<SEC-DOCUMENT>0001683168-17-001953.txt : 20170804
<SEC-HEADER>0001683168-17-001953.hdr.sgml : 20170804
<ACCEPTANCE-DATETIME>20170804162812
ACCESSION NUMBER:		0001683168-17-001953
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20170802
ITEM INFORMATION:		Other Events
FILED AS OF DATE:		20170804
DATE AS OF CHANGE:		20170804

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			APPLIANCE RECYCLING CENTERS OF AMERICA INC /MN
		CENTRAL INDEX KEY:			0000862861
		STANDARD INDUSTRIAL CLASSIFICATION:	RETAIL-HOME FURNITURE, FURNISHINGS & EQUIPMENT STORES [5700]
		IRS NUMBER:				411454591
		STATE OF INCORPORATION:			MN
		FISCAL YEAR END:			0103

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-19621
		FILM NUMBER:		171008969

	BUSINESS ADDRESS:	
		STREET 1:		175 JACKSON AVE N
		STREET 2:		SUITE 102
		CITY:			MINNEAPOLIS
		STATE:			MN
		ZIP:			55343
		BUSINESS PHONE:		9529309000

	MAIL ADDRESS:	
		STREET 1:		175 JACKSON AVE N
		STREET 2:		SUITE 102
		CITY:			MINNEAPOLIS
		STATE:			MN
		ZIP:			55343
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>arca_8k.htm
<DESCRIPTION>FORM 8-K
<TEXT>
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<P STYLE="font: 18pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 16pt"><B>UNITED
STATES </B></FONT></P>

<P STYLE="font: 18pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 16pt"><B>SECURITIES
AND EXCHANGE COMMISSION </B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Washington, D.C. 20549 </B></P>

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<P STYLE="font: 18pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 18pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>FORM 8-K </B></P>

<P STYLE="font: 18pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>CURRENT REPORT </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Pursuant to Section 13 or 15(d) </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>of The Securities Exchange Act of 1934
</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Date of Report (Date of Earliest Event
Reported): August 2, 2017</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 16pt"><B>APPLIANCE
RECYCLING CENTERS OF AMERICA, INC. </B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>(Exact name of registrant as specified
in its charter) </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

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    <TD STYLE="vertical-align: bottom; width: 2%">&nbsp;</TD>
    <TD STYLE="width: 32%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 2%">&nbsp;</TD>
    <TD STYLE="width: 32%">&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: top; font-size: 10pt; text-align: center"><B>Minnesota</B></TD>
    <TD STYLE="vertical-align: bottom; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="vertical-align: top; font-size: 10pt; text-align: center"><B>0-19621</B></TD>
    <TD STYLE="vertical-align: bottom; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="vertical-align: top; font-size: 10pt; text-align: center"><B>41-1454591</B></TD></TR>
<TR>
    <TD STYLE="vertical-align: top">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>(State or other jurisdiction</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>of incorporation)</B></P></TD>
    <TD STYLE="vertical-align: bottom; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="vertical-align: top">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>(Commission</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>File Number)</B></P></TD>
    <TD STYLE="vertical-align: bottom; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="vertical-align: top">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>(I.R.S. Employer</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Identification No.)</B></P></TD></TR>
</TABLE>
<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR>
    <TD STYLE="width: 67%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="width: 32%">&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: top; font-size: 10pt; text-align: center"><B>175 Jackson Avenue North Suite 102, Minneapolis, Minnesota</B></TD>
    <TD STYLE="vertical-align: bottom; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; font-size: 10pt; text-align: center"><B>55343</B></TD></TR>
<TR>
    <TD STYLE="vertical-align: top; font-size: 10pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Address of principal executive offices)</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="vertical-align: top; font-size: 10pt; text-align: center"><FONT STYLE="font-size: 10pt"><B>(Zip Code)</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Registrant&rsquo;s telephone number,
including area code: 952-930-9000 </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Not Applicable </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>(Former name or former address, if changed
