Wilmington, Del. — Outdoor retailer Cabela’s is facing four class action lawsuits related to its pending merger with Bass Pro Shops, according to documents released on Thursday.
The lawsuits, which were filed after its June 5 proxy statement announcing an upcoming shareholder meeting to approve the merger on July 11 cite “incomplete and materially misleading” statements to investors, and accuse Cabela’s financial advisor, Guggenheim Securities, of conflicts of interest. The suits claim that Guggenheim Securities and Cabela’s failed to update financial projections for stockholders after news of the Bass Pro merger first broke.
The legal action was filed in a U.S. District Court in Delaware, where Cabela’s is incorporated.
Cabela’s says the lawsuits are “unmeritorious” and has voted to defend against the litigation, “vigorously.”
An excerpt of the Cabela’s disclosure is below:
As previously disclosed, on October 3, 2016, Cabela's Incorporated, a Delaware corporation (the "Company"), entered into an Agreement and Plan of Merger, by and among the Company, Bass Pro Group, LLC, a Delaware limited liability company ("Parent"), and Prairie Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of Parent ("Sub"), which was amended by the Amendment to Agreement and Plan of Merger, dated as of April 17, 2017 (and as further amended from time to time, the "Merger Agreement"). The Merger Agreement provides for Sub to merge with and into the Company, causing the Company to become a wholly owned subsidiary of Parent (the "Merger"). The following complaints have been filed in the United States District Court for the District of Delaware: (i) on June 7, 2017, a class action lawsuit captioned Adam Klein, Individually And On Behalf Of All Others Similarly Situated v. Cabela's Incorporated, James W. Cabela, Theodore M. Armstrong, Michael R. McCarthy, John H. Edmondson, Beth M. Pritchard, Thomas L. Millner, James F. Wright, Peter S. Swinburn, Dennis Highby, and Donna M. Milrod, Case No. 1:17-cv-00698-UNA (the "Klein Complaint"); (ii) on June 7, 2017, a class action lawsuit captioned Bernard Garcarz, individually and on behalf of all others similarly situated v. Cabela's, Inc., Theodore M. Armstrong, James W. Cabela, John H. Edmondson, Dennis Highby, Michael R. McCarthy, Donna M. Milrod, Thomas L. Millner, Beth M. Pritchard, Peter S. Swinburn, and James F. Wright, Case No. 1:99-mc-09999 (the "Garcarz Complaint"); (iii) on June 9, 2017, a class action lawsuit captioned Christopher A. Brown, Individually and on Behalf of All Others Similarly Situated v. Cabela's Incorporated, James W. Cabela, Thomas L. Millner, Theodore M. Armstrong, John H. Edmondson, Dennis Highby, Michael R. McCarthy, Donna M. Milrod, Beth M. Pritchard, James F. Wright, and Peter S. Swinburn, Case No. 1:17-cv-00711-UNA (the "Brown Complaint") and (iv) on June 14, 2017, a class action lawsuit captioned John Solak, On Behalf of Himself and All Others Similarly Situated v. Cabela's Incorporated, James W. Cabela, Thomas L. Millner, Michael R. McCarthy, Dennis Highby, Theodore M. Armstrong, John H. Edmondson, Beth M. Pritchard, Donna M. Milrod, James F. Wright, and Peter Swinburn, Case No. 1:17-cv-00763 (the "Solak Complaint" and, together with the Klein Complaint, the Garcarz Complaint and the Brown Complaint, the "Merger Litigation"). The Merger Litigation relates to the Merger Agreement and the definitive proxy statement filed with the Securities and Exchange Commission (the "SEC") on June 5, 2017 (the "Proxy Statement") in connection with the Merger. The Company believes that the claims asserted in the Merger Litigation are without merit and intends to defend against the Merger Litigation vigorously. However, in order to moot the plaintiffs' unmeritorious disclosure claims, alleviate the costs, risks and uncertainties inherent in litigation and provide additional information to its stockholders, the Company has determined to voluntarily supplement the Proxy Statement as described in this Current Report on Form 8-K. Nothing in this Current Report on Form 8-K shall be deemed an admission of the legal necessity or materiality under applicable laws of any of the disclosures set forth herein. To the contrary, the Company specifically denies all allegations in the Merger Litigation that any additional disclosure was or is required. Supplemental Disclosures. The following disclosures supplement the disclosures contained in the Proxy Statement and should be read in conjunction with the disclosures contained in the Proxy Statement, which should be read in its entirety. To the extent the information set forth herein differs from or updates information contained in the Proxy Statement, the information set forth herein shall supersede or supplement the information in the Proxy Statement. All page references are to pages in the Proxy Statement, and terms used below, unless otherwise defined, have the meanings set forth in the Proxy Statement.