ABOUT THIS PROSPECTUS SUPPLEMENT
This document consists of two parts. The first part is this prospectus supplement, which describes the specific terms of this offering and also
adds to and updates the information contained or incorporated by reference in the accompanying prospectus. The second part is the accompanying prospectus, which contains more general information, some
of which may not apply to this offering.
You
should read both this prospectus supplement and the accompanying prospectus, together with any documents incorporated by reference herein and therein and the additional information
described below under the heading "Where You Can Find More Information; Incorporation of Certain Documents by Reference" in their entirety before making an investment decision. To the extent there is
a variation between information contained in this prospectus supplement, on the one hand, and the information contained in the accompanying prospectus, on the other hand, you should rely on the
information in this prospectus supplement.
If
the description of the offering varies between this prospectus supplement and the accompanying prospectus, you should rely on the information in this prospectus supplement. Any
statement made in this prospectus supplement or in a document incorporated or deemed to be incorporated by reference in this prospectus supplement will be deemed to be modified or superseded for
purposes of this prospectus supplement to the extent that a statement contained in this prospectus supplement or in any other subsequently filed document that is also incorporated or deemed to be
incorporated by reference in this prospectus supplement modifies or supersedes that statement. Any statement so modified or superseded will not be deemed, except as so modified or superseded, to
constitute a part of this prospectus supplement.
The
distribution of this prospectus supplement and the accompanying prospectus and the offering of the common stock in certain jurisdictions may be restricted by law. Neither the selling
shareholders nor the underwriter are making an offer of the common stock in any jurisdiction where the offer is not permitted. Persons who come into possession of this prospectus supplement and the
accompanying prospectus should inform themselves about and observe any such restrictions. This prospectus supplement and the accompanying prospectus do not constitute, and may not be used in
connection with, an offer or solicitation by anyone in any jurisdiction in which such offer or solicitation is not authorized or in which the person making such offer or solicitation is not qualified
to do so or to any person to whom it is unlawful to make such offer or solicitation.
You
should not consider any information in this prospectus supplement, the accompanying prospectus or any free writing prospectus to be investment, legal or tax advice. You should
consult your own counsel, accountant and other advisors for legal, tax, business, financial and related advice regarding the purchase of the common stock. None of we, the selling shareholders or the
underwriter are making any representation to you regarding the legality of an investment in the common stock by you under applicable investment or similar laws.
S-iii
Table of Contents
SUMMARY
The items in the following summary are described in more detail later in, or are incorporated by reference into, this
prospectus supplement and the accompanying prospectus. This summary provides an overview of selected information and does not contain all of the information you should consider. Therefore, you should
also read the more detailed information set out in or incorporated by reference into this prospectus supplement and the accompanying prospectus, including the risk factors, the financial statements
and related notes thereto, and the other documents to which this prospectus supplement and the accompanying prospectus refer before making an investment decision. Unless otherwise stated in this
prospectus supplement, or as the context otherwise requires, references to "Black Knight," the "Company," "we," "us" or "our" (1) with respect to periods prior to the Reorganization (as defined
below), are to Black Knight Financial Services, Inc., a Delaware corporation, and its consolidated subsidiaries and (2) with respect to periods after the Reorganization, are to Black
Knight, Inc., a Delaware corporation, and its consolidated subsidiaries.
Business Description
Black Knight is a leading provider of software, data and analytics solutions to the mortgage and consumer loan, real estate and capital market
verticals. We believe we differentiate ourselves by the breadth and depth of our comprehensive, integrated solutions and the insight we provide to our clients.
We
have market-leading positions in mortgage processing and software solutions combined with comprehensive real estate data and extensive analytic capabilities. Our solutions are
utilized by U.S. mortgage originators and mortgage servicers, as well as other financial institutions, investors and real estate professionals, to support mortgage lending and servicing operations,
analyze portfolios and properties, operate more efficiently, meet regulatory compliance requirements and mitigate risk.
Share Repurchase
We intend to purchase from the underwriter 2,000,000 shares of our common stock that are subject to this offering at a price per share equal to
the price per share paid by the underwriter to the selling shareholders in this offering. We refer to this repurchase as the "share
repurchase." The share repurchase is part of our existing equity repurchase program initially approved by our board of directors on January 31, 2017. After giving effect to the share
repurchase, we will have remaining authorization to repurchase up to an additional 6,809,879 shares of our common stock under the repurchase program. We intend to fund the share repurchase with cash
on hand and borrowings under our revolving credit facility. The closing of the share repurchase is contingent on the closing of this offering.
The
description and the other information in this prospectus supplement regarding the share repurchase is included in this prospectus supplement solely for informational purposes.
Nothing in this prospectus supplement should be construed as an offer to sell, or the solicitation of an offer to buy, any of our common stock subject to the share repurchase.
Corporate Reorganization
Pursuant to a reorganization and certain mergers described below and in our Current Report on Form 8-K12B, filed with the SEC on
October 2, 2017, the Company became the public parent holding company of Black Knight Financial Services, Inc. (the "Predecessor") (the "Reorganization").
The
Reorganization was effected by the following on September 29, 2017: (i) the contribution by Fidelity National Financial, Inc. ("FNF") of (x) all of the
shares of Class B common stock of the Predecessor that Black Knight Holdings, Inc. ("BKHI") owned and (y) all of the class A units of Black Knight Financial
Services, LLC ("BKFS LLC") that BKHI owned to New BKH Corp. ("New BKH"), a
S-1
Table of Contents
direct
wholly-owned subsidiary of BKHI, (ii) the distribution of the shares of New BKH common stock to the holders of the FNF Group tracking stock of FNF, followed by (iii) the mergers
of the Predecessor
and New BKH into wholly-owned subsidiaries of the Company (collectively, the "Transactions"). In the Transactions, the outstanding shares of the Predecessor's Class A common stock and New BKH
common stock were converted into shares of the Company's common stock on a one-for-one basis as set forth in the Agreement and Plan of Merger dated as of June 8, 2017 by and among the Company,
FNF, BKHI, New BKH, New BKH Merger Sub, Inc. and BKFS Merger Sub, Inc. As a result of the closing of the Transactions, the Company became the new public parent of the Predecessor. Shares
of the Company's common stock are listed on the NYSE under the trading symbol "BKI", and began trading at the market opening on October 2, 2017. Under the organizational documents of the
Company, the rights of the holders of shares of the Company's common stock are substantially the same as the rights of former holders of the Predecessor's Class A common stock. Following the
Transactions, the Company is the successor issuer to the Predecessor pursuant to Rule 414 under the Securities Act of 1933, as amended (the "Securities Act").
Corporate Information
We are incorporated in Delaware. Our principal executive offices are located at 601 Riverside Avenue, Jacksonville, Florida 32204, and our
telephone number is (904) 854-5100. Our corporate website address is www.blackknightinc.com. Our website and the information contained on, or that can be accessed through, the website is not
deemed to be incorporated by reference in, and is not considered part of, this prospectus supplement. You should not rely on any such information in making your decision whether to purchase our common
stock.
S-2
Table of Contents
THE OFFERING
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|
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Common stock offered by the selling shareholders
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5,000,000 shares of common stock.
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Use of proceeds
|
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We will not receive any proceeds from the sale of shares of common stock by the selling shareholders. See "Use of
Proceeds."
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Share repurchase
|
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Subject to completion of this offering, we have agreed to repurchase 2,000,000 shares of our common stock that are subject
to this offering from the underwriter at a price per share equal to the price paid by the underwriter to the selling shareholders in this offering. The closing of the share repurchase is contingent on the closing of this offering. The share
repurchase was approved by the audit committee of our board of directors, which is comprised entirely of disinterested directors.
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Dividend policy
|
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We do not anticipate paying dividends on our common stock in the foreseeable future. See "Dividend Policy."
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Voting rights
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Each share of common stock entitles the holder to one vote in all matters submitted to a vote of shareholders. See
"Description of Capital Stock" in the accompanying prospectus.
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Immediately following this offering, our public shareholders will have 80% of the voting power in Black Knight,
Inc.
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Risk factors
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Investing in our common stock involves a high degree of risk. See "Risk Factors" beginning on page S-8 of this prospectus
supplement, the accompanying prospectus, any free writing prospectus prepared by or on behalf of us and other documents incorporated by reference herein or therein for a discussion of factors you should carefully consider before investing in our
common stock.
|
NYSE symbol
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|
"BKI."
|
Unless
otherwise indicated, the number of shares of our common stock to be outstanding after this offering is based on 153,469,978 shares of common stock outstanding as of
November 1, 2017, includes the repurchase of 2,000,000 shares of our common stock in the share repurchase and excludes an aggregate of 8,668,638 additional shares of common stock that are
reserved for issuance for future awards pursuant to the Black Knight, Inc. Amended and Restated 2015 Omnibus Incentive Plan.
S-3
Table of Contents
SUMMARY HISTORICAL FINANCIAL DATA
The following table sets forth our summary historical financial data for the periods indicated. We derived the statements of operations data for
the nine months ended September 30, 2017 and 2016 and the balance sheets data as of September 30, 2017 and 2016 from our unaudited condensed consolidated financial statements
incorporated by reference in this prospectus supplement. We derived the statements of operations data for the years ended December 31, 2016, 2015 and 2014 and the balance sheets data as of
December 31, 2016 and 2015 from our audited consolidated financial statements incorporated by reference in this prospectus supplement. We derived the balance sheet data as of
December 31, 2014 from our audited consolidated financial statements not incorporated by reference in this prospectus supplement.
We
have prepared the unaudited condensed consolidated financial information set forth below on the same basis as our audited consolidated financial statements and have included all
adjustments, consisting of only normal recurring adjustments, that we consider necessary for a fair presentation of our financial position and operating results for such periods. The results for any
interim period are not necessarily indicative of the results that may be expected for a full year.
Our
historical results are not necessarily indicative of future operating results. You should read the information set forth below in conjunction with our financial statements and the
related notes thereto and "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in our Annual Report on Form 10-K for the year ended
December 31, 2016 and our
S-4
Table of Contents
Quarterly
Reports on Form 10-Q for the quarters ended March 31, 2017, June 30, 2017 and September 30, 2017 incorporated by reference in this prospectus supplement.
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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Nine Months
Ended
September 30,
|
|
Year Ended December 31,
|
|
|
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2017
|
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2016
|
|
2016
|
|
2015
|
|
2014
|
|
|
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(In millions)
|
|
Statements of Operations Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
$
|
784.1
|
|
$
|
764.5
|
|
$
|
1,026.0
|
|
$
|
930.7
|
|
$
|
852.1
|
|
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses
|
|
|
428.2
|
|
|
433.4
|
|
|
582.6
|
|
|
538.2
|
|
|
514.9
|
|
Depreciation and amortization
|
|
|
154.2
|
|
|
154.2
|
|
|
208.3
|
|
|
194.3
|
|
|
188.8
|
|
Transition and integration costs
|
|
|
8.5
|
|
|
2.2
|
|
|
2.3
|
|
|
8.0
|
|
|
119.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total expenses
|
|
|
590.9
|
|
|
589.8
|
|
|
793.2
|
|
|
740.5
|
|
|
823.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
193.2
|
|
|
174.7
|
|
|
232.8
|
|
|
190.2
|
|
|
29.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income and expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense
|
|
|
(44.8
|
)
|
|
(50.6
|
)
|
|
(67.6
|
)
|
|
(89.8
|
)
|
|
(128.7
|
)
|
Other expense, net
|
|
|
(17.1
|
)
|
|
(6.2
|
)
|
|
(6.4
|
)
|
|
(4.6
|
)
|
|
(12.0
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Total other expense, net
|
|
|
(61.9
|
)
|
|
(56.8
|
)
|
|
(74.0
|
)
|
|
(94.4
|
)
|
|
(140.7
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) from continuing operations before income taxes
|
|
|
131.3
|
|
|
117.9
|
|
|
158.8
|
|
|
95.8
|
|
|
(111.6
|
)
|
Income tax expense (benefit)
|
|
|
24.3
|
|
|
19.2
|
|
|
25.8
|
|
|
13.4
|
|
|
(5.3
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings (loss) from continuing operations
|
|
|
107.0
|
|
|
98.7
|
|
|
133.0
|
|
|
82.4
|
|
|
(106.3
|
)
|
Loss from discontinued operations, net of tax
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(0.8
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
New earnings (loss)
|
|
|
107.0
|
|
|
98.7
|
|
|
133.0
|
|
|
82.4
|
|
|
(107.1
|
)
|
Less: Net earnings (loss) attributable to noncontrolling interests
|
|
|
71.9
|
|
|
64.7
|
|
|
87.2
|
|
|
62.4
|
|
|
(107.1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings attributable to Black Knight
|
|
$
|
35.1
|
|
$
|
34.0
|
|
$
|
45.8
|
|
$
|
20.0
|
|
$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Financial Measures
(1)
:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Revenues
|
|
$
|
787.7
|
|
$
|
770.3
|
|
$
|
1,033.3
|
|
$
|
940.3
|
|
$
|
864.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
|
|
$
|
373.9
|
|
$
|
346.4
|
|
$
|
463.1
|
|
$
|
413.5
|
|
$
|
354.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA Margin
|
|
|
47.5
|
%
|
|
45.0
|
%
|
|
44.8
|
%
|
|
44.0
|
%
|
|
41.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30,
|
|
December 31,
|
|
|
|
2017
|
|
2016
|
|
2016
|
|
2015
|
|
2014
|
|
Balance Sheets Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
146.2
|
|
$
|
58.9
|
|
$
|
133.9
|
|
$
|
186.0
|
|
$
|
61.9
|
|
Total assets
|
|
$
|
3,750.0
|
|
$
|
3,713.5
|
|
$
|
3,762.0
|
|
$
|
3,703.7
|
|
$
|
3,598.3
|
|
Total debt
|
|
$
|
1,542.0
|
|
$
|
1,580.5
|
|
$
|
1,570.2
|
|
$
|
1,661.5
|
|
$
|
2,135.1
|
|
-
(1)
-
We
use Adjusted Revenues, Adjusted EBITDA and Adjusted EBITDA Margin for financial and operational decision making as a means to evaluate period-to-period
comparisons. Adjusted Revenues, Adjusted EBITDA and Adjusted EBITDA Margin are non-GAAP financial measures, which we believe are useful for investors in evaluating our overall financial performances.
Black Knight believes these measures provide useful information about operating results, enhance the overall understanding of past financial performance and future prospects and allow for greater
S-5
Table of Contents
transparency
with respect to key metrics used by management in its financial and operational decision making, including determining a portion of executive compensation.
-
-
Adjusted Revenues
We define Adjusted Revenues as Revenues adjusted to include the
revenues that were not recorded by Black Knight during the periods presented due to the deferred revenue purchase accounting adjustment recorded in accordance with GAAP. These adjustments are
reflected in Corporate and Other.
-
-
Adjusted EBITDA
We define Adjusted EBITDA as Net earnings, with adjustments to
reflect the addition or elimination of certain income statement items including, but not limited to:
-
-
Depreciation and amortization;
-
-
Interest expense;
-
-
Income tax expense;
-
-
Other expense, net;
-
-
Loss (gain) from discontinued operations, net of tax;
-
-
deferred revenue purchase accounting adjustment recorded in accordance with GAAP;
-
-
equity-based compensation, including related payroll taxes;
-
-
transition and integration costs;
-
-
costs associated with debt and/or equity offerings, including the spin-off of Black Knight from FNF;
-
-
spin-off related transaction costs;
-
-
member management fees paid to FNF and THL Managers, LLC;
-
-
acquisition-related costs; and
-
-
legal and regulatory matters.
These
adjustments are reflected in Corporate and Other.
-
-
Adjusted EBITDA Margin
Adjusted EBITDA Margin is calculated by dividing Adjusted
EBITDA by Adjusted Revenues.
S-6
Table of Contents
A
reconciliation of the above non-GAAP financial measures to the most directly comparable GAAP financial measures is presented in the tables below (in millions):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months
Ended
September 30,
|
|
Year ended December 31,
|
|
|
|
2017
|
|
2016
|
|
2016
|
|
2015
|
|
2014
|
|
|
|
(In millions)
|
|
Revenues
|
|
$
|
784.1
|
|
$
|
764.5
|
|
$
|
1,026.0
|
|
$
|
930.7
|
|
$
|
852.1
|
|
Deferred revenue purchase accounting adjustment
|
|
|
3.6
|
|
|
5.8
|
|
|
7.3
|
|
|
9.6
|
|
|
12.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Revenues
|
|
$
|
787.7
|
|
$
|
770.3
|
|
$
|
1,033.3
|
|
$
|
940.3
|
|
$
|
864.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings (loss)
|
|
$
|
107.0
|
|
$
|
98.7
|
|
$
|
133.0
|
|
$
|
82.4
|
|
$
|
(107.1
|
)
|
Depreciation and amortization
|
|
|
154.2
|
|
|
154.2
|
|
|
208.3
|
|
|
194.3
|
|
|
188.8
|
|
Interest expense
|
|
|
44.8
|
|
|
50.6
|
|
|
67.6
|
|
|
89.8
|
|
|
128.7
|
|
Income tax expense (benefit)
|
|
|
24.3
|
|
|
19.2
|
|
|
25.8
|
|
|
13.4
|
|
|
(5.3
|
)
|
Other expense, net
|
|
|
17.1
|
|
|
6.2
|
|
|
6.4
|
|
|
4.6
|
|
|
12.0
|
|
Discontinued operations, net of tax
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
0.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
|
347.4
|
|
|
328.9
|
|
|
441.1
|
|
|
384.5
|
|
|
217.9
|
|
Deferred revenue purchase accounting adjustment
|
|
|
3.6
|
|
|
5.8
|
|
|
7.3
|
|
|
9.6
|
|
|
12.8
|
|
Equity-based compensation
|
|
|
14.4
|
|
|
9.5
|
|
|
12.4
|
|
|
11.4
|
|
|
6.4
|
|
Transition and integration costs
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
110.3
|
|
Debt and/or equity offering expenses
|
|
|
5.8
|
|
|
0.6
|
|
|
0.6
|
|
|
4.4
|
|
|
|
|
Spin-off related transition costs
|
|
|
2.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Management Fees
|
|
|
|
|
|
|
|
|
|
|
|
3.6
|
|
|
9.0
|
|
Acquisition-related costs
|
|
|
|
|
|
1.6
|
|
|
1.7
|
|
|
|
|
|
|
|
Legal and regulatory matters
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1.5
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
|
|
$
|
373.9
|
|
$
|
346.4
|
|
$
|
463.1
|
|
$
|
413.5
|
|
$
|
354.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA Margin
|
|
|
47.5
|
%
|
|
45.0
|
%
|
|
44.8
|
%
|
|
44.0
|
%
|
|
41.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months
Ended
September 30,
|
|
Year Ended
December 31,
|
|
May 26, 2015
through
December 31,
|
|
|
|
|
|
2017
|
|
2016
|
|
2016
|
|
2015
|
|
|
|
Earnings per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings per share attributable to Black Knight common shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.52
|
|
$
|
0.52
|
|
$
|
0.69
|
|
$
|
0.31
|
|
|
|
|
Diluted
|
|
$
|
0.51
|
|
$
|
0.50
|
|
$
|
0.67
|
|
$
|
0.29
|
|
|
|
|
Weighted average shares of common stock outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
67.7
|
|
|
65.9
|
|
|
65.9
|
|
|
64.4
|
|
|
|
|
Diluted
|
|
|
152.7
|
|
|
67.8
|
|
|
67.9
|
|
|
67.9
|
|
|
|
|
S-7
Table of Contents
RISK FACTORS
An investment in our common stock involves a high degree of risk. You should carefully consider the information contained in this prospectus
supplement and the accompanying prospectus before making an investment in our common stock. In addition, you should read and consider the risk factors included in the documents incorporated by
reference in this prospectus supplement, including our Annual Report on Form 10-K for the year ended December 31, 2016 and our Quarterly Report on Form 10-Q for the quarter
September 30, 2017. See "Where You Can Find More Information; Incorporation of Certain Documents by Reference." If any risks actually occur, our business, financial condition and results of
operations may be materially adversely affected. In such an event, the trading price of our common stock could decline and you could lose part or all of your investment.
Risks Related to this Offering and Ownership of Our Common Stock
The market price of our common stock may be volatile and you may lose all or part of your investment.
The market price of our common stock could fluctuate significantly and you may not be able to resell your shares at or above the offering price.
Those fluctuations could be based on various factors in addition to those otherwise described in this prospectus, including those listed in "Risk Factors" included in our Annual Report on
Form 10-K for the year ended December 31, 2016 and our Quarterly Report on Form 10-Q for the quarter ended September 30, 2017 and the following:
-
-
our operating performance and the performance of our competitors and fluctuations in our operating results;
-
-
the public's reaction to our press releases, our other public announcements and our filings with the SEC;
-
-
global, national or local economic, legal and regulatory factors unrelated to our performance;
-
-
announcements of positive news by us or our competitors, such as announcements of new products, services, strategic investments or
acquisitions;
-
-
announcements of negative news by us or our competitors, such as announcements of poorer than expected results of operations, data breaches or
significant litigation;
-
-
actual or anticipated variations in our or our competitors' operating results, and our and our competitors' growth rates;
-
-
failure by us or our competitors to meet analysts' projections or guidance that we or our competitors may give the market;
-
-
changes in laws or regulations, or new interpretations or applications of laws and regulations, that are applicable to our business;
-
-
changes in accounting standards, policies, guidance, interpretations or principles;
-
-
the arrival or departure of key personnel;
-
-
the number of shares to be publicly traded after this offering and the share repurchase;
-
-
future sales or issuances of our common stock, including sales, distributions or issuances by us, our officers or directors and our significant
shareholders, including Thomas H. Lee Partners, L.P. ("THL") and certain of their affiliates; and
-
-
other developments affecting us, our industry or our competitors.
In
addition, in recent years the stock market has experienced significant price and volume fluctuations that have affected and continue to affect the market prices of equity securities
of many
S-8
Table of Contents
companies.
These fluctuations have often been unrelated or disproportionate to the operating performance of those companies. These broad market fluctuations, as well as general economic, political and
market conditions such as recessions or interest rate changes, may cause declines in the market price of our common stock and you may not realize any return on your investment in us and may lose some
or all of your investment.
As
we primarily operate in a single industry, we are especially vulnerable to these factors to the extent that they affect our industry or our products. In the past, securities class
action litigation has often been initiated against companies following periods of volatility in their stock price. This type of litigation could result in substantial costs and divert our management's
attention and resources, and could also require us to make substantial payments to satisfy judgments or to settle litigation.
Future sales of our common stock in the public market could cause the market price of our common stock to
decrease significantly.
Sales of substantial amounts of our common stock in the public market following this offering by our existing shareholders or by persons who
acquire shares in this offering may cause the market price of our common stock to decrease significantly. These issuances, or the possibility that these issuances may occur, may also make it more
difficult for us to raise additional capital by selling equity securities in the future, at a time and price that we deem appropriate.
In
connection with this offering, our executive officers, directors, other than William P. Foley, II, and the selling shareholders entered into lock-up agreements with the underwriter of
this offering that, subject to certain exceptions, prohibit the signing party from selling, contracting to sell or otherwise
disposing of any common stock or securities that are convertible or exchangeable for common stock in excess of 10% (subject to certain exceptions) of the shares beneficially owned by such signing
party, or entering into any arrangement that transfers the economic consequences of ownership of our common stock for at least 30 days from the date of this prospectus filed in connection with
this offering, although the underwriter may, in its sole discretion and at any time without notice, release all or any portion of the securities subject to these lock-up agreements. Upon a request to
release any shares subject to a lock-up, the underwriter would consider the particular circumstances surrounding the request including, but not limited to, the length of time before the lock-up
expires, the number of shares requested to be released, reasons for the request, the possible impact on the market for our common stock and whether the holder of our shares requesting the release is
an officer, director or other affiliate of ours. See "Underwriting."
Additionally,
we have adopted an equity incentive plan pursuant to which stock options to purchase shares of common stock and other stock-based awards may be issued in the future from
time to time to our officers, directors and employees.
As
restrictions on resale expire or as shares are registered, our share price could drop significantly if the holders of these restricted or newly registered shares sell them or are
perceived by the market as intending to sell them. These sales might also make it more difficult for us to raise capital through the sale of equity securities in the future at a time and at a price
that we deem appropriate.
If securities or industry analysts publish inaccurate or unfavorable research about our business, our stock
price and trading volume could decline.
The trading market for our common stock is influenced in part on the research and reports that securities or industry analysts publish about us
or our business. If one or more of the analysts who cover us downgrades our common stock or publishes inaccurate or unfavorable research about our business, our stock price could decline. If one or
more of these analysts ceases coverage of us or fails to publish reports on us regularly, demand for our common stock could decrease, which could cause our stock price and trading volume to decline.
S-9
Table of Contents
Our charter and bylaws and provisions of Delaware law may discourage or prevent strategic transactions,
including a takeover of our company, even if such a transaction would be beneficial to our shareholders.
Provisions contained in our charter and bylaws and provisions of the Delaware General Corporate Law, or DGCL, could delay or prevent a third
party from entering into a strategic transaction with us, as applicable, even if such a transaction would benefit our shareholders. For example, our charter and
bylaws:
-
-
divide our board of directors into three classes with staggered three-year terms, which may delay or prevent a change of our management or a
change of control;
-
-
authorize the issuance of "blank check" preferred stock that could be issued by us upon approval of our board of directors to increase the
number of outstanding shares of capital stock, making a takeover more difficult and expensive;
-
-
provide that directors may be removed from office only for cause and that any vacancy on our board of directors may only be filled by a
majority of our directors then in office, which may make it difficult for other shareholders to reconstitute our board of directors;
-
-
provide that special meetings of the shareholders may be called only upon the request of a majority of our board of directors or by our
chairman of the board of directors or chief executive officer; and
-
-
require advance notice to be given by shareholders for any shareholder proposals or director nominees.
By
virtue of not opting out of Section 203 of the DGCL in our amended and restated certificate of incorporation, we are subject to Section 203 of the DGCL, which prohibits
a publicly held Delaware corporation from engaging in a "business combination" with an "interested stockholder" for a period of three years after the time the shareholder became an interested
stockholder, subject to certain exceptions, including if, prior to such time, the board of directors approved the business combination or the transaction which resulted in the shareholder becoming an
interested stockholder. "Business combinations" include mergers, asset sales and other transactions resulting in a financial benefit to the "interested stockholder." Subject to various exceptions, an
"interested stockholder" is a person who, together with his or her affiliates and associates, owns, or within three years did own, 15% or more of the corporation's outstanding voting stock. These
restrictions generally prohibit or delay the accomplishment of mergers or other takeover or change of control attempts that are not approved by a company's board of directors.
These
restrictions and provisions could keep us from pursuing relationships with strategic partners and from raising additional capital, which could impede our ability to expand our
business and strengthen our competitive position. These restrictions could also limit shareholder value by impeding a sale of us.
We do not intend to pay dividends for the foreseeable future.
We may retain future earnings, if any, for future operations, expansion and debt repayment. We have not paid cash dividends to date and have no
current plans to pay any cash dividends for the foreseeable future. As a result of our current dividend policy, you may not receive any return on an investment in our common stock unless you sell our
common stock for a price greater than that which you paid for it. Any future determination to declare and pay cash dividends will be at the discretion of our board of directors and will depend on,
among other things, our financial condition, results of operations, cash requirements, contractual restrictions and such other factors as our board of directors deems relevant. Our ability to pay
dividends depends on our receipt of cash dividends from our operating subsidiaries, which may further restrict our ability to pay dividends as a result of the laws of their jurisdiction of
organization or agreements of our subsidiaries, including agreements governing our indebtedness. Existing or future agreements governing our indebtedness may limit our ability to pay dividends.
S-10
Table of Contents
FORWARD-LOOKING STATEMENTS
The statements contained in this prospectus supplement, the accompanying prospectus and any documents incorporated by reference herein or
therein that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), including statements regarding expectations, hopes, intentions or strategies regarding the future. These statements relate to, among other things, future financial and
operating results of Black Knight. In many cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "expect," "plan," "anticipate," "believe," "estimate,"
"predict," "potential," or "continue," or the negative of these terms and other comparable terminology. Actual results could differ materially from those anticipated in these statements as a result of
a number of factors, including, but not limited to the following:
-
-
security breaches against our information systems;
-
-
changes to our relationships with our top clients, whom we rely on for a significant portion of our revenues and profit;
-
-
limitation of our growth due to the time and expense associated with switching from competitors' software and services;
-
-
providing credits or refunds for prepaid amounts or contract terminations in connection with our service level commitments;
-
-
our ability to offer high-quality technical support services;
-
-
our ability to comply with or changes in laws, rules and regulations that affect our and our customers' businesses;
-
-
consolidation in our end client market;
-
-
regulatory developments with respect to use of consumer data and public records;
-
-
efforts by the government to reform or address the mortgage market and current economic environment;
-
-
our clients' relationships with government-sponsored enterprises;
-
-
our ability to adapt our solutions to technological changes or evolving industry standards;
-
-
our ability to compete effectively;
-
-
increase in the availability of free or relatively inexpensive information;
-
-
our ability to protect our proprietary technology and information rights;
-
-
infringement on the proprietary rights of others by our applications or services;
-
-
our ability to successfully consummate and integrate acquisitions;
-
-
our reliance on third parties;
-
-
our dependence on our ability to access data from external sources;
-
-
our international operations and third-party service providers;
-
-
our ability to develop widespread brand awareness cost-effectively;
-
-
system failures, damage or interruption with respect to our technology solutions;
-
-
delays or difficulty in developing or implementing new or enhanced mortgage processing or technology solutions;
S-11
Table of Contents
-
-
change in the strength of the economy and housing market generally;
-
-
our substantial indebtedness and any additional significant debt we incur;
-
-
the adequacy of our risk management policies and procedures;
-
-
our ability to achieve our growth strategies;
-
-
litigation, investigations or other actions against us;
-
-
the market price of our common stock may be volatile;
-
-
future sales of our common stock in the public market;
-
-
industry or securities analysts could publish unfavorable or inaccurate information about us;
-
-
our charter and bylaws and provisions of Delaware law may discourage or prevent strategic transactions;
-
-
our intention not to pay dividends on our common stock for the foreseeable future;
-
-
if the Reorganization is treated as a taxable transaction due to our acts or failure to act, we may have a significant indemnity obligation to
FNF, which is not limited in amount or subject to any cap;
-
-
the possibility that we will forgo certain transactions in order to avoid the risk of incurring significant tax-related liabilities; and
-
-
restrictions on our ability to pursue potential business opportunities under a non-competition agreement with FNF that we entered in connection
with the Reorganization.