since last report) </B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Check the appropriate box below if the Form 8-K filing is intended
to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 3%; font-size: 10pt"><FONT STYLE="font-family: Wingdings; font-size: 10pt">o</FONT></TD>
    <TD STYLE="width: 97%; font-size: 10pt"><FONT STYLE="font-size: 10pt">Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)</FONT></TD></TR>
</TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 3%; font-size: 10pt"><FONT STYLE="font-family: Wingdings; font-size: 10pt">o</FONT></TD>
    <TD STYLE="width: 97%; font-size: 10pt"><FONT STYLE="font-size: 10pt">Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)</FONT></TD></TR>
</TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 3%; font-size: 10pt"><FONT STYLE="font-family: Wingdings; font-size: 10pt">o</FONT></TD>
    <TD STYLE="width: 97%; font-size: 10pt"><FONT STYLE="font-size: 10pt">Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))</FONT></TD></TR>
</TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 3%; font-size: 10pt"><FONT STYLE="font-family: Wingdings; font-size: 10pt">o</FONT></TD>
    <TD STYLE="width: 97%; font-size: 10pt"><FONT STYLE="font-size: 10pt">Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))</FONT></TD></TR>
</TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Indicate by check mark whether the registrant is an emerging
growth company as defined in Rule 405 of the Securities Act of 1933 (&sect;230.405 of this chapter) or Rule 12b-2 of the Securities
Exchange Act of 1934 (&sect;240.12b-2 of this chapter).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left">Emerging growth company&nbsp;&nbsp;&nbsp;<FONT STYLE="font-family: Wingdings">&uml;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">If an emerging growth company, indicate by check mark if the
registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards
provided pursuant to Section 13(a) of the Exchange Act.&nbsp; <FONT STYLE="font-family: Wingdings">&uml;</FONT></P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Item&nbsp;8.01. Other Events.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">On August&nbsp;2, 2017, the Hennepin County District Court,
State of Minnesota, issued an order preliminarily approving a proposed settlement by and among Appliance Recycling Centers of America,
Inc. (&ldquo;ARCA&rdquo;), the plaintiffs, and all named defendants in the stockholder derivative action captioned&nbsp;<I>Gray,
et al. v. Cameron, et al.,&nbsp;</I>No.&nbsp;27-CV-15-19456.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">A hearing to determine whether the court should issue an order
of final approval of the settlement has been scheduled for September 29, 2017 at 8:45 a.m., before the Honorable Daniel H. Mabley,
at the Hennepin County Government Center, 300 South 6th Street, Minneapolis, Minnesota 55487. Pursuant to the Court&rsquo;s order,
any objections to the settlement must be filed in writing with the court no later than fourteen (14) days prior to the hearing.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Additional information concerning the terms of the settlement,
the September 29, 2017 hearing, and the requirements for objections can be found in the Notice to Current ARCA Stockholders, which
is attached hereto as Exhibit 99.1 and incorporated in this Current Report on Form 8-K by reference.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Item&nbsp;9.01. Financial Statements and Exhibits</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Exhibits</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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    <TD STYLE="width: 13%">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Exhibit</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><U>Number</U></B></P></TD>
    <TD STYLE="width: 87%">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><U>Description of Document</U></B></P></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt">99.1</TD>
    <TD STYLE="font-size: 10pt">Notice to Current ARCA Stockholders</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>SIGNATURES </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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    <TD STYLE="font-size: 10pt">Date: August 4, 2017</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt">APPLIANCE RECYCLING CENTERS OF AMERICA, INC.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 51%">&nbsp;</TD>
    <TD STYLE="width: 4%; font-size: 10pt">By:</TD>
    <TD STYLE="width: 45%">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; border-bottom: black 0.75pt solid">/s/ Tony Isaac</P></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="font-size: 10pt">Tony Isaac</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="font-size: 10pt">Chief Executive Officer</TD></TR>
