TRAVERSE
CITY, Mich., June