Bilinsky v. Gatos Silver, Inc. — Entry #99: SETTLEMENT AGREEMENT by Plaintiff Bard Betz
Case: Bilinsky v. Gatos Silver, Inc. cod · 1:22-cv-00453
filed February 22, 2022
What this document is
Docket entry #99 · filed October 22, 2024
SETTLEMENT AGREEMENT by Plaintiff Bard Betz. (Fonti, Joseph) (Entered: 10/22/2024)
Who is involved
- Ali Erfan
- Bard Betz
- BMO Capital Markets Corp.
- Canaccord Genuity Corp.
- Charles Hansard
- CIBC World Markets Corp.
- Daniel Muniz Quintanilla
- David Peat
- Gatos Silver, Inc.
- Goldman Sachs & Co. LLC
- Hong Nguyen
- Igor Gonzales
- Igor Levental
- Janice Stairs
- Jeb Burns
- John D. Dockter
- John Teselsky
- Kaan Yazgan
- Karl Hanneman
- Kathleen Marcus
- Kenneth Pigford
- Mark Lloyd
- Michael Bilinsky
- Philip Pyle
- RBC Capital Markets, LLC
- Richard Kennay
- Roger Johnson
- Scott Gelb
- Stephen Orr
- Thomas S. Kaplan
- William Algeo
Why we have it
We follow this case because it names a company we track, although that company is not a party:
- Marathon Digital: its name “Marathon Digital Holdings, Inc.” appears in a filing in this case.
…23-CV-00691 (D. Ariz); • Moreno, et al. v. Marathon Digital Holdings, Inc., et al. (D. Nev.) • SLF is also…
A free copy from the RECAP archive of federal court filings (mirrored at the Internet Archive), retrieved November 02, 2026. Federal court filings are public records.
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UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Civil Action No. 1:22-cv-00453-PAB-KLM
MICHAEL BILINSKY, Individually and On Behalf of All Others
Similarly Situated,
Plaintiff,
v.
GATOS SILVER, INC.,
STEPHEN ORR,
ROGER JOHNSON,
PHILIP PYLE,
JANICE STAIRS,
ALI ERFAN,
IGOR GONZALES,
KARL HANNEMAN,
DAVID PEAT,
CHARLES HANSARD, and
DANIEL MUÑIZ QUINTANILLA,
Defendants.
STIPULATION AND AGREEMENT OF SETTLEMENT
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This Stipulation and Agreement of Settlement (the “Stipulation” or “Settlement Agreement”)
is made and entered into by and between lead plaintiff Bard Betz (“Lead Plaintiff”) along with
named plaintiff Jude Sweidan (individually, “Named Plaintiff” and collectively, “Plaintiffs”), on the
one hand, and Defendants Gatos Silver, Inc. (“Gatos” or the “Company”); individual defendants
Stephen Orr, Roger Johnson, Philip Pyle, Janice Stairs, Ali Erfan, Igor Gonzales, Karl Hanneman,
David Peat, Charles Hansard, and Daniel Muñiz Quintanilla (the “Individual Defendants”); and
underwriter defendants BMO Capital Markets Corp., Goldman Sachs & Co. LLC, RBC Capital
Markets, LLC, Canaccord Genuity Corp., CIBC World Markets Corp. (the “Underwriter
Defendants”) (collectively, with Gatos and the Individual Defendants, “Defendants”), on the other
hand, by and through their counsel of record in the above-captioned litigation (the “Litigation”)
pending in the United States District Court for the District of Colorado (the “Court”). This
Stipulation is intended by Plaintiffs, on behalf of themselves and each of the Settlement Class
Members (as defined below), and Defendants (each a “Party,” and collectively, the “Parties”) to
fully, finally, and forever resolve, discharge, and settle the Released Claims (as defined in ¶1.45
hereof), upon and subject to the terms and conditions hereof and subject to the Court’s approval.
WHEREAS:
A. All words or terms used herein that are capitalized shall have the meanings ascribed
to those words or terms herein and in ¶1 hereof entitled “Definitions.”
B. On February 22, 2022, the initial Class Action Complaint for Violations of the
Securities Laws (the “Complaint”) was filed against all Defendants in the United States District
Court for the District of Colorado, styled Bilinsky v. Gatos Silver Inc. et al., No. 1:22-cv-00453-
PAB-KLM. ECF No. 1.
C. On April 25, 2022, Lead Plaintiff moved to serve as lead plaintiff. ECF No. 16. In
the motion, Lead Plaintiff proposed that Bleichmar Fonti & Auld LLP be selected as Lead Counsel
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for the class. That same day, Kenneth Pigford (ECF No. 6); Richard Kennay (ECF No. 8); Mark
Lloyd (ECF No. 11); John Teselsky and Hong Nguyen (ECF No. 12); William Algeo (ECF No. 13);
John D. Dockter, Scott Gelb, and Kaan Yazgan (ECF No. 14); and Kathleen Marcus (ECF No. 17)
also moved to serve as lead plaintiffs.
D. On June 3, 2022, the Court entered an order appointing Lead Plaintiff as lead plaintiff
and approving Lead Plaintiff’s selection of Bleichmar Fonti & Auld LLP as lead counsel (“Lead
Counsel”). ECF No. 49.
E. On August 15, 2022, Plaintiffs filed an Amended Class Action Complaint for
Violations of the Securities Laws (the “Amended Complaint”), which is the operative complaint in
the Litigation. ECF No. 54. The Amended Complaint asserted claims against Gatos and the
Individual Defendants, specifically: (1) against the Securities Act Defendants for violations of
Section 11 of the Securities Act of 1933 (the “Securities Act”); (2) against the Individual Defendants
for violations of Section 15 of the Securities Act; (3) against the Exchange Act Defendants for
violations of Section 10(b) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule
10b-5 promulgated thereunder; and (4) against the Exchange Act Defendants for violations of
Section 20(a) of the Exchange Act.1 Plaintiffs asserted the Securities Act claims on behalf of all
persons who, in domestic transactions or on the New York Stock Exchange (“NYSE”), purchased or
acquired Gatos common stock pursuant or traceable to the 2020 Registration Statement or the 2021
Registration Statement during a Class Period of December 9, 2020 through January 25, 2022, both
inclusive, and were damaged thereby. Plaintiffs asserted the Exchange Act claims on behalf of all
persons who purchased or acquired Gatos common stock listed on the NYSE, or who, in domestic
transactions, purchased or acquired publicly traded call options on Gatos common stock, or sold
1
The Amended Complaint did not assert claims against the Underwriter Defendants.
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publicly traded put options on Gatos common stock, during a Class Period of December 9, 2020
through January 25, 2022, both inclusive, and were damaged thereby.
F. On October 14, 2022, Gatos and the Individual Defendants filed a motion to dismiss
the Amended Complaint. ECF No. 63. On November 23, 2022, Plaintiffs opposed the motion to
dismiss. ECF No. 67. On December 23, 2022, Gatos and the Individual Defendants filed a reply in
further support of their motion to dismiss. ECF No. 70.
G. On April 13, 2023, certain Parties submitted a Joint Motion to Stay Ruling on
Defendants’ Motion to Dismiss (1) asking that the Court stay any disposition on the pending motion
to dismiss while those Parties considered a path forward for the Litigation and (2) stating that the
Parties would submit a joint status report to the Court on or before June 15, 2023. ECF No. 78. On
April 26, 2023, the Court granted the Parties’ Joint Motion, noted that those Parties would file a joint
status report on or before June 15, 2023, and agreed to postpone a ruling on the motion to dismiss
until on or after June 16, 2023. ECF No. 79.
H. On June 13, 2023, Gatos, the Individual Defendants, and Plaintiffs participated in a
full-day mediation session before Robert Meyer of JAMS (the “Mediator”). In advance of that
session, those parties provided detailed mediation statements to the Mediator addressing issues of
liability and the strength of the pending motion to dismiss. After arm’s-length negotiations and the
Parties’ exchange of multiple demands and counteroffers, the same day, the Mediator made a formal
mediator’s proposal that the case settle for $21 million. Gatos, the Individual Defendants and
Plaintiffs accepted this proposal and the Parties subsequently began negotiating this Settlement
Agreement. This Stipulation, together with the exhibits hereto and the Opt-Out Agreement defined
in ¶1.35 below, constitute the final and binding agreement between the Parties.
I. Plaintiffs and Lead Counsel believe that the claims and allegations in the Litigation
have merit and that the information developed to date supports the claims and allegations asserted.
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However, Plaintiffs and Lead Counsel recognize and acknowledge the expense and length of
continued proceedings necessary to prosecute the Litigation against Defendants through trial and
through appeals. Plaintiffs and Lead Counsel have also 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. Plaintiffs and Lead Counsel are also mindful of the
problems of proof and possible defenses to the securities law violations asserted in the Litigation.
Plaintiffs and Lead Counsel believe that the Settlement set forth in this Stipulation confers
substantial benefits upon Settlement Class Members in light of the circumstances here, is in the best
interests of Plaintiffs and Settlement Class Members, and is fair, reasonable, and adequate.
J. Defendants are entering into this Stipulation solely to avoid and eliminate the burden,
expense, uncertainty, and risk of further litigation, as well as the business disruption associated
therewith. Defendants have expressly denied and continue to deny any wrongdoing or liability
against them arising out of any statements or omissions alleged, or that could have been alleged, in
the Litigation. Nonetheless, Defendants have determined that it is desirable and beneficial to them
that the Litigation be settled in the manner and upon the terms and conditions set forth in this
Stipulation to avoid the further expense, inconvenience, and burden of this Litigation, to end the
distraction and diversion of personnel and resources, and to obtain the conclusive and final dismissal
and/or release of this Litigation, as to them, and the Released Claims.
NOW THEREFORE, without any concession by Plaintiffs that the Litigation lacks merit, and
without any concession by the Defendants of any liability or wrongdoing or lack of merit in their
defenses, it is hereby STIPULATED AND AGREED, by and among the Parties to this Stipulation,
through their respective attorneys, subject to approval by the Court pursuant to Rule 23(e) of the
Federal Rules of Civil Procedure, that in consideration of the benefits flowing to the Parties hereto,
all Released Claims as against all Released Parties shall be fully, finally, and forever compromised,
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settled, released, waived, discharged, and dismissed with prejudice, and without costs, upon and
subject to the following terms and conditions:
1. Definitions
As used in this Stipulation, as well as any exhibits attached hereto and made part hereof and
the Opt-Out Agreement as defined below, the following terms have the meanings specified below:
1.1 “2020 Registration Statement” means Gatos’s registration statement for its initial
public offering (including the documents incorporated by reference therein), filed by Gatos on Form
S-1 on October 27, 2020, and declared effective on October 27, 2020.
