Conns Inc.

The Conns Inc. shareholder derivative action has settled for $11 million. A copy of the notice of settlement and other relevant documents are contained below.

Because the Action was brought derivatively on behalf of Conn’s, the benefits of this Settlement will go directly to Conn’s and not to Current Conn’s Stockholders. Thus, Current Conn’s Stockholders are not eligible to submit claims or receive payment in connection with the Settlement.

The purpose of the Notice contained in the link below is to inform Current Conn’s Stockholders about (a) the Derivative Action; (b) the Settlement; (c) Current Conn’s Stockholders’ rights with respect to the Settlement; and (d) the hearing that the Court will hold on February 17, 2022 at 2:00 p.m., 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).

Plaintiffs' operative complaint (a copy of which is attached below) asserts claims on behalf of Conn’s against the Individual Defendants for breaches of fiduciary duties, unjust enrichment, gross mismanagement, and insider trading. Plaintiff alleged that all members of Conn’s board knew that Conn’s had lowered its underwriting standards and offered credit lines to customers who lacked creditworthiness, as a strategy to generate revenue. Plaintiff further alleged the Individual Defendants caused Conn’s to make false and misleading statements and to fail to disclose numerous material adverse facts about its business, operations, and prospects, including the Company’s underwriting standards and collection practices during the fourth quarter of 2013 through the third quarter of 2014. Plaintiff alleged the Individual Defendants violated their fiduciary duty of candor and caused Conn’s to violate the federal securities laws by failing to disclose, among other things, the following material facts: (a) that Conn’s was increasing its sales revenues and improving its financial results by using underwriting practices that, despite its statements to the contrary, weakened its portfolio quality and left it vulnerable to substantial increases in delinquency rates and bad debt; (b) that Conn’s was experiencing rising delinquencies at a substantially higher rate than it was representing; and (c) that Conn’s credit segment practices substantially threatened the Company’s financial performance.