Conn's Summary Notice of Proposed Settlement of Stockholder Derivative Action

Rhea-AI Summary

Conn's announced a proposed settlement of a derivative lawsuit, Hack v. Wright, filed in 2014. The U.S. District Court for the Southern District of Texas authorized this notice to all stockholders as of November 24, 2021. The settlement involves a payment of $11 million from the defendants' insurance carriers to Conn's. A hearing on the settlement will occur on February 17, 2022, where the court will determine its fairness and approve or reject the proposal. Current stockholders must file notices of objection to participate in the hearing.

Positive

• Settlement includes $11 million cash payment from defendants' insurance to Conn's, potentially enhancing its financial position.

Negative

• Stockholders may be barred from contesting the settlement if approved.

THE WOODLANDS, Texas, Dec. 27, 2021 (GLOBE NEWSWIRE) -- The following is being released by Conn’s, Inc. pursuant to an Order of the United States District Court of the Southern District of Texas, Houston Division. This press release relates to the proposed settlement of litigation that was filed in 2014 and captioned: 

Robert Hack, derivatively on behalf of Conn’s Inc. v. Theodore M. Wright, et al., Civil Action No. 4:14-CV-3442 (KPE); In the United States District Court of the Southern District of Texas, Houston Division

SUMMARY NOTICE OF PROPOSED SETTLEMENT OF
STOCKHOLDER DERIVATIVE ACTION

The United States District Court for the Southern District of Texas authorized this Notice.
This is not a solicitation from an attorney

TO: ALL RECORD HOLDERS AND BENEFICIAL OWNERS OF CONN’S, INC. (“CONN’S”) COMMON STOCK (TICKER SYMBOL: CONN) AS OF THE CLOSE OF BUSINESS ON NOVEMBER 24, 2021 (“CURRENT CONN’S STOCKHOLDERS”).

PLEASE READ THIS NOTICE CAREFULLY AND IN ITS ENTIRETY. YOUR RIGHTS WILL BE AFFECTED BY THIS LITIGATION. 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.

IF THE COURT APPROVES THE SETTLEMENT AND DISMISSAL OF THE ACTION, CURRENT CONN’S STOCKHOLDERS WILL BE FOREVER BARRED FROM CONTESTING THE APPROVAL OF THE PROPOSED SETTLEMENT AND FROM PURSUING THE SETTLED CLAIMS.

THE COURT HAS MADE NO FINDINGS OR DETERMINATIONS WITH RESPECT TO 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.

PLEASE TAKE NOTICE that the above-captioned stockholder Derivative Action is being settled, and the parties have entered into a Stipulation and Agreement of Settlement, dated November 24, 2021 (the “Stipulation”). The terms of the proposed Settlement are set forth in the Stipulation, and all capitalized terms herein have the same meaning as defined in the Stipulation. This notice should be read in conjunction with, and is qualified in its entirety by reference to, the text of the Stipulation, which has been filed with the Court. A further notice describing the Derivative Action along with the text of the Stipulation is available at https://ir.conns.com/notice-derivative-settlement-and-hearing.

In consideration of the proposed Settlement, the Individual Defendants will cause their insurance carriers to pay $11 million in cash to Conn’s.

IF YOU ARE A CURRENT RECORD OR BENEFICIAL OWNER OF CONN’S COMMON STOCK AS OF NOVEMBER 24, 2021, YOUR RIGHTS MAY BE AFFECTED BY PROCEEDINGS IN THIS LITIGATION.

On February 17, 2022 at 2:00 pm , a hearing (the “Settlement Hearing”) will be held before the Honorable Keith P. Ellison at the United States District Court for the Southern District of Texas, Houston Division, 515 Rusk Street Houston, TX 77002 (or by telephonic or video means as may be designated by the Court in the interest of public safety) to: (a) determine whether the Settlement is fair, reasonable, and adequate to Plaintiffs, Conn’s, its stockholders, and the Individual Defendants, and should be approved by the Court; (b) determine whether a Final Order and Judgment should be entered dismissing with prejudice the Derivative Action and extinguishing and releasing the Released Claims; (c) determine whether the application by Plaintiffs’ Counsel for an award of attorneys’ fees and reimbursement of litigation expenses (“Fee and Expense Application”), and for Service Awards to the two named Plaintiffs (“Service Award Application”), should be approved; (d) hear and consider any objections to the Settlement or the Fee and Expense Application and the Service Award Application to be submitted by Plaintiffs’ Counsel; and (e) consider any other matters concerning the Settlement that may properly be brought before the Court. The Court may adjourn the date of the Settlement Hearing without further notice to Current Conn’s Stockholders, and the Settlement Hearing may be continued by the Court at the Settlement Hearing, or at any adjourned session thereof, without further notice.