1.2 “2021 Registration Statement” means Gatos’s registration statement for its secondary
offering in July 2021 (including the documents incorporated by reference therein), filed by Gatos on
Form S-1 on July 12, 2021, and declared effective on July 15, 2021.
1.3 “Amended Complaint” means Plaintiffs’ Amended Class Action Complaint for
Violations of the Securities Laws, filed in the Litigation on August 15, 2022. ECF No. 54.
1.4 “Authorized Claimant” means any Settlement Class Member whose claim for
recovery has been allowed pursuant to the terms of the Stipulation.
1.5 “Claimant” means any Settlement Class Member who files a Proof of Claim in such
form and manner, and within such time, as the Court shall prescribe.
1.6 “Claims Administrator” means Epiq Class Action and Claims Solutions, Inc.
1.7 “Class Period” means the period between December 9, 2020 and January 25, 2022,
both inclusive.
1.8 “Complaint” means the Class Action Complaint for Violations of the Federal
Securities Laws, filed in the Litigation on February 22, 2022. ECF No. 1.
1.9 “Court” means the United States District Court for the District of Colorado.
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1.10 “Defendants” means Gatos Silver, Inc., Stephen Orr, Roger Johnson, Philip Pyle,
Janice Stairs, Ali Erfan, Igor Gonzales, Karl Hanneman, David Peat, Charles Hansard, Daniel Muñiz
Quintanilla, BMO Capital Markets Corp., Goldman Sachs & Co. LLC, RBC Capital Markets, LLC,
Canaccord Genuity Corp., and CIBC World Markets Corp.
1.11 “Defendants’ Counsel” means Davis Polk & Wardwell LLP for Gatos and the
Individual Defendants, and Paul, Weiss, Rifkind, Wharton & Garrison LLP for the Underwriter
Defendants.
1.12 “Effective Date” means the first date by which each of the conditions specified in
¶8.1 of the Stipulation have occurred or have been waived.
1.13 “Escrow Accounts” means the segregated and separate escrow accounts designated
and controlled by Lead Counsel into which the Settlement Amount will be deposited for the benefit
of the Settlement Class.
1.14 “Escrow Agents” means The Huntington National Bank and Esquire Bank, National
Association.
1.15 “Exchange Act Defendants” means Defendants Gatos Silver, Inc., Stephen Orr, Roger
Johnson, and Philip Pyle.
1.16 “Exchange Act Settlement Class” means, for the purpose of settlement only: (i) all
Persons and entities who purchased or otherwise acquired Gatos common stock listed on the NYSE,
from December 9, 2020 through January 25, 2022, both inclusive, and were damaged thereby; (ii) all
Persons and entities who, in domestic transactions, purchased or otherwise acquired publicly traded
call options on Gatos common stock, from December 9, 2020 through January 25, 2022, both
inclusive, and were damaged thereby; and/or (iii) all Persons and entities who, in domestic
transactions, sold publicly traded put options on Gatos common stock, from December 9, 2020
through January 25, 2022, both inclusive, and were damaged thereby.
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1.17 “Fee and Expense Application” shall have the meaning set forth in ¶7.1 of this
Stipulation.
1.18 “Fee and Expense Award” shall have the meaning set forth in ¶6.2(c) of this
Stipulation.
1.19 “Final,” with respect to the Judgment approving the Stipulation, substantially in the
form of Exhibit B attached hereto, means when the last of the following shall occur: (i) the
expiration of the time to file a motion to alter or amend the Judgment under Federal Rule of Civil
Procedure 59(e) has passed without any such motion having been filed; (ii) the expiration of the time
in which to appeal the Judgment has passed without any appeal having been taken, which date shall
be deemed to be thirty (30) days following the entry of the Judgment, unless the date to take such an
appeal shall have been extended by Court order or otherwise, or unless the thirtieth (30th) day falls
on a weekend or a Court holiday, in which case the date for purposes of this Stipulation shall be
deemed to be the next business day after such thirtieth (30th) day; (iii) if a motion to alter or amend
the Judgment is timely filed, and the motion is denied; and (iv) if an appeal is taken, either: (a) the
appeal has been dismissed and the time, if any, for commencing any further appeal has expired; or
(b) the Judgment has been affirmed in its entirety and the time, if any, for commencing any further
appeal has expired. For purposes of this paragraph, an “appeal” shall include any petition for a writ
of certiorari or other writ or request for judicial review that may be filed in connection with approval
or disapproval of this Settlement, but shall not include any appeal that concerns only the issue of
attorneys’ fees or expenses or the Plan of Allocation of the Settlement Fund.
1.20 “Final Approval Hearing” means the hearing to determine whether the proposed
Settlement embodied by this Stipulation is fair, reasonable, and adequate to the Settlement Class, and
whether the Court should enter a Judgment approving the proposed Settlement.
1.21 “Gatos” or the “Company” means Gatos Silver, Inc.
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1.22 “Gatos’s Counsel” means Davis Polk & Wardwell LLP.
1.23 “Gatos Securities” means Gatos common stock, call options of Gatos, and put options
of Gatos.
1.24 “Individual Defendants” means Defendants Stephen Orr, Roger Johnson, Janice
Stairs, Ali Erfan, Igor Gonzalez, Karl Hanneman, David Peat, Charles Hansard, and Daniel Muñiz
Quintanilla.
1.25 “Judgment” means the judgment to be rendered by the Court, substantially in the
form attached hereto as Exhibit B, or such other substantially similar form mutually agreed to by the
Parties.
1.26 “Lead Counsel” means Bleichmar Fonti & Auld LLP.
1.27 “Lead Plaintiff” means Bard Betz.
1.28 “Litigation” means the civil action captioned Bilinsky v. Gatos Silver Inc. et al., No.
1:22-cv-00453-PAB-KLM, pending in the United States District Court for the District of Colorado,
before Chief Judge Philip A. Brimmer, United States District Judge, Magistrate Judge Kristin K.
Mix, or any judge previously or subsequently assigned, including any and all civil actions
consolidated therewith.
1.29 “Long-Form Notice” shall have the meaning set forth in ¶4.1 of this Stipulation.
1.30 “Named Plaintiff” means Jude Sweidan.
1.31 “Net Settlement Fund” shall have the meaning set forth in ¶6.2(d) of this Stipulation.
1.32 “Notice” shall have the meaning set forth in ¶4.1 of this Stipulation.
1.33 “Notice and Administration Costs” shall have the meaning set forth in ¶2.8 of this
Stipulation.
1.34 “Notice Order” means the preliminary approval order as entered by the Court for
mailing and publication of notice.
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1.35 “Opt-Out Agreement” shall have the meaning set forth in ¶8.4 of this Stipulation.
1.36 “Parties” means, collectively, Plaintiffs, on behalf of themselves and each of the
Settlement Class Members, and Defendants.
1.37 “Party” means, individually, any Plaintiff, on behalf of himself and each of the
Settlement Class Members, or any Defendant.
1.38 “Person” means a natural person, individual, corporation (including all divisions and
subsidiaries thereof), partnership, limited partnership, limited liability company, joint venture,
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, executors, administrators, guardians, conservators, predecessors, successors, agents,
trustees, estates, representatives, or assignees.
1.39 “Plaintiffs” means Lead Plaintiff Bard Betz and Named Plaintiff Jude Sweidan.
1.40 “Plaintiffs’ Counsel” means Lead Counsel; Wheeler Trigg O’Donnell LLP; and The
Schall Law Firm.
1.41 “Plan of Allocation” means a plan or formula of allocation of the Settlement Fund
whereby the Settlement Fund shall be distributed to Authorized Claimants after payment of expenses
of notice and administration of the Settlement, Taxes and Tax Expenses, and such attorneys’ fees,
expenses, and interest as may be awarded by the Court, and any award to Plaintiffs. Any Plan of
Allocation is not part of this Stipulation and Defendants and their Related Parties shall have no
responsibility therefore or liability with respect thereto.
1.42 “Proof of Claim” shall have the meaning set forth in ¶5.3 of this Stipulation.
1.43 “PSLRA” means the Private Securities Litigation Reform Act of 1995, 15 U.S.C.
§ 78u-4, as amended.
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1.44 “Related Parties” means each of a Defendant’s past or present directors, officers,
employees, partners, insurers, co-insurers, reinsurers, principals, controlling shareholders, members,
agents, administrators, attorneys, accountants, auditors, bankers, underwriters, investment advisors,
personal or legal representatives, predecessors, successors, direct and/or indirect parents,
subsidiaries, divisions, joint ventures, partnerships, limited liability companies, affiliates, assigns,
spouses, heirs, estates, related or affiliated entities, any entity in which a Defendant has a majority
interest, any member of a Defendant’s immediate family, any trust of which a Defendant is the
settlor or which is for the benefit of a Defendant and/or any member of a Defendant’s immediate
family, and any entity in which a Defendant and/or any member of a Defendant’s immediate family
has or had a majority interest (directly or indirectly).
1.45 “Released Claims” means any and all claims (including Unknown Claims as defined
in ¶1.59 hereof), rights, demands, losses, suits, debts, obligations, damages, judgments,
controversies, liabilities, or causes of action of every nature and description whatsoever, in law,
equity, or otherwise (including, but not limited to, any claims for damages, interest, attorneys’ fees,
expert or consulting fees, and any other costs, expenses, or liabilities whatsoever), whether asserted
or unasserted, accrued or unaccrued, fixed or contingent, whether arising under federal, state, local,
common, or foreign law, or any other law, rule, or regulation, whether class or individual in nature,
to the fullest extent that the law permits their release in this Litigation against any of the Defendants
or their Related Parties, which arise out of, are based on, or relate to both: (i) the allegations, acts,
transactions, facts, events, matters, occurrences, disclosures, statements, filings, events,
representations, or omissions involved, set forth, alleged, or referred to in the Complaint, Amended
Complaint, or the Litigation, or which could have been alleged in the Litigation; and (ii) the
purchase, sale, holding, or other acquisition, disposition, or holding of Gatos Securities, whether on
the NYSE or otherwise within the United States, between October 28, 2020 and January 25, 2022,
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both inclusive. Released Claims also include any and all claims (including Unknown Claims as
defined in ¶1.59 hereof), rights, demands, losses, suits, debts, obligations, damages, judgments,
controversies, liabilities, or causes of action of every nature and description whatsoever, in law,
equity, or otherwise (including, but not limited to, any claims for damages, interest, attorneys’ fees,
expert or consulting fees, and any other costs, expenses, or liabilities whatsoever), whether asserted
or unasserted, accrued or unaccrued, fixed or contingent, whether arising under federal, state, local,
common, or foreign law, or any other law, rule, or regulation, whether class or individual in nature,
which arise out of, are based on, or relate to the institution, prosecution, or settlement of the
Litigation or the Released Claims against Defendants or their Related Parties. Released Claims shall
not include claims to enforce the Settlement. For avoidance of doubt and without limitation to other
claims or potential claims not released hereby, Released Claims do not include any breach of
fiduciary duty, unjust enrichment, or waste claims by or on behalf of Gatos against the Individual
Defendants or other individuals, which claims are referenced in or may arise from the litigation
demand sent by Kathleen Marcus on April 27, 2023.
