Item 8.01. Other Events.
As previously announced, on March 16, 2022, Summer Infant, Inc., a Delaware
corporation (the "Company"), Kids2, Inc., a Georgia corporation ("Kids2"), and
Project Abacus Acquisition Corp., a Delaware corporation and a wholly owned
subsidiary of Kids2 ("Merger Sub"), entered into Agreement and Plan of Merger
(as the same may be amended, supplemented and modified from time to time, the
"Merger Agreement"), which provides that, subject to the conditions set forth in
the Merger Agreement, Merger Sub will merge with and into the Company, with
Company continuing as the surviving company and a wholly owned subsidiary of
Kids2 (such transactions, collectively, the "Merger").
One of the conditions to the Merger under the Merger Agreement is the approval
of the Company's stockholders. On April 8, 2022, in accordance with the rules
and regulations of the Securities and Exchange Commission (the "SEC"), the
Company filed a preliminary proxy statement on Schedule 14A with the SEC in
order to solicit proxies in connection with an upcoming special meeting of the
Company's stockholders to approve the Merger Agreement.
Commencing on April 13, 2022, purported individual stockholders of the Company
filed complaints in the United States District Courts for the Southern District
of New York, the Eastern District of New York, and the Eastern District of
Pennsylvania, in the matters captioned Ryan O'Dell v. Summer Infant, Inc., et.
al., Case No. 1:22-cv-03050-VSB (S.D.N.Y., filed April 13, 2022), Jeffrey D.
Justice II v. Summer Infant, Inc., et al, Case No. 1:22-cv-02260 (E.D.N.Y.,
filed April 20, 2022), and Matthew Hopkins v. Summer Infant, Inc., et al, Case
No. 2:22-cv-01545-JDW (E.D. Pa., filed April 20, 2022). The complaints name as
defendants the Company and the members of the Board of Directors of the Company
(the "Board").
The complaints generally allege that the preliminary proxy statement filed by
the Company materially misrepresents or omits certain purportedly material
information, including information relating to the financial projections of the
Company, the valuation analyses performed by one of the financial advisors to
the Company, and the terms of engagement of one of the financial advisors to the
Company. Each of the complaints asserts violations of Section 14(a) of the
Exchange Act, Rule 14a-9 promulgated thereunder, and Section 20(a) of the
Exchange Act. The complaints seek, among other things, an injunction enjoining
consummation of the proposed Merger, rescission of the Merger Agreement or the
Merger, if the Merger is consummated, a declaratory judgment that the Company
and the Board violated the Exchange Act and Rule 14a-9 promulgated thereunder,
and awarding the costs of the actions, including plaintiff's reasonable
attorneys' and experts' fees and expenses.
Additional complaints or demands may be filed in connection with the proposed
Merger. If additional similar complaints or demands are filed or made, absent
new or different allegations that are material, the Company will not necessarily
announce them.
While the Company believes that the claims asserted in these complaints are
without merit and that no additional disclosure is required under applicable
law, in order to avoid the risk of these complaints delaying or adversely
affecting the Merger and to minimize the costs, risks and uncertainties inherent
in litigation, and without admitting any liability or wrongdoing, the Company
determined to voluntarily provide certain disclosures in its revised preliminary
proxy statement filed with the SEC on May 6, 2022.
Additional Information about the Proposed Merger and Where to Find It
In connection with the proposed Merger, the Company has filed and will prepare
and file relevant materials with the SEC, including a preliminary proxy
statement on Schedule 14A that was filed with the SEC on April 8, 2022, a
revised preliminary proxy statement on Schedule 14A that was filed with the SEC
on May 6, 2022, and a definitive proxy statement on Schedule 14A and a proxy
card to be filed and mailed to Company stockholders entitled to vote at the
special meeting relating to the proposed Merger. This communication is not
intended to be, and is not, a substitute for the proxy statement or any other
document that the Company has filed or may file with the SEC in connection with
the proposed Merger. INVESTORS AND STOCKHOLDERS ARE URGED TO CAREFULLY READ THE
PROXY STATEMENT (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO AND ANY
DOCUMENTS INCORPORATED BY REFERENCE THEREIN) AND ANY OTHER RELEVANT DOCUMENTS IN
CONNECTION WITH THE PROPOSED MERGER THAT THE COMPANY HAS FILED OR WILL FILE WITH
THE SEC WHEN THEY BECOME AVAILABLE BECAUSE THEY CONTAIN IMPORTANT INFORMATION
ABOUT THE COMPANY AND THE PROPOSED MERGER. The preliminary proxy statement, the
definitive proxy statement, and other relevant materials in connection with the
transaction (when they become available), and any other documents filed or
furnished by the Company with the SEC, may be obtained free of charge at the
SEC's website (www.sec.gov). In addition, copies of the proxy statement and
other relevant materials and documents filed by the Company with the SEC will
also be available free of charge on the Investor Relations page of the Company's
website located at https://www.sumrbrands.com.
Participants in the Solicitation of Company Stockholders
The Company, Kids2, Inc. and their respective directors and executive officers,
management and employees may be deemed to be participants in the solicitation of
proxies from the Company's stockholders in connection with the proposed Merger.
Information about the Company's directors and executive officers and their
ownership of Company common stock is set forth in its definitive proxy statement
for its 2021 annual meeting of shareholders filed with the SEC on April 16,
2021. To the extent that holdings of the Company's securities have changed since
the amounts reflected in the Company's proxy statement, such changes have been
or will be reflected on Statements of Change in Ownership on Form 4 filed with
the SEC. Additional information regarding the participants in the solicitation
and their interests in the proposed Merger are included in the proxy statement
and other materials relating to the proposed Merger filed or to be filed with
the SEC. These documents may be obtained free of charge at the SEC's web site at
www.sec.gov and on the Investor Relations page of the Company's website located
at https://www.sumrbrands.com.
Forward-Looking Statements
Certain statements in this Current Report on Form 8-K that are not historical
fact may be deemed "forward-looking statements" within the meaning of Section
27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act
of 1934, and the Company intends that such forward-looking statements be subject
to the safe harbor created thereby. These statements are accompanied by words
such as "anticipate," "expect," "project," "will," "believes," "estimate" and
similar expressions, and include a statement regarding the Company's belief
regarding the merits of the claims made in the complaints filed in connection
with the pending acquisition of the Company by Kids2, Inc. The Company cautions
that these statements are qualified by important factors that could cause actual
results to differ materially from those reflected by such forward-looking
statements. Such factors include risks related to the proposed merger with
Kids2, Inc., including disruption of management's attention from ongoing
business operations due to the pending transaction; that one or more closing
conditions to the transaction may not be satisfied or waived, on a timely basis
or otherwise; that the transaction does not close when anticipated, or at all;
the occurrence of any event, change or other circumstances that could give rise
to the termination of the merger agreement; potential adverse reactions or
changes to employee or business relationships resulting from the announcement or
completion of the proposed merger; the risk of litigation or legal proceedings
related to the proposed transaction; and unexpected costs, charges or expenses
resulting from the proposed transaction, and other risks as detailed in the
Company's most recent Annual Report on Form 10-K, its Quarterly Reports on Form
10-Q and other filings with the Securities and Exchange Commission. The Company
assumes no obligation to update the information contained in this Current Report
on Form 8-K.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit Number Description
Cover Page Interactive Data File (embedded within the Inline XBRL
104 document)
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