Any Current Conn’s Stockholder as of the Hearing Date shall have the right to appear and to be heard at the Settlement Hearing. However, no stockholder shall be heard at the Settlement Hearing unless, at least twenty-one (21) calendar days prior to the date of the Settlement Hearing, such stockholder has filed with the Court and delivered to counsel for the Settling Parties a written notice of objection in accordance with the requirements below. Only stockholders who have filed and delivered validly and timely written notices of objection will be entitled to be heard at the Settlement Hearing unless the Court orders otherwise.

Any written notice of objection must contain the following information:

a)   a written and signed notice which states the name, address, telephone number, and email address (if available) of the objector and, if represented, of his, her, or its counsel;

b)   proof that the objector owned Conn’s common stock as of the date of the execution of the Stipulation and continues to hold such shares; and

c)   a written, detailed statement of the Person’s objections to any aspect of the settlement, and the specific grounds therefor or the reasons why such Person desires to appear and to be heard, as well as all documents and writings which such Person desires the Court to consider, including any legal and evidentiary support.

If you wish to object to the settlement, you must file a written objection setting forth the grounds for such objection and the information listed above with the Court on or before 21 calendar days before the Settlement Hearing, with service to: (a) counsel to Plaintiff Robert Hack, Francis A. Bottini, Jr., BOTTINI & BOTTINI, INC., 7817 Ivanhoe Ave., Suite 102, La Jolla, California 92037; (b) counsel to Plaintiff 95250 Canada LTEE, Kip B. Shuman, SHUMAN, GLENN & STECKER, 100 Pine Street, Suite 1250, San Francisco, California 94111; (c) counsel to the Individual Defendants, Marissa Secco Giles, VINSON & ELKINS L.L.P., 2801 Via Fortuna, Suite 100, Austin, TX 78746; and (d) counsel to Nominal Defendant Conn’s, Inc., N. Scott Fletcher, FLETCHER HELD, PLLC, 808 Travis Street, Suite 1420, Houston, Texas 77002.

Unless the Court orders otherwise, your objection will not be considered unless it is timely filed with the Court and delivered to the above counsel. Any Person who fails to object in the manner provided 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 proposed settlement as set forth in the Stipulation and the Judgment, or to the award of attorneys’ fees and expenses to Plaintiffs’ Counsel, unless otherwise ordered by the Court. Current Conn’s Stockholders who have no objection to the settlement do not need to appear at the Settlement Hearing or take any other action.

Inquiries may be made to Plaintiffs’ Counsel: (a) counsel to Plaintiff Robert Hack, Francis A. Bottini, Jr., BOTTINI & BOTTINI, INC., 7817 Ivanhoe Ave., Suite 102, La Jolla, California 92037, Tel.: (858) 914-2001; or (b) counsel to Plaintiff 95250 Canada LTEE, Kip B. Shuman, SHUMAN, GLENN & STECKER, 100 Pine Street, Suite 1250, San Francisco, California 94111, Tel.: 1-866-569-4531.

DO NOT CALL OR WRITE THE COURT REGARDING THIS NOTICE.

FAQ

What is the Conn's proposed settlement about?

The proposed settlement relates to a derivative lawsuit from 2014, involving a payment of $11 million to Conn's.

When is the Conn's settlement hearing scheduled?

The Conn's settlement hearing is scheduled for February 17, 2022.

Who are the current stockholders affected by the proposed settlement?

All record and beneficial owners of Conn's common stock as of November 24, 2021, are affected.

What happens if stockholders do not object to the Conn's settlement?

Stockholders who do not object will be barred from contesting the settlement once approved.

How can stockholders file objections to the Conn's settlement?

Stockholders must file a written notice of objection with the court at least 21 days before the settlement hearing.