Current Report Filing (8-k)
August 23 2021 - 7:09AM
Edgar (US Regulatory)
0001395942
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0001395942
2021-08-20
2021-08-20
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xbrli:shares
iso4217:USD
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to
Section 13 OR 15(d) of the Securities Exchange Act of 1934
Date of Report
(Date of earliest event reported): August 20, 2021
KAR
Auction Services, Inc.
(Exact name of
Registrant as specified in its charter)
Delaware
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001-34568
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20-8744739
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(State
or other jurisdiction
of incorporation)
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(Commission
File
Number)
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(I.R.S. Employer
Identification No.)
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11299 N. Illinois
Street
Carmel, Indiana
46032
(Address of principal
executive offices)
(Zip Code)
(800) 923-3725
(Registrant’s
telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended
to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨ Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging
growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities
Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ¨
If an emerging growth company, indicate
by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial
accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Securities registered pursuant to Section 12(b) of the
Act:
Title of each class
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Trading symbol
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Name of each exchange on which registered
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Common Stock, par value $0.01 per share
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KAR
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New York Stock Exchange
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Item 1.01 Entry Into a Material
Definitive Agreement.
On August 20, 2021, ADESA, Inc. (“ADESA”),
a subsidiary of KAR Auction Services, Inc., a Delaware corporation (the “Company”), entered into a Securities
Purchase Agreement (the “Purchase Agreement”), by and among (i) ADESA, (ii) Carwave Holdings LLC (“Carwave”),
(iii) KKR Chevy Blocker, LLC (“SMA Blocker”) and KKR NGT II (Chevy) Blocker L.P. (“NGT2 Blocker”
and, together with the SMA Blocker, the “Blockers”), (iv) KKR Chevy Aggregator L.P. (the “Aggregator”),
John Lauer, William Lauer, Joseph Lauer, Lauer Holdings Inc., KKR-Milton Strategic Partners L.P., KKR DAF Private Assets Fund Designated
Activity Company and KKR NGT II (Chevy) Blocker Parent L.P. (collectively, the “Sellers”) and (v) the Aggregator,
in its capacity as seller representative. Pursuant to the terms and conditions of the Purchase Agreement, ADESA will purchase from the
Sellers all of the equity interests of Carwave and the Blockers (the “Transaction”).
The aggregate cash consideration payable by ADESA
in connection with the Transaction is $450 million, subject to certain adjustments pursuant to the Purchase Agreement. The Transaction
and the Purchase Agreement have been unanimously approved by the Board of Directors of the Company.
Consummation of the Transaction is subject to
customary conditions, including the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements
Act of 1976, as amended (the “HSR Act”). Under certain circumstances, upon the termination of the Purchase Agreement
relating to the failure of ADESA to perform certain covenants, ADESA would be required to pay a termination fee of $22.5 million to the
Sellers on the terms and conditions further set forth in the Purchase Agreement.
The Purchase Agreement also contains customary
representations and warranties and covenants, including, among other things, covenants with respect to the operation of the business of
Carwave and its subsidiaries between the signing of the Purchase Agreement and the closing of the Transaction. In connection with the
entry into of the Purchase Agreement, ADESA has obtained a customary representations and warranties insurance policy as recourse for certain
losses arising out of breaches of the representations and warranties of the Sellers, the Blockers and Carwave and its subsidiaries in
the Purchase Agreement.
The
foregoing description of the Transaction does not purport to be complete and is qualified in its entirety by reference to the complete
text of the Purchase Agreement, a copy of which is attached hereto as Exhibit 2.1 and incorporated herein by reference.
Item 8.01. Other Events.
On August 23, 2021, the Company issued a
press release (the “Press Release”) announcing the execution of the Purchase Agreement. A copy of the Press Release
is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
Forward-Looking
Statements
Certain
statements contained in this report include “forward-looking statements” within the meaning of the Private Securities Litigation
Reform Act of 1995 and which are subject to certain risks, trends and uncertainties. In particular, statements made that are not historical
facts may be forward-looking statements. Words such as “should,” “may,” “will,” “anticipates,”
“expects,” “intends,” “plans,” “believes,” “seeks,” “estimates,”
and similar expressions identify forward-looking statements. Such statements are based on management’s current expectations, are
not guarantees of future performance and are subject to risks and uncertainties that could cause actual results to differ materially from
the results projected, expressed or implied by these forward-looking statements. Factors that could cause or contribute to such differences
include those uncertainties regarding the impact of the COVID-19 virus on our business and the economy generally, and those other matters
disclosed in the Company’s Securities and Exchange Commission filings. The Company does not undertake any obligation to update any
forward-looking statements.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
EXHIBIT NO.
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DESCRIPTION OF EXHIBIT
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2.1
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Securities Purchase Agreement, by and among ADESA, Inc., Carwave Holdings LLC, KKR Chevy Aggregator L.P., John Lauer, William
Lauer, Joseph Lauer, Lauer Holdings Inc., KKR Chevy Blocker, LLC, KKR-Milton Strategic Partners L.P., KKR DAF Private Assets Fund Designated
Activity Company, KKR NGT II (Chevy) Blocker L.P. and KKR NGT II (Chevy) Blocker Parent L.P.*
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99.1
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Press Release dated August 23, 2021.
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104
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Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document.
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* Certain exhibits and schedules to the Securities Purchase Agreement have been omitted pursuant to Item 601(b)(2) of Regulation S-K.
The Company hereby undertakes to provide to the Securities and Exchange Commission copies of such documents upon request; provided, however,
that the Company reserves the right to request confidential treatment for portions of any such documents.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.
Dated: August 23, 2021
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KAR Auction Services, Inc.
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/s/ Eric M. Loughmiller
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Eric M. Loughmiller
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Executive Vice President and Chief Financial Officer
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