Bluegreen Vacations Corporation Announces Receipt of Notice from Bass Pro, Inc.
March 25 2019 - 6:00AM
Business Wire
BBX Capital Corporation Reevaluates Short
Form Merger
Bluegreen Vacations Corporation (NYSE: BXG) (“Bluegreen”)
announced today that on March 22, 2019, Bluegreen Vacations
Unlimited, Inc. (“BVU”), a wholly-owned subsidiary of Bluegreen,
and Bluegreen/Big Cedar Vacations, LLC (“Bluegreen/Big Cedar”), a
51%-owned subsidiary of BVU, (BVU, Bluegreen/Big Cedar and
Bluegreen, collectively, the “Company”) received a formal
notice delivered pursuant to the Amended and
Restated Marketing and Promotions Agreement dated December 31, 2007
(the “Agreement”) from Bass Pro, Inc. and Big Cedar L.L.C.
(collectively, “Bass Pro”) notifying the Company that Bass Pro
intends to cancel the Company’s access to the Bass Pro marketing
channels and advertising materials as of 30 days from
the notice unless the Company cures certain alleged breaches
to Bass Pro’s satisfaction.
The alleged breaches cited in the notice include
those previously disclosed by the
Company, and specifically Bass Pro’s belief that the
amounts paid to it as VOI sales commissions should not have been
adjusted for certain purchaser defaults, breaches regarding
the calculation of commissions and other
amounts payable under the Agreement and other related
agreements including reimbursements paid to the
Company, as well as matters regarding the operations
at Bluegreen/Big Cedar. In addition,
the notice references a breach Bass Pro
alleged in 2014 regarding customer
service, notwithstanding that this
alleged breach has not been the subject of any
correspondence since that time and that the customer
service issues arising from Bass Pro have, to the Company's
knowledge, been minimal and been appropriately addressed.
As indicated in Bass Pro’s notice, the parties have
recently held several in person meetings and as publicly
disclosed, the Company has been optimistic that a resolution of the
outstanding issues would be achieved. These recent discussions
with Bass Pro were not about alleged breaches but, at
Bass Pro's suggestion, were focused on how best to
move forward. These discussions included a
possible restructuring of the amount and timing of
compensation paid to Bass Pro, an extension of the term of the
Agreement, the timing of entry into the Cabela’s stores and a
mutual waiver of any prior alleged claims between the parties. The
Company believed based on its telephone discussions and
subsequent meetings with Bass Pro management that Bass
Pro and the Company were in basic agreement
regarding the waiver of past issues and the terms of
compensation going forward
but these were subject to reaching an agreement
on the terms
of an extension and the timing of entry
into Cabela’s.
Prior issues between the parties primarily related to
a claim by the Company that Bass Pro owed
it additional amounts and a claim by Bass Pro
regarding reimbursements and additional annual
revenue going forward as well as matters
regarding the operation of the Bluegreen/Big Cedar joint
venture. The Company has suggested on numerous
occasions that the parties agree to binding arbitration to resolve
these issues, but Bass Pro has refused to do so.
While these discussions with Bass Pro were ongoing,
the Company, with Bass Pro’s cooperation, has continued
to execute the vacation package marketing strategy contemplated by
the Agreement including the recent opening of a new marketing
kiosk in Las Vegas, Nevada as well as plans to open an
additional kiosk in a former Cabela's store in Rogers,
Arkansas in the near term. Given the frequency and
positive tone of the discussions with Bass Pro and no
indication by Bass Pro of the position taken in
its notice regarding customer service, the
Company was both surprised and disappointed
by Bass Pro's current position.
The Company will seek to continue its discussions with Bass
Pro with the hope of reaching a mutually satisfactory
resolution and to obtain information regarding
what Bass Pro believes would constitute the cure of
the breaches that it has alleged. However, if the issues with
Bass Pro are not resolved or any identified cures
achieved, the Company's results will be
adversely impacted and the Company will, in that
case, pursue all remedies available to it, including
pursuing recovery of all damages caused by Bass
Pro's actions.
BBX Capital Corporation has advised the Company that in light of
these events, it is re-evaluating the previously
announced short form merger that would have taken
the Company private and BBX Capital may choose not
to proceed with the merger.
About BBX Capital
Corporation: BBX Capital Corporation (NYSE: BBX) (OTCQX:
BBXTB) is a Florida-based diversified holding company whose
activities include its 90 percent ownership interest in Bluegreen
Vacations Corporation (NYSE: BXG) as well as its real estate and
middle market divisions. For additional information, please visit
www.BBXCapital.com.
About Bluegreen Vacations
Corporation Bluegreen Vacations Corporation (NYSE: BXG)
is a leading vacation ownership company that markets and sells
vacation ownership interests (VOIs) and manages resorts in top
leisure and urban destinations. The Bluegreen Vacation Club is a
flexible, points-based, deeded vacation ownership plan with
approximately 216,000 owners, 69 Club and Club Associate Resorts
and access to more than 11,000 other hotels and resorts through
partnerships and exchange networks as of December 31, 2018.
Bluegreen Vacations also offers a portfolio of comprehensive,
fee-based resort management, financial, and sales and marketing
services, to or on behalf of third parties. Bluegreen is
approximately 90% owned by BBX Capital Corporation (NYSE: BBX)
(OTCQX: BBXTB), a diversified holding company. For further
information, visit www.BluegreenVacations.com.
This press release contains forward-looking
statements within the meaning of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Exchange
Act. All opinions, forecasts, projections, future plans or
other statements, other than statements of historical fact, are
forward-looking statements. Forward-looking statements may be
identified by the use of words or phrases such as “plans,”
“believes,” “will,” “expects,” “anticipates,” “intends,”
“estimates,” “our view,” “we see,” “would” and words and phrases of
similar import. Actual results, performance, or achievements could
differ materially from those contemplated, expressed, or implied by
the forward-looking statements. Forward-looking statements are
subject to a number of risks and uncertainties. These risks and
uncertainties include, but are not limited to, those relating
to the risks associated with the Company's relationship
with Bass Pro, that the parties will not reach a resolution of
the outstanding issues and that the Company will not have
access to the Bass Pro marketing channels and advertising materials
going forward; that the alleged breaches will not be cured;
that the Company's results will be adversely impacted by the
termination of the relationship or ongoing litigation regarding the
relationship and the obligations of the parties under the parties'
agreements; and that the proposed short
form merger with a subsidiary of BBX Capital Corporation may
not be consummated. Reference is also made to the risks
and uncertainties regarding the businesses, operations and
trading markets of Bluegreen which are detailed in reports
filed by Bluegreen with the SEC, including the “Risk
Factors” sections thereof, and may be viewed on the SEC’s
website at www.sec.gov Bluegreen cautions that the
foregoing factors are not exclusive.
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version on businesswire.com: https://www.businesswire.com/news/home/20190325005198/en/
Bluegreen Vacations
Corporation:Nikki Sacks, 203-682-8263orEvelyn Infurna,
203-682-8265Email: bluegreenvac@icrinc.com
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