</TABLE>


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<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>arca_ex9901.htm
<DESCRIPTION>NOTICE TO CURRENT ARCA STOCKHOLDERS
<TEXT>
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<P STYLE="margin: 0"><B>Exhibit 99.1</B></P>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top; text-align: left">
    <TD STYLE="width: 50%">STATE OF MINNESOTA</TD>
    <TD STYLE="width: 50%; text-align: right">DISTRICT COURT</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>COUNTY OF HENNEPIN</TD>
    <TD STYLE="text-align: right">FOURTH JUDICIAL DISTRICT</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">CASE TYPE: Other Civil</TD></TR>
</TABLE>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top; text-align: left">
    <TD STYLE="width: 45%">DAVID GRAY and MICHAEL BOLLER, <BR>
Derivatively and on Behalf of APPLIANCE <BR>
RECYCLING CENTERS OF AMERICA, INC.,</TD>
    <TD STYLE="width: 10%">&nbsp;</TD>
    <TD STYLE="width: 45%; text-align: left; vertical-align: middle">Court File No. 27-CV-15-19456</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>Jude Daniel H. Mabley</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD STYLE="text-align: center">Plaintiffs,</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><B>NOTICE TO CURRENT ARCA</B></TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;v.</TD>
    <TD>&nbsp;</TD>
    <TD><B>STOCKHOLDERS</B></TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>EDWARD R. CAMERON, JEFFREY A. <BR>
CAMMERRER, MARK G. <BR>
EISENSCHENK, STEVE LOWENTHAL, <BR>
RANDY L. PEARCE, DEAN R. <BR>
PICKERELL, RICHARD D. BUTLER, JR., <BR>
BRIAN T. CONNERS, DENNIS (DE) <BR>
GAO, TONY ISAAC, STANLEY <BR>
GOLDBERG, and DUANE S. CARLSON, </TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD STYLE="padding-left: 30pt">Defendants</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD STYLE="padding-left: 30pt">and</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>APPLIANCE RECYCLING CENTERS OF <BR>
AMERICA, INC.,</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
</TABLE>

<P STYLE="margin: 0"></P>

<P STYLE="margin: 0">&nbsp;&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left; text-indent: 60pt">Nominal Defendant.</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left; text-indent: 60pt"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left; text-indent: 60pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left; text-indent: 60pt"></P>


<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in"><B>TO:</B></TD><TD STYLE="text-align: justify"><B>ALL OWNERS OF APPLIANCE RECYCLING CENTERS OF AMERICA, INC. (&ldquo;ARCA&rdquo;) COMMON STOCK
(TICKER SYMBOL: ARCI) AS OF JULY 31, 2017, WHO CONTINUE TO OWN SUCH SHARES (&ldquo;CURRENT ARCA STOCKHOLDERS&rdquo;).</B></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify"><B>PLEASE READ THIS NOTICE CAREFULLY
AND IN ITS ENTIRETY. YOUR RIGHTS MAY BE AFFECTED. THIS NOTICE RELATES TO A PROPOSED SETTLEMENT AND DISMISSAL OF STOCKHOLDER DERIVATIVE
LITIGATION AND CONTAINS IMPORTANT INFORMATION REGARDING YOUR RIGHTS. YOUR RIGHTS MAY BE AFFECTED BY LEGAL PROCEEDINGS IN THIS ACTION.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify"><B>IF THE COURT APPROVES THE
SETTLEMENT AND DISMISSAL OF THE ACTION, STOCKHOLDERS OF ARCA WILL BE FOREVER BARRED FROM CONTESTING THE APPROVAL OF THE PROPOSED
SETTLEMENT AND FROM PURSUING THE SETTLED CLAIMS. THIS ACTION IS NOT A &ldquo;CLASS ACTION.&rdquo; THUS, THERE IS NO COMMON FUND
UPON WHICH YOU CAN MAKE A CLAIM FOR A MONETARY PAYMENT.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify"><B>THE COURT HAS MADE NO FINDINGS
OR DETERMINATIONS RESPECTING THE MERITS OF THE ACTION. THE RECITATION OF THE BACKGROUND AND CIRCUMSTANCES OF THE SETTLEMENT CONTAINED
HEREIN DOES NOT CONSTITUTE THE FINDINGS OF THE COURT. IT IS BASED ON REPRESENTATIONS MADE TO THE COURT BY COUNSEL FOR THE PARTIES.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B></B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>YOU ARE HEREBY NOTIFIED</B>,
pursuant to Minnesota Rule of Civil Procedure 23.09 and an Order from the Honorable Daniel H. Mabley of the Hennepin County District
Court for the State of Minnesota (the &ldquo;Court&rdquo;), that a proposed settlement agreement has been reached among Plaintiffs,<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><SUP>[1]</SUP></FONT>
derivatively on behalf of Appliance Recycling Centers Of America, Inc. (&ldquo;ARCA&rdquo; or the &ldquo;Company&rdquo;), the Individual
Defendants, and ARCA in connection with the above-captioned consolidated stockholder derivative action titled <I>Gray, et al. v.
Cameron, et al.</I>, Case No. 27-CV-15-19456 (the &ldquo;Action&rdquo;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Plaintiffs filed the
Action derivatively on behalf of ARCA to remedy the alleged harm caused to the Company by the Individual Defendants&rsquo; alleged
breach of their fiduciary duties and other alleged misconduct. The proposed Settlement, if approved by the Court, would fully,
finally and forever resolve the Action on the terms set forth in the Stipulation and summarized in this Notice, including the dismissal
of the Action with prejudice.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">As explained below,
a Settlement Hearing shall be held before the Court on September 29, 2017 at 8:45 a.m., before the Honorable Daniel H. Mabley,
at the Hennepin County Government Center, 300 South 6th Street, Minneapolis, Minnesota 55487, to determine whether, <I>inter alia</I>,
the proposed Settlement is fair, reasonable, and adequate, and should be finally approved by the Court and whether Plaintiffs&rsquo;
Counsel&rsquo;s Fee Award, including Service Awards to the Plaintiffs, should be finally approved. You have the right to object
to the Settlement and the Fee Award in the manner provided herein. If you fail to object in the manner provided herein <B><I>at
least fourteen (14) days prior to the Settlement Hearing</I></B>, you will be deemed to have waived your objections and will be
forever bound by the Judgment to be entered and the releases to be given, unless otherwise ordered by the Court.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">This Notice is not
intended to be and should not be construed as an expression of any opinion by the Court with respect to the merits of the claims
made in the Action, but is merely to advise you of the proposed Settlement and of your rights as a Current ARCA Stockholder.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: bold 10pt Times New Roman, Times, Serif; text-transform: uppercase; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in">I.</TD><TD STYLE="text-align: justify">background</TD></TR></TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: bold 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">A.</TD><TD STYLE="text-align: justify">Plaintiffs&rsquo; Allegations</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">ARCA is a Minnesota
corporation with its principal offices located in Minneapolis, Minnesota. ARCA sells household appliances through a chain of Company-owned
retail stores under the &ldquo;ApplianceSmart&rdquo; name, and also provides turnkey appliance recycling and replacement services
for electric utilities and other sponsors of energy efficiency programs through its wholly-owned subsidiary, ARCA Recycling, Inc.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Plaintiffs allege in
their proposed amended shareholder derivative complaint in the Action, which was filed on May 23, 2017 as an exhibit to plaintiffs&rsquo;
cross-motion for leave to amend the complaint, that ARCA failed to collect or remit sales tax in the state of California for the
appliances that it sold to utility companies as part of their appliance replacement programs, in violation of California tax laws.
Plaintiffs further allege that the Individual Defendants&rsquo; alleged knowing or reckless breaches of fiduciary duty in connection
with the California sales and use tax issues subjected ARCA to examination by California&rsquo;s Board of Equalization (&ldquo;BOE&rdquo;)
as well as a self-examination through participation in a BOE audit program related to state sales and use taxes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Defendants have denied,
and continue to deny, each and every claim and contention alleged by Plaintiffs in the Action and affirm that they have acted properly,
lawfully, and in full accord with their fiduciary duties, at all times.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-right: 0; margin-bottom: 0pt; text-align: left">_________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-right: 0; margin-bottom: 0pt; text-align: justify"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><SUP>[1]</SUP></FONT>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For purposes of this Notice, the Court incorporates by reference the definitions in the
Settling Parties&rsquo; Stipulation and Agreement of Settlement, fully executed as of July 31, 2017 (the &ldquo;Stipulation&rdquo;),
and all capitalized terms used herein, unless otherwise defined herein, shall have the same meanings as set forth in the Stipulation.
A copy of the Stipulation may be inspected at the Records Center of the Hennepin County Government Center, 300 South 6th Street,
Minneapolis, Minnesota 55487 or by visiting the investor relations portion of ARCA&rsquo;s website at www.arcainc.com.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: bold 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">B.</TD><TD STYLE="text-align: justify">Settlement Negotiations</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Plaintiffs&rsquo; Counsel
and Defendants&rsquo; Counsel formally commenced settlement discussions on November 3, 2016, when Plaintiffs&rsquo; Counsel sent
a settlement demand together with a proposal for corporate governance reforms to be instituted by ARCA to Defendants&rsquo; Counsel.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">After further extensive
negotiations that included numerous email exchanges and telephonic conferences, the Settling Parties reached an agreement in principle
to resolve the Action on July 26, 2017. As a condition of the settlement reflected in this Stipulation (the &ldquo;Settlement&rdquo;),
ARCA will agree to require employee training for employees who are employed in ARCA&rsquo;s accounting department, on issues relevant
to ARCA on accounting, auditing or taxation issues, for a period of one (1) year. This employee training may be conducted by ARCA
through the use of online, in-person or other resources, at ARCA&rsquo;s discretion. The Settling Parties vigorously negotiated,
at arm&rsquo;s-length, the attorneys&rsquo; fees and reimbursement of expenses to be paid to Plaintiffs&rsquo; Counsel (the &ldquo;Fee
Award&rdquo;) in light of the substantial benefits that will be conferred upon the Company by the employee training and as a result
of the settlement of the Action.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: bold 10pt Times New Roman, Times, Serif; text-transform: uppercase; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in">II.</TD><TD STYLE="text-align: justify">PLAINTIFFS&rsquo; Counsel&rsquo;s Investigation and Research, Plaintiffs&rsquo; CLAIMS, AND THE
BENEFIT OF SETTLEMENT</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Plaintiffs&rsquo; Counsel
conducted an investigation relating to the claims and the underlying events alleged in the Action, including, but not limited to:
(1) reviewing and analyzing the Company&rsquo;s public filings with the United States Securities and Exchange Commission (&ldquo;SEC&rdquo;),
press releases, announcements, transcripts of investor conference calls, and news articles; (2) reviewing and analyzing the allegations
contained in the Securities Class Action; (3) researching and drafting the shareholder derivative complaint in the Action; (4)
researching and drafting the proposed amended shareholder derivative complaint in the Action; (5) researching the applicable law
with respect to the claims in the Action and the potential defenses thereto; (6) researching and drafting the brief in opposition
to the motion to dismiss; (7) researching corporate governance issues; (8) preparing an extensive settlement demand and corporate
governance reforms proposals; and (9) engaging in extensive settlement discussions with Defendants&rsquo; Counsel.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Plaintiffs&rsquo; Counsel
believe that the claims asserted in the Action have merit and that their investigation supports the claims asserted. Without conceding
the merit of any of Defendants&rsquo; defenses or the lack of merit of any of their own allegations, and in light of the benefits
of the Settlement as well as to avoid the potentially protracted time, expense, and uncertainty associated with continued litigation,
including potential trials and appeals, Plaintiffs have concluded that it is desirable that the Action be fully and finally settled
in the manner and upon the terms and conditions set forth in this Stipulation. Plaintiffs and Plaintiffs&rsquo; Counsel recognize
the significant risk, expense, and length of continued proceedings necessary to prosecute the Action against the Individual Defendants
through trials and possible appeals. Plaintiffs&rsquo; Counsel also have taken into account the uncertain outcome and the risk
of any litigation, especially complex litigation such as the Action, as well as the difficulties and delays inherent in such litigation.