1.46 “Released Parties” means each and all of Defendants, each and all of their respective
Related Parties, Plaintiffs, Settlement Class Members, and Plaintiffs’ Counsel.
1.47 “Releases” means the releases set forth in ¶5.1 through ¶5.5 of this Stipulation.
1.48 “Securities Act Defendants” means Defendants Gatos Silver, Inc., Stephen Orr, Roger
Johnson, Janice Stairs, Ali Erfan, Igor Gonzalez, Karl Hanneman, David Peat, Charles Hansard, and
Daniel Muñiz Quintanilla.
1.49 “Securities Act Settlement Class” means, for the purposes of settlement only, all
Persons and entities who, in domestic transactions or on the NYSE, purchased or otherwise acquired
Gatos common stock pursuant or traceable to the 2020 Registration Statement or the 2021
Registration Statement, and were damaged thereby.
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1.50 “Settlement” means the settlement contemplated by this Stipulation.
1.51 “Settlement Amount” means the principal amount of Twenty-One Million U.S.
Dollars ($21,000,000.00).
1.52 “Settlement Class,” “Settlement Class Members,” or “Members of the Settlement
Class” means both the Securities Act Settlement Class and the Exchange Act Settlement Class.
Excluded from the Settlement Class are: Defendants, the current and Class Period officers and
directors of the Company, the members of the immediate families and the legal representatives,
affiliates, heirs, successors-in-interest, or assigns of any such excluded person, any entity in which
such excluded persons have or had a majority interest, and the Electrum Group, LLC; provided,
however, that any “Investment Vehicle” shall not be excluded from the Settlement Class.
“Investment Vehicle” means any investment company, pooled investment fund, or separately
managed account (including, but not limited to, mutual fund families, exchange traded funds, funds
of funds, private equity funds, real estate funds, hedge funds, and employee benefit plans) in which
the Underwriter Defendants, or any of them, have, has, or may have a direct or indirect interest, or as
to which its affiliates may serve as a fiduciary or act as an investment advisor, general partner,
managing member, or in any other similar capacity, but in which any of the Underwriter Defendants
alone or together, with its, his, or her respective affiliates, is not a majority owner or does not hold a
majority beneficial interest. Also excluded from the Settlement Class are those Persons who timely
and validly request exclusion from the Settlement Class pursuant to the requirements set by the
Court.
1.53 “Settlement Fund” means the Settlement Amount, plus any accrued interest earned
thereon.
1.54 “Stipulation” means this Stipulation of Settlement, including the recitals and Exhibits
hereto.
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1.55 “Summary Notice” shall have the meaning set forth in ¶4.1 of this Stipulation.
1.56 “Taxes” means all taxes (including any estimated taxes, interest or penalties) arising
with respect to the income earned by the Settlement Fund.
1.57 “Tax Expenses” means expenses and costs incurred in connection with the calculation
and payment of taxes or the preparation of tax returns and related documents, including, without
limitation, expenses of tax attorneys and/or accountants and mailing and distribution costs and
expenses relating to filing (or failing to file) the returns described in ¶2.9 hereof.
1.58 “Underwriter Defendants” means BMO Capital Markets Corp., Goldman Sachs &
Co. LLC, RBC Capital Markets, LLC, Canaccord Genuity Corp., and CIBC World Markets Corp.
1.59 “Unknown Claims” means collectively (i) any Released Claims that Plaintiffs or
Settlement Class Members do not know or suspect to exist in his, her, or its favor at the time of the
release of the Released Parties which, if known by him, her, or it, might have affected such
Settlement Class Member’s settlement or decisions with respect to the Settlement, including, but not
limited to, the release of the Released Parties or the decision not to object to or opt out of this
Settlement; and (ii) any Released Claims that Defendants and their Related Parties do not know or
suspect to exist in his, her, or its favor at the time of the release, which, if known by him, her, or it,
might have affected his, her, or its settlement with and release of Plaintiffs, Plaintiffs’ Counsel,
and/or Settlement Class Members. With respect to any and all Released Claims, the Parties stipulate
and agree that, upon the Effective Date, Plaintiffs, Defendants, and Defendants’ Related Parties shall
expressly waive, and each of the Settlement Class Members shall be deemed to have waived, and by
operation of the Judgment shall have expressly waived, any and all provisions, rights, and benefits
conferred by the law of any state or territory or other jurisdiction or principle of common law or
foreign law that is similar, comparable, or equivalent to California Civil Code § 1542, which
provides:
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A general release does not extend to claims that the creditor or releasing
party does not know or suspect to exist in his or her favor at the time of
executing the release and that, if known by him or her, would have materially
affected his or her settlement with the debtor or released party.
Plaintiffs, Settlement Class Members, Defendants, and Defendants’ Related Parties may hereafter
discover facts in addition to or different from those which he, she, they, or it now knows or believes
to be true with respect to the subject matter of the Released Claims, but Plaintiffs, Defendants, and
Defendants’ Related Parties shall expressly fully, finally, and forever settle and release, and each
Settlement Class Member, upon the Effective Date, shall be deemed to have, and by operation of the
Judgment shall have, fully, finally, and forever settled and released, any and all Released Claims,
known or unknown, suspected or unsuspected, contingent or non-contingent, whether or not
concealed or hidden, which now exist, or heretofore have existed, upon any theory of law or equity
now existing or coming into existence in the future, including, but not limited to, conduct which is
negligent, intentional, with or without malice, or a breach of any duty, law or rule, without regard to
the subsequent discovery or existence of such different or additional facts. Plaintiffs, Defendants,
and Defendants’ Related Parties acknowledge, and Settlement Class Members shall be deemed by
operation of law (including by operation of the Judgment) to have acknowledged, that the foregoing
waiver was separately bargained for and is a key element of the Settlement.
2. The Settlement
a. The Settlement Fund
2.1 In consideration of the terms of the Stipulation, Gatos, on behalf of all Defendants,
shall pay or cause to be paid the sum of $21,000,000.00 (the “Settlement Amount”) into the Escrow
Accounts within the later of thirty (30) calendar days from (i) the date of entry by the Court of an
order granting preliminary approval of the Settlement or (ii) receipt by Gatos’s Counsel of adequate
payment instructions and a Form W-9 providing the tax identification number for the Escrow
Accounts. If the entire Settlement Amount is not timely paid to the Escrow Accounts pursuant to the
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above, Lead Counsel may terminate the settlement but only if (a) Lead Counsel has notified
Defendants’ Counsel in writing of their intention to terminate the settlement, and (b) the entire
Settlement Amount is not transferred to the Escrow Accounts within ten (10) calendar days after
Lead Counsel has provided such written notice. The Defendants other than Gatos shall have no
responsibility or liability to pay any portion of the Settlement Amount.
2.2 The Settlement Amount is an all-in number, meaning it shall include, among other
things, payment for all Lead Counsel’s attorneys’ fees, administration costs, expenses, class member
benefits, costs of administration and notice, and reimbursement of Plaintiffs’ time and expenses
pursuant to the PSLRA, as well as any other costs, expenses, or fees of any kind whatsoever
associated with the resolution of this matter. Except as provided in ¶4.3, Defendants and their
Related Parties shall have no obligation whatsoever to pay any additional amounts beyond the
Settlement Amount.
2.3 The payment described in ¶2.1 is the only payment to be made by or on behalf of
Defendants in connection with this Settlement.
b. The Escrow Agents
2.4 The Escrow Agents, with Lead Counsel’s prior written consent, shall invest the
Settlement Amount deposited pursuant to ¶2.1 hereof in United States Agency or Treasury securities
or other instruments backed by the full faith and credit of the United States Government or fully
insured by the United States Government or an agency thereof, and shall reinvest the proceeds of
these instruments as they mature in other such instruments at their then-current market rates. The
Settlement Fund shall bear all risks related to the investments of the Settlement Amount.
2.5 The Escrow Agents shall not disburse the Settlement Fund except as provided in this
Stipulation, by an order of the Court, or with the written agreement of Lead Counsel and
Defendants’ Counsel.
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2.6 Subject to further order and/or direction as may be made by the Court, the Escrow
Agents are authorized to execute such transactions as are consistent with the terms of the Stipulation.
Defendants and their Related Parties shall have no responsibility for, interest in, or liability
whatsoever with respect to, any action, omission, or determination of the Escrow Agents or any
designees or agents thereof; or any transaction executed by the Escrow Agents or any designees or
agents thereof.
2.7 All funds held by the Escrow Agents shall be deemed and considered to be in
custodia legis of the Court, and shall remain subject to the jurisdiction of the Court, until such time
as such funds shall be distributed pursuant to this Stipulation and/or further order(s) of the Court.
2.8 Notwithstanding the fact that the Effective Date has not yet occurred, Lead Counsel
may use up to $100,000 from the Settlement Fund to pay the costs and expenses reasonably and
actually incurred in connection with providing notice to the Settlement Class, locating Settlement
Class Members, administering and distributing the Net Settlement Fund to Authorized Claimants
and processing Proofs of Claim (“Notice and Administration Costs”). Prior to the Effective Date,
payment of any Notice and Administration Costs exceeding $100,000 shall be paid from the
Settlement Fund subject to prior approval of the Court or agreement of the Parties. Subsequent to
the Effective Date, Lead Counsel may pay all further Notice and Administration Costs from the
Settlement Fund, regardless of amount, without further order of the Court or agreement of the
Parties. In the event that the Settlement does not become Final, any money paid or incurred for the
above purposes, including any related fees, shall not be returned or repaid to the original funding
entity. Defendants and the Related Parties are not responsible for, and shall not be liable for, any
costs incurred in connection with providing notice to the Settlement Class, locating Settlement Class
Members, administering and distributing the Settlement Fund, or processing Proofs of Claim.
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c. Taxes
2.9 (a) The Parties and the Escrow Agents agree to treat the Settlement Fund as being
at all times a “qualified settlement fund” within the meaning of Treasury Regulation § 1.468B-1. In
addition, Lead Counsel shall timely make such elections as necessary or advisable to carry out the
provisions of this ¶2.9, including the “relation-back election” (as defined in Treasury Regulation
§ 1.468B-1) back to the earliest permitted date. Such elections shall be made in compliance with the
procedures and requirements contained in such regulations. It shall be the responsibility of the Lead
Counsel to timely and properly prepare and deliver the necessary documentation for signature by all
necessary parties, and thereafter to cause the appropriate filing to occur.
