HCC Insurance Holding has reached a settlement, subject to court approval, with the plaintiffs in class action litigation relating to the company's historic stock option granting practices.
The company has previously reached a settlement in the shareholder derivative litigation regarding the stock option matter. With the current announcement, all private securities litigation pending against the company regarding the stock option matter has been resolved.
The terms of the settlement, which includes no admission of liability or wrongdoing by HCC or any other defendants, provided for a full and complete release of all claims in the litigation and payment of $10 million to be paid into a settlement fund, pending approval by the court of a plan of distribution.
The $10 million will be paid by the company’s directors’ and officers’ liability insurers, and will not have a material effect on HCC’s financial results. Once approved, the settlement will resolve all class action litigation pending against the company, as well as its former and current directors and officers.
Frank Bramanti, CEO of HCC Insurance, said: The settlement of this class action lawsuit is another step in the direction of putting the entire option issue behind us. We are now waiting to hear the Securities and Exchange Commission’s ruling on the option issue, which we hope will finally and completely resolve the matter.