Spruce Power Announces Notice of Pendency and Proposed Settlement of Stockholder Derivative Matters
THE UNITED STATES DISTRICT COURT
DISTRICT OF
Plaintiff, v.
Defendants, And
Nominal Defendant.
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Case No. 22-cv-10977
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SUMMARY NOTICE OF PENDENCY AND PROPOSED SETTLEMENT OF STOCKHOLDER DERIVATIVE MATTERS
TO: |
ALL RECORD HOLDERS AND BENEFICIAL OWNERS OF SPRUCE POWER HOLDING CORPORATION (FORMERLY KNOWN AS XL FLEET CORP.) (THE “COMPANY,” “XL FLEET,” OR “SPRUCE POWER”) COMMON STOCK (TICKER SYMBOL: SPRU) AS OF |
PLEASE READ THIS NOTICE CAREFULLY AND IN ITS ENTIRETY. THIS NOTICE RELATES TO A PROPOSED SETTLEMENT AND DISMISSAL WITH PREJUDICE OF STOCKHOLDER DERIVATIVE LITIGATION AND CONTAINS IMPORTANT INFORMATION REGARDING YOUR RIGHTS.
IF THE COURT APPROVES THE SETTLEMENT OF THE DERIVATIVE MATTERS, CURRENT SPRUCE POWER STOCKHOLDERS WILL BE FOREVER BARRED FROM CONTESTING THE APPROVAL OF THE PROPOSED SETTLEMENT AND DISMISSAL WITH PREJUDICE, AND FROM PURSUING RELEASED CLAIMS.
THIS ACTION IS NOT A “CLASS ACTION.” THUS, THERE IS NO COMMON FUND UPON WHICH YOU CAN MAKE A CLAIM FOR A MONETARY PAYMENT.
PLEASE TAKE NOTICE that this action is being settled on the terms set forth in a Stipulation of Settlement dated
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the existence of the above-captioned derivative action Kay v. Frodl, et al., Case No. 22-cv-10977 (
D. Mass .), pending in the Court (the “Massachusetts Action”); -
the existence of a similar derivative action captioned In re
Spruce Power Holding Corp. S’holder Derivative Litig., Case No. 1:23-cv-00289-MN (D. Del.), pending in theUnited States District Court for the District of Delaware (the “Delaware Action”); -
the existence of a
December 28, 2022 shareholder litigation demand by shareholderSham Lakhani (the “Litigation Demand”) (together with the above cases, the “Derivative Matters”); - the proposed settlement between Plaintiffs1 and Defendants reached in the Derivative Matters (the “Settlement”);
- the hearing to be held by the Court to consider the fairness, reasonableness, and adequacy of the Settlement and dismissal of the Derivative Matters with prejudice;
- Plaintiffs’ Counsel’s application to the Court for the Fee and Expense Amount; and
- Plaintiffs’ Counsel’s application to the Court for case Service Awards to the Plaintiffs.
This Notice describes what steps you may take in relation to the Settlement. This Notice is not an expression of any opinion by the Court about the truth or merits of Plaintiffs’ claims or Defendants’ defenses. This Notice is solely to advise you of the proposed Settlement of the Derivative Matters and of your rights in connection with the proposed Settlement.
Summary
On
After negotiating the material substantive terms of the Settlement, Plaintiffs’ Counsel and Defendants’ Counsel, with the assistance of the Mediator, separately negotiated with regard to the amount in attorneys’ fees and expenses to be paid by the Company to Plaintiffs’ Counsel commensurate with the value of the substantial benefits conferred upon the Company and Current Stockholders through the Reforms and the risks assumed by Plaintiffs’ Counsel in pursuing the Derivative Matters on a wholly contingent basis. The Parties were unable to reach agreement on the amount of such fees and expenses and the Court will determine such amount (the “Fee and Expense Amount”). Defendants reserve the right to contest any such application. Plaintiffs’ Counsel shall also apply to the Court for service awards to be paid to four Plaintiffs in an amount up to
This notice is a summary only and does not describe all of the details of the Stipulation. For full details of the matters discussed in this summary, please see the full Stipulation and its exhibits posted on the Company’s website, www.sprucepower.com, contact Plaintiffs’ Counsel at the addresses listed below, or inspect the full Stipulation filed with the Clerk of the Court.
What Are the Derivative Matters About?
The Derivative Matters assert claims for breach of fiduciary duty and related causes of action in connection with the merger of special purpose acquisition company (“SPAC”)
In summary, Plaintiffs allege that Defendants made materially false and misleading statements and/or failed to disclose that (i)
Why Is There a Settlement of the Derivative Matters?
The Court has not decided in favor of Defendants or Plaintiffs. Instead, the Parties have agreed to the Settlement to avoid the distraction, costs, and risks of further litigation, and because the Company has determined that the Reforms that the Company has adopted and will adopt as part of the Settlement provide substantial benefits to the Company and its stockholders.
Defendants have vigorously denied, and continue to deny vigorously, any and all allegations of wrongdoing or liability with respect to the claims asserted in the Derivative Matters, including without limitation that they breached their fiduciary duties, or any other duty owed to the Company or its stockholders. Defendants have further asserted, and continue to assert, that at all relevant times, they acted in good faith and in a manner that they reasonably believed to be in the best interests of the Company and its stockholders, and diligently and scrupulously complied with any applicable fiduciary duties.
The Settlement Hearing, and Your Right to Object to the Settlement
On
The Court may, in its discretion, change the date and/or time of the Settlement Hearing without further notice to you. The Court also has reserved the right to hold the Settlement Hearing telephonically or by videoconference without further notice to you. If you intend to attend the Settlement Hearing, please consult the Court’s calendar and/or the website of the Company, www.sprucepower.com, for any change in date, time, or format of the Settlement Hearing.
Any Current Stockholder who wishes to object to the fairness, reasonableness, or adequacy of the Settlement as set forth in the Stipulation, or to the Fee and Expense Award or Service Awards, may file with the Court a written objection. An objector must, at least twenty-one (21) calendar days prior to the Settlement Hearing: (1) file with the Clerk of the Court and serve (either by hand delivery or by first class mail) upon the below listed counsel a written objection to the Settlement setting forth (a) the nature of the objection, (b) proof of ownership of
IF YOU MAKE A WRITTEN OBJECTION, IT MUST BE RECEIVED BY THE CLERK OF THE COURT NO LATER THAN
Clerk of the Court,
YOU ALSO MUST DELIVER COPIES OF THE MATERIALS TO PLAINTIFFS’ COUNSEL AND DEFENDANTS’ COUNSEL SO THEY ARE RECEIVED NO LATER THAN
Plaintiffs’ Counsel:
GAINEY McKENNA & EGLESTON
Telephone: (212) 983-1300 Facsimile: (212) 983-0383 Email: tjmckenna@gme-law.com Email: gegleston@gme-law.com |
Defendants’ Counsel:
TROUTMAN PEPPER
Eighteenth and
Telephone: (215) 981-4000 Email: jay.dubow@troutman.com Email: erica.dressler@troutman.com |
An objector may file an objection on his, her, or its own or through an attorney hired at his, her, or its own expense. If an objector hires an attorney to represent him, her, or it for the purposes of making such objection, the attorney must serve (either by hand delivery or by first class mail) a notice of appearance on the counsel listed above and file such notice with the Court no later than twenty-one (21) calendar days before the Settlement Hearing. Any Current Stockholder who does not timely file and serve a written objection complying with the above terms shall be deemed to have waived, and shall be foreclosed from raising, any objection to the Settlement, and any untimely objection shall be barred.
Any objector who files and serves a timely, written objection in accordance with the instructions above, may appear at the Settlement Hearing either in person or through counsel retained at the objector’s expense. Objectors need not attend the Settlement Hearing, however, in order to have their objections considered by the Court.
If you are a Current Stockholder and do not take steps to appear in this action and object to the proposed Settlement, you will be bound by the Judgment of the Court and will forever be barred from raising an objection to the settlement in this Massachusetts Action, and from pursuing any of Plaintiffs’ or Defendants’ Released Claims.
SPRUCE POWER STOCKHOLDERS AS OF
Interim Stay and Injunction
Pending the Court’s determination as to final approval of the Settlement, Plaintiffs and Plaintiffs’ Counsel, and any Current Stockholders, derivatively on behalf of
Scope of the Notice
This Notice is a summary description of the Derivative Matters, the complaints, the terms of the Settlement, and the Settlement Hearing. For a more detailed statement of the matters involved in the Derivative Matters, reference is made to them in the Stipulation and its exhibits, copies of which may be reviewed and downloaded at (www.sprucepower.com).
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You may obtain further information by contacting Plaintiffs’ Counsel at:
Please Do Not Call the Court or Defendants with Questions About the Settlement.
About
1 All capitalized terms used in this notice, unless otherwise defined herein, are defined as set forth in the Stipulation.
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For More Information
Investor Contact: investors@sprucepower.com
Head of Investor Relations:
Media Contact: publicrelations@sprucepower.com
Source: