SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 1)*
GANDER MOUNTAIN COMPANY
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(Name of Issuer)
COMMON STOCK, PAR VALUE $.01 PER SHARE
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(Title of Class of Securities)
36471 P 10 8
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(CUSIP Number)
CHARLES E. H. LUEDDE, ESQ.
GREENSFELDER, HEMKER & GALE, P.C.
TEN SOUTH BROADWAY, SUITE 2000, ST. LOUIS, MISSOURI 63102 (314) 241-9090
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(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
DECEMBER 11, 2006
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(Date of Event Which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is filing
this schedule because of Rule 13d-1(e), (f) or (g), check the following box [ ].
NOTE. Schedules filed in paper format shall include a signed original and
five copies of the schedule, including all exhibits. See Rule 13d-7(b) for other
parties to whom copies are to be sent.
* The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which would
alter the disclosures provided in a prior cover page.
The information required in the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
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CUSIP No. 36471 P 10 8 13D Page 2 of 7 Pages
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1 Names of Reporting Persons/I.R.S. Identification Nos. of Above
Persons (entities only)
DAVID C. PRATT
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2 Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [ ]
(b) [ ]
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3 SEC Use Only
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4 Source of Funds (See Instructions)
OO
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5 Check if Disclosure of Legal Proceedings is Required Pursuant
to Items 2(d) or 2(e) [ ]
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6 Citizenship or Place of Organization
U.S.
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Number of
7 Sole Voting Power
Shares
-0-
Beneficially ------------------------------------------------
8 Shared Voting Power
Owned by
-5,711,255-
Each ------------------------------------------------
9 Sole Dispositive Power
Reporting
-0-
Person With ------------------------------------------------
10 Shared Dispositive Power
-5,711,255-
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11 Aggregate Amount Beneficially Owned by Each Reporting Person
5,711,255
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12 Check if the Aggregate Amount in Row (9) Excludes Certain Shares
(See Instructions) [ ]
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13 Percent of Class Represented by Amount in Row (9)
28.5%
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14 Type of Reporting Person (See Instructions)
IN
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CUSIP No. 36471 P 10 8 13D Page 3 of 7 Pages
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1 Names of Reporting Persons/I.R.S. Identification Nos. of Above
Persons (entities only)
MARK R. GALE
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2 Check the Appropriate Box if a Member of a Group (See Instructions)
(a) [ ]
(b) [ ]
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3 SEC Use Only
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4 Source of Funds (See Instructions)
OO
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5 Check if Disclosure of Legal Proceedings is Required Pursuant
to Items 2(d) or 2(e) [ ]
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6 Citizenship or Place of Organization
UNITED STATES
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Number of
7 Sole Voting Power
Shares
1,400,000, SUBJECT TO THE DISCLAIMER IN ITEM 5.
Beneficially -----------------------------------------------------
8 Shared Voting Power
Owned by
5,701,255, SUBJECT TO THE DISCLAIMER IN ITEM 5.
Each -----------------------------------------------------
9 Sole Dispositive Power
Reporting
1,400,000, SUBJECT TO THE DISCLAIMER IN ITEM 5.
Person With -----------------------------------------------------
10 Shared Dispositive Power
5,701,255, SUBJECT TO THE DISCLAIMER IN ITEM 5.
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11 Aggregate Amount Beneficially Owned by Each Reporting Person
7,101,255, SUBJECT TO THE DISCLAIMER IN ITEM 5.
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12 Check if the Aggregate Amount in Row (9) Excludes Certain Shares
(See Instructions) [ ]
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13 Percent of Class Represented by Amount in Row (9)
35.5%
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14 Type of Reporting Person (See Instructions)
OO
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CUSIP No. 36471 P 10 8 13D Page 4 of 7 Pages
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PRELIMINARY NOTE
This Schedule 13D amends and supercedes the Schedule 13D originally filed
by Mr. Pratt and Mr. Gale on August 19, 2005, and reflects events and
transactions occurring during the period December 8, 2006 through December 13,
2006, inclusive, relating to such persons' respective holdings of the securities
and issuer named in Item 1 below.
Mr. Pratt is the sole Manager of Gratco, LLC ("Gratco"), a limited
liability company whose membership interests are held by irrevocable trusts (the
"Trusts") of which Mr. Pratt was the grantor. Mr. Gale is the sole owner,
director and president of Calco, Inc., a private trust company which is the sole
trustee of the respective Trusts. Mr. Pratt and Mr. Gale acknowledge, without so
admitting, that they could be deemed to constitute a "group" with respect to
Gratco's and Calco's respective beneficial ownership (as defined in Rule 13(d)-3
under the Securities Exchange Act) of the Registrant's securities and
accordingly jointly file this Schedule 13 D. Mr. Pratt and Mr. Gale are not
related by blood or marriage.
ITEM 1. SECURITY AND ISSUER.
This Schedule 13 D relates to the Common Stock, par value $.01 per share,
of Gander Mountain Company (the "Registrant") whose principal executive offices
are at 180 East Fifth Street, Suite 1300 St. Paul, Minnesota 55101
ITEM 2. IDENTITY AND BACKGROUND.