(b) For the purpose of § 1.468B of the Internal Revenue Code of 1986, as amended, and
the regulations promulgated thereunder, the “administrator” shall be Lead Counsel. Lead Counsel
shall timely and properly file all informational and other tax returns necessary or advisable with
respect to the Settlement Fund (including, without limitation, the returns described in Treasury
Regulation § 1.468B-2(k)). Such returns (as well as the election described in ¶2.9(a) hereof) shall be
consistent with this ¶2.9(b) and in all events shall reflect that all Taxes (including any estimated
Taxes, interest or penalties) on the income earned by the Settlement Fund shall be paid out of the
Settlement Fund as provided in ¶2.9(c) hereof.
(c) All (i) Taxes (including any estimated Taxes, interest, or penalties) arising with
respect to the income earned by the Settlement Fund, including any Taxes or tax detriments that may
be imposed upon Defendants and their Related Parties with respect to any income earned by the
Settlement Fund for any period during which the Settlement Fund does not qualify as a “qualified
settlement fund” for federal or state income tax purposes, and (ii) Tax Expenses shall be paid out of
the Settlement Fund. In no event shall Defendants or their Related Parties have any responsibility
for, or liability whatsoever with respect to, the Taxes or the Tax Expenses. Further, Taxes and Tax
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Expenses shall be treated as, and considered to be, a cost of administration of the Settlement Fund
and shall be timely caused by Lead Counsel to be paid out of the Settlement Fund without prior
order from the Court. Lead Counsel shall be obligated (notwithstanding anything herein to the
contrary) to withhold from distribution to Authorized Claimants any funds necessary to pay such
amounts, including the establishment of adequate reserves for any Taxes and Tax Expenses (as well
as any amounts that may be required to be withheld under Treasury Regulation § 1.468B-2(l)(2)).
Defendants and their Related Parties are not responsible therefor, nor shall they have any liability
with respect thereto. The Parties agree to cooperate with the Escrow Agents, each other, and their
tax attorneys and accountants to the extent reasonably necessary to carry out the provisions of this
paragraph.
(d) Except as required by ¶2.1 concerning payment of the Settlement Amount and subject
to this ¶¶2.9 and 6.1 below, Defendants and their Related Parties shall have no responsibility for,
interest in, or liability whatsoever with respect to: Taxes, Tax Expenses, Notice and Administration
Costs, locating Settlement Class Members, assisting with the filing of claims, administering and
distributing the Net Settlement Fund to Authorized Claimants, processing Proofs of Claim, or paying
escrow fees and costs.
d. Termination of the Settlement
2.10 In the event that the Stipulation is not approved, or is terminated, canceled, or fails to
become effective for any reason, including, without limitation, in the event that the Settlement is not
approved by the Court or the Judgment is reversed or vacated following appeal, the Settlement
Amount, including accrued interest, less the expenses and Taxes described in ¶¶2.8 and 2.9 hereof
actually incurred, shall be refunded to such Persons that paid the Settlement Amount pursuant to
written instructions from Gatos’s Counsel, within ten (10) business days of termination of the
Settlement.
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3. Certification of the Settlement Class
3.1 Solely for purposes of this Settlement, and subject to approval by the Court, the
Parties agree that the Settlement Class shall be certified and Plaintiffs and Lead Counsel shall be
appointed as representatives of the Settlement Class pursuant to Federal Rule of Civil Procedure 23.
Should the Settlement Class not be certified, or should any court amend the scope of the Settlement
Class, each of the Parties reserves the right to void this Stipulation in accordance with ¶8.5 hereof.
If for any reason final approval of the Settlement is not granted, then the certification of the
Settlement Class shall become null and void without further order of the Court or any other court,
and the Parties shall be restored to their respective positions in the Litigation as of June 13, 2023.
4. Notice Order and Final Approval Hearing
4.1 Once the Stipulation is executed, Plaintiffs shall promptly, and no later than July 13,
2023, submit the Stipulation together with its Exhibits to the Court and shall apply for entry of the
Notice Order, substantially in the form of Exhibit A attached hereto, requesting, inter alia, the
preliminary approval of the Settlement set forth in the Stipulation, and approval for mailing a
settlement notice (“Notice”), substantially in the form of Exhibit A-1 attached hereto, dissemination
of a Long-Form Notice of Pendency and Proposed Settlement of Class Action (“Long-Form
Notice”), substantially in the form of Exhibit A-2 attached hereto, through a dedicated website, and
publication of a summary notice (“Summary Notice”), substantially in the form of Exhibit A-4
attached hereto. The Notice shall include the general terms of the Settlement set forth in the
Stipulation, the proposed Plan of Allocation, the general terms of the Fee and Expense Application
as defined in ¶7.1 below, and the date of the Final Approval Hearing.
4.2 For purposes of identifying and providing notice to the Settlement Class, within seven
(7) business days of filing this Stipulation with the Court, Gatos shall use best efforts to cause its
securities transfer agent to provide to the Claims Administrator, a list, in electronic form, of all
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persons or custodians acting on their behalf (or both persons and custodians, where available) who
purchased or otherwise acquired Gatos Securities between October 28, 2020 and January 25, 2022,
both inclusive.
4.3 Gatos shall no later than five (5) business days following the filing of this Stipulation
with the Court serve or cause to be served proper notice of the proposed Settlement upon those who
are entitled to receive notice pursuant to the Class Action Fairness Act of 2005, 28 U.S.C. § 1715, et
seq. (“CAFA”). Gatos is solely responsible for the costs of the CAFA notice and compliance with
CAFA’s notice requirements.
4.4 The Parties shall request that after notice is given and not earlier than ninety (90)
calendar days after the later of the dates on which the appropriate Federal official and the appropriate
State officials are provided with notice pursuant to CAFA as set forth in ¶4.3 above, the Court hold a
Final Approval Hearing and approve the Settlement of the Litigation as set forth herein. At or after
the Final Approval Hearing, Lead Counsel also will request that the Court approve the proposed Plan
of Allocation and the Fee and Expense Application.
5. Releases
5.1 Defendants’ obligations incurred pursuant to this Stipulation are in consideration of:
(i) the full and final disposition of the Litigation as against all Defendants; and (ii) the Releases
provided for herein.
5.2 Upon the Effective Date, without any further action by anyone, Plaintiffs and each of
the Settlement Class Members shall be deemed to have, and by operation of the Judgment shall have,
fully, finally, and forever released, relinquished, compromised, settled, resolved, waived, discharged,
and dismissed on the merits with prejudice all Released Claims (including, without limitation,
Unknown Claims) against Defendants and their Related Parties, whether or not such Settlement
Class Member executes and delivers a Proof of Claim or participates in the Settlement Fund.
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Plaintiffs and each of the Settlement Class Members are aware of California Civil Code § 1542 and
expressly waive and relinquish any rights or benefits available to them under this statute and any law
of any state or territory of the United States, or principle of common law, which is similar,
comparable, or equivalent to California Civil Code § 1542. The releases and waivers contained in
this section were separately bargained for and are essential elements of this Stipulation and the
Settlement. For avoidance of doubt and without limitation to other claims or potential claims not
released hereby, this release does not include any breach of fiduciary duty, unjust enrichment, or
waste claims by or on behalf of Gatos against the Individual Defendants or other individuals, which
claims are referenced in or may arise from the litigation demand sent by Kathleen Marcus on April
27, 2023.
5.3 The Proof of Claim and Release form (“Proof of Claim”) to be executed by
Settlement Class Members shall release all Released Claims against Defendants and their Related
Parties and shall be substantially in the form contained in Exhibit A-3 attached hereto.
5.4 Upon the Effective Date, Plaintiffs, all Settlement Class Members, and anyone
claiming through or on behalf of any of them, are forever barred and enjoined from commencing,
instituting, intervening in, prosecuting, or continuing to prosecute any action or proceeding in any
court of law or equity, arbitration tribunal, administrative forum, or other forum of any kind,
asserting any of the Released Claims against any of the Defendants and their Related Parties, and
each of them.
5.5 Upon the Effective Date, without any further action by anyone, each of the
Defendants and their Related Parties shall be deemed to have, and by operation of the Judgment shall
have, fully, finally, and forever released, relinquished, and discharged Plaintiffs, Plaintiffs’ Counsel,
Settlement Class Members, and their employees, successors, and assigns from all claims (including,
without limitation, Unknown Claims) arising out of, relating to, or in connection with the institution,
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prosecution, assertion, settlement or resolution of: (i) the Litigation; or (ii) the Released Claims,
except for those claims brought to enforce the Settlement. Defendants and their Related Parties are
aware of California Civil Code § 1542 and expressly waive and relinquish any rights or benefits
available to them under this statute and any law of any state or territory of the United States, or
principle of common law, which is similar, comparable, or equivalent to California Civil Code
§ 1542.
6. Administration and Calculation of Claims, Final Awards and
Supervision and Distribution of the Settlement Fund
6.1 The Claims Administrator shall administer and calculate the claims submitted by
Settlement Class Members and shall oversee distribution of the Net Settlement Fund to Authorized
Claimants. The Claims Administrator will be subject to such supervision and direction from the
Court and/or Lead Counsel as may be necessary or as circumstances may require. Defendants and
their respective Related Parties shall have no responsibility for, or interest whatsoever with respect
to, the administration of the Settlement or the actions or decisions of the Claims Administrator, and
shall have no liability whatsoever to the Plaintiffs, Settlement Class Members, or Lead Counsel, in
connection with such administration, including, but not limited to: (i) any act, omission, or
determination by Lead Counsel, the Escrow Agents, and/or the Claims Administrator, or any of their
respective designees or agents, in connection with the administration of the Settlement or otherwise;
(ii) the management or investment of the Settlement Fund or the Net Settlement Fund, or the
distribution of the Net Settlement Fund; (iii) the Plan of Allocation; (iv) the determination,
administration, calculation, or payment of any claims asserted against the Settlement Fund; (v) any
losses suffered by, or fluctuations in value of, the Settlement Fund; or (vi) the payment or
withholding of any Taxes, expenses, and/or costs incurred with the taxation of the Settlement Fund
or the filing of any federal, state, or local returns.
6.2 The Settlement Fund shall be applied as follows:
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(a) to pay all the fees and expenses reasonably and actually incurred in
connection with providing notice, locating Settlement Class Members, assisting with the filing of
claims, administering and distributing the Net Settlement Fund to Authorized Claimants, processing
Proofs of Claim, and paying escrow fees and costs, if any;
(b) to pay the Taxes and Tax Expenses described in ¶2.9 hereof;
(c) to pay Lead Counsel’s fees and expenses to the extent allowed by the Court
(the “Fee and Expense Award”) and to pay any award to Plaintiffs pursuant to 15 U.S.C. § 78u-
4(a)(4) in connection with their representation of the Settlement Class to the extent allowed by the
Court; and
(d) after the Effective Date, to distribute the balance of the Settlement Fund (the
“Net Settlement Fund”) to Authorized Claimants as allowed by the Stipulation, the Plan of
Allocation, or the Court.
6.3 After the Effective Date, and in accordance with the terms of the Stipulation, the Plan
of Allocation, or such further approval and further order(s) of the Court as may be necessary or as
circumstances may require, the Net Settlement Fund shall be distributed to Authorized Claimants,
subject to and in accordance with the following.
6.4 Within ninety (90) calendar days after the mailing of the Notice or such other time as
may be set by the Court, each Person claiming to be an Authorized Claimant shall be required to
submit to the Claims Administrator a completed Proof of Claim, substantially in the form of Exhibit
A-3 attached hereto, signed under penalty of perjury and supported by such documents as are
specified in the Proof of Claim.
6.5 Except as otherwise ordered by the Court, all Settlement Class Members who fail to
timely submit a Proof of Claim within the period specified herein, or such other period as may be
ordered by the Court, or otherwise allowed, shall be forever barred from receiving any payments
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pursuant to the Stipulation and the Settlement set forth herein, but will in all other respects be subject
to and bound by the provisions of this Stipulation, the releases contained herein, and the Judgment,
and will be barred from bringing any action against the Released Parties asserting, concerning,
arising out of, or relating to the Released Claims. Notwithstanding the foregoing, Lead Counsel
shall have the discretion (but not the obligation) to accept late-submitted claims, so long as
distribution of the Net Settlement Fund to Authorized Claimants is not materially delayed thereby,
and Lead Counsel shall also have the discretion (but not the obligation) to direct the Claims
Administrator to waive what Lead Counsel deems to be de minimis or formal or technical defects in
any claims submitted. No Person shall have any claim against Plaintiffs, Lead Counsel, the Claims
Administrator or any Settlement Class Member by reason of the exercise or non-exercise of such
discretion.
6.6 Each Proof of Claim shall be submitted to and reviewed by the Claims Administrator,
under the supervision of Lead Counsel, who shall determine, in accordance with this Stipulation and
the approved Plan of Allocation, the extent, if any, to which each claim shall be allowed, subject to
the review by the Court pursuant to ¶6.8 below.
6.7 Proofs of Claim that do not meet the submission requirement may be rejected. Prior
to rejecting a Proof of Claim in whole or in part, the Claims Administrator shall communicate with
the Claimant in writing to give the Claimant the chance to remedy any curable deficiencies in the
Proof of Claim submitted. The Claims Administrator, under the supervision of Lead Counsel, shall
notify, in a timely fashion and in writing, all Claimants whose claims the Claims Administrator
proposes to reject in whole or in part for curable deficiencies, setting forth the reasons therefor, and
shall indicate in such notice that the Claimant whose claim is to be rejected has the right to a review
by the Court if the Claimant so desires and complies with the requirements of ¶6.8 below.
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6.8 If any Claimant whose timely claim has been rejected in whole or in part for curable
deficiency desires to contest such rejection, the Claimant must, within twenty (20) calendar days
after the mailing of the notice required in ¶6.7 above, or a lesser period of time if the claim was
untimely, 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 the Claim is still rejected, the Settlement Class Member
must move this Court within twenty (20) days to have the Claim accepted by Lead Counsel and the
Claims Administrator; this deadline may be extended at Lead Counsel’s discretion to facilitate
resolving any disputes before their presentation to the Court.
6.9 Each Claimant shall be deemed to have submitted to the jurisdiction of the Court with
respect to the Claimant’s claim, including, but not limited to, all releases provided for herein and in
the Judgment. 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,
but shall not in any event delay or affect the finality of the Judgment. All Settlement Class
Members, other Claimants, and Parties to this Settlement expressly waive trial by jury (to the extent
any such right may exist) and any right of appeal or review with respect to such determinations.
6.10 Following the Effective Date, the Net Settlement Fund shall be distributed to
Authorized Claimants substantially in accordance with a Plan of Allocation to be described in the
Notice and approved by the Court. If there is any balance remaining in the Net Settlement Fund
after a reasonable period of time after the date of distribution of the Net Settlement Fund (whether by
reason of tax refunds, uncashed checks or otherwise), the Claims Administrator shall, if feasible,
reallocate such balance (which may occur on multiple occasions) among Authorized Claimants who
negotiated the checks sent in the initial distribution and who would receive a minimum of $10.00.
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These redistributions shall be repeated so long as they are economically feasible. Any balance that
still remains in the Net Settlement Fund after such reallocation(s) and payments, which is not
feasible or economical to reallocate shall be donated to a non-profit, charitable organization serving
the public interest and unaffiliated with the Parties or their counsel, selected by Lead Counsel.
6.11 This Settlement is not a claims-made settlement. Upon the occurrence of the
Effective Date, no portion of the Settlement Fund will be returned to the Defendants or their
insurers. The Released Parties shall have no responsibility for, interest in, or liability whatsoever
with respect to the distribution of the Net Settlement Fund, the Plan of Allocation, the determination,
administration, or calculation of claims, the payment or withholding of Taxes or Tax Expenses, or
any losses incurred in connection therewith.
6.12 No Person shall have any claim against Plaintiffs, Plaintiffs’ Counsel, the Released
Parties, the Claims Administrator, or any other entity designated by Lead Counsel based on
distributions made substantially in accordance with the Stipulation and the Settlement contained
herein, the Plan of Allocation, or further order(s) of the Court. This does not include any claim by
any Party for breach of this Stipulation.
6.13 It is understood and agreed by the Parties that any proposed Plan of Allocation of the
Net Settlement Fund, including, but not limited to, any adjustments to an Authorized Claimant’s
claim set forth therein, is not a part of this Stipulation and is to be considered by the Court separately
from the Court’s consideration of the fairness, reasonableness, and adequacy of the Settlement set
forth in this Stipulation, and any order or proceeding relating to the Plan of Allocation shall not
operate to terminate or cancel this Stipulation or affect or delay the finality of the Court’s Judgment
approving this Stipulation and the Settlement set forth herein (including the releases contained
herein), or any other orders entered pursuant to this Stipulation.
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7. Lead Counsel’s Fees and Expenses
7.1 Lead Counsel may submit an application or applications (the “Fee and Expense
Application”) for distributions from the Settlement Fund for: (i) an award of attorneys’ fees; plus (ii)
payment of expenses or charges in connection with prosecuting the Litigation; plus (iii) any interest
on such fees and expenses at the same rate and for the same time periods as earned by the Settlement
Fund (until paid), as may be awarded by the Court. In addition, Plaintiffs may request awards
pursuant to 15 U.S.C. § 78u-4(a)(4) in connection with their representation of the Settlement Class.
Lead Counsel reserves the right to make additional applications for distributions from the Settlement
Fund for fees and expenses incurred. The application or applications described in this paragraph are
not the subject of any agreement between Plaintiffs and Defendants other than what is set forth in
this Stipulation.
7.2 The Fee and Expense Award, as awarded by the Court, shall be paid to Lead Counsel
from the Settlement Fund, as ordered, immediately after the Court executes an order awarding such
fees and expenses, notwithstanding any pending appeals of such Fee and Expense Award. Lead
Counsel may thereafter allocate the attorneys’ fees and expenses among other Plaintiffs’ counsel in a
manner in which it in good faith believes reflects the contributions of such counsel to the institution,
prosecution, and resolution of the Litigation. In the event that the Effective Date does not occur, or
the Judgment or the order making the Fee and Expense Award is reversed or modified by final non-
appealable order, or the Stipulation is canceled or terminated for any other reason, and in the event
that the Fee and Expense Award has been paid to any extent, then Lead Counsel shall be obligated,
within ten (10) business days from receiving notice from Defendants’ Counsel or from a court of
appropriate jurisdiction, to refund to the Settlement Fund the fees and expenses previously paid to
Lead Counsel from the Settlement Fund plus interest earned thereon in an amount consistent with
such reversal or modification. Lead Counsel, as a condition of receiving the Fee and Expense
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Award, agrees that Lead Counsel’s law firm and its respective partners are subject to the jurisdiction
of the Court for the purpose of enforcing this provision, and are severally liable and responsible for
any required repayment.
7.3 The procedure for and the allowance or disallowance by the Court of any Fee and
Expense Application are not part of the Settlement set forth in this Stipulation, and are to be
considered by the Court separately from the Court’s consideration of the fairness, reasonableness,
and adequacy of the Settlement set forth in this Stipulation, and any order or proceeding relating to
the Fee and Expense Application, or any appeal from any order relating thereto or reversal or
modification thereof, shall not operate to terminate or cancel this Stipulation, or affect or delay the
finality of the Judgment approving the Stipulation and the Settlement of the Litigation set forth
herein (including the releases contained herein).
7.4 Defendants and their respective Related Parties shall not take any position
concerning, have no responsibility for, and have no liability whatsoever with respect to, any Fee and
Expense Application, the payment of any Fee and Expense Award to Lead Counsel, and/or the
allocation by Lead Counsel of any attorneys’ fees or the Fee and Expense Award among other
Plaintiffs’ Counsel. Defendants, their respective Related Parties, and Defendants’ Counsel are not
entitled to any award of fees or expenses from the Settlement Fund.
8. Conditions of Settlement, Effect of Disapproval, Cancellation or
Termination
8.1 The Effective Date of this Stipulation shall be conditioned, and shall be deemed to
have occurred, upon the occurrence or waiver of all of the following events:
(a) the Court has entered the Notice Order, as required by ¶4.1 hereof;
(b) the Settlement Amount has been deposited by Defendants or their insurers into
the Escrow Accounts maintained by the Escrow Agents, as required by ¶2.1 hereof;
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(c) Gatos has not exercised its option to terminate the Stipulation pursuant to ¶8.4
hereof;
(d) the Court has entered the Judgment, substantially in the form of Exhibit B
attached hereto, or such other substantially similar form mutually agreed to by the Parties; and
(e) the Judgment has become Final, as defined in ¶1.19 hereof.
8.2 Upon the occurrence of all of the events referenced in ¶8.1 hereof, any and all
remaining interest or right of Defendants or their insurers in or to the Settlement Fund, if any, shall
be absolutely and forever extinguished. If all of the conditions specified in ¶8.1 hereof are not met,
then the Stipulation shall be canceled and terminated subject to ¶8.5 hereof unless Lead Counsel and
Defendants’ Counsel mutually agree in writing to proceed with the Stipulation.
8.3 Any decision or proceeding, whether in this Court or any appellate court, with respect
to the Fee or Expense Application or with respect to any plan of allocation shall not be considered
material to the Settlement, shall not affect the finality of any Judgment and shall not be grounds for
termination of the Settlement.
