-BBX Capital To Re-evaluate Proposed Short
Form Merger-
BBX Capital Corporation (NYSE: BBX, OTCQX: BBXTB) (“BBX Capital”
or “BBX”) announced today that its approximately 90% owned
subsidiary, Bluegreen Vacations Corporation (“Bluegreen”) (NYSE:
BXG), had received a formal notice from Bass Pro Inc. and Big Cedar
L.L.C. ("Bass Pro") notifying Bluegreen that Bass Pro intends to
cancel Bluegreen's access to the Bass Pro marketing channels and
advertising materials 30 days from the date of the notice unless
Bluegreen cures certain alleged breaches to Bass Pro's
satisfaction. BBX has advised Bluegreen that in light of this
issue, it is re-evaluating the previously announced short form
merger of its subsidiary with Bluegreen which would have taken
Bluegreen private and that it may choose not to proceed with the
merger.
Bluegreen issued the following press release this
morning:
“Bluegreen Vacations Corporation
AnnouncesReceipt of Notice from Bass Pro, Inc.BBX
Capital Corporation Re-evaluates Short Form Merger
BOCA RATON, Florida – March 25, 2019 – 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
principal investments include Bluegreen Vacations Corporation
(NYSE: BXG), BBX Capital Real Estate, Renin Holdings, and IT’SUGAR.
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 Bluegreen's relationship with Bass Pro,
that the parties will not reach a resolution of the
outstanding issues and that Bluegreen will not have
access to the Bass Pro marketing channels and advertising materials
going forward; that the alleged breaches will not be cured;
that BBX Capital’s and Bluegreen'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 may not be consummated. Reference is
also made to the risks and uncertainties regarding the
businesses, operations and trading markets of BBX Capital and
Bluegreen which are detailed in reports filed by BBX
Capital and Bluegreen with the SEC, including the
“Risk Factors” sections thereof, and may be viewed on the
SEC’s website at www.sec.gov. The companies caution that
the foregoing factors are not exclusive.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190325005297/en/
BBX Capital Corporation Contact
Info:Investor Relations:
Leo Hinkley, Managing Director, Investor Relations
Officer954-940-5300, Email: LHinkley@BBXCapital.com
Media Relations Contacts:
Kip Hunter Marketing, 954-765-1329, Nicole Lewis / Shannon
O’MalleyEmail: nicole@kiphuntermarketing.com,
shannon@kiphuntermarketing.com
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