no matter where they reside in Canada or elsewhere, who (a) acquired common shares of Boliden Limited (the “Common Shares”) as a result of a trade in one of the provinces of Canada other than New Brunswick or Alberta, the jurisdiction of such trade being the jurisdiction where the registrant (broker) who received the buy order relating to the acquisition was located, or where a “trade”, as defined in the applicable jurisdiction, occurred; (b) acquired the Common Shares: (i) as offered by the Prospectus from an underwriter involved in the initial public offering of the Common Shares (the “IPO”); or (ii) in the case of Common Shares acquired as a result of a “trade” in Manitoba, acquired the Common Shares either as offered by the Prospectus from an underwriter involved in the IPO or on the secondary market; and (c) retained all or part of the Common Shares on April 25, 1998.
PURPOSE OF THIS NOTICE
Lawsuits have been filed in British Columbia and Ontario against Boliden Limited, Trelleborg International BV, Trelleborg AB, Anders Bulow, Robert K. McDermott, Jan Petter Traaholt, Lars Olof Nilsson, Kjell Nilsson, Frederick Telmer, Alex Balogh, Robert Stone and Nesbitt Burns Inc. These lawsuits are Kenneth Elliott et al. v. Boliden Limited et al., Vancouver registry no. C985348, Supreme Court of British Columbia (the “B.C. Action”) and Kenneth Elliott et al. v. Boliden Limited et al., court file no. 98-BN-07157, Ontario Superior Court of Justice (the “Ontario Action”).
In these lawsuits, the plaintiffs allege that the defendants breached provincial securities statutes concerning the disclosure of information in the Prospectus related to a tailings dam at Los Frailes, Spain, which collapsed on April 25, 1998. The defendants deny any liability and deny that any plaintiff or any class member is entitled to any relief. The courts have not ruled on the merits of the plaintiffs’ claims or the defendants’ defences. You can learn more about the lawsuits by inspecting the pleadings at www.kleinlyons.com or by contacting the lawyers for the Class (“Class Counsel”) at the address below.
The plaintiffs have entered into a settlement agreement (the “Settlement Agreement”) with Boliden Limited, Trelleborg International BV and Trelleborg AB (the “Settling Defendants”), which is subject to the approval of courts in British Columbia and Ontario. A copy of the Settlement Agreement is available at www.kleinlyons.com. The plaintiffs had earlier agreed to discontinue the lawsuits as against the other defendants without any settlement payment by them, but had not yet obtained court approval of this discontinuance before the Settlement Agreement was reached.
The B.C. Action was certified by Mr. Justice Burnyeat of the British Columbia Supreme Court by order dated February 24, 2000, such order varied by the British Columbia Court of Appeal by order dated November 21, 2002. The Ontario Action has not yet been certified. As part of the Settlement Agreement, the parties are seeking certification of the Ontario Action.
It is the opinion of Class Counsel that if is approved – and if the Ontario action is certified -, the settlement will be binding on all members of the Class except for those who timely and properly opt out. A further notice, describing the procedures and deadlines for class members who wish to opt out of the settlement, will be issued if the Settlement Agreement is approved.
TERMS OF THE PROPOSED SETTLEMENT
This is a summary only. See the Settlement Agreement for a complete description of its terms and conditions. Pursuant to the Settlement Agreement, the Settling Defendants will pay $1 million, plus certain notice costs, in full and final settlement of all claims associated with the lawsuits. Due to the administrative expense of distributing the net settlement funds (after fees, disbursements and expenses) to individual class members, no direct compensation will be paid to any class members in this settlement. Instead, the net settlement funds will be paid to charitable and non-profit organizations appropriate to the allegations in the lawsuits, to be applied to activities across Canada that are reasonably expected to indirectly benefit the Class in the future. The proposed organizations are the Rotman School of Management, University of Toronto, the Sauder School of Business, University of British Columbia, the Consumers’ Association of Canada, and the Small Investors’ Protection Association.
In addition, Class Counsel will seek court approval for payment of a portion of the settlement monies to cover its reasonable legal fees. Counsel will request fees of $400,000, plus disbursements and taxes. The representative plaintiff in the B.C. Action, and the proposed representative plaintiff in the Ontario Action will each seek court approval for modest payments in compensation for their work on behalf of the Class, not to exceed $5000 and $1000 respectively.
In exchange for these settlement benefits, members of the Class who do not “opt out” will release and discharge all claims in the lawsuits against all defendants. If the settlement is approved, the courts will specify the timing and manner in which a class member may opt out of the settlement. This would likely involve class members providing Class Counsel with written notice, by a date to be fixed, of their intention to opt out of the settlement.
SETTLEMENT APPROVAL HEARINGS
The dates for the courts to consider approval of the Settlement Agreement – and, in Ontario, certification - are as follows:
- For residents of British Columbia, on June 20, 2006 at 9:00 am at the Courthouse at 800 Smithe Street, Vancouver, B.C.; and
- For all other class members, on September 25, 2006 at 10:00 am at the Ontario Superior Court of Justice, 361 University Avenue, Toronto, Ontario.
OBJECTIONS TO THE PROPOSED SETTLEMENT
You may attend at these hearings if you wish, but are not required to do so. The courts will consider any objections to the proposed settlement by class members or their legal counsel. All persons who object to the Settlement Agreement are requested, but are not required, to provide written notice to Class Counsel by June 16, 2006 at the address below explaining the reason for their objection, and advising whether they intend to appear at one or both of the approval hearings and providing a mailing address, telephone number or e-mail address where they may be contacted.
ADDITIONAL INFORMATION AND QUESTIONS FOR CLASS COUNSEL
Do not contact the courts about this notice or the proceedings. Additional information concerning the lawsuits and the proposed settlement can be found at www.kleinlyons.com, or by contacting Class Counsel at Klein Lyons, Barristers & Solicitors, Attn: Doug Lennox, Suite 1100, 1333 West Broadway, Vancouver BC V6H 4C1, tel 1-800-216-1383, fax 604-874-7180, e-mail, dlennox@kleinlyons.com.
This notice has been approved by the British Columbia Supreme Court and the Superior Court of Justice for Ontario.
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