Item 8.01. Other Events.
As previously disclosed,
a subsidiary of Cohen & Company Inc. (together, the “Company”) is the sponsor of Insurance Acquisition Corp.
(Nasdaq: INSU) (“IAC”), a special purpose acquisition company (SPAC) formed for the purpose of effecting a merger,
capital stock exchange, asset acquisition, stock purchase, reorganization, or similar business combination with one or more businesses.
On June 29, 2020, IAC
entered into an Agreement and Plan of Merger (the “Merger Agreement”) with IAC Merger Sub, Inc., a Delaware corporation
and direct wholly owned subsidiary of IAC (“Merger Sub”), and Shift Technologies, Inc., a Delaware corporation
(“Shift”). The Merger Agreement provides for, among other things, the acquisition of Shift by IAC pursuant to the proposed
merger of Merger Sub with and into Shift with Shift continuing as the surviving entity and a direct wholly owned subsidiary of
IAC (the “Merger”).
Consummation of the
transactions contemplated by the Merger Agreement is subject to customary conditions of the respective parties, including, among
others, that (i) the Merger be approved by the IAC’s stockholders and the Shift Stockholders; (ii) there has been
no material adverse effect that is continuing with respect to Shift or IAC since the date of the Merger Agreement; (iii) the
filings of IAC and Shift pursuant to the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, if any, shall have been
made and the applicable waiting period and any extension thereof will have expired or been terminated; and (iv) IAC will have
at least $5,000,001 of net tangible assets immediately following the closing (after giving effect to the redemption of public shares
by IAC’s public stockholders, the PIPE investment (see below) and the other transactions contemplated to occur upon the closing).
The Merger Agreement also provides that, upon consummation of the Merger, IAC will enter into a letter agreement with subsidiaries
of the Company (“Sponsor”) providing for certain board observer rights in favor of Sponsor.
Concurrently with the
execution and delivery of the Merger Agreement, certain institutional accredited investors (the “PIPE Investors”),
including a subsidiary of the Company, entered into subscription agreements (the “PIPE Subscription Agreements”) pursuant
to which the PIPE Investors have committed to subscribe for and purchase up to 18,500,000 shares of IAC Class A Common Stock (the
“IAC Common Stock”) at a purchase price per share of $10.00. The purchase of IAC Common Stock by the PIPE Investors
will be consummated concurrently with the closing of the Merger, subject to certain additional closing conditions that are customary
for transactions of this nature. The PIPE Subscription Agreement with the Company’s subsidiary, dated June 29, 2020 (the
“Affiliate Subscription Agreement”), provides for the purchase of 200,000 shares of IAC Common Stock by the Company’s
subsidiary, which number of shares may be increased by up to 1,300,000 shares of IAC Common Stock at the election of the Company’s
subsidiary, subject to certain limitations. The Affiliate Subscription Agreement also contains provisions regarding registration
rights that, among other matters, requires IAC to file with the Securities and Exchange Commission, within 15 days following the
closing, a registration statement relating to the resale of the IAC Common Stock purchased by the Company’s subsidiary pursuant
to the Affiliate Subscription Agreement.
Including initial placement
shares and founders shares, following the closing of the Merger the Company expects to own between 1.8 million and 2.3 million
shares of IAC Class A Common Stock (collectively, the “Sponsor Shares”), in addition to the shares purchased pursuant
to the Affiliate Subscription Agreement discussed above. All of the Sponsor Shares and the shares purchased pursuant to the Affiliate
Subscription Agreement will be subject to restrictions on resale under applicable securities laws until the resale of such shares
is either registered under the Securities Act of 1933 or otherwise exempt from registration. Further, subject to certain limited
exceptions, the initial placement shares will not be transferable or salable until 30 days following the closing of the Merger,
and founders shares will not be transferable or salable except (a) with respect to 20% of such Founder Shares, until the closing
of the Merger, and (b) with respect to additional 20% tranches of such Founder Shares, when the closing price of the IAC Common
Stock exceeds $12.00, $13.50, $15.00, and $17.00, respectively, for 20 out of any 30 consecutive trading days following the closing
of the Merger, in each case subject to certain limited exceptions.
Forward Looking Statements
This Current Report
on Form 8-K contains “forward-looking statements” within the meaning of the “safe harbor” provisions
of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such
as “anticipate”, “believe”, “could”, “continue”, “expect”, “estimate”,
“may”, “plan”, “outlook”, “future” and “project” and other similar
expressions that predict or indicate future events or trends or that are not statements of historical matters. These statements,
which involve risks and uncertainties, relate to analyses and other information that are based on forecasts of future results and
estimates of amounts not yet determinable and may also relate to our future prospects, developments and business strategies. In
particular, such forward-looking statements include statements concerning the timing of the Merger; the business plans, objectives,
expectations and intentions of the public company once the transaction is complete, and Shift’s estimated and future results
of operations, business strategies, competitive position, industry environment and potential growth opportunities. These statements
are based on the Company’s current expectations and beliefs, as well as a number of assumptions concerning future events.
Such forward-looking
statements are subject to known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside
the Company’s control that could cause actual results to differ materially from the results discussed in the forward-looking
statements. These risks, uncertainties, assumptions and other important factors include, but are not limited to, (1) the occurrence
of any event, change or other circumstances that could give rise to the termination of the Merger Agreement; (2) the inability
to complete the transactions contemplated by the Merger Agreement due to the failure to obtain approval of the stockholders of
IAC or other conditions to closing in the Merger Agreement; (3) the inability to complete the private placement; (4) the
outcome of any legal proceedings that may be instituted against IAC, Shift or any of their respective directors or officers, following
the announcement of the potential transaction; and (5) changes in terms of the Merger Agreement, the Company Subscription
Agreement or other agreements or documents relating to the Merger, the PIPE Subscription Agreements or otherwise.
New risks and uncertainties
arise from time to time, and it is impossible for us to predict these events or how they may affect us. You are cautioned not to
place undue reliance upon any forward-looking statements, which speak only as of the date made, and the Company undertakes no obligation
to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise.