On August 11, 2008, Lead Plaintiffs RH Capital Associates LLC and Pacific Investment Management
Company LLC signed a memorandum of agreement with Defendant Sandler O'Neill & Partners L.P.
in partial settlement of the Refco securities fraud class action. Sandler O'Neill was a
junior member of the 15-member investment banking syndicate that underwrote Refco's August
2005 initial public offering ("IPO"). In the IPO, Refco sold 30,475,000 shares at $22 per
share to raise over $670 million. As a junior member of the underwriting syndicate,
Sandler O'Neill underwrote approximately 2.8% of the IPO or approximately 850,000 of
the 30,475,000 shares sold by Refco in the IPO.
In this settlement, Sandler O'Neill has agreed to pay to Lead Plaintiffs, on
behalf of the Class, a total of $3.5 million in cash in exchange for a release
from the Class' claims against Sandler O'Neill under the Securities Act of 1933.
Lead Plaintiffs expect to ask the Court to give preliminary approval to the
settlement with Sandler O'Neill shortly, with notice to the Class of Refco
investors to follow. The litigation against the other defendants, including
the remaining fourteen investment banks, continues.