The
risks and uncertainties that forward-looking statements are subject to include other risks detailed in the "Statement Regarding Forward-Looking Information," "Risk Factors" and other
sections of our Annual Report on Form 10-K for the year ended December 31, 2016 and in our subsequent filings with the SEC, as incorporated by reference into this prospectus supplement.
Forward-looking
statements are based on our beliefs, as well as assumptions made by, and information currently available to, us. We undertake no obligation to update any forward-looking
statements, whether as a result of new information, future events or otherwise. Moreover, we operate in a competitive and rapidly changing environment. New risks emerge from time to time. It is not
possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to
differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties and assumptions, the future events and trends discussed in this report may
not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements.
You
should not rely upon forward-looking statements as predictions of future events. The events and circumstances reflected in the forward-looking statements may not be achieved or
occur. Although we believe that the expectations and assumptions reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, or
achievements. Any forward-looking statement made by us in this prospectus or any documents incorporated by reference herein or therein speaks only as of the date on which we make it.
S-12
Table of Contents
USE OF PROCEEDS
All shares of our common stock offered by this prospectus supplement will be sold by the selling shareholders. We will not receive any proceeds
from the sale of shares by the selling shareholders.
MARKET PRICE OF OUR COMMON STOCK
Our common stock has been trading on the NYSE under the symbol "BKI" since October 2, 2017. Prior to the Reorganization, the
Class A common stock of our Predecessor traded on the NYSE under the symbol "BKFS" since May 20, 2015. As of November 1, 2017, there were
approximately 6,624 holders of record of our common stock. The actual number of shareholders is greater than this number of holders of record, and includes shareholders who are beneficial owners but
whose shares are held in street name by brokers and other nominees. The following table sets forth for the periods indicated the high and low closing prices per share of our common stock on the NYSE.
|
|
|
|
|
|
|
|
Fiscal Quarter
|
|
High
|
|
Low
|
|
2015
|
|
|
|
|
|
|
|
Fourth Quarter
|
|
$
|
36.25
|
|
$
|
32.07
|
|
2016
|
|
|
|
|
|
|
|
First Quarter
|
|
$
|
31.66
|
|
$
|
26.00
|
|
Second Quarter
|
|
$
|
37.60
|
|
$
|
28.89
|
|
Third Quarter
|
|
$
|
41.04
|
|
$
|
37.00
|
|
Fourth Quarter
|
|
$
|
40.38
|
|
$
|
35.75
|
|
2017
|
|
|
|
|
|
|
|
First Quarter
|
|
$
|
40.00
|
|
$
|
34.45
|
|
Second Quarter
|
|
$
|
41.90
|
|
$
|
38.10
|
|
Third Quarter
|
|
$
|
44.75
|
|
$
|
40.70
|
|
Fourth Quarter (through November 17, 2017)
|
|
$
|
46.85
|
|
$
|
42.00
|
|
S-13
Table of Contents
DIVIDEND POLICY
We do not intend to pay cash dividends on our common stock in the foreseeable future. Any future determination to pay dividends will be at the
discretion of our board of directors and subject to, among other things, our compliance with applicable law, and depending on, among other things, our results of operations, financial condition, level
of indebtedness, capital requirements, contractual restrictions, restrictions in our debt agreements, business prospects and other factors that our board of directors may deem relevant. We will
evaluate future quarterly dividend payment amounts based on, among other things, our cash flow and liquidity position. The payment, including timing and amount, of any dividends will be at the
discretion of our board of directors.
Our
ability to pay dividends depends on our receipt of cash dividends from our operating subsidiaries, including BKFS LLC, which may further restrict our ability to pay dividends
as a result of the laws of their jurisdiction of organization or agreements of our subsidiaries, including agreements governing our indebtedness. Future agreements governing our indebtedness may also
limit our ability to pay dividends. See "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Description of Certain Indebtedness" incorporated in this
prospectus supplement by
reference from our Annual Report on Form 10-K for a description of the restrictions on our ability to pay dividends.
You
may need to sell your shares of our common stock to realize a return on your investment, and you may not be able to sell your shares at or above the price you paid for them. See
"Risk FactorsRisks Related to this OfferingWe do not intend to pay dividends for the foreseeable future" in this prospectus supplement.
S-14
Table of Contents
SELLING SHAREHOLDERS
The following table shows information regarding the beneficial ownership of our common stock by the selling shareholders (1) immediately
prior to this offering and the share repurchase and (2) as adjusted to give effect to this offering and the share repurchase.
For
further information regarding the beneficial ownership of our common stock and material transactions between us and the selling shareholders, see "Stock Ownership of Certain
Beneficial Owners, Directors and Executive Officers" and "Related Person Transactions" in our Definitive Proxy Statement on Schedule 14A filed with the SEC on April 26, 2017, which is
incorporated by reference into this prospectus supplement.
Beneficial
ownership of shares is determined under rules of the SEC and generally includes any shares over which a person exercises sole or shared voting or investment power. Except as
indicated by footnote, and subject to community property laws where applicable, we believe based on the information provided to us that the persons and entities named in the table below have sole
voting and investment power with respect to all shares of our common stock shown as beneficially owned by them. Percentage of beneficial ownership is based on 153,469,978 shares of common stock
outstanding as of November 1, 2017.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares of common stock beneficially
owned before this offering and
the share repurchase
|
|
Shares of common stock beneficially
owned after this offering and
the share repurchase
|
|
Name and address of beneficial owner
|
|
Number of
shares
|
|
Percentage
of shares
|
|
Total voting
percentage
|
|
Number of
shares
|
|
Percentage
of shares
|
|
Total voting
percentage
|
|
Affiliates of Thomas H. Lee Partners, L.P.(1)
|
|
|
35,074,582
|
|
|
23
|
%
|
|
23
|
%
|
|
30,074,582
|
|
|
20
|
%
|
|
20
|
%
|
-
(1)
-
Includes
9,401,018 shares of common stock held by Thomas H. Lee Equity Fund VI, L.P., 6,365,870 shares of common stock held by Thomas H. Lee Parallel Fund
VI, L.P., 1,111,989 shares of common stock held by Thomas H. Lee Parallel (DT) Fund VI, L.P., 9,520,244 shares of common stock held by THL Equity Fund VI Investors (BKFS), L.P.,
5,962,679 shares of common stock held by THL Equity Fund VI Investors (BKFS) II, L.P., 1,002,131 shares of common stock held by THL Equity Fund VI Investors (BKFS) III, L.P., 308,404
shares of common stock held by THL Coinvestment Partners, L.P., 1,815 shares of common stock held by THL Operating Partners, L.P., 48,916 shares of common stock held by Great-West
Investors LP, 48,745 shares of common stock held by Putnam Investments Employees' Securities Company III LLC, 1,252,664 shares of common stock held by THL Equity Fund VI Investors
(BKFS-LM), LLC and 50,107 shares of common stock held by THL Equity Fund VI Investors (BKFS-NB), LLC. THL Equity Advisors VI, LLC is the general partner of Thomas H. Lee Equity
Fund VI, L.P., Thomas H. Lee Parallel Fund VI, L.P., Thomas H. Lee Parallel (DT) Fund VI, L.P., THL Equity Fund VI Investors (BKFS), L.P. and THL Equity Fund VI Investors
(BKFS) II, L.P. and the manager of THL Equity Fund VI Investors (BKFS-LM), LLC and THL Equity Fund VI Investors (BKFS-NB), LLC. Thomas H. Lee Partners, L.P. is the managing
member of THL Equity Advisors VI, LLC and is also the general partner of THL Coinvestment Partners, L.P. and THL Operating Partners, L.P. Thomas H. Lee Advisors, LLC, is
the general partner of Thomas H. Lee Partners, L.P. Thomas H. Lee Advisors, LLC is attorney in fact for Great-West Investors LP and Putnam Investments LLC, which is the
managing member of Putnam Investments Employees' Securities Company III LLC, with respect to the shares of common stock they hold. THL Equity Fund VI Investors (TNBGP) LLC (which is
managed by THL Equity Advisors VI, LLC) is the general partner of THL Equity Fund VI Investors (BKFS) III, L.P. THL Holdco, LLC is the managing member of Thomas H. Lee
Advisors, LLC and all investment decisions at THL Holdco, LLC are taken by its private equity management committee (the "THL Committee") consisting of Todd M. Abbrecht,
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Anthony
J. DiNovi, Thomas M. Hagerty, Soren L. Oberg, Scott M. Sperling and Kent R. Weldon. As such, each member of the THL Committee may be deemed to share beneficial ownership of the shares referred
to above. Each of member of the THL Committee disclaims beneficial ownership of such shares except to the extent of their pecuniary interest therein. Excludes 36,699 shares held directly by
Mr. Hagerty. Also excludes 7,719 shares held directly by Mr. Hagerty and 7,719 shares held directly by Mr. Rao, in each case, for the benefit of affiliates of Thomas H. Lee
Partners, L.P. pursuant to their operative agreements. The address of Great-West Investors LP is 8515 East Orchard Road, Greenwood Village, Colorado 80111; the address of Putnam
Investments Employees' Securities Company III LLC is c/o Putnam Investment, Inc., 1 Post Office Square, Boston, Massachusetts 02109; the address of each member of the THL Committee and
all other entities referred to above is c/o Thomas H. Lee Partners, L.P., 100 Federal Street, 35th Floor, Boston, Massachusetts 02110.
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MATERIAL U.S. FEDERAL INCOME AND ESTATE TAX CONSIDERATIONS FOR
NON-U.S. HOLDERS
The following is a general discussion of the material U.S. federal income and estate tax consequences to non-U.S. holders (as defined below) of
the purchase, ownership and disposition of our common stock. This discussion does not provide a complete analysis of all potential U.S. federal income tax and estate tax considerations relating
thereto. This description is based on the Internal Revenue Code ("IRC"), existing and proposed U.S. Treasury regulations promulgated thereunder, administrative pronouncements, judicial decisions, and
interpretations of the foregoing, all as of the date hereof and all of which are subject to change, possibly with retroactive effect. In particular, recently proposed legislation may impact the U.S.
federal tax consequences to a holder of our common stock. This discussion is limited to non-U.S. Holders who hold shares of our common stock as capital assets within the meaning of Section 1221
of the IRC. Moreover, this discussion is for general information only and does not address all of the tax consequences that may be relevant to you in light of your particular circumstances, nor does
it discuss special tax provisions, which may apply to you if you are subject to special treatment under U.S. federal income tax laws, such as for certain financial institutions or financial services
entities, insurance companies, tax-exempt entities, dealers in securities or currencies, entities that are treated as partnerships for U.S. federal income tax purposes, "controlled foreign
corporations," "passive foreign investment companies," former U.S. citizens or long-term residents, persons deemed to sell common stock under the constructive sale provisions of the IRC, and persons
that hold common stock as part of a straddle, hedge, conversion transaction, or other integrated investment. In addition, this summary does not address the Medicare tax on certain investment income or
any state, local or foreign taxes or any U.S. federal tax laws other than U.S. federal income tax laws and estate tax laws.
You
are urged to consult with your own tax advisor concerning the U.S. federal income tax and estate tax consequences of acquiring, owning and disposing of our common stock, as well as
the application of any state, local, and foreign income and other tax laws.
As
used in this section, a "non-U.S. holder" is a beneficial owner of our common stock that is not, for U.S. federal income tax purposes:
-
-
an individual who is a citizen or resident of the United States,
-
-
a corporation (or other entity taxable as a corporation) that is created or organized in or under the laws of the United States, any state
thereof or the District of Columbia,
-
-
an estate the income of which is subject to U.S. federal income taxation regardless of its source, or
-
-
a trust if (i) a court within the United States is able to exercise primary supervision over the administration of the trust and one or
more U.S. persons have the authority to control all substantial decisions of the trust or (ii) it has a valid election in effect under applicable U.S. Treasury regulations to be treated as a
domestic trust.
If
you are an individual, you are a resident alien if you are a lawful permanent resident of the United States (e.g., a green card holder) and you may, in many cases, be deemed to
be a resident alien, as opposed to a nonresident alien, by virtue of being present in the United States for at least 31 days in the calendar year and for an aggregate of at least
183 days during a three-year period ending in the current calendar year. For these purposes, all the days present in the current year, one-third of the days present in the immediately preceding
year, and one-sixth of the days present in the second preceding year are counted. Resident aliens are subject to U.S. federal income tax as if they were U.S. citizens. Such an individual is urged to
consult his or her own tax advisor regarding the U.S. federal income tax consequences of the purchase, ownership or disposition of our common stock.
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If
a partnership or other pass-through entity is a beneficial owner of our common stock, the tax treatment of a partner in the partnership or an owner of the other pass-through entity
will depend upon the status of the partner or owner and the activities of the partnership or other pass-through entity. Any partner in a partnership or owner of a pass-through entity holding shares of
our common stock should consult its own tax advisor.
INVESTORS CONSIDERING THE PURCHASE OF OUR COMMON STOCK SHOULD CONSULT THEIR OWN TAX ADVISORS REGARDING THE APPLICATION OF THE U.S. FEDERAL INCOME AND ESTATE TAX
LAWS TO THEIR PARTICULAR SITUATIONS AND THE CONSEQUENCES OF OTHER FEDERAL, STATE, LOCAL AND FOREIGN TAX LAWS, AND APPLICABLE TAX TREATIES.
Distributions on Common Stock
If we pay distributions on shares of our common stock, such distributions will constitute dividends for U.S. federal income tax purposes to the
extent paid from our current or accumulated earnings and profits, as determined under U.S. federal income tax principles. Distributions in excess of our current and accumulated earnings and profits
will constitute a return of capital that is applied against and reduces, but not below zero, a non-U.S. holder's adjusted tax basis in shares of our common stock. Any remaining excess will be treated
as gain realized on the sale or other disposition of our common stock. See "Dispositions of Common Stock."
Any
dividend paid to a non-U.S. holder on our common stock will generally be subject to U.S. federal withholding tax at a 30% rate. The withholding tax might not apply, however, or might
apply at a reduced rate, under the terms of an applicable income tax treaty between the United States and the non-U.S. holder's country of residence. You should consult your tax advisors regarding
your entitlement to benefits under a relevant income tax treaty. Generally, in order for us or our paying agent to withhold tax at a lower treaty rate, a non-U.S. holder must certify its entitlement
to treaty benefits. A non-U.S. holder generally can meet this certification requirement by providing an Internal Revenue Service ("IRS") Form W-8BEN or IRS Form W-8BEN-E, as applicable,
to us or our paying agent. If the non-U.S. holder holds the stock through a financial institution or other agent acting on the holder's behalf, the holder will be required to provide appropriate
documentation to the agent. The holder's agent will then be required to provide certification to us or our paying agent, either directly or through other intermediaries. A non-U.S. holder that does
not timely furnish the required documentation, but
that qualifies for a reduced treaty rate, may obtain a refund of any excess amounts withheld by timely filing an appropriate claim for refund with the IRS.
Dividends
received by a non-U.S. holder that are effectively connected with a U.S. trade or business conducted by the non-U.S. holder and, if required by an applicable income tax treaty
between the United States and the non-U.S. holder's country of residence, are attributable to a permanent establishment (or, in certain cases involving individual holders, a fixed base) maintained by
the non-U.S. holder in the United States, are not subject to such withholding tax. To obtain this exemption, a non-U.S. holder must provide us with an IRS Form W-8ECI properly certifying such
exemption. Such effectively connected dividends, although not subject to withholding tax, are taxed at the same graduated rates applicable to U.S. persons, net of certain deductions and credits. In
addition to the graduated tax described above, such effectively connected dividends received by corporate non-U.S. holders may also be subject to a branch profits tax at a rate of 30% or such lower
rate as may be specified by an applicable income tax treaty.
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Dispositions of Common Stock
Subject to the discussion below on backup withholding and other withholding requirements, gain realized by a non-U.S. holder on a sale, exchange
or other disposition of our common stock generally will not be subject to U.S. federal income or withholding tax, unless:
-
-
the gain (i) is effectively connected with the conduct by the non-U.S. holder of a U.S. trade or business and (ii) if required by
an applicable income tax treaty between the United States and the non-U.S. holder's country of residence, is attributable to a permanent establishment (or, in certain cases involving individual
holders, a fixed base) maintained by the non-U.S. holder in the United States (in which case the special rules described below apply),
-
-
the non-U.S. holder is an individual who is present in the United States for 183 or more days in the taxable year of such disposition and
certain other conditions are met (in which case the gain would be subject to a flat 30% tax, or such reduced rate as may be specified by an applicable income tax treaty, which may be offset by certain
U.S. source capital losses), or
-
-
we are, or have been, a U.S. real property holding corporation, or a USRPHC, for U.S. federal income tax purposes at any time during the
shorter of the five-year period ending on the date of disposition of our common stock and the non-U.S. holder's holding period for our common stock.
Generally,
a corporation is a USRPHC if the fair market value of its "United States real property interests" equals 50% or more of the sum of the fair market value of (a) its
worldwide real property interests and (b) its other assets used or held for use in a trade or business. The tax relating to stock in a USRPHC does not apply to a non-U.S. holder whose holdings,
actual and constructive, amount to 5% or less of our common stock at all times during the applicable period, provided that our common stock is regularly traded on an established securities market. We
believe we have not been and are not currently a USRPHC, and do not anticipate being a USRPHC in the future.
If
any gain from the sale, exchange or other disposition of our common stock, (1) is effectively connected with a U.S. trade or business conducted by a non-U.S. holder and
(2) if required by an applicable income tax treaty between the United States and the non-U.S. holder's country of residence, is attributable to a permanent establishment (or, in certain cases
involving individuals, a fixed base) maintained by such non-U.S. holder in the United States, then the gain generally will be subject to U.S. federal income tax at the same graduated rates applicable
to U.S. persons, net of certain deductions and credits. If the non-U.S. holder is a corporation, under certain circumstances, that portion of its earnings and profits that is effectively connected
with its U.S. trade or business, subject to certain adjustments, generally would also be subject to a "branch profits tax." The branch profits tax rate is generally 30%, although an applicable income
tax treaty between the United States and the non-U.S. holder's country of residence might provide for a lower rate.
U.S. Federal Estate Tax
Individuals, or an entity the property of which is includable in an individual's gross estate for U.S. federal estate tax purposes, should note
that any of our common stock held at the time of such individual's death will be included in such individual's gross estate for U.S. federal estate tax purposes, and may be subject to U.S. federal
estate tax, unless an applicable estate tax treaty provides otherwise.
Backup Withholding and Information Reporting
Any dividends that are paid to a non-U.S. holder must be reported annually to the IRS and to the non-U.S. holder. Copies of these information
returns also may be made available to the tax authorities of the country in which the non-U.S. holder resides under the provisions of various treaties or agreements for the exchange of information.
Dividends paid on our common stock and the gross
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proceeds
from a taxable disposition of our common stock may be subject to additional information reporting and may also be subject to U.S. federal backup withholding if such non-U.S. holder fails to
comply with applicable U.S. information reporting and certification requirements. Provision of any IRS Form W-8 appropriate to the non-U.S. holder's circumstances will generally satisfy the
certification requirements necessary to avoid the additional information reporting and backup withholding.
Backup
withholding is not an additional tax. Any amounts so withheld under the backup withholding rules will be refunded by the IRS or credited against the non-U.S. holder's U.S. federal
income tax liability, provided that the required information is timely furnished to the IRS.
Other Withholding Taxes
Provisions commonly referred to as "FATCA" impose withholding of 30% on payments of U.S.-source dividends (including our dividends) and,
beginning in 2019, on sales or other proceeds from the disposition of domestic corporate stock (including our stock), paid to "foreign financial institutions" (which is broadly defined for this
purpose and in general includes investment vehicles) and certain other non-U.S. entities unless various U.S. information reporting and due diligence requirements (generally relating to ownership by
U.S. persons of interests in or accounts with those entities) have been satisfied, or an exemption applies. An intergovernmental agreement between the United States and the entity's jurisdiction may
modify these requirements. If FATCA withholding is imposed, a beneficial owner that is not a foreign financial institution generally will be entitled to a refund of any amounts withheld by filing a
U.S. federal income tax return containing the required
information (which may entail significant administrative burden). Non-U.S. holders should consult their tax advisors regarding the effects of FATCA on their investment in our common stock.
THE PRECEDING DISCUSSION OF U.S. FEDERAL INCOME TAX AND ESTATE TAX CONSIDERATIONS IS FOR GENERAL INFORMATION ONLY. IT IS NOT TAX ADVICE. EACH PROSPECTIVE INVESTOR
SHOULD CONSULT ITS OWN TAX ADVISOR REGARDING THE PARTICULAR U.S. FEDERAL, STATE, LOCAL AND FOREIGN TAX CONSEQUENCES OF PURCHASING, HOLDING AND DISPOSING OF OUR COMMON STOCK, INCLUDING THE CONSEQUENCES
OF ANY PROPOSED CHANGE IN APPLICABLE LAWS.
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CERTAIN BENEFIT PLAN INVESTOR CONSIDERATIONS
Each purchaser of shares in this offering that is a "Plan" will be deemed to make the representations in the following paragraph. For this
purpose, a "Plan" is (i) any "employee benefit plan" subject to Title I of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), (ii) individual retirement accounts
("IRAs") and other arrangements subject to Section 4975 of the IRC, and (iii) any entity whose underlying assets include "plan assets" within the meaning of ERISA by reason of the
investments by such plans or accounts therein.
Each
purchaser of shares in this offering that is a "Plan" is deemed to represent that a fiduciary (the "Fiduciary") independent of the Company, the underwriter, or any of their
affiliates (the "Transaction Parties") acting on the Plan's behalf is responsible for the Plan's decision to acquire the shares in this offering and that such Fiduciary:
-
(i)
-
is
either a U.S. bank, a U.S. insurance carrier, a U.S. registered investment adviser, a U.S. registered broker-dealer or an independent fiduciary with at least
$50 million of assets under management or control, in each case under the requirements specified in the U.S. Code of Federal Regulations, 29 C.F.R. Section 2510.3-21(c)(1)(i), as
amended from time to time,
-
(ii)
-
in
the case of a Plan that is an IRA, is not the IRA owner, beneficiary of the IRA or relative of the IRA owner or beneficiary,
-
(iii)
-
is
capable of evaluating investment risks independently, both in general and with regard to the prospective investment in the shares,
-
(iv)
-
is
a fiduciary under ERISA or the IRC, or both, with respect to the decision to acquire the shares,
-
(v)
-
has
exercised independent judgment in evaluating whether to invest the assets of the Plan in the shares,
-
(vi)
-
understands
that the Transaction Parties are not undertaking to provide impartial investment advice, or to give advice in a fiduciary capacity to the Plan, in
connection with the Plan's acquisition of the shares, and
-
(vii)
-
understands
and has been fairly informed of the existence and the nature of the financial interests of the Transaction Parties in connection with the Plan's
acquisition of the shares,
-
(viii)
-
confirms
that no fee or other compensation will be paid directly to any of the Transaction Parties by the Plan, or any fiduciary, participant or beneficiary of
the Plan, for the provision of investment advice (as opposed to other services) in connection with the Plan's acquisition of the shares.
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UNDERWRITING
Goldman Sachs & Co. LLC is acting as underwriter of the offering. Subject to the terms and conditions set forth in an underwriting
agreement among us, the selling shareholders and the underwriter, the selling shareholders have agreed to sell to the underwriter, and the underwriter has agreed to purchase from the selling
shareholders, 5,000,000 shares of common stock.
Subject
to the terms and conditions set forth in the underwriting agreement, the underwriter has agreed to purchase all of the shares of common stock sold under the underwriting
agreement if any of these shares are purchased.
Subject
to the completion of this offering, we have agreed to purchase 2,000,000 shares of our common stock that are subject to this offering from the underwriter at a price per share
equal to the price per
share paid by the underwriter to the selling shareholders in this offering. The closing of the share repurchase is contingent on the closing of this offering.
We
and the selling shareholders have agreed to indemnify the underwriter against certain liabilities, including liabilities under the Securities Act, or to contribute to payments the
underwriter may be required to make in respect of those liabilities.
The
underwriter is offering the shares, subject to prior sale, when, as and if issued to and accepted by it, subject to approval of legal matters by its counsel, including the validity
of the shares, and other conditions contained in the underwriting agreement, such as the receipt by the underwriter of officer's certificates and legal opinions. The underwriter reserves the right to
withdraw, cancel or modify offers to the public and to reject orders in whole or in part.
Commissions and Discounts
The underwriter is purchasing the shares of common stock from the selling shareholders at $ per share (representing approximately
$ aggregate proceeds to the selling shareholders, before expenses). The underwriter proposes to offer the shares of common stock directly to the public at the public offering price set
forth on the cover page of this prospectus supplement and to certain dealers at a price less a concession not in excess of $ per share. After the initial public offering of the
shares,
the offering and other selling terms may be changed by the underwriter.
We
will pay the expenses incurred by the selling shareholders in connection with this offering. The expenses of this offering that are payable by us are estimated to be approximately
$ .
No Sales of Similar Securities
In connection with this offering, we will, and we expect our executive officers, directors, other than Mr. Foley, the selling
shareholders and other holders of 5.0% of our outstanding common stock to, enter into lock-up agreements with the underwriter of this offering that, subject to certain exceptions, prohibit the signing
party from selling, contracting to sell or otherwise disposing of any common stock in excess of 10% (subject to certain exceptions) of the shares beneficially owned by such signing party, or entering
into any arrangement that transfers the economic consequences of ownership of our common stock for at least 30 days (and in the case of the Company, 45 days) from the
date of this prospectus supplement filed in connection with this offering, although the underwriter may, in its sole discretion and at any time without notice, release all or any portion of the
securities subject to these lock-up agreements. Upon a request to release any shares subject to a lock-up, the underwriter would consider the particular circumstances surrounding the request
including, but not limited to, the length of time before the lock-up expires, the number of shares requested to be released, reasons for the request and the possible impact on the market for our
common stock and whether the holder of our shares requesting the release is an officer, director or other affiliate of ours. As a result of these lock-up agreements, notwithstanding earlier
eligibility for sale under the provisions of Rule 144 under
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the
Securities Act, none of these shares would be allowed to be sold until at least 30 days (and in the case of the Company, 45 days) after the date of this prospectus supplement.
New York Stock Exchange Listing
Our common stock is listed on the NYSE under the symbol "BKI."
Price Stabilization, Short Positions
In connection with this offering, the underwriter may purchase and sell our common stock in the open market. These transactions may include
short sales, purchases on the open market to cover positions created by short sales and stabilizing transactions. Short sales involve the sale by the underwriter of a greater number of shares than it
is required to purchase in this offering. "Covered" short sales are sales made in an amount not greater than the underwriter's option to purchase additional shares described above. The underwriter may
close out any covered short position by either exercising its option to purchase additional shares or purchasing shares in the open market. In determining the source of shares to close out the covered
short position, the underwriter will consider, among other things, the price of shares available for purchase in the open market as compared to the price at which it may purchase shares through the
option granted to it. "Naked" short sales are sales in excess of such option. The underwriter must close out any naked short position by purchasing shares in the open market. A naked short position is
more likely to be created if the underwriter is concerned that there may be downward pressure on the price of our common stock in the open market after pricing that could adversely affect investors
who purchase in this offering. Stabilizing transactions
consist of various bids for or purchases of shares of common stock made by the underwriter in the open market prior to the completion of this offering.
Similar
to other purchase transactions, the underwriter's purchases to cover the syndicate short sales may have the effect of raising or maintaining the market price of our common stock
or preventing or retarding a decline in the market price of our common stock. As a result, the price of our common stock may be higher than the price that might otherwise exist in the open market. The
underwriter may conduct these transactions on the NYSE, in the over-the-counter market or otherwise.
Neither
we nor the underwriter make any representation or prediction as to the direction or magnitude of any effect that the transactions described above may have on the price of our
common stock. In addition, neither we nor the underwriter make any representation that the underwriter will engage in these transactions or that these transactions, once commenced, will not be
discontinued without notice.
Electronic Distribution
In connection with this offering, the underwriter or securities dealers may distribute prospectuses by electronic means, such as e-mail.
Other Relationships
The underwriter and its affiliates are a full service financial institution engaged in various activities, which may include sales and trading,
commercial and investment banking, advisory, investment management, investment research, principal investment, hedging, market making, brokerage and other financial and non-financial activities and
services. The underwriter and its affiliates have provided, and may in the future provide, a variety of these services to us, the selling shareholders and to persons and entities with relationships
with us or the selling shareholders, for which the underwriter received or will receive customary fees and expenses.
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In
the ordinary course of its various business activities, the underwriter and its affiliates, officers, directors and employees may purchase, sell or hold a broad array of investments
and actively trade securities, derivatives, loans, commodities, currencies, credit default swaps and other financial instruments for their own account and for the accounts of their customers, and such
investment and trading activities may involve or relate to assets, securities and/or instruments of the issuer (directly, as collateral securing other obligations or otherwise) and/or persons and
entities with relationships with the issuer. The underwriter and its affiliates may also communicate independent investment recommendations, market color or trading ideas and/or publish or express
independent research views in respect of such assets, securities or instruments and may at any time hold, or recommend to clients that they should acquire, long and/or short positions in such assets,
securities and instruments.
Certain
affiliates of the underwriter may be our customers.
Notice to Prospective Investors in the European Economic Area
In relation to each Member State of the European Economic Area (each, a "Relevant Member State"), no offer of shares may be made to the public
in that Relevant Member State other than:
-
A.
-
to
any legal entity which is a qualified investor as defined in the Prospectus Directive;
-
B.
-
to
fewer than 100 or, if the Relevant Member State has implemented the relevant provision of the 2010 PD Amending Directive, 150, natural or legal persons (other than
qualified investors as defined in the Prospectus Directive), as permitted under the Prospectus Directive, subject to obtaining the prior consent of the underwriter; or
-
C.
