DEFA14A: Matterport Addresses Stockholder Lawsuits with Supplemental Proxy Statement

Matterport issues a supplement to its proxy statement addressing stockholder lawsuits and demand letters related to the proposed merger with CoStar Group.

Summary

• Matterport has released a supplement to its proxy statement regarding the proposed merger with CoStar Group, dated July 17, 2024.
• This supplement addresses concerns raised in four stockholder complaints and over ten demand letters.
• The complaints allege material omissions and misleading statements in the original proxy statement, particularly regarding Matterport's financial projections and Qatalyst Partners' analyses.
• The lawsuits seek to enjoin the merger and recover attorneys' fees.
• Matterport denies the allegations but is providing supplemental disclosures to minimize expenses and distraction.
• The supplement includes additional information related to risk factors, the background of the mergers, litigation details, and the opinion of Matterport's financial advisor.
• The special meeting of stockholders to vote on the merger is scheduled for July 26, 2024.

Sentiment

Score: 4

Explanation: The sentiment is neutral to slightly negative due to the ongoing litigation and potential risks to the merger. While Matterport is addressing the issues, the lawsuits create uncertainty.

Positives

• Matterport is proactively addressing stockholder concerns by providing supplemental disclosures.
• The company intends to vigorously defend against the lawsuits, which it believes are without merit.
• The supplement aims to minimize expenses and distractions associated with the litigation.
• Executives have agreed to restrictive covenants and waivers to facilitate the merger.

Negatives

• Stockholder lawsuits and demand letters create uncertainty and potential delays for the merger.
• Litigation could be time-consuming and expensive, diverting management's attention.
• An injunction could prevent the merger from being completed.
• The lawsuits allege material omissions and misleading statements in the proxy statement.

Risks

• The lawsuits could delay or prevent the completion of the merger.
• Adverse resolution of the litigation could have a material adverse effect on Matterport's financial condition.
• Additional lawsuits and demand letters may be filed in the future.
• The company faces risks related to regulatory approvals and compliance.
• The merger could disrupt Matterport's current plans and operations.
• There is a risk that Matterport's stock price may decline significantly if the merger is not consummated.

Future Outlook

The document contains forward-looking statements regarding the proposed transaction with CoStar Group and its potential impact on Matterport's business, operations, and financial performance. These statements are subject to risks and uncertainties, and actual results may differ materially.

Management Comments

• Matterport denies the allegations in the Complaints and the demand letters, and denies that any violation of law has occurred.
• Matterport believes that the proxy statement disclosed all material information required to be disclosed and denies that any of the Supplemental Disclosures are material or are otherwise required to be disclosed.

Industry Context

The document references selected companies and transactions for comparison purposes, including those in the Internet of Things, Real Estate, 3D/Metaverse, and SPAC Presentation sectors. This provides context for Matterport's valuation and strategic positioning within the broader technology and real estate landscape.

Comparison to Industry Standards

• The document includes a selected companies analysis, comparing Matterport to companies like Cognex Corp., Planet Labs PBC, Spire Global, Inc., Trimble Inc., AppFolio, Inc., CoStar Group, Inc., Procore Technologies, Inc., Adobe Inc., Autodesk, Inc., Roblox Corp., Unity Software Inc., Appian Corp., DocuSign Inc., Elastic N.V., MongoDB, Inc., and Twilio Inc.
• The analysis uses CY2024E and CY2025E revenue multiples to assess valuation.
• The document also includes a selected transactions analysis, listing numerous M&A deals and their corresponding LTM and NTM revenue multiples.
• These comparisons provide benchmarks for evaluating the fairness of the merger consideration.

Legal Proceedings

• Andrew Rose v. Matterport, Inc., et al., Case No. 5:24-cv-3313 (N.D. Cal.)
• Hamilton v. Matterport, Inc., et al., Case No. 240709-34 (New York Supreme Court)
• Scott v. Matterport, Inc., et al., Case No. 240711-901 (New York Supreme Court)
• Hanna, et al. v. Pittman, et al., C.A. No. 2024-0088-LWW (Delaware Court of Chancery)

Stakeholder Impact

• Shareholders face uncertainty regarding the merger's completion and potential impact on stock value.
• Employees may experience disruption and uncertainty due to the merger and litigation.
• Customers and suppliers could be affected by potential changes in Matterport's operations.
• The merger's outcome could impact Matterport's ability to retain and hire key personnel.

Next Steps

• Matterport will continue to defend against the lawsuits.
• Stockholders will vote on the merger at the special meeting on July 26, 2024.
• The company will seek to obtain required regulatory approvals.
• The company will monitor and respond to any additional lawsuits or demand letters.

Key Dates

Keywords

Merger, Matterport, CoStar Group, Proxy Statement, Litigation, Stockholder Lawsuits, Demand Letters, Financial Projections, Qatalyst Partners, Merger Agreement