8.4 Gatos shall have the option to terminate the Settlement in the event that Persons who
otherwise would be Members of the Settlement Class and timely choose to exclude themselves from
the Settlement Class in accordance with the provisions of the Notice Order and Notice given
pursuant thereto purchased more than a certain number of shares of Gatos common stock during the
Settlement Class Period (“Opt-Out Threshold”), as set forth in a separate agreement (the “Opt-Out
Agreement”) executed between Lead Counsel and Gatos’s Counsel, which is incorporated by
reference into this Stipulation. The Parties shall not file the Opt-Out Agreement with the Court
unless instructed to do so by the Court. The Opt-Out Threshold may be disclosed to the Court for
purposes of approval of the Settlement, as may be required by the Court, but such disclosure shall be
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carried out to the fullest extent possible in accordance with the practices of the Court so as to
maintain the Opt-Out Threshold as confidential.
8.5 Unless otherwise ordered by the Court, in the event the Stipulation shall terminate, or
be canceled, or shall not become effective for any reason, then within ten (10) business days after
written notification of such event is sent by Defendants’ Counsel or Lead Counsel to the Escrow
Agents, the Settlement Fund (including accrued interest), less any expenses and costs reasonably and
actually incurred pursuant to ¶2.8 and Taxes and Tax Expenses pursuant to ¶2.9 hereof, which have
either been disbursed from the Settlement Fund or are chargeable to the Settlement Fund pursuant to
these provisions, shall be refunded by the Escrow Agents based upon written instructions from Lead
Counsel pursuant to written instructions from Defendants’ Counsel. At the request of Defendants’
Counsel, Lead Counsel or its designee shall apply for any tax refund owed on the Settlement Fund
and pay the proceeds, after deduction of any fees or expenses incurred in connection with such
application(s) for refund, pursuant to written direction from Defendants’ Counsel.
8.6 In the event that the Stipulation is not approved by the Court or the Settlement set
forth in the Stipulation is terminated or fails to become effective in accordance with its terms or the
terms of the Opt-Out Agreement, the Parties shall be restored to their respective positions in the
Litigation as of June 13, 2023. In such event, the terms and provisions of the Stipulation, with the
exception of ¶¶2.8-2.10, 8.1-8.2, 8.5-8.7, 9.4-9.5, 9.8, and 9.11-9.15 hereof, shall have no further
force and effect with respect to the Parties and shall not be used in this Litigation or in any other
proceeding for any purpose, and any judgment or order entered by the Court in accordance with the
terms of the Stipulation shall be treated as vacated, nunc pro tunc. No order of the Court or
modification or reversal on appeal of any order of the Court concerning the Plan of Allocation or any
Fee and Expense Award shall constitute grounds for cancellation or termination of the Stipulation.
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8.7 If the Effective Date does not occur, or if the Stipulation is terminated pursuant to its
terms, neither Plaintiffs nor Plaintiffs’ Counsel shall have any obligation to repay any amounts
disbursed for notice costs and Taxes and Tax Expenses pursuant to ¶¶2.8-2.9 hereof. In addition,
any expenses already incurred and chargeable pursuant to ¶2.8 hereof at the time of such termination
or cancellation, but which have not been paid, shall be paid by the Escrow Agents in accordance
with the terms of the Stipulation prior to the remaining balance being refunded in accordance with
¶¶2.10 and 8.5 hereof.
9. Miscellaneous Provisions
9.1 The Parties: (i) acknowledge that it is their intent to consummate this Settlement; and
(ii) agree to cooperate to the extent reasonably necessary to effectuate and implement all terms and
conditions of the Stipulation and to exercise their best efforts to accomplish the foregoing terms and
conditions of the Stipulation.
9.2 The Parties intend this Settlement to be a final and complete resolution of all disputes
between them with respect to the Litigation. The Settlement compromises claims that are contested
and shall not be deemed an admission by any Party as to the merits of any claim or defense. The
Parties agree that each has complied fully with the strictures of Rule 11 of the Federal Rules of Civil
Procedure, and the Judgment will contain a statement that during the course of the Litigation, the
Parties and their respective counsel at all times complied with the requirements of Federal Rule of
Civil Procedure 11. In addition, Plaintiffs shall not make applications against Defendants and/or
their counsel, and Defendants shall not make applications against Plaintiffs and/or their counsel, for
fees, costs, or sanctions.
9.3 Neither the Stipulation nor the Settlement contained herein, nor any act performed or
document executed pursuant to or in furtherance of the Stipulation or the Settlement: (i) is or may be
deemed to be or may be used as an admission of, or concession or evidence of, the validity of any
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Released Claim, the truth of any fact alleged in the Litigation, the deficiency of any defense that has
been or could have been asserted in the Litigation, or of any alleged wrongdoing, liability,
negligence, or fault of Defendants; or (ii) is or may be deemed to be or may be used as an admission
of, or evidence of, any fault or misrepresentation or omission of, including with respect to any
statement or written document attributed to, approved or made by, any Defendant in any civil,
criminal, or administrative proceeding in any court, administrative agency, proceeding, or other
forum or tribunal. Defendants and their Related Parties may file the Stipulation and/or the Judgment
in any action that may be brought against them in order to support a defense or counterclaim based
on principles of res judicata, collateral estoppel, release, good faith settlement, judgment bar or
reduction, or any other theory of, without limitation, claim preclusion or issue preclusion or similar
defense or counterclaim.
9.4 The Released Parties are intended third-party beneficiaries of this Stipulation, and this
Stipulation may be enforced by such Persons.
9.5 All agreements made and orders entered during the course of the Litigation relating to
the confidentiality of information shall survive this Stipulation, pursuant to their terms.
9.6 All of the Exhibits to the Stipulation as well as the Opt-Out Agreement are material
and integral parts hereof and are fully incorporated herein by this reference.
9.7 This 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 that all Parties have contributed substantially and materially to the preparation of this
Stipulation.
9.8 The Stipulation may be amended or modified only by a written instrument signed by
or on behalf of all Parties or their respective successors-in-interest.
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9.9 The Stipulation and the Exhibits attached hereto and the Opt-Out Agreement
constitute the entire agreement among the Parties hereto and no representations, warranties, or
inducements have been made to any Party concerning the Stipulation or its Exhibits or the Opt-Out
Agreement other than the representations, warranties, and covenants contained and memorialized in
such documents. Except as otherwise provided herein, each Party shall bear its own costs.
9.10 Lead Counsel, on behalf of the Settlement Class, is expressly authorized by Plaintiffs
to take all appropriate action required or permitted to be taken by the Settlement Class pursuant to
the Stipulation to effectuate its terms and also is expressly authorized to enter into any modifications
or amendments to the Stipulation on behalf of the Settlement Class that it deems appropriate.
9.11 Each counsel or other Person executing the Stipulation or any of its Exhibits on
behalf of any Party hereto hereby warrants that such Person has the full authority to do so.
9.12 The Stipulation may be executed in one or more counterparts, including by signature
transmitted by email in pdf format. All executed counterparts and each of them shall be deemed to
be one and the same instrument. A complete set of executed counterparts shall be filed with the
Court.
9.13 The Stipulation shall be binding upon, and inure to the benefit of, the successors and
assigns of the Parties hereto.
9.14 Subject to entry of the Judgment, substantially in the form of Exhibit B hereto, the
Court shall retain jurisdiction with respect to implementation and enforcement of the terms of the
Stipulation, and all Parties hereto submit to the jurisdiction of the Court for purposes of
implementing and enforcing the Settlement embodied in the Stipulation.
9.15 The Stipulation and the Exhibits hereto shall be considered to have been negotiated,
executed, and delivered, and to be wholly performed, in the State of New York, and the rights and
obligations of the Parties to the Stipulation shall be construed and enforced in accordance with, and
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governed by, the internal, substantive laws of the State of New York without giving effect to any
choice-of-law principles that would result in applying substantive laws other than those of the State
of New York.
9.16 Pending approval of the Court of this Stipulation and its Exhibits, all non-settlement-
related proceedings in this Litigation shall be stayed and all Members of the Settlement Class shall
be barred and enjoined from prosecuting any of the Released Claims against any of the Defendants
and their Related Parties.
9.17 The waiver by one Party of any breach of this Stipulation by any other Party shall not
be deemed a waiver of any other prior or subsequent breach of this Stipulation.
9.18 Unless otherwise provided, the Parties may agree to reasonable extensions of time to
carry out any of the provisions of this Stipulation without further order of the Court.
IN WITNESS WHEREOF, the Parties hereto have caused the Stipulation to be executed, by
their duly authorized attorneys, dated September 12, 2023.
WHEELER TRIGG O’DONNELL LLP FOSTER GRAHAM MILSTEIN & CALISHER, LLP
s/ Kathryn A. Reilly s/ Michael A. Rollin
Michael L. O’Donnell Michael A. Rollin
Kathryn A. Reilly 360 S Garfield Street, #600
Daniel N. Guisbond Denver, CO 80209
370 Seventeenth Street, Suite 4500 Telephone: 303.333.9810
Denver, CO 80202 Fax: 303.333.9786
Telephone: 303.244.1800 Email: mrollin@fostergraham.com
Facsimile: 303.244.1879
Email: odonnell@wtotrial.com
reilly@wtotrial.com s/ Michael Flynn
guisbond@wtotrial.com Michael Flynn
Lawrence Portnoy
Liaison Counsel for Lead Plaintiff Bard Isaac M. Gelbfish
Betz and Named Plaintiff Jude Sweidan Danielle Mullery
DAVIS POLK & WARDWELL LLP
450 Lexington Avenue
BLEICHMAR FONTI & AULD LLP New York, NY 10017
Telephone: 212.450.4000
s/ Joseph A. Fonti Email: michael.flynn@davispolk.com
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Joseph A. Fonti lawrence.portnoy@davispolk.com
Evan A. Kubota isaac.gelbfish@davispolk.com
7 Times Square, 27th Floor danielle.mullery@davispolk.com
New York, NY 10036
Telephone: 212.789.1340 Counsel for Gatos and the Individual
Facsimile: 212.205.3960 Defendants
Email: jfonti@bfalaw.com
ekubota@bfalaw.com s/ Audra J. Soloway
Audra J. Soloway
Counsel for Lead Plaintiff Bard Betz and Paul, Weiss, Rifkind, Wharton & Garrison
Lead Counsel for the Class LLP
1285 Avenue of the Americas
New York, New York 10019
THE SCHALL LAW FIRM Telephone: 212.373.3289
Email: asoloway@paulweiss.com
s/ Brian Schall
Brian Schall Counsel for the Underwriter Defendants
2049 Century Park East, Suite 2460
Los Angeles, CA 90067
Telephone: 424.303.1964
Email: brian@schallfirm.com
Additional Counsel for Lead Plaintiff
Bard Betz and Named Plaintiff Jude
Sweidan
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UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Civil Action No. 1:22-cv-00453-PAB-KLM
MICHAEL BILINSKY, Individually and On Behalf of All Others
Similarly Situated,
Plaintiff,
v.