-
in
any other circumstances falling within Article 3(2) of the Prospectus Directive,
provided
that no such offer of shares shall require us or the underwriter to publish a prospectus pursuant to Article 3 of the Prospectus Directive or supplement a prospectus pursuant to
Article 16 of the Prospectus Directive
Each
person in a Relevant Member State who initially acquires any shares or to whom any offer is made will be deemed to have represented, acknowledged and agreed that it is a "qualified
investor" within the meaning of the law in that Relevant Member State implementing Article 2(1)(e) of the Prospectus Directive. In the case of any shares being offered to a financial
intermediary as that term is used in Article 3(2) of the Prospectus Directive, each such financial intermediary will be deemed to have represented, acknowledged and agreed that the shares
acquired by it in the offer have not been acquired on a non-discretionary basis on behalf of, nor have they been acquired with a view to their offer or resale to, persons in circumstances which may
give rise to an offer of any shares to the public other than their offer or resale in a Relevant Member State to qualified investors as so defined or in circumstances in which the prior consent of the
underwriter has been obtained to each such proposed offer or resale.
We,
the underwriter and its affiliates will rely upon the truth and accuracy of the foregoing representations, acknowledgements and agreements.
This
prospectus has been prepared on the basis that any offer of shares in any Relevant Member State will be made pursuant to an exemption under the Prospectus Directive from the
requirement to publish a prospectus for offers of shares. Accordingly any person making or intending to make an offer in that Relevant Member State of shares which are the subject of the offering
contemplated in this prospectus may only do so in circumstances in which no obligation arises for us or the underwriter to publish a prospectus pursuant to Article 3 of the Prospectus Directive
in relation to such offer. Neither we, the selling shareholders nor the underwriter have authorized, nor do they authorize, the making of any offer of shares in circumstances in which an obligation
arises for us or the underwriter to publish a prospectus for such offer.
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For
the purpose of the above provisions, the expression "an offer to the public" in relation to any shares in any Relevant Member State means the communication in any form and by any
means of sufficient information on the terms of the offer and the shares to be offered so as to enable an investor to decide to purchase or subscribe the shares, as the same may be varied in the
Relevant Member State by any measure implementing the Prospectus Directive in the Relevant Member State and the expression "Prospectus Directive" means Directive 2003/71/EC (including the 2010 PD
Amending Directive, to the extent implemented in the Relevant Member States) and includes any relevant implementing measure in the Relevant Member State and the expression "2010 PD Amending Directive"
means Directive 2010/73/EU.
Notice to Prospective Investors in Canada
The shares of common stock may be sold only to purchasers purchasing, or deemed to be purchasing, as principal that are accredited investors, as
defined in National Instrument 45-106
Prospectus Exemptions
or subsection 73.3(1) of the
Securities
Act
(Ontario), and are permitted clients, as defined in National Instrument 31-103
Registration Requirements, Exemptions and Ongoing Registrant
Obligations
. Any resale of the shares must be made in accordance with an exemption from, or in a transaction not subject to, the prospectus requirements of applicable
securities laws.
Securities
legislation in certain provinces or territories of Canada may provide a purchaser with remedies for rescission or damages if this prospectus (including any amendment thereto)
contains a misrepresentation, provided that the remedies for rescission or damages are exercised by the purchaser within the time limit prescribed by the securities legislation of the purchaser's
province or territory. The purchaser should refer to any applicable provisions of the securities legislation of the purchaser's province or territory for particulars of these rights or consult with a
legal advisor.
Pursuant
to section 3A.3 of National Instrument 33-105 Underwriting Conflicts (NI 33-105), the underwriter is not required to comply with the disclosure requirements
of NI 33-105 regarding underwriter conflicts of interest in connection with this offering.
Notice to Prospective Investors in the United Kingdom
In addition, in the United Kingdom, this document is being distributed only to, and is directed only at, and any offer subsequently made may
only be directed at persons who are "qualified investors" (as defined in the Prospectus Directive) (i) who have professional experience in matters relating to investments falling within
Article 19 (5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "Order") and/or (ii) who are high net worth companies (or persons
to whom it may otherwise be lawfully communicated) falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as "relevant persons"). This document
must not be acted on or relied on in the United Kingdom by persons who are not relevant persons. In the United Kingdom, any investment or investment activity to which this document relates is only
available to, and will be engaged in with, relevant persons.
Notice to Prospective Investors in Switzerland
The shares may not be publicly offered in Switzerland and will not be listed on the SIX Swiss Exchange ("SIX") or on any other stock exchange or
regulated trading facility in Switzerland. This document has been prepared without regard to the disclosure standards for issuance prospectuses under art. 652a or art. 1156 of the Swiss Code of
Obligations or the disclosure standards for listing prospectuses under art. 27 ff. of the SIX Listing Rules or the listing rules of any other stock exchange or regulated trading facility in
Switzerland. Neither this document nor any other offering or marketing material relating to the shares or this offering may be publicly distributed or otherwise made publicly available in Switzerland.
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Neither
this document nor any other offering or marketing material relating to this offering, us or the shares have been or will be filed with or approved by any Swiss regulatory
authority. In particular, this document will not be filed with, and the offer of shares will not be supervised by, the Swiss Financial Market Supervisory Authority FINMA (FINMA), and the offer of
shares has not been and will not be authorized under the Swiss Federal Act on Collective Investment Schemes ("CISA"). The investor protection afforded to acquirers of interests in collective
investment schemes under the CISA does not extend to acquirers of shares.
Notice to Prospective Investors in the Dubai International Financial Centre
This prospectus relates to an Exempt Offer in accordance with the Offered Securities Rules of the Dubai Financial Services Authority ("DFSA").
This prospectus is intended for distribution only to persons of a type specified in the Offered Securities Rules of the DFSA. It must not be delivered to, or relied on by, any other person. The DFSA
has no responsibility for reviewing or verifying any documents in connection with Exempt Offers. The DFSA has not approved this prospectus nor taken steps to verify the information set forth herein
and has no responsibility for the prospectus. The shares to which this prospectus relates may be illiquid and/or subject to restrictions on their resale. Prospective purchasers of the shares offered
should conduct their own due diligence on the shares. If you do not understand the contents of this prospectus you should consult an authorized financial advisor.
Notice to Prospective Investors in Australia
No placement document, prospectus, product disclosure statement or other disclosure document has been lodged with the Australian Securities and
Investments Commission ("ASIC"), in relation to this offering. This prospectus does not constitute a prospectus, product disclosure statement or other disclosure document under the Corporations Act
2001 (the "Corporations Act"), and does not purport to include the information required for a prospectus, product disclosure statement or other disclosure document under the Corporations Act.
Any
offer in Australia of the shares may only be made to persons (the "Exempt Investors") who are "sophisticated investors" (within the meaning of section 708(8) of the
Corporations Act), "professional investors" (within the meaning of section 708(11) of the Corporations Act) or otherwise pursuant to one or more exemptions contained in section 708 of
the Corporations Act so that it is lawful to offer the shares without disclosure to investors under Chapter 6D of the Corporations Act.
The
shares applied for by Exempt Investors in Australia must not be offered for sale in Australia in the period of 12 months after the date of allotment under this offering,
except in circumstances where disclosure to investors under Chapter 6D of the Corporations Act would not be required pursuant to an exemption under section 708 of the Corporations Act or
otherwise or where the offer is pursuant to a disclosure document which complies with Chapter 6D of the Corporations Act. Any person acquiring shares must observe such Australian on-sale
restrictions.
This
prospectus contains general information only and does not take account of the investment objectives, financial situation or particular needs of any particular person. It does not
contain any securities recommendations or financial product advice. Before making an investment decision, investors need to consider whether the information in this prospectus is appropriate to their
needs, objectives and circumstances, and, if necessary, seek expert advice on those matters.
Notice to Prospective Investors in Hong Kong
The shares have not been offered or sold and will not be offered or sold in Hong Kong, by means of any document, other than (a) to
"professional investors" as defined in the Securities and Futures Ordinance (Cap. 571) of Hong Kong and any rules made under that Ordinance; or (b) in other circumstances which do not result in
the document being a "prospectus" as defined in the Companies
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Ordinance
(Cap. 32) of Hong Kong or which do not constitute an offer to the public within the meaning of that Ordinance. No advertisement, invitation or document relating to the shares has been
or may be issued or has been or may be in the possession of any person for the purposes of issue, whether in Hong Kong or elsewhere, which is directed at, or the contents of which are likely to be
accessed or read by, the public of Hong Kong (except if permitted to do so under the securities laws of Hong Kong) other than with respect to shares which are or are intended to be disposed of only to
persons outside Hong Kong or only to "professional investors" as defined in the Securities and Futures Ordinance and any rules made under that Ordinance.
Notice to Prospective Investors in Japan
The shares have not been and will not be registered under the Financial Instruments and Exchange Law of Japan (Law No. 25 of 1948, as
amended) and, accordingly, will not be offered or sold, directly or indirectly, in Japan, or for the benefit of any Japanese Person or to others for re-offering or resale, directly or indirectly, in
Japan or to any Japanese Person, except in compliance with all applicable laws, regulations and ministerial guidelines promulgated by relevant Japanese governmental or regulatory authorities in effect
at the relevant time. For the purposes of this paragraph, "Japanese Person" shall mean any person resident in Japan, including any corporation or other entity organized under the laws of Japan.
Notice to Prospective Investors in Singapore
This prospectus has not been registered as a prospectus with the Monetary Authority of Singapore. Accordingly, this prospectus and any other
document or material in connection with the offer or sale, or invitation for subscription or purchase, of Non-CIS Securities may not be circulated or distributed, nor may the Non-CIS Securities be
offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in Singapore other than (i) to an institutional investor under
Section 274 of the Securities and Futures Act, Chapter 289 of Singapore (the "SFA"), (ii) to a relevant person pursuant to Section 275(1), or any person pursuant to
Section 275(1A), and in accordance with the conditions specified in Section 275, of the SFA, or (iii) otherwise pursuant to, and in accordance with the conditions of, any other
applicable provision of the SFA.
Where
the Non-CIS Securities are subscribed or purchased under Section 275 of the SFA by a relevant person which is:
-
(a)
-
a
corporation (which is not an accredited investor (as defined in Section 4A of the SFA)) the sole business of which is to hold investments and the entire
share capital of which is owned by one or more individuals, each of whom is an accredited investor; or
-
(b)
-
a
trust (where the trustee is not an accredited investor) whose sole purpose is to hold investments and each beneficiary of the trust is an individual who is an
accredited investor, securities (as defined in Section 239(1) of the SFA) of that corporation or the beneficiaries' rights and interest (howsoever described) in that trust shall not be
transferred within six months after that corporation or that trust has acquired the Non-CIS Securities pursuant to an offer made under Section 275 of the SFA except:
-
(a)
-
to
an institutional investor or to a relevant person defined in Section 275(2) of the SFA, or to any person arising from an offer referred to in
Section 275(1A) or Section 276(4)(i)(B) of the SFA;
-
(b)
-
where
no consideration is or will be given for the transfer;
-
(c)
-
where
the transfer is by operation of law;
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(d)
-
as
specified in Section 276(7) of the SFA; or
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(e)
-
as
specified in Regulation 32 of the Securities and Futures (Offers of Investments) (Shares and Debentures) Regulations 2005 of Singapore.
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LEGAL MATTERS
Weil, Gotshal & Manges LLP, New York, New York, has passed upon the validity of our common stock offered hereby on behalf of us.
The validity of the shares of common stock offered hereby will be passed upon on behalf of the underwriter by Sullivan & Cromwell LLP, Los Angeles, California.
EXPERTS
The Consolidated Financial Statements of Lender Processing Services, Inc. as of January 1, 2014 and for the day ended
January 1, 2014 have been incorporated by reference herein in reliance upon the report of KPMG LLP, independent registered public accounting firm, incorporated by reference herein, and
upon the authority of said firm as experts in accounting and auditing.
The
Consolidated Financial Statements of Black Knight Financial Services, Inc. and subsidiaries as of December 31, 2016 and 2015, and management's assessment of the
effectiveness of internal control over financial reporting as of December 31, 2016, have been incorporated by reference herein and in the registration statement in reliance upon the reports of
KPMG LLP, independent registered public accounting firm, incorporated by reference herein, and upon the authority of said firm as experts in accounting and auditing. The audit report covering
the Consolidated Financial Statements as of December 31, 2016 and 2015 and for each of the years in the three-year period ended December 31, 2016, contains an explanatory paragraph that
states that, as discussed in Note 1 to the Consolidated Financial Statements, Black Knight Financial Services, Inc. completed an initial public offering ("IPO") of its stock on
May 26, 2015 and contributed the net cash proceeds received from the IPO to Black Knight Financial Services, LLC in exchange for 44.5% of the units and a managing member's membership
interest in Black Knight Financial Services, LLC. Additionally, as discussed in Notes 1 and 2 to the Consolidated Financial Statements, Lender Processing Services, Inc.
merged with Lion Merger Sub, Inc. on January 2, 2014, through which Lender Processing Services, Inc. became a wholly-owned
subsidiary of Fidelity National Financial, Inc., which then reorganized the operations of Lender Processing Services, Inc. and contributed certain of its operations into Black Knight
Financial Services, LLC on January 3, 2014. The audit report on the effectiveness of internal control over financial reporting as of December 31, 2016, contains an explanatory
paragraph that states that Black Knight Financial Services, Inc. acquired eLynx Holdings, Inc. ("eLynx") on May 16, 2016 and Motivity Solutions, Inc. ("Motivity") on
June 22, 2016, and management has excluded from its assessment of the effectiveness of Black Knight Financial Services, Inc.'s internal control over financial reporting as of
December 31, 2016, eLynx's and Motivity's internal control over financial reporting associated with approximately 4.1% of total assets and 2.3% of total revenues included in the Consolidated
Financial Statements of Black Knight Financial Services, Inc. and subsidiaries as of and for the year ended December 31, 2016, and that our audit of internal control over financial
reporting of Black Knight Financial Services, Inc. also excludes an evaluation of the internal control over financial reporting of eLynx and Motivity.
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WHERE YOU CAN FIND MORE INFORMATION;
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
We file annual, quarterly and current reports, proxy statements and other information with the SEC. You may read and copy any document we file
at the SEC's Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. You may obtain information on the operation of the Public Reference Room by calling the SEC at
1-800-SEC-0330. The SEC maintains an Internet site that contains our reports, proxy and other information regarding us at http://www.sec.gov. Our SEC filings are also available free of charge at our
website (www.blackknightinc.com). However, except for our filings with the SEC that are incorporated by reference into this prospectus, the information on our website is not incorporated by reference
into this prospectus supplement. In addition, you can inspect reports and other information we file at the office of the New York Stock Exchange, 20 Broad Street, New York, New York 10005.
The
SEC allows "incorporation by reference" into this prospectus of information that we file with the SEC. This permits us to disclose important information to you by referencing these
filed documents. Any information referenced this way is considered to be a part of this prospectus and any information filed by us with the SEC subsequent to the date of this prospectus automatically
will be deemed to update and supersede this information. We incorporate by reference the following documents which we have filed with the SEC (excluding any documents or portions of such documents
that have been "furnished" but not "filed" for purposes of the Exchange Act:
-
-
our Annual Report on Form 10-K for the year ended December 31, 2016, which we filed with the SEC on February 24, 2017;
-
-
the information specifically incorporated by reference into our Annual Report on Form 10-K for the year ended December 31, 2016
from our Definitive Proxy Statement on Schedule 14A for our 2016 Annual Meeting of Shareholders, filed with the SEC on April 26, 2017;
-
-
our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2017, June 30, 2017 and September 30, 2017,
which we filed with the SEC on May 5, 2017, July 28, 2017 and November 2, 2017, respectively;
-
-
our Current Reports on Form 8-K, which we filed with the SEC on March 2, 2017, April 27, 2017, May 12, 2017,
May 18, 2017, June 9, 2017, June 19, 2017, July 19, 2017, September 18, 2017, September 27, 2017 and October 2, 2017; and
-
-
the description of our capital stock contained or incorporated by reference in our registration statement on Form 8-A, as filed on
May 14, 2015, as amended by the Current Report on Form 8-K filed by the Company on October 2, 2017 and any amendments or reports filed for the purpose of updating such
description.
We
incorporate by reference any filings made with the SEC in accordance with Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act on or after the date of this prospectus
supplement and the date all of the
securities offered hereby are sold or the offering is otherwise terminated, with the exception of any information furnished under Item 2.02 and Item 7.01 (including any financial
statements or exhibits relating thereto furnished pursuant to Item 9.01) of Form 8-K, which is not deemed filed and which is not incorporated by reference herein. Any such filings shall
be deemed to be incorporated by reference and to be a part of this prospectus supplement from the respective dates of filing of those documents.
Any
statement contained in a document incorporated or deemed to be incorporated by reference in this prospectus supplement will be deemed to be modified or superseded to the extent that
a statement contained herein or in any other subsequently filed document which also is or is deemed to be incorporated by reference in this prospectus supplement modifies or supersedes that statement.
Any
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statement
so modified or superseded will not be deemed, except as so modified or superseded, to constitute a part of this prospectus supplement.
We
will provide to each person, including any beneficial owner, to whom a prospectus supplement is delivered, without charge, upon written or oral request, a copy of any or all of the
documents that are incorporated by reference into this prospectus supplement but not delivered with this prospectus supplement, excluding any exhibits to those documents unless the exhibit is
specifically incorporated by reference as an exhibit in this prospectus supplement. You should direct requests for documents to:
Black Knight, Inc.
Investor Relations
601 Riverside Avenue
Jacksonville, Florida 32204
(877) 880-1990
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PROSPECTUS
Common Stock
This prospectus relates solely to sales of common stock of Black Knight, Inc. by selling shareholders. The selling shareholders, who will
be named in a prospectus supplement, may offer and sell shares of our common stock from time to time in amounts, at prices and on terms that will be determined at the time of any such offering. We
will not receive any proceeds from the sale of shares of common stock to be offered by the selling shareholders.
This
prospectus describes some of the general terms that may apply to our common stock. Each time any shares of common stock are offered pursuant to this prospectus, we will provide a
prospectus supplement and attach it to this prospectus. The prospectus supplement will contain more specific information about the offering, including the number of shares of our common stock to be
sold by the selling shareholders. The prospectus supplement may also add, update or change information contained in this prospectus. You should read this prospectus and the accompanying prospectus
supplement, as well as the documents incorporated by reference herein or therein, carefully before you make your investment decision.
This
prospectus may not be used to offer and sell shares of our common stock unless accompanied by a prospectus supplement or a free writing prospectus.
The
shares of our common stock may be sold at fixed prices, prevailing market prices at the times of sale, prices related to the prevailing market prices, varying prices determined at
the times of sale or negotiated prices. The shares of our common stock offered by this prospectus and the accompanying prospectus supplement may be offered by the selling shareholders directly to
investors or to or through underwriters, dealers or other agents. The prospectus supplement for each offering will describe in detail the plan of distribution for that offering and will set forth the
names of any underwriters, dealers or agents involved in the offering and any applicable fees, commissions or discount arrangements.
Our
common stock is listed on the New York Stock Exchange, or NYSE, under the symbol "BKI".
Investing in our common stock involves a high degree of risk. See "Risk Factors" on page 7 before you make your investment
decision.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these
securities or determined if this prospectus or the accompanying prospectus supplement is truthful or complete. Any representation to the contrary is a criminal offense.
The date of this prospectus is November 20, 2017.
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ABOUT THIS PROSPECTUS
This prospectus is part of an automatic shelf registration statement that we filed with the Securities and Exchange Commission, or SEC, as a
"well-known seasoned issuer" as defined in Rule 405 under the Securities Act of 1933, as amended, which we refer to as the Securities Act. Under the automatic shelf registration process, the
selling shareholders may, from time to time, offer and/or sell our common stock in one or more offerings or resales. This prospectus provides you with a general description of the common stock that
the selling shareholders may offer. Each time the selling shareholders sell shares of common stock using this prospectus, we will provide a prospectus supplement and attach it to this prospectus and
may also provide you with a free writing prospectus. The prospectus supplement and any free writing prospectus will contain more specific information about the offering, including the names of the
selling shareholders. The prospectus supplement may also add, update, change or clarify information contained in or incorporated by reference into this prospectus. Any statement that we make in this
prospectus will be modified or superseded by any inconsistent statement made by us in a prospectus supplement. If there is any inconsistency between the information in this prospectus and the
information in the prospectus supplement, you should rely on the information in the prospectus supplement.
The
rules of the SEC allow us to incorporate by reference information into this prospectus. This means that important information is contained in other documents that are considered to
be a part of this prospectus. Additionally, information that we file later with the SEC will automatically update and supersede this information. You should carefully read this prospectus, the
applicable prospectus supplement, together with the additional information that is incorporated or deemed incorporated by reference in this prospectus as described under the heading "Where You Can
Find More Information; Incorporation of Certain Documents by Reference," and any applicable free writing prospectus before making an investment in our common stock. This prospectus contains summaries
of certain provisions contained in some of the documents described herein, but reference is made to the actual documents for complete information. All of the summaries are qualified in their entirety
by the actual documents. Copies of the documents referred to herein have been filed, or will be filed or incorporated by reference, as exhibits to the Registration Statement of which this prospectus
is a part. The Registration Statement, including the exhibits and documents incorporated or deemed incorporated by reference in this prospectus, can be read on the SEC website or at the SEC offices
mentioned under the heading "Where You Can Find More Information."
THIS PROSPECTUS MAY NOT BE USED TO SELL ANY SECURITIES UNLESS ACCOMPANIED BY A PROSPECTUS SUPPLEMENT OR A FREE WRITING PROSPECTUS.
Neither the delivery of this prospectus or any applicable prospectus supplement or any free writing prospectus nor any sale made using this prospectus or any
applicable prospectus supplement or any free writing prospectus implies that there has been no change in our affairs or that the information contained in, or incorporated by reference in, this
prospectus or in any applicable prospectus supplement or any free writing prospectus is correct as of any date after their respective dates. You should not assume that the information contained in, or
incorporated by reference in, this prospectus or any applicable prospectus supplement or any free writing prospectus prepared by us is accurate as of any date other than the respective dates thereof.
Our business, financial condition, results of operations and prospects may have changed since those dates.
You should rely only on the information contained or incorporated by reference in this prospectus, in any accompanying prospectus supplement or in any free
writing prospectuses related hereto that we have prepared. Neither we nor any selling shareholder or any of our or their respective affiliates have authorized anyone to provide you with different
information and we and the selling shareholders take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. You should not assume
that the information contained or incorporated by reference in this prospectus and any accompanying prospectus supplement or any free writing prospectus is accurate as of any date other than the
respective dates thereof. This prospectus and any accompanying prospectus supplement or any free writing prospectus do not constitute an offer to sell
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or the solicitation of an offer to buy any securities other than the registered securities to which they relate, nor do this prospectus and any accompanying prospectus supplement or any free writing
prospectus constitute an offer to sell or the solicitation of an offer to buy securities in any jurisdiction to any person to whom it is unlawful to make such offer or solicitation in such
jurisdiction.
Unless
we state otherwise or the context otherwise requires, references in this prospectus to "we," "our," "us," "Black Knight" or the "Company" (1) with respect to the periods
prior to the Reorganization (as defined in "The CompanyThe Reorganization") are to Black Knight Financial Services, Inc., a Delaware corporation, and its consolidated subsidiaries
and (2) with respect to the periods after the Reorganization, are to Black Knight, Inc., a Delaware corporation, and its consolidated subsidiaries.
WHERE YOU CAN FIND MORE INFORMATION;
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
We file annual, quarterly and current reports, proxy statements and other information with the SEC. You may read and copy any document we file
at the SEC's Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. You may obtain information on the operation of the Public Reference Room by calling the SEC at
1-800-SEC-0330. The SEC maintains an Internet site that contains our reports, proxy statements and other information regarding us at http://www.sec.gov. Our SEC filings are also available free of
charge at our website (www.blackknightinc.com). However, except for our filings with the SEC that are incorporated by reference into this prospectus, the information on our website is not incorporated
by reference into this prospectus. In addition, you can inspect reports and other information we file at the office of the New York Stock Exchange, 20 Broad Street, New York, New York 10005.
The
SEC allows "incorporation by reference" into this prospectus of information that we file with the SEC. This permits us to disclose important information to you by referencing these
filed documents. Any information referenced this way is considered to be a part of this prospectus, and any information filed by us with the SEC subsequent to the date of this prospectus automatically
will be deemed to update and supersede this information. We incorporate by reference the following documents, which we have filed with the SEC (excluding any documents or portions of such documents
that have been "furnished" but not "filed" for purposes of the Securities Exchange Act of 1934, as amended, or the Exchange Act):
-
-
our Annual Report on Form 10-K for the year ended December 31, 2016, which we filed with the SEC on February 24, 2017;
-
-
our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2017, June 30, 2017 and September 30, 2017,
which we filed with the SEC on May 5, 2017, July 28, 2017 and November 2, 2017, respectively;
-
-
our Current Reports on Form 8-K, which we filed with the SEC on March 2, 2017, April 27, 2017, May 12, 2017,
May 18, 2017, June 9, 2017, June 19, 2017, July 19, 2017, September 18, 2017, September 27, 2017 and October 2, 2017;
-
-
the information specifically incorporated by reference into our Annual Report on Form 10-K for the year ended December 31, 2016
from our Definitive Proxy Statement on Schedule 14A for our 2016 Annual Meeting of Shareholders, filed with the SEC on April 26, 2017; and
-
-
the description of our capital stock contained or incorporated by reference in our registration statement on Form 8-A, as filed on
May 14, 2015, as amended by the Current Report on Form 8-K filed by the Company on October 2, 2017 and any amendments or reports filed for the purpose of updating such
description.
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We
incorporate by reference any filings made with the SEC in accordance with Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act on or after the date of this prospectus and the
date all of the securities offered hereby are sold or the offering is otherwise terminated, with the exception of any information furnished under Item 2.02 and Item 7.01 (including any
financial statements or exhibits relating thereto furnished pursuant to Item 9.01) of Form 8-K, which is not deemed filed and which is not incorporated by reference herein. Any such
filings shall be deemed to be incorporated by reference and to be a part of this prospectus from the respective dates of filing of those documents.
Any
statement contained in a document incorporated or deemed to be incorporated by reference in this prospectus will be deemed to be modified or superseded to the extent that a statement
contained herein or in any other subsequently filed document, which also is or is deemed to be incorporated by reference in this prospectus, modifies or supersedes that statement. Any statement so
modified or superseded will not be deemed, except as so modified or superseded, to constitute a part of this prospectus.
We
will provide to each person, including any beneficial owner, to whom a prospectus is delivered, without charge, upon written or oral request, a copy of any or all of the documents
that are incorporated by reference into this prospectus but not delivered with this prospectus, excluding any exhibits to those documents unless the exhibit is specifically incorporated by reference
as an exhibit in this prospectus. You should direct requests for documents to:
Black Knight, Inc.
Investor Relations
601 Riverside Avenue
Jacksonville, Florida 32204
(877) 880-1990
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FORWARD-LOOKING STATEMENTS
The statements contained in this prospectus and any documents incorporated by reference herein or therein that are not purely historical are
forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act") and Section 21E of the Exchange Act, including statements
regarding expectations, hopes, intentions or strategies regarding the future. These statements relate to, among other things, future financial and operating results of Black Knight. In many cases, you
can identify forward-looking statements by terminology such as "may," "will," "should," "expect," "plan," "anticipate," "believe," "estimate," "predict," "potential" or "continue," or the negative of
these terms and other comparable terminology. Actual results could differ materially from those anticipated in these statements as a result of a number of factors, including, but not limited to the
following:
-
-
security breaches against our information systems;
-
-
changes to our relationships with our top clients, whom we rely on for a significant portion of our revenues and profit;
-
-
limitation of our growth due to the time and expense associated with switching from competitors' software and services;
-
-
providing credits or refunds for prepaid amounts or contract terminations in connection with our service level commitments;
-
-
our ability to offer high-quality technical support services;
-
-
our ability to comply with or changes in laws, rules and regulations that affect our customers' businesses;
-
-
consolidation in our end client market;
-
-
regulatory developments with respect to use of consumer data and public records;
-
-
efforts by the government to reform or address the mortgage market and current economic environment;
-
-
our clients' relationships with government-sponsored enterprises;
-
-
our ability to adapt our solutions to technological changes or evolving industry standards;
-
-
our ability to compete effectively;
-
-
increase in the availability of free or relatively inexpensive information;
-
-
our ability to protect our proprietary technology and information rights;
-
-
infringement on the proprietary rights of others by our applications or services;
-
-
our ability to successfully consummate and integrate acquisitions;
-
-
our reliance on third parties;
-
-
our dependence on our ability to access data from external sources;
-
-
our international operations and third-party service providers;
-
-
our ability to develop widespread brand awareness cost-effectively;
-
-
system failures, damage or interruption with respect to our technology solutions;
-
-
delays or difficulty in developing or implementing new or enhanced mortgage processing or technology solutions;
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-
-
change in the strength of the economy and housing market generally;
-
-
our substantial indebtedness and any additional significant debt we incur;
-
-
the adequacy of our risk management policies and procedures;
-
-
our ability to achieve our growth strategies;
-
-
litigation, investigations or other actions against us;
-
-
as a result of the Reorganization (as defined in "The CompanyThe Reorganization"), we may have significant tax liability to
Fidelity National Financial, Inc. ("FNF") and to the former holders of FNF Group tracking stock of FNF common stock, and under certain circumstances, we may have a significant indemnity obligation to
FNF, which is not limited in amount or subject to any cap, if the Reorganization is treated as a taxable transaction due to our acts or failure to act;
-
-
the possibility that we will forgo certain transactions in order to avoid the risk of incurring significant tax-related liabilities; and
-
-
restrictions on our ability to pursue potential business opportunities under the non-competition agreement.
The
risks and uncertainties that forward-looking statements are subject to include other risks detailed in the "Statement Regarding Forward-Looking Information," "Risk Factors" and other
sections of our Annual Report on Form 10-K for the year ended December 31, 2016 and in our subsequent filings with the SEC, as incorporated by reference into this prospectus.
Forward-looking
statements are based on our beliefs, as well as assumptions made by, and information currently available to, us. We undertake no obligation to update any forward-looking
statements, whether as a result of new information, future events or otherwise. Moreover, we operate in a competitive and rapidly changing environment. New risks emerge from time to time. It is not
possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to
differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties and assumptions, the future events and trends discussed in this report may
not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements.
