According to the docket dated March 10, 2005, on January 19, 2005, the Court entered the Order by U.S. District Judge John L. Kane granting the Lead Plaintiff’s motion for Order approving the class action settlement, the plan of allocation, the application by plaintiffs’ co-lead counsel for an award of attorney fees and reimbursements of expenses, and the application for award to the representative plaintiffs. The Court further entered the Final Judgment and Order dismissing the case with prejudice.
On November 12, 2004, class plaintiffs in the class action litigation against FirstWorld Communications, Inc. (now known as Verado Holdings, Inc.), led by four individual lead plaintiff class representatives, obtain preliminary approval of a $25.925 million settlement reached with defendants in this case brought in the District of Colorado against FirstWorld Communications, Inc., members of its management team and underwriters of the initial public offering of FirstWorld's stock in March 2000. The settlement came during the discovery phase of the case, when plaintiffs were gathering the evidence they needed to support the allegations in the lawsuit. Class plaintiffs had alleged that defendants misled investors about the company's business plan in the offering documents.
The court has scheduled a hearing for January 18, 2005, to consider whether the settlement is fair, reasonable and adequate. Any class member who desires to participate in a distribution of the proceeds of the settlement, assuming it is approved, must submit a proof of claim form to the claims administrator by March 22, 2005.
The complaint charges that the Company and certain of its officers and directors violated the federal securities laws by issuing a false and misleading Registration Statement and Prospectus for the IPO of FirstWorld common stock. The complaint alleges that as a direct result of the falsity of the Registration Statement and Prospectus, FirstWorld's IPO was sold at a price far exceeding the true value of the stock at that time.