GATOS SILVER, INC.,
STEPHEN ORR,
ROGER JOHNSON,
PHILIP PYLE,
JANICE STAIRS,
ALI ERFAN,
IGOR GONZALES,
KARL HANNEMAN,
DAVID PEAT,
CHARLES HANSARD, and
DANIEL MUÑIZ QUINTANILLA,
Defendants.
[PROPOSED] ORDER PRELIMINARILY APPROVING SETTLEMENT
AND PROVIDING FOR CLASS NOTICE
EXHIBIT A
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WHEREAS, a class action is pending before the Court entitled Bilinsky v. Gatos Silver Inc.
et al., No. 1:22-cv-00453-PAB-KLM (the “Litigation”);
WHEREAS, the Parties having made an application, pursuant to Federal Rule of Civil
Procedure 23(e), for an order preliminarily approving the settlement of this Litigation, in
accordance with a Stipulation of Settlement, dated July 13, 2023 (the “Stipulation”), which,
together with the Exhibits annexed thereto, sets forth the terms and conditions for a proposed
Settlement of the Litigation and for dismissal of the Litigation on the merits and with prejudice
upon the terms and conditions set forth therein; and the Court having read and considered the
Stipulation and the Exhibits annexed thereto;
WHEREAS, the Parties to the Stipulation have consented to the entry of this order; and
WHEREAS, all defined terms contained herein shall have the same meanings as set forth
in the Stipulation, unless otherwise defined herein;
NOW, THEREFORE, IT IS HEREBY ORDERED:
1. Preliminary Approval of the Settlement. The Court does hereby preliminarily
approve the Stipulation and the Settlement set forth therein, subject to further consideration at the
Final Approval Hearing described below.
2. The Court preliminarily finds that the proposed Settlement should be approved as:
(i) the result of informed, extensive arm’s-length, and non-collusive negotiations between
experienced counsel, including mediation under the direction of an experienced mediator, Robert
Meyer of JAMS; (ii) eliminating risks to the Parties of continued litigation; (iii) falling within a
range of reasonableness warranting final approval; (iv) having no obvious deficiencies; and (v)
warranting notice of the proposed Settlement to Settlement Class Members and further
consideration of the Settlement at the fairness hearing described below.
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3. Pending final determination of whether the Settlement should be approved,
Plaintiffs, all Settlement Class Members, and each of them, and anyone who acts or purports to act
on their behalf, shall not institute, commence, or prosecute any action which asserts Released
Claims against Defendants and their Related Parties (other than continuing proceedings related to
the Settlement).
4. Settlement Hearing. A hearing (the “Final Approval Hearing”) shall be held
before this Court on _______________, 2023 [a date that is the later of October 24, 2023 or ninety
(90) calendar days from the date of this Order], at __:__ _.m., in Courtroom A701 at the Alfred A.
Arraj United States Courthouse, 901 19th Street, Denver, Colorado 80294.
(a) The purposes of the Final Approval Hearing shall be to: (i) determine
whether the proposed Settlement of the Litigation on the terms and conditions provided for in the
Stipulation is fair, reasonable, and adequate to the Settlement Class and should be approved by the
Court; (ii) determine whether a Judgment as defined in ¶1.25 of the Stipulation should be entered
herein; (iii) determine, for purposes of the Settlement only, whether the Settlement Class should
be finally certified, whether Plaintiffs should be finally certified as Class Representatives for the
Settlement Class, and whether Lead Counsel should be finally appointed as counsel for the
Settlement Class; (iv) determine whether the proposed Plan of Allocation for the Net Settlement
Fund is fair and reasonable and should be approved; (v) consider Lead Counsel’s application for
an award of attorneys’ fees and expenses (which may include an application for an award to
Plaintiffs for reimbursement of their reasonable costs and expenses directly related to their
representation of the Settlement Class, pursuant to the Private Securities Litigation Reform Act of
1995 (“PSLRA”)); (vi) hear any objections by Settlement Class Members to the Settlement, Plan
of Allocation, or Lead Counsel’s or Plaintiffs’ application(s); and (viii) consider such other matters
the Court deems appropriate.
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(b) The Court may approve the proposed Settlement with such modifications as
the Parties may agree to, if appropriate, and with or without further notice to the Settlement Class
of any kind. The Court further reserves the right to enter the Judgment approving the Settlement
regardless of whether it has approved the Plan of Allocation or awarded attorneys’ fees and/or
expenses. The Court may also adjourn the Final Approval Hearing, decide to hold the hearing
remotely, or modify any of the dates herein without further individual notice to members of the
Settlement Class. Any such changes shall be posted on the website of the Claims Administrator.
5. Class Certification. Pursuant to Rule 23 of the Federal Rules of Civil Procedure,
the Court preliminarily certifies, for purposes of effectuating this Settlement only, a Settlement
Class of all Persons and entities who or which either (i) during the period from December 9, 2020
to January 25, 2022, both inclusive (the “Class Period”), purchased or otherwise acquired Gatos
common stock listed on the NYSE, or, in domestic transactions, purchased or otherwise acquired
publicly traded call options on Gatos common stock, and/or sold publicly traded put options on
Gatos common stock, and were damaged thereby; or (ii) purchased or otherwise acquired Gatos
common stock pursuant or traceable to the 2020 Registration Statement or the 2021 Registration
Statement, in domestic transactions or on the NYSE, and were damaged thereby. Excluded from
the Settlement Class are: Defendants, the current and Class Period officers and directors of the
Company, the members of the immediate families and the legal representatives, affiliates, heirs,
successors-in-interest, or assigns of any such excluded person, any entity in which such excluded
persons have or had a majority interest, and the Electrum Group, LLC; provided, however, that
any “Investment Vehicle” shall not be excluded from the Settlement Class. “Investment Vehicle”
means any investment company, pooled investment fund, or separately managed account
(including, but not limited to, mutual fund families, exchange traded funds, funds of funds, private
equity funds, real estate funds, hedge funds, and employee benefit plans) in which the Underwriter
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Defendants, or any of them, have, has, or may have a direct or indirect interest, or as to which its
affiliates may serve as a fiduciary or act as an investment advisor, general partner, managing
member, or in any other similar capacity, but in which any of the Underwriter Defendants alone
or together, with its, his, or her respective affiliates, is not a majority owner or does not hold a
majority beneficial interest. Also excluded from the Settlement Class are those Persons who timely
and validly request exclusion from the Settlement Class pursuant to the requirements set by the
Court. Pursuant to Rule 23, and for purposes of settlement only, the Court hereby preliminarily
certifies Plaintiffs as Settlement Class Representatives and Bleichmar Fonti & Auld LLP as
Settlement Class Counsel.
6. Settlement Class Findings. With respect to the Settlement Class, the Court
preliminarily finds, for purposes of effectuating this Settlement only, that (i) the Members of the
Settlement Class are so numerous that joinder of all Settlement Class Members in the Litigation is
impracticable; (ii) there are questions of law and fact common to the Settlement Class which
predominate over any individual questions; (iii) the claims of the Plaintiffs are typical of the claims
of the Settlement Class; (iv) Plaintiffs and Lead Counsel have fairly and adequately represented
and protected the interests of all Settlement Class Members; and (v) a class action is superior to
other available methods for the fair and efficient adjudication of the controversy, considering that:
the claims of Settlement Class Members in the Litigation are substantially similar and would, if
tried, involve substantially identical proofs and may therefore be efficiently litigated and resolved
on an aggregate basis as a class action; the amounts of the claims of many of the Settlement Class
Members are too small to justify the expense of individual actions; and it does not appear that there
is significant interest among Settlement Class Members in individually controlling the litigation
of their claims.
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7. Approval of Form and Content of Notice. The Court approves, as to form and
content, the Notice of Pendency and Proposed Settlement of Class Action (the “Notice”), the Long-
Form Notice of Pendency and Proposed Settlement of Class Action (“Long-Form Notice”), the
Proof of Claim and Release form (the “Proof of Claim”), and the Summary Notice (“Summary
Notice”), annexed hereto as Exhibits 1, 2, 3, and 4, respectively, and finds that they: (a) constitute
the best notice to Settlement Class Members practicable under the circumstances; (b) are
reasonably calculated, under the circumstances, to describe the terms and effect of the Settlement
and to apprise Settlement Class Members of their right to object to the proposed Settlement or to
exclude themselves from the Settlement Class; (c) are reasonable and constitute due, adequate, and
sufficient notice to all persons entitled to receive such notice; and (d) satisfy all applicable
requirements of the Federal Rules of Civil Procedure (including Rules 23(c)-(e)), the Due Process
Clause of the United States Constitution, 15 U.S.C. §78u-4(a)(7) and 15 U.S.C. §77z-1(a)(7), as
amended by the PSLRA, and the rules of this Court.
8. Retention of Claims Administrator and Manner of Notice. Lead Counsel is
hereby authorized to retain Epiq Class Action and Claims Solutions, Inc. (“Claims Administrator”)
to supervise and administer the notice procedure as well as the processing of claims as more fully
set forth below:
(a) No later than _______________, 2023 (the “Notice Date”) [a date that is
twenty-one (21) calendar days from the date of this Order], the Claims Administrator shall
commence mailing a copy of the Notice, substantially in the form annexed hereto, by First-Class
Mail to (i) all Settlement Class Members who can be identified with reasonable effort, and (ii)
brokers and nominees on the Claims Administrator’s list of brokers and nominees that commonly
hold securities for the benefit of investors. Further, on the Notice Date, the Notice, Long-Form
Notice, Proof of Claim, and the Stipulation and its Exhibits shall be posted on the website to be
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established by the Claims Administrator for the purpose of providing information concerning the
Settlement to Settlement Class Members and for online claim submission by Settlement Class
Members;
(b) No later than _______________, 2023 [a date that is fourteen (14) calendar
days after the Notice Date], the Claims Administrator shall cause the Summary Notice to be
published once in a national news publication, and once over a national newswire service; and
(c) On or before _______________, 2023 [a date that is seven (7) calendar days
prior to the Final Approval Hearing], Lead Counsel shall cause to be served on Defendants’
Counsel and filed with the Court proof, by affidavit or declaration, of such mailing, publishing,
and posting.
9. All reasonable expenses incurred in identifying and notifying Settlement Class
Members, as well as administering the Settlement Fund, shall be paid as set forth in the Stipulation.
In the event the Settlement is not approved by the Court, or otherwise fails to become effective,
neither Plaintiffs nor Plaintiffs’ Counsel shall have any obligation to repay any amounts incurred
and/or disbursed from the Settlement Fund in connection with administering the Settlement, as
provided in the Stipulation.