You
should not rely upon forward-looking statements as predictions of future events. The events and circumstances reflected in the forward-looking statements may not be achieved or
occur. Although we believe that the expectations and assumptions reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or
achievements. Any forward-looking statement made by us in this prospectus or any documents incorporated by reference herein or therein speaks only as of the date on which we make it.
THE COMPANY
We are a leading provider of software, data and analytics solutions to the mortgage and consumer loan, real estate and capital market verticals.
Our solutions facilitate and automate many of the mission-critical business processes across the homeownership lifecycle, from origination until asset disposition. We believe we differentiate
ourselves by the breadth and depth of our comprehensive, integrated solutions and the insight we provide to our clients.
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The Reorganization
Pursuant to a reorganization and certain mergers described below and in our Current Report on Form 8-K12B, filed with the Commission on
October 2, 2017, the Company became the public parent holding company of Black Knight Financial Services, Inc. (the "Predecessor") (the "Reorganization").
The
Reorganization was effected by the following on September 29, 2017: (i) the contribution by FNF of (x) all of the shares of Class B common stock of the
Predecessor that Black Knight Holdings, Inc. ("BKHI") owned and (y) all of the class A units of Black Knight Financial Services, LLC ("BKFS LLC") that BKHI owned to
New BKH Corp. ("New BKH"), a direct wholly-owned subsidiary of BKHI, (ii) the distribution of the shares of New BKH common stock to the holders of the FNF Group tracking stock of FNF, followed
by (iii) the mergers of the Predecessor and New BKH into wholly-owned subsidiaries of the Company (collectively, the "Transactions"). In the Transactions, the outstanding shares of the
Predecessor's Class A common stock and New BKH common stock were converted into shares of the Company's common stock on a one-for-one basis as set forth in the Agreement and Plan of Merger
dated as of June 8, 2017 by and among the Company, FNF, BKHI, New BKH, New BKH Merger Sub, Inc. and BKFS Merger Sub, Inc. As a result of the closing of the Transactions, the
Company became the new public parent of the Predecessor. Shares of the Company's common stock are listed on the NYSE under the trading symbol "BKI", and began trading at the market opening on
October 2, 2017. Under the organizational documents of the Company, the rights of the holders of shares of the Company's common stock are substantially the same as the rights of former holders
of the Predecessor's Class A common stock. Following the Transactions, the Company is the successor issuer to the Predecessor pursuant to Rule 414 under the Securities Act.
Corporate Information
We are a Delaware corporation. We completed our initial public offering ("IPO") in May 2015 and a corporate reorganization pursuant to the
Transactions on September 29, 2017. Our common stock is listed on the NYSE under the symbol "BKI". Our principal executive offices are located at 601 Riverside Avenue, Jacksonville,
Florida 32204, and our telephone number is (904) 854-5100. Our website address is www.blackknightinc.com. The information that appears on our website is not part of, and is not incorporated
into, this prospectus.
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RISK FACTORS
You should consider the specific risks described in our Annual Report on Form 10-K for the year ended December 31, 2016, the risk
factors described under the caption "Risk Factors" in any applicable prospectus supplement or any free writing prospectus that we provide you in connection with an offering of shares of our common
stock pursuant to this prospectus and any risk factors set forth in our other filings with the SEC, pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act that are incorporated or
deemed to be incorporated by reference in this prospectus, before making an investment decision. See "Where You Can Find More Information; Incorporation of Certain Documents by Reference." Each of the
risks described in these documents could materially and adversely affect our business, financial condition, results of operations and prospects, and could result in a partial or complete loss of your
investment. The risks and uncertainties are not limited to those set forth in the risk factors described in these documents. Additional risks and uncertainties not presently known to us or that we
currently believe to be less significant than the risk factors incorporated by reference herein may also adversely affect our business. In addition, past financial performance may not be a reliable
indicator of future performance, and historical trends should not be used to anticipate results or trends in future periods.
USE OF PROCEEDS
All shares of our common stock offered by this prospectus will be sold by the selling shareholders. We will not receive any proceeds from the
sale of shares by the selling shareholders.
DESCRIPTION OF CAPITAL STOCK
The following descriptions include summaries of the material terms of our amended and restated certificate of incorporation, our amended and
restated by-laws and the applicable provisions of the Delaware General Corporation Law (the "DGCL"). For more information on how you can obtain our amended and restated certificate of
incorporation and our amended and restated by-laws, see "Where You Can Find More Information; Incorporation of Certain Documents by Reference." We urge you to read our amended and restated certificate
of incorporation and our amended and restated by-laws in their entirety.
Authorized Capitalization
Our authorized capital stock consists of (i) 550,000,000 shares of common stock, par value $0.0001 per share, of which 153,469,978 shares
were outstanding as of November 1, 2017 and (ii) 25,000,000 shares of preferred stock, par value $0.0001 per share, none of which are outstanding.
Common Stock
Voting Rights
The holders of common stock are entitled to one vote per share on all matters to be voted upon by the shareholders.
Dividend Rights
Subject to preferences that may be applicable to any outstanding preferred stock, the holders of shares of common stock are entitled to receive
ratably such dividends, if any, as may be declared from time to time by the board of directors out of funds legally available therefor.
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Rights upon Liquidation
In the event of any voluntary or involuntary liquidation, dissolution or winding up of our affairs, the holders of common stock are entitled to
share ratably in all assets remaining after payment of our debts and other liabilities, subject to prior distribution rights of preferred stock, then outstanding, if any.
Other Rights
The holders of our common stock have no preemptive or conversion rights or other subscription rights. There are no redemption or sinking fund
provisions applicable to the common stock. The rights, preferences and privileges of holders of our common stock will be subject to those of the holders of any shares of our preferred stock we may
issue in the future.
Registration Rights
In connection with our IPO, we entered into a registration rights agreement with certain persons, including subsidiaries of FNF and certain
affiliates of Thomas H. Lee Partners, L.P. ("THL"), a Delaware limited partnership, that held shares of our common stock (the "Registration Rights Agreement"). In connection with
our reorganization pursuant to the Transactions, on September 29, 2017, Black Knight Financial Services, Inc. assigned its rights and obligations under the Registration Rights Agreement
to Black Knight, Inc. The registration statement of which this prospectus forms a part has been requested by the selling shareholders pursuant to their rights under the Registration
Rights Agreement.
The
Registration Rights Agreement provides certain shareholders that hold at least 7.5% of our registrable shares of common stock the right to require us to register the number of our
shares of common stock requested to be so registered in accordance with the Registration Rights Agreement. In addition, holders of registrable shares of common stock under the Registration Rights
Agreement are entitled to request to participate in, or "piggyback" on, registrations of registrable securities for sale by us at any time after this offering. Subject to certain limitations, we are
required to include in the registration all securities with respect to which we receive a written request for inclusion in such registration. These registration rights are subject to conditions and
limitations, including the right of the underwriters to limit the number of shares to be included in a registration statement and our right to delay, suspend or withdraw a registration statement under
specified circumstances. The Registration Rights Agreement also provides that we are required to pay certain expenses of these electing holders relating to such registrations and indemnify them
against certain liabilities that may arise under the Securities Act.
Preferred Stock
Our board of directors has the authority to issue shares of preferred stock in one or more series and to fix the rights, preferences and
limitations thereof, including dividend rights, specification of par value, conversion rights, voting rights, terms of redemption, specification of par value, liquidation preferences and the number of
shares constituting any series or the designation of such series, without further vote or action by the shareholders.
The
issuance of preferred stock may have the effect of delaying, deferring or preventing a change of control of us without further action by the shareholders and may adversely affect the
voting and other rights of the holders of common stock. At present, we have no shares of preferred stock issued and outstanding, and we have no plans to issue any preferred stock.
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Election and Removal of Directors; Vacancies
Our amended and restated certificate of incorporation provides that our board of directors consist of between one and fourteen directors. The
exact number of directors may be fixed from time to time by a majority of our board of directors. In accordance with our amended and restated certificate of incorporation, our board of directors is
divided into three classes of directors, with each class constituting, as nearly as possible, one-third of the total number of directors. Each class of directors will be elected for a three-year term.
As a result, approximately one-third of our board of directors will be elected each year. There is no limit on the number of terms a director may serve on our board of directors.
Shareholder Action by Written Consent
Our amended and restated certificate of incorporation provides that actions required or permitted to be taken by shareholders at an annual or
special meeting may be effected without a meeting by written consent. A shareholder seeking to have the shareholders authorize or take action by written consent must deliver requests from the holders
of not less than 15% of our common stock, or from the holders of our preferred stock, if the terms of such class or series of preferred stock expressly provide for action by written consent, subject
to certain procedural provisions.
Anti-takeover Effects of our Amended and Restated Certificate of Incorporation and Amended and Restated
Bylaws
Our amended and restated certificate of incorporation and amended and restated bylaws contain provisions that may delay, defer or discourage
another party from acquiring control of us. We believe that these provisions, which are summarized below, discourage coercive takeover practices or inadequate takeover bids. These provisions are also
designed to encourage persons seeking to acquire control of us to first negotiate with our board of directors, which we believe may result in an improvement of the terms of any such acquisition in
favor of our shareholders. However, they also give our board of directors the power to discourage acquisitions that some shareholders may favor.
Classified Board of Directors and Related Provisions
Our amended and restated certificate of incorporation provides that our board of directors must be divided into three classes of directors (each
class containing approximately one-third of the total number of directors) serving staggered three-year terms. As a result, approximately one-third of our board of directors is elected each year. This
classified board provision prevents a third party who acquires control of a majority of our outstanding voting stock from obtaining control of our board of directors until the second annual
shareholders meeting following the date the acquirer obtains the controlling interest. The number of directors constituting our board of directors is determined from time to time by our board of
directors. Our amended and restated certificate of incorporation also provides that, subject to any rights of any preferred stock then outstanding, any director may be removed from office at any time
but only for cause and only by the affirmative vote of the holders of a majority of the voting power of the shares entitled to vote for the election of directors, considered for this purpose as one
class. In addition, our amended and restated certificate of incorporation provides that any vacancy on the board of directors, including a vacancy that results from an increase in the number of
directors or a vacancy that results from the removal of a director with cause, may be filled
only by a majority of the directors then in office or by an affirmative vote of the sole remaining director. This provision, in conjunction with the provisions of our amended and restated certificate
of incorporation authorizing our board of directors to fill vacancies on the board of directors, prevents shareholders from removing incumbent directors without cause and filling the resulting
vacancies with their own nominees.
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Special Meetings
Our amended and restated certificate of incorporation provides that, except as otherwise required by law, special meetings of the shareholders
can only be called by a majority of our entire board of directors or our chairman of the board of directors or chief executive officer. Shareholders may not call a special meeting or require that our
board of directors call a special meeting of shareholders.
Requirements for Advance Notification of Shareholder Meetings, Nominations and Proposals
Our amended and restated bylaws provide that, if one of our shareholders desires to submit a proposal or nominate persons for election as
directors at an annual shareholders' meeting, the shareholder's written notice must be received by us not less than 120 days prior to the anniversary date of the date of the proxy statement for
the immediately preceding annual meeting of shareholders. However, if the annual meeting is called for a date that is not within 30 days before or after such anniversary date, notice by a
shareholder must be received by us not later than the close of business on the 10th day following the day on which public disclosure of the date of the annual meeting was made. The notice must
describe the proposal or nomination and set forth the name and address of, and stock held of record and beneficially by, the shareholder. Notices of shareholder proposals or nominations must set forth
the reasons for the proposal or nomination and any material interest of the shareholder in the proposal or nomination and a representation that the shareholder intends to appear in person or by proxy
at the annual meeting. Director nomination notices must set forth the name and address of the nominee, arrangements between the shareholder and the nominee and other information required under
Regulation 14A of the Exchange Act. The presiding officer of the meeting may refuse to acknowledge a proposal or nomination not made in compliance with the procedures contained in our amended
and restated bylaws. The advance notice requirements regulating shareholder nominations and proposals may have the effect of precluding a contest for the election of directors or the
introduction of a shareholder proposal if the requisite procedures are not followed and may discourage or deter a third-party from conducting a solicitation of proxies to elect its own slate of
directors or to introduce a proposal.
Authorized but Unissued Shares
The authorized but unissued shares of our common stock and our preferred stock are available for future issuance without any further vote or
action by our shareholders. These additional shares may be utilized for a variety of corporate purposes, including future public offerings to raise additional capital, corporate acquisitions and
employee benefit plans. The existence of authorized but unissued shares of our common stock and our preferred stock could render more difficult or discourage an attempt to obtain control over us by
means of a proxy contest, tender offer, merger or otherwise.
Delaware Anti-Takeover Statute
By virtue of not opting out of Section 203 of the DGCL in our amended and restated certificate of incorporation, we are subject to
Section 203 of the DGCL, which prohibits a publicly held Delaware corporation from engaging in a "business combination" with an "interested stockholder" for a period of three years after the
time the shareholder became an interested stockholder, subject to certain exceptions, including if, prior to such time, the board of directors approved the business combination or the transaction
which resulted in the shareholder becoming an interested stockholder. "Business combinations" include mergers, asset sales and other transactions resulting in a financial benefit to the "interested
stockholder." Subject to various exceptions, an "interested stockholder" is a person who, together with his or her affiliates and associates, owns, or within three years did own, 15% or more of the
corporation's outstanding voting stock. These restrictions generally prohibit or delay the accomplishment of mergers or other takeover or change of control attempts that are not approved by a
company's board of directors.
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Limitations on Director Liability
Under the DGCL, we may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation), by reason of the fact that he or she is or was our
director, officer, employee or agent, or is or was serving at our request as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorneys' fees), judgments, fines and amounts paid in settlement actually and reasonably incurred in connection with such action, suit or proceeding if he or she acted in
good faith and in a manner he or she reasonably believed to be in or not opposed to our best interests, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his
or her conduct was unlawful. In addition, Section 102(b)(7) of the DGCL provides that a certificate of incorporation may contain a provision eliminating or limiting the personal liability of a
director to the corporation or its shareholders for monetary damages for breach of fiduciary duty as a director, provided that such provision shall not eliminate or limit the liability of a director
(i) for any breach of the director's duty of loyalty to the corporation or its shareholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, (iii) under Section 174 of the DGCL (relating to liability for unauthorized acquisitions or redemptions of, or dividends on, capital stock) or (iv) for
any transaction from which the director derived an improper personal benefit. Our amended and restated certificate of incorporation contains the provisions permitted by Section 102(b)(7) of the
DGCL.
Corporate Opportunities
To address situations in which officers or directors have conflicting duties to affiliated corporations, Section 122(17) of the DGCL
allows a corporation to renounce, in its certificate of incorporation or by action of its board of directors, any interest or expectancy of the corporation in specified classes or categories of
business opportunities. As such, and in order to address potential conflicts of interest between us and FNF or THL, our amended and restated certificate of incorporation contains provisions regulating
and defining, to the fullest extent permitted by law, the conduct of our affairs as they may involve FNF and THL and FNF's and THL's officers and directors.
