Gildan Activewear Inc. has entered into an agreement to settle all proposed securities class action proceedings filed in 2008 before the Ontario Superior Court of Justice, the Quebec Superior Court and the United States District for the Southern District of New York (the ‘Courts’). The proposed litigation related to, among other things, the company’s April 29, 2008 announcement revising its fiscal 2008 earnings guidance.
The settlement will be entirely funded by the company’s insurance policies and will have no impact on the Company’s earnings or cash flows. The settlement agreement provides for a total settlement amount of U.S. $22.5 million for distribution to eligible class members in accordance with a plan of allocation to be approved by the Courts, net of court approved expenses and attorneys’ fees for class counsel.
The settlement agreement acknowledges that the company and its senior officers deny all of the claims and charges of wrongdoing, liability or violation of laws.
The settlement agreement is conditional upon approval of the settlement by each of the Courts. Dates have not yet been set for settlement approval hearings. The settlement agreement is also subject to the company’s option to terminate the agreement if opt-outs by shareholders eligible to participate in the settlement exceed a certain pre-determined threshold.