10. Nominee Procedures. The Claims Administrator shall use reasonable efforts to
give notice to nominee purchasers such as brokerage firms and other persons and entities that
purchased or otherwise acquired Gatos Securities during the Class Period as record owners but not
as beneficial owners. Such nominees shall (1) send the Notice to such beneficial owners of such
Gatos Securities within seven (7) calendar days after receipt thereof, or (2) send a list of the names
and addresses of such beneficial owners to the Claims Administrator within seven (7) calendar
days of receipt thereof, in which event the Claims Administrator shall promptly mail the Notice to
such beneficial owners. If you choose the first option, you must send a statement to the Claims
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Administrator confirming that the mailing was made and you must retain your mailing records for
use in connection with any further notices that may be provided in the Litigation. Upon nominees’
full and timely compliance with these directions, such nominees may seek reimbursement out of
the Settlement Fund solely of their reasonable out-of-pocket expenses actually incurred in
providing notice to beneficial owners by providing the Claims Administrator with proper
documentation supporting the expenses for which reimbursement is sought, subject to further order
of this Court with respect to any dispute concerning such compensation.
11. Participation in the Settlement. All Members of the Settlement Class shall be
bound by all determinations and judgments in the Litigation concerning the Settlement, including,
but not limited to, the releases provided for therein, whether favorable or unfavorable to the
Settlement Class, regardless of whether such Persons seek or obtain by any means, including,
without limitation, by submitting a Proof of Claim or any similar document, any distribution from
the Settlement Fund or the Net Settlement Fund.
(a) Settlement Class Members who wish to participate in the Settlement shall
complete and submit Proofs of Claim in accordance with the instructions contained therein. Unless
the Court orders otherwise, all Proofs of Claim must be postmarked or submitted electronically no
later than _______________, 2023 [a date that is ninety (90) calendar days after the Notice
Date]. Any Settlement Class Member who does not submit a Proof of Claim within the time
provided for (a) shall be bound by all determinations and judgments in the Litigation concerning
the Settlement, whether favorable or unfavorable to the Settlement Class, including, without
limitation, the Judgment and the releases provided for therein; (b) shall be barred from
commencing, maintaining, or prosecuting any of the Released Claims against any of the
Defendants and their Related Parties, as more fully described in the Stipulation; and (c) shall be
barred from sharing in the distribution of the proceeds of the Net Settlement Fund, unless otherwise
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ordered by the Court. Notwithstanding the foregoing, Lead Counsel shall have the discretion (but
not the obligation) to accept late-submitted claims for processing by the Claims Administrator so
long as distribution of the Net Settlement Fund is not materially delayed thereby. No Person shall
have any claim against Plaintiffs, Plaintiffs’ Counsel, or the Claims Administrator by reason of the
decision to exercise such discretion whether to accept late-submitted claims.
(b) A Proof of Claim must satisfy the following conditions, unless otherwise
allowed pursuant to the Stipulation: (i) it must be properly completed, signed, and submitted in a
timely manner in accordance with the provisions of the preceding subparagraph; (ii) it must be
accompanied by adequate supporting documentation for the transactions reported therein, in the
form of broker confirmation slips, broker account statements, an authorized statement from the
broker containing the transactional information found in a broker confirmation slip, or such other
documentation as is deemed adequate by the Claims Administrator and/or Lead Counsel; (iii) if
the person executing the Claim Form is acting in a representative capacity, a certification of their
current authority to act on behalf of the claimant must be included in the Claim Form; and (iv) the
Claim Form must be complete and contain no material deletions or modifications of any of the
printed matter contained therein and must be signed under penalty of perjury.
(c) As part of the Proof of Claim, each Claimant shall submit to the jurisdiction
of the Court with respect to the claim submitted.
12. Exclusion from the Settlement Class. Any Person who desires to request
exclusion from the Settlement Class shall do so by submitting a written request for exclusion to
the Claims Administrator, which must be timestamped (for online submissions) or received by the
Claims Administrator no later than ___, 2023 [a date that is forty-five (45) calendar days after
the Notice Date]. The request for exclusion must: (i) include the person’s or entity’s name,
address, and telephone number; (ii) state that the person or entity wishes to be “excluded from the
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Settlement Class” in this Litigation; (iii) include proof (such as stockbroker confirmation slips,
stockbroker statements, or other documents) adequately evidencing the date(s), price(s), and
number(s) of all Gatos Securities purchased and/or sold during the Class Period or purchased or
acquired pursuant or traceable to the 2020 Registration Statement or the 2021 Registration
Statement; and (iv) be signed by the person or entity requesting exclusion or their authorized
representative (accompanied by proof of authorization). No request for exclusion shall be effective
unless it is timely and provides the required information. Upon receiving any request(s) for
exclusion, the Claims Administrator shall promptly notify Lead Counsel and Gatos’s Counsel of
such request(s) and provide them copies of such request(s) and the documentation accompanying
them by facsimile or electronic mail. All Persons who submit valid and timely requests for
exclusion shall have no rights under the Stipulation, shall not share in the distribution of the Net
Settlement Fund, and shall not be bound by the Stipulation or the Judgment entered in the
Litigation. Lead Counsel shall cause to be provided to Gatos’s Counsel copies of all requests for
exclusion promptly upon receipt and as expeditiously as possible and, in any event, not more than
five (5) calendar days after receipt by the Claims Administrator.
13. Appearance and Objections at Final Approval Hearing. Any Member of the
Settlement Class may enter an appearance in the Litigation, at his, her, or its own expense,
individually or through counsel of his, her, or its own choice. If he, she, or it does not enter an
appearance, he, she, or it will be represented by Lead Counsel.
(a) Any Settlement Class Member may file a written objection to the proposed
Settlement and show cause why the proposed Settlement of the Litigation should or should not be
approved as fair, reasonable, and adequate, why the 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 Lead Counsel or awards granted to Plaintiffs;
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provided, however, that no Settlement Class Member or any other Person shall be heard or entitled
to contest such matters, unless that Person has mailed or delivered said objections, papers, and
briefs to the Clerk of the United States District Court for the District of Colorado, on or before
_______________, 2023 [a date that is twenty-one (21) calendar days prior to the Final
Approval Hearing], and delivered copies of any such papers to Bleichmar Fonti & Auld LLP,
Joseph A. Fonti, Times Square Tower, 7 Times Square, 27th Floor, New York, NY 10036, Davis
Polk & Wardwell LLP, Michael S. Flynn, 450 Lexington Avenue, New York, NY 10017, and
Paul, Weiss, Rifkind, Wharton & Garrison LLP, Audra J. Soloway, 1285 Avenue of the Americas,
New York, NY 10019, with emailed copies to gatossettlement@bfalaw.com such that they are
received on or before the same date. To object, a Settlement Class Member must send a letter
saying that he, she, or it objects to the Settlement in Bilinsky v. Gatos Silver Inc. et al., No. 1:22-
cv-00453-PAB-KLM, which must (1) include the objector’s name, address, and telephone number;
(2) provide documentation establishing the objector’s membership in the Settlesment Class,
including documents showing the type and number of Gatos Securities purchased, acquired, and
sold during the Class Period or purchased or acquired pursuant or traceable to the 2020
Registration Statement or the 2021 Registration Statement, as well as the dates and prices of each
such purchase, acquisition, and sale; (3) contain a statement of reasons for the objection, including
whether it applies only to the objector, to a specific subset of the Settlement Class, or to the entire
Settlement Class; (4) identify any other class action settlement(s) in which the objector or the
objector’s attorney has objected; (5) include copies of any papers or other documents upon which
the objection is based; and (6) include the objector’s signature, even if represented by counsel.
Any Settlement Class Member who does not make his, her, or its objection in the manner provided
in this Order shall be deemed to have waived such objection and shall forever be foreclosed from
making any objection to the fairness or adequacy of the proposed Settlement as set forth in the
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Stipulation, to the Plan of Allocation, or to the award of attorneys’ fees and expenses to Lead
Counsel or awards to Plaintiffs, unless otherwise ordered by the Court.
(b) Attendance at the Final Approval Hearing is not necessary. However,
persons wishing to be heard orally in opposition to the approval of the Settlement, the Plan of
Allocation, and/or the Fee and Expense Application are required to indicate in their written
objection their intention to appear at the hearing. Persons who intend to object to the Settlement,
the Plan of Allocation, and/or the Fee and Expense Application and desire to present evidence at
the Final Approval Hearing must include in their written objections the identity of any witnesses
they may call to testify and copies of any exhibits they intend to introduce into evidence at the
Final Approval Hearing.
(c) Settlement Class Members do not need to appear at the hearing or take any
other action to indicate their approval.
(d) At or after the Final Approval Hearing, the Court shall determine whether
the Plan of Allocation proposed by Lead Counsel, and any application for attorneys’ fees or
expenses, shall be approved.
14. Settlement Fund. The Court approves the establishment of the Escrow Accounts
into which the Settlement Amount will be deposited for the benefit of the Settlement Class. All
funds held by the Escrow Agent shall be deemed and considered to be in custodia legis of the
Court, and shall remain subject to the jurisdiction of the Court, until such time as such funds shall
be distributed pursuant to the Stipulation and/or further order(s) of the Court. No person who is
not a Settlement Class Member or Lead Counsel shall have any right to any portion of, or to any
distribution of, the Net Settlement Fund unless otherwise ordered by the Court or otherwise
provided in the Stipulation.
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15. Supporting Papers. All opening papers in support of the Settlement, the Plan of
Allocation, and the application for attorneys’ fees and expenses shall be filed and served on or
before _______________, 2023 [a date that is thirty-five (35) calendar days prior to the Final
Approval Hearing]. Any reply papers in response to objections shall be filed and served on or
before _______________, 2023 [a date that is seven (7) calendar days prior to the Final Approval
Hearing].
16. Defendants shall not have any responsibility for, or liability with respect to, the
Plan of Allocation or any application for attorneys’ fees or expenses submitted by Lead Counsel,
and such matters will be considered separately from the fairness, reasonableness, and adequacy of
the Settlement.
17. All reasonable expenses incurred in identifying and notifying Settlement Class
Members, as well as administering the Settlement Fund, shall be paid as set forth in the Stipulation.
In the event the Settlement is not approved by the Court, or otherwise fails to become effective,
neither Plaintiffs nor Plaintiffs’ Counsel shall have any obligation to repay any amounts disbursed
or incurred pursuant to ¶¶2.8 or 2.9 of the Stipulation.
18. Use of this Order. Neither this Order nor the proposed Settlement (including the
Stipulation), nor any of the negotiations or proceedings connected with it: (a) shall be offered
against any Defendants or their Related Parties as evidence of, or construed as, or deemed to be
evidence of, any presumption, concession, or admission by any of the Released Parties with respect
to the Showing the first 150,000 of 360,946 characters. Full text.