Based on their evaluation, and in light of the significant benefits conferred upon the Company and its shareholders as a result
of the Settlement, Plaintiffs and Plaintiffs&rsquo; Counsel have determined that the Settlement is in the best interests of Plaintiffs,
ARCA, and Current ARCA Stockholders (as defined herein), and have agreed to settle the Action upon the terms and subject to the
conditions set forth herein.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: bold 10pt Times New Roman, Times, Serif; text-transform: uppercase; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in">III.</TD><TD STYLE="text-align: left">DEFENDANTS&rsquo; DENIALS OF WRONGDOING AND LIABILITY</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Defendants have vigorously
denied, and continue vigorously to deny, all allegations of wrongdoing, fault, liability or cognizable damage to the Company, deny
that they engaged in any wrongdoing, deny that they committed any violation of law, deny that they acted improperly in any way,
believe that they acted properly at all times, believe the Action has no merit, and maintain that they have committed no breach
of duty whatsoever. Defendants are entering into this Settlement solely because they consider it desirable that the Action be settled
and dismissed with prejudice in order to, among other things, (i) eliminate the burden, inconvenience, expense, uncertainty and
distraction of further litigation; and (ii) finally put to rest all claims that were or could have been asserted against Defendants
in the Action.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Neither this Stipulation,
nor any of its terms or provisions, <FONT STYLE="font-family: Times New Roman, Times, Serif">nor any act performed or document
executed pursuant to or in furtherance of the Settlement: (a)</FONT> is, may be construed as, or may be used as an admission of,
or evidence of, the truth or validity of any of the Released Claims, of any claims or allegations made in the Action, or of any
purported acts or omissions by the Defendants; (b) is, may be construed as, or may be used as an admission of, or evidence of,
any fault, omission, negligence, or wrongdoing by the Defendants, or any concession of liability whatsoever; or (c) is, may be
construed as, or may be used as an admission of, or evidence of, a concession by any Defendant of any infirmity in the defenses
that Defendants asserted or could have asserted in this Action or otherwise.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: bold 10pt Times New Roman, Times, Serif; text-transform: uppercase; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in">IV.</TD><TD STYLE="text-align: justify">THE SETTLEMENT HEARING</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Settlement Hearing
will be held before the Honorable Daniel H. Mabley on September 29, 2017 at 8:45 a.m. at the Hennepin County Government Center,
300 South 6th Street, Minneapolis, Minnesota 55487 to determine: (i) whether the proposed Settlement, upon the terms set forth
in the Stipulation, should be finally approved in all respects as fair, reasonable, and adequate; (ii)&nbsp;whether the Judgment
approving the Settlement, substantially in the form of Exhibit C attached to the Stipulation, should be entered, dismissing the
Action with prejudice and releasing and enjoining the prosecution of any and all Released Claims; and (iii)&nbsp;whether Plaintiffs&rsquo;
Counsel&rsquo;s Fee Award, including any Service Awards, should be finally approved. At the Settlement Hearing, the Court may hear
or consider such other matters as the Court may deem necessary and appropriate. The Court may adjourn the date of the Settlement
Hearing without further notice to Current ARCA Stockholders, and the Settlement Hearing may be continued by the Court at the Settlement
Hearing, or at any adjourned session thereof, without further notice.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: bold 10pt Times New Roman, Times, Serif; text-transform: uppercase; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in">V.</TD><TD STYLE="text-align: justify">THE SETTLEMENT</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The terms and conditions
of the proposed Settlement are set forth fully in the Stipulation. The following is only a summary of its terms.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.5pt 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.5pt 0pt 0; text-align: justify; text-indent: 0.5in">The benefits
of the Settlement consist of ARCA&rsquo;s agreement to institute employee training for employees who are employed in ARCA&rsquo;s
accounting department, on issues relevant to ARCA on accounting, auditing or taxation issues, for a period of one (1) year following
the Effective Date. ARCA acknowledges that the filing and pendency of the Action comprised a substantial contributing factor to
the Company&rsquo;s decision to implement the employee training program. The Settling Parties agree that the employee training