As to David C. Pratt:
(b) Suite 1125
7701 Forsyth Boulevard
Saint Louis, Missouri 63105
(c) Private investor; Mr. Pratt is the president of, and a direct or
indirect shareholder in or member of, several privately held
businesses including Rex Industrial Corp., DCP Investments, Three
Forks Ranch Corp., Three Forks Aviation, Inc. and Three Forks Lodge,
Inc. Prior to the sale of a significant portion of its operations
and assets in 1999, Mr. Pratt was the chairman, president and chief
executive officer of, and a shareholder of, United Industries, Inc.,
a privately held entity engaged primarily in the manufacture and
distribution of pesticides and other chemical formulations. In
August 2005, Mr. Pratt was elected as a member of the Registrant's
Board of Directors and has served as Vice Chairman of that Board.
(d) no such convictions
(e) not a party to any such proceedings,
(f) United States
As to Mark R. Gale:
(b) c/o Greensfelder, Hemker & Gale, P.C.
Suite 2000
Ten South Broadway
Saint Louis, Missouri 63102
(c) Retired; of counsel to Greensfelder, Hemker & Gale, P.C., a legal
services firm. Sole owner, director and president of Calco, Inc.
("Calco") a corporation serving as trustee of the David C. Pratt
Irrevocable Grantor Retained Annuity Trust, dated 12/1/92, (the
"GRAT") and other private trusts. Mr. Gale has served, and currently
serves, as a executive of certain privately held entities with which
Mr. Pratt is affiliated.
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CUSIP No. 36471 P 10 8 13D Page 5 of 7 Pages
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(d) no such convictions.
(e) not a party to any such proceedings.
(f) United States.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Prior to the transactions reported herein, and as previously reported, the
GRAT was the economic owner of 1,400,000 shares of Registrant's Common Stock and
also of a $20.0 million floating rate convertible subordinated note due August
15, 2010 (the "Note"). The Note was convertible into common stock at $16.00 per
share and thus represented a potential additional holding of 1,250,000 shares of
Registrant's Common Stock.
Note Amendment; Formation of Gratco LLC
On December 8, 2006, the GRAT agreed with the Registrant to amend and
restate the Note in order to eliminate the right to convert the Note into shares
of common stock and to eliminate the floating rate feature of the Note and fix
the interest rate at 6.75 percent per year, a reduction of 25 basis points from
the previously applicable interest rate. Following the amendment of the Note,
the trust assigned the Note to Gratco, a newly formed limited liability company
managed by Mr. Pratt and whose member-owners are certain Pratt family trusts,
the current beneficiaries of which are Mr. Pratt or members of his immediate
family. The GRAT is the sole voting member of Gratco and under certain
circumstances may remove or appoint a successor manager and must consent to any
amendment of the operating agreement of the limited liability company. The Note
was subsequently surrendered to the Registrant and cancelled as partial payment
for the Shares (as defined below) sold in the Stock Purchase (as defined below).
Stock Purchase
On December 11, 2006, Gratco entered into a stock purchase agreement (the
"Stock Purchase Agreement") pursuant to which it agreed to purchase 5,701,255
shares of the Registrant's common stock (the "Shares") for an aggregate purchase
price of $50.0 million, or $8.77 per share (the "Stock Purchase"). The per share
price of the Stock Purchase is equal to the closing market value per share of
the Registrant's common stock on December 11, 2006, defined by NASDAQ Stock
Market rules as the closing bid price on such date. The purchase price for the
Shares will be paid by surrendering the Note for cancellation of the $20 million
in principal due thereunder and by delivering cash for the balance of the
purchase price. The $30 million in such funds are being contributed to Gratco
from assets of the GRAT and other Pratt-related trusts acting as members of
Gratco. The closing and funding of the transaction and issuance of the Shares
occurred on December 13, 2006. A copy of the Stock Purchase Agreement was filed
as Exhibit 10 to the Registrant's Current Report on Form 8-K dated December 13,
2006, and is incorporated by reference into this Item 3.
The Registrant provided certain registration rights to Gratco under the
Stock Purchase Agreement. Under the Stock Purchase Agreement, the Registrant has
agreed to file a shelf registration statement for resales of the Shares within
365 days of the closing date of the Stock Purchase. The Registrant is further
obligated to use its best efforts to cause the shelf registration statement to
become effective under the Securities Act of 1933 within 420 days after the
closing date of the Stock Purchase (480 days in the event of a full review of
the shelf registration statement by the Securities and Exchange Commission).
ITEM 4. PURPOSE OF THE TRANSACTION.
Mr. Pratt resigned as a member of the Board of Directors of the Registrant
on December 8, 2006, prior to the Registrant's Board's consideration and action
in the financial transactions set forth in Item 3, above. On December 12, 2006
(subject to consummation of the closing of the transactions), Mr. Pratt was
re-elected to the Board of Directors and asked to serve as its non-executive
Chairman of the Board.