Our
amended and restated certificate of incorporation provides that, subject to any written agreement to the contrary, neither FNF nor THL will have a duty to refrain from engaging in
the same or similar activities or lines of business that we engage in, and, except as set forth in our amended and restated certificate of incorporation, none of FNF, THL and FNF's and
THL's officers and directors will be liable to us or our shareholders for any breach of any fiduciary duty due to any such activities of FNF or THL.
Our
amended and restated certificate of incorporation also provides that we may from time to time be or become a party to and perform, and may cause or permit any subsidiary to be or
become a party to and perform, one or more agreements (or modifications or supplements to pre-existing agreements) with FNF or THL. With limited exceptions, to the fullest extent permitted by law, no
such agreement, nor the performance thereof in accordance with its terms by us, any of our subsidiaries, FNF or THL, shall be considered contrary to any fiduciary duty to us or our shareholders of any
director or officer of ours who is also a director, officer or employee of FNF or THL. With limited exceptions, to the fullest extent permitted by law, no director or officer of ours who is also a
director, officer or employee of FNF or THL shall have or be under any fiduciary duty to us or our shareholders to refrain from acting on behalf of us or any of our subsidiaries or on behalf of FNF or
THL in respect of any such agreement or performing any such agreement in accordance with its terms.
Our
amended and restated certificate of incorporation further provides that if one of our directors or officers who is also a director or officer of FNF or THL acquires knowledge of a
potential
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transaction
or matter that may be a corporate opportunity for any of FNF, THL or us, the director or officer will have satisfied his or her fiduciary duty to us and our shareholders with respect to
that corporate opportunity if he or she acts in a manner consistent with the following policy:
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a corporate opportunity offered to any person who is an officer of ours and who is also a director but not an officer of FNF or THL, will
belong to us unless the opportunity is expressly offered to that person in a capacity other than such person's capacity as one of our officers, in which case it will not belong to us;
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a corporate opportunity offered to any person who is a director but not an officer of ours, and who is also a director or officer of FNF or
THL, will belong to us only if that opportunity is expressly offered to that person in that person's capacity as one of our directors; and
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a corporate opportunity offered to any person who is an officer of any of FNF, THL or us will belong to us only if that opportunity is
expressly offered to that person in that person's capacity as one of our officers.
Notwithstanding
these provisions, our amended and restated certificate of incorporation does not prohibit us from pursuing any corporate opportunity of which we become aware.
These
provisions in our amended and restated certificate of incorporation will no longer be effective on the date that none of our directors or officers are also directors or officers of
FNF or THL.
Amendment to Amended and Restated Bylaws and Amended and Restated Certificate of Incorporation
Our amended and restated certificate of incorporation and our amended and restated bylaws provide that, subject to the affirmative vote of the
holders of any series of preferred stock required by law, the provisions (i) of our amended and restated bylaws may be adopted, amended or repealed if approved by a majority of the board of
directors then in office or approved by holders of the common stock and (ii) of our amended and restated certificate of incorporation may be adopted, amended or repealed as provided by the
DGCL.
Listing
Our common stock is listed on the NYSE under the symbol "BKI".
Transfer Agent and Registrar
The transfer agent and registrar for our common stock is Continental Stock Transfer & Trust.
SELLING SHAREHOLDERS
Information regarding the beneficial ownership of our common stock by the selling shareholders, the number of shares being offered by the
selling shareholders and the number of shares beneficially owned by the selling shareholders after the applicable offering will be set forth in a prospectus supplement, free writing prospectus,
post-effective amendment or filings we make with the SEC under the Exchange Act that are incorporated by reference.
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PLAN OF DISTRIBUTION
The selling shareholders may sell the common stock offered by this prospectus from time to time in one or more transactions, including without
limitation:
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directly to one or more purchasers;
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through agents;
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to or through underwriters, brokers or dealers; or
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through a combination of any of these methods.
In
addition, the manner in which the selling shareholders may sell some or all of the securities covered by this prospectus includes any method permitted by law, including, without
limitation, through:
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a block trade in which a broker-dealer will attempt to sell as agent, but may position or resell a portion of the block, as principal, in order
to facilitate the transaction;
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purchases by a broker-dealer, as principal, and resale by the broker-dealer for its account;
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ordinary brokerage transactions and transactions in which a broker solicits purchasers; or
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privately negotiated transactions.
The
selling shareholders may also enter into hedging transactions. For example, the selling shareholders may:
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enter into transactions with a broker-dealer or affiliate thereof in connection with which such broker-dealer or affiliate will engage in short
sales of the common stock pursuant to this prospectus, in which case such broker-dealer or affiliate may use shares of common stock received from the selling shareholders to close out its short
positions;
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sell securities short and redeliver such shares to close out the short positions;
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enter into option or other types of transactions that require the selling shareholders to deliver common stock to a broker-dealer or an
affiliate thereof, who will then resell or transfer the common stock under this prospectus; or
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loan or pledge the common stock to a broker-dealer or an affiliate thereof, who may sell the loaned shares or, in an event of default in the
case of a pledge, sell the pledged shares pursuant to this prospectus.
The
securities covered by this prospectus may be sold:
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on a national securities exchange;
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in the over-the-counter market; or
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in transactions otherwise than on an exchange or in the over-the-counter market, or in combination.
A
prospectus supplement with respect to each offering of securities will state the terms of the offering of the securities, including:
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the name or names of any underwriters or agents and the amounts of securities underwritten or purchased by each of them, if any;
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the public offering price or purchase price of the securities and the net proceeds to be received by the selling shareholders from the sale;
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any delayed delivery arrangements;
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any underwriting discounts or agency fees and other items constituting underwriters' or agents' compensation;
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any discounts or concessions allowed or reallowed or paid to dealers; and
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any securities exchange or markets on which the securities may be listed.
The
offer and sale of the securities described in this prospectus by the selling shareholders, the underwriters or the third parties described above may be effected from time to time in
one or more transactions, including privately negotiated transactions, either:
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at a fixed price or prices, which may be changed;
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at market prices prevailing at the time of sale;
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at prices related to the prevailing market prices; or
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at negotiated prices.
General
Any public offering price and any discounts, commissions, concessions or other items constituting compensation allowed or reallowed or paid to
underwriters, dealers, agents or remarketing firms may be changed from time to time. Any selling shareholders, underwriters, dealers, agents and remarketing firms that participate in the distribution
of the offered securities may be "underwriters" as defined in the Securities Act. Any discounts or commissions they receive from the selling shareholders and any profits they receive on the resale of
the offered securities may be treated as underwriting discounts and commissions under the Securities Act. We will identify any underwriters, agents or dealers and describe their commissions, fees or
discounts in the applicable prospectus supplement or pricing supplement, as the case may be.
The
selling shareholders and other persons participating in the sale or distribution of the securities will be subject to the applicable provisions of the Exchange Act, and the rules and
regulations thereunder, including Regulation M. This regulation may limit the timing of purchases and sales of any of the securities by the selling shareholders, or any other person. The
anti-manipulation rules under the Securities Act may apply to sales of securities in the market and to the activities of the selling shareholders and their affiliates. Furthermore, Regulation M
may restrict the ability of any person engaged in the distribution for a period of up to five business days before the distribution. These restrictions may affect the marketability of the securities
and the ability of any person or entity to engage in market-making activities with respect to the securities.
The
selling shareholders are not restricted as to the price or prices at which the securities may be sold. Sales of such securities may have an adverse effect on the market price of the
securities.
Moreover,
it is possible that a significant number of shares of common stock could be sold at the same time, which may have an adverse effect on the market price of the securities.
We
cannot assure you that the selling shareholders will sell all or any portion of the securities offered hereby.
Underwriters and Agents
If underwriters are used in a sale, they will acquire the offered securities for their own account. The underwriters may resell the offered
securities in one or more transactions, including negotiated transactions. These sales may be made at a fixed public offering price or prices, which may be changed, at market prices prevailing at the
time of the sale, at prices related to such prevailing market price or
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at
negotiated prices. The selling shareholders may offer the securities to the public through an underwriting syndicate or through a single underwriter. The underwriters in any particular offering
will be mentioned in the applicable prospectus supplement or pricing supplement, as the case may be.
Unless
otherwise specified in connection with any particular offering of securities, the obligations of the underwriters to purchase the offered securities will be subject to certain
conditions contained in an underwriting agreement that the selling shareholders will enter into with the underwriters at the time of the sale to them. The underwriters will be obligated to purchase
all of the securities of the series offered if any of the securities are purchased, unless otherwise specified in connection with any particular offering of securities. Any initial offering price and
any discounts or concessions allowed, reallowed or paid to dealers may be changed from time to time.
The
selling shareholders may designate agents to sell the offered securities. Unless otherwise specified in connection with any particular offering of securities, the agents will agree
to use their best efforts to solicit purchases for the period of their appointment. The selling shareholders may also sell the offered securities to one or more remarketing firms, acting as principals
for their own accounts or as agents for the selling shareholders. These firms will remarket the offered securities upon purchasing them in accordance with a redemption or repayment pursuant to the
terms of the offered securities. A prospectus supplement or pricing supplement, as the case may be will identify any remarketing firm and will describe the terms of its agreement, if any, with the
selling shareholders and its compensation.
In
connection with offerings made through underwriters or agents, the selling shareholders may enter into agreements with such underwriters or agents pursuant to which the selling
shareholders receive outstanding securities in consideration for the securities being offered to the public for cash. In connection with these arrangements, the underwriters or agents may also sell
securities covered by this prospectus to hedge their positions in these outstanding securities, including in short sale transactions. If so, the underwriters or agents may use the securities received
by the selling shareholders under these arrangements to close out any related open borrowings of securities.
Dealers
The selling shareholders may sell the offered securities to dealers as principals. The selling shareholders may negotiate and pay dealers'
commissions, discounts or concessions for their services. The dealer may then resell such securities to the public either at varying prices to be determined by the dealer or at a fixed offering price
agreed to with the selling shareholders, at the time of resale. Dealers engaged by the selling shareholders may allow other dealers to participate in resales.
Direct Sales
The selling shareholders may choose to sell the offered securities directly. In this case, no underwriters or agents would be involved.
Institutional Purchasers
The selling shareholders may authorize agents, dealers or underwriters to solicit certain institutional investors to purchase offered securities
on a delayed delivery basis pursuant to delayed delivery contracts providing for payment and delivery on a specified future date. The applicable prospectus supplement or pricing supplement, as the
case may be, will provide the details of any such arrangement, including the offering price and commissions payable on the solicitations.
The
selling shareholders will enter into such delayed contracts only with institutional purchasers that the selling shareholders approve. These institutions may include commercial and
savings banks, insurance companies, pension funds, investment companies and educational and charitable institutions.
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Indemnification; Other Relationships
The selling shareholders may have agreements with agents, underwriters, dealers and remarketing firms to indemnify them against certain civil
liabilities, including liabilities under the Securities Act. Agents, underwriters, dealers and remarketing firms, and their affiliates, may engage in transactions with, or perform services for the
selling shareholders in the ordinary course of business. This includes commercial banking and investment banking transactions.
Market-Making, Stabilization and Other Transactions
In connection with any offering of common stock, the underwriters may purchase and sell shares of common stock in the open market. These
transactions may include short sales, syndicate covering transactions and stabilizing transactions. Short sales involve syndicate sales of common stock in excess of the number of shares to be
purchased by the underwriters in the offering, which creates a syndicate short position. "Covered" short sales are sales of shares made in an amount up to the number of shares represented by the
underwriters' over-allotment option. In determining the source of shares to close out the covered syndicate short position, the underwriters will consider, among other things, the price of shares
available for purchase in the open market as compared to the price at which they may purchase shares through the over-allotment option. Transactions to close out the covered syndicate short involve
either purchases of the common stock in the open market after the distribution has been completed or the exercise of the over-allotment option. The underwriters may also make "naked" short sales of
shares in excess of the over-allotment option. The underwriters must close out any naked short position by purchasing shares of common stock in the open market. A naked short position is more likely
to be created if the underwriters are concerned that there may be downward pressure on the price of the shares in the open market after pricing that could adversely affect investors who purchase in
the offering. Stabilizing transactions consist of bids for or purchases of shares in the open market while the offering is in progress for the purpose of pegging, fixing or maintaining the price of
the securities.
In
connection with any offering, the underwriters may also engage in penalty bids. Penalty bids permit the underwriters to reclaim a selling concession from a syndicate member when the
securities originally sold by the syndicate member are purchased in a syndicate covering transaction to cover syndicate short positions. Stabilizing transactions, syndicate covering transactions and
penalty bids may cause the price of the securities to be higher than it would be in the absence of the transactions. The underwriters may, if they commence these transactions, discontinue them at any
time.
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LEGAL MATTERS
Weil, Gotshal & Manges LLP, New York, New York, will pass upon the validity of the common stock offered by this prospectus.
EXPERTS
The Consolidated Financial Statements of Lender Processing Services, Inc. as of January 1, 2014 and for the day ended
January 1, 2014 have been incorporated by reference herein in reliance upon the report of KPMG LLP, independent registered public accounting firm, incorporated by reference herein, and
upon the authority of said firm as experts in accounting and auditing.
The
Consolidated Financial Statements of Black Knight Financial Services, Inc. and subsidiaries as of December 31, 2016 and 2015, and management's assessment of the
effectiveness of internal control over financial reporting as of December 31, 2016, have been incorporated by reference herein and in the registration statement in reliance upon the reports of
KPMG LLP, independent registered public accounting firm, incorporated by reference herein, and upon the authority of said firm as experts in accounting and auditing. The audit report covering
the Consolidated Financial Statements as of December 31, 2016 and 2015 and for each of the years in the three-year period ended December 31, 2016, contains an explanatory paragraph that
states that, as discussed in Note 1 to the Consolidated Financial Statements, Black Knight Financial Services, Inc. completed an initial public offering ("IPO") of its stock on
May 26, 2015 and contributed the net cash proceeds received from the IPO to Black Knight Financial Services, LLC in exchange for 44.5% of the units and a managing member's membership
interest in Black Knight Financial Services, LLC. Additionally, as discussed in Notes 1 and 2 to the Consolidated Financial Statements, Lender Processing Services, Inc. merged
with Lion Merger Sub, Inc. on January 2, 2014, through which Lender Processing Services, Inc. became a wholly-owned subsidiary of Fidelity National Financial, Inc., which
then reorganized the operations of Lender Processing Services, Inc. and contributed certain of its operations into Black Knight Financial Services, LLC on January 3, 2014. The
audit report on the effectiveness of internal control over financial reporting as of December 31, 2016, contains an explanatory paragraph that states that Black Knight Financial
Services, Inc. acquired eLynx Holdings, Inc. ("eLynx") on May 16, 2016 and Motivity Solutions, Inc. ("Motivity") on June 22, 2016, and management has excluded from
its assessment of the effectiveness of Black Knight Financial Services, Inc.'s internal control over financial reporting as of December 31, 2016, eLynx's and Motivity's internal control
over financial reporting associated with approximately 4.1% of total assets and 2.3% of total revenues included in the Consolidated Financial Statements of Black Knight Financial Services, Inc.
and subsidiaries as of and for the year ended December 31, 2016, and that our audit of internal control over financial reporting of Black Knight Financial Services, Inc. also excludes an
evaluation of the internal control over financial reporting of eLynx and Motivity.
17
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BLACK KNIGHT, INC.
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