program will provide substantial benefits to ARCA and Current ARCA Stockholders. ARCA always has been, and continues to be, committed
to the implementation, enhancement, and enforcement of rigorous corporate governance measures. The fact that ARCA has agreed to
implement the employee training shall not be construed as an admission that it is legally required, or that the Defendants had
engaged in any wrongdoing.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.5pt 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: bold 10pt Times New Roman, Times, Serif; text-transform: uppercase; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in">VI.</TD><TD STYLE="text-align: justify">DISMISSAL AND RELEASES</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In connection with
the Court&rsquo;s approval of the Settlement, the Settling Parties will jointly request entry of the Judgment by the Court, dismissing
with prejudice all claims that Plaintiffs have alleged in the Action and any other Released Claims.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Upon the Effective
Date, ARCA, Plaintiffs, derivatively on behalf of ARCA, and each of ARCA&rsquo;s stockholders shall be deemed to have, and by operation
of the Judgment shall have, fully, finally, and forever released, relinquished, and discharged the Released Claims (including Unknown
Claims) against the Released Persons and any and all claims arising out of, relating to, or in connection with, the defense, settlement
or resolution of the Action against the Released Persons. ARCA, Plaintiffs, and each of ARCA&rsquo;s stockholders shall be deemed
to have, and by operation of the Judgment shall have, covenanted not to sue any Released Person with respect to such Released Claims,
and shall be permanently barred and enjoined from instituting, commencing or prosecuting the Released Claims against the Released
Persons except to enforce the releases and other terms and conditions contained in the Stipulation and/or the Judgment entered
pursuant thereto.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Upon the Effective
Date, each of the Released Persons shall be deemed to have, and by operation of the Judgment shall have, fully, finally, and forever
released, relinquished, and discharged each and all of Plaintiffs or their beneficiaries, Plaintiffs&rsquo; Counsel, and ARCA from
any and all Defendants&rsquo; Released Claims.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: bold 10pt Times New Roman, Times, Serif; text-transform: uppercase; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in">VII.</TD><TD STYLE="text-align: justify">ATTORNEYS&rsquo; FEES AND EXPENSES</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Plaintiffs&rsquo; Counsel
intends to apply to the Court for an award of attorneys&rsquo; fees and expenses in the total amount of forty-five thousand dollars
($45,000) (the &ldquo;Fee Award&rdquo;). Defendants agree that Plaintiffs&rsquo; counsel is entitled to an award of reasonable
attorneys&rsquo; fees and expenses from the Company, and Defendants will not object to Plaintiffs&rsquo; Counsel&rsquo;s application
for a Fee Award in an amount not to exceed $45,000. Court approval of such fee application is not a condition of this Settlement,
and such fee application may be considered separately from the proposed Settlement. In light of the substantial benefits they have
helped to create for all Current ARCA Stockholders, both Plaintiffs may apply for Court-approved service awards in the amount of
seven hundred and fifty dollars ($750.00) each (the &ldquo;Service Awards&rdquo;). Each Service Award, to the extent that it is
applied for and approved in whole or part, shall be funded from the portion of the Fee Award distributed to that Plaintiff&rsquo;s
Counsel.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: bold 10pt Times New Roman, Times, Serif; text-transform: uppercase; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in">VIII.</TD><TD STYLE="text-align: justify">THE RIGHT TO OBJECT AND/OR BE HEARD AT THE SETTLEMENT HEARING</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Any Current ARCA Stockholder
may object and/or appear and show cause, if he, she, or it has any concern, why the Settlement should not be approved as fair,
reasonable, and adequate, why Judgment should not be entered thereon, or why the Fee Award, including any Service Awards, should
not be finally approved; provided, however, unless otherwise ordered by the Court, that no Current ARCA Stockholder shall be heard
or entitled to contest the approval of the terms and conditions of the Settlement, or, if approved, the Judgment to be entered
approving the Settlement, or the Fee Award, unless that Stockholder has, <B><I>at least fourteen (14) days prior to the Settlement
Hearing</I></B>: (1) filed with the Hennepin County District Court a written objection to the Settlement setting forth: (a) the
nature of the objection; (b) proof of ownership of ARCA common stock on July 31, 2017 and through the date of the Settlement Hearing,
including the number of shares of ARCA common stock held and the date of purchase; (c) any and all documentation or evidence in
support of such objection; and (d)&nbsp;the identities of any cases, by name, court, and docket number, in which the Stockholder
or his, her, or its attorney has objected to a settlement in the last three years; and (2) if a Current ARCA Stockholder intends
to appear and requests to be heard at the Settlement Hearing, such Stockholder must have, in addition to the requirements of (1)
above, filed with the Hennepin County District Court: (a) a written notice of such stockholder&rsquo;s intention to appear at the
Settlement Hearing; (b) a statement that indicates the basis for such appearance; (c) the identities of any witnesses the stockholder
intends to call at the Settlement Hearing and a statement as to the subjects of their testimony; and (d)&nbsp;any and all evidence
that would be presented at the Settlement Hearing. If a Current ARCA Stockholder files a written objection and/or written notice
of intent to appear, such stockholder must also simultaneously serve copies of such notice, proof, statement, and documentation,
together with copies of any other papers or briefs such Stockholder files with the Court (either by hand delivery or by first class
mail) upon each of the following:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Timothy W. Brown</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">THE BROWN LAW FIRM, P.C.</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">240 Townsend Square</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Oyster Bay, NY 11771</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 0in"><I>Counsel for Plaintiffs</I></P></TD>
    <TD STYLE="width: 50%">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: center">Michael C. Tu</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: center">ORRICK, HERRINGTON &amp; SUTCLIFFE
        LLP</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: center">777 S. Figueroa Street, Suite
        3200</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: center">Los Angeles, CA 90017</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: center"><I>Counsel for Defendants</I></P></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Any Current ARCA Stockholder
who does not make his, her, or its objection in the manner provided herein shall be deemed to have waived such objection and shall
forever be foreclosed from making any objection to the fairness, reasonableness, or adequacy of the Settlement and the Fee Award,
including any Service Awards, as set forth in the Stipulation, unless otherwise ordered by the Court, but shall be forever bound
by the Judgment to be entered, the dismissal of the Action with prejudice, and any and all of the releases set forth in the Stipulation.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: bold 10pt Times New Roman, Times, Serif; text-transform: uppercase; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in">IX.</TD><TD STYLE="text-align: justify">CONDITIONS FOR SETTLEMENT</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Settlement is conditioned
upon the occurrence of certain events described in the Stipulation, which requires, among other things: (1) entry of the requested
Judgment by the Court; and (2) the Judgment has become Final. If, for any reason, any one of the conditions described in the Stipulation
is not met and/or the entry of the Judgment does not occur, the Stipulation might be terminated and, if terminated, will become
null and void; and the Settling Parties to the Stipulation will be restored to their respective positions as of the date immediately
preceding the date of the Stipulation.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: bold 10pt Times New Roman, Times, Serif; text-transform: uppercase; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in">X.</TD><TD STYLE="text-align: justify">EXAMINATION OF PAPERS AND INQUIRIES</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">This Notice contains
only a summary of the terms of the Settlement. For a more detailed statement of the matters involved in the Action, reference is
made to the Stipulation, which may be inspected at the Records Center of the Hennepin County Government Center, 300 South 6th Street,
Minneapolis, Minnesota 55487, during business hours of each business day or by visiting the investor relations portion of ARCA&rsquo;s
website at www.arcainc.com.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Any other inquiries
regarding the Settlement or the Action should be addressed in writing to Counsel for Plaintiffs in the Action, Timothy W. Brown,
The Brown Law Firm, P.C., 240 Townsend Square, Oyster Bay, NY 11771; Telephone: (516) 922-5427; Facsimile: (516) 344-6204.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>PLEASE DO NOT TELEPHONE
THE COURT REGARDING THIS NOTICE.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

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