The acquisition of the Stock by Gratco was undertaken for general
investment purposes. Mr. Pratt or Gratco or the GRAT may, from time to time,
acquire additional shares of stock or participate in financing transactions
relating to the Registrant or may determine to sell portions or all of the
investments currently held.
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CUSIP No. 36471 P 10 8 13D Page 6 of 7 Pages
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No transactions undertaken by Mr. Pratt or by the Trusts were undertaken with a
view to changing or effecting any of the events listed or described in items (a)
through (j) of Item 4, notwithstanding the fact as reported above that Mr. Pratt
was elected to a newly-created vacancy on the Board of Directors of the
Registrant coincident with the investment made by the GRAT in August 2005.
Although Mr. Pratt did not join the Board of Directors with a specific
transactional agenda, his position as Chairman of the Board of Directors of the
Registrant and the percentage of ownership of the Registrant held by Gratco and
the GRAT enable him to exercise substantial influence over the policies,
practices and direction of the Registrant's business. It is Mr. Pratt's
expressed and continuing intention to work with the Registrant's management team
to assist in realizing the growth potential he perceives in the Registrant.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a) The following table represents the shares of common stock
beneficially owned by the parties who are Reporting Persons in the
filing of this Schedule 13 D:
Shares Beneficially Relationship to Number Percentage of Outstanding
Owned by Reporting Person of Shares Securities(1)
-------- ---------------- --------- -------------
David C. Pratt Reporting Person - David C. 10,000(2)
Pratt
Gratco LLC Reporting Person - David C. 5,701,255 28.5%
Pratt,
as sole Manager
subtotal for David C. Pratt 5,711,255 28.5%
David C. Pratt Reporting Person - Mark R. Gale 7,101,255(3) 35.5%
Irrevocable as sole owner of trustee
Grantor Retained
Annuity Trust
Notes:
(1) Based upon 20,009,529 shares outstanding.
(2) Exercisable options; does not include options, not presently exercisable, to
purchase an additional 10,000 shares. Options granted under Registrant's option
program for non-employee directors.
(3) Includes shares held by Gratco.
AS PERMITTED IN S.E.C. REGULATION Section 240.13d-4, THIS STATEMENT SHALL NOT BE
CONSTRUED AS AN ADMISSION THAT DAVID C. PRATT IS, FOR THE PURPOSES OF SECTION
13(d) OR 13(g) OF THE SECURITIES EXCHANGE ACT, THE BENEFICIAL OWNER OF THE
SECURITIES HELD BY THE DAVID C. PRATT IRREVOCABLE GRANTOR RETAINED ANNUITY
TRUST. MARK R. GALE DISCLAIMS ANY ECONOMIC BENEFICIAL INTEREST IN THE ASSETS OF
GRATCO OR THE DAVID C. PRATT IRREVOCABLE GRANTOR RETAINED ANNUITY TRUST.
(b) Subject to the above disclaimers of beneficial ownership, for each
Reporting Person named in paragraph (a), the number of shares
reflects shares as to which the Reporting Person holds sole voting
and investment power.
(c) As indicated in Item 3 above, Gratco purchased 5,701,255 shares of
Common Stock from the Registrant on December 13,2006.
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CUSIP No. 36471 P 10 8 13D Page 7 of 7 Pages
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(d) David C. Pratt is a current income beneficiary of the David C. Pratt
Irrevocable Grantor Annuity Trust.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO
SECURITIES OF THE ISSUER.
As indicated above in this Schedule 13 D, David C. Pratt serves as a
director of the Registrant. As a director of the Registrant, Mr. Pratt may be
entitled to indemnification in accordance with applicable law and the
Registrant's by-laws.
The Stock Purchase Agreement also contains cross-indemnification
provisions between Gratco and the Registrant and usual and customary terms
relating to participation in certain underwritten offerings. In addition, the
option agreement relating to the option held by Mr. Pratt includes certain
restrictions and "black out periods" relating to sales of shares of the
Registrant's Common Stock by such holder.
As indicated in Item 3 above, any description herein of provisions of the
Stock Purchase Agreement is qualified in its entirety by reference to the full
text and terms of such agreement.
The GRAT and Gratco may agree to a further contribution by the GRAT to the
capital of Gratco in the form of a contribution of the 1,400,000 shares of
Registrant's Common Stock in exchange for additional ownership interests in
Gratco.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
The Note Purchase Agreement dated August 16, 2005, together with the
Exhibits thereto (including the form of Note), is incorporated herein by
reference to the Registrant's Form 8-K filed on December 13, 2006.
After reasonable inquiry, and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
DAVID C. PRATT IRREVOCABLE GRANTOR RETAINED
ANNUITY TRUST DATED 12/1/92
by its Trustee, Calco, Inc.
/s/ Mark R. Gale
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by Mark R. Gale, President
After reasonable inquiry, and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
DAVID C. PRATT, INDIVIDUALLY AND AS SOLE
MANAGER OF GRATCO LLC
/s/ David C. Pratt
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December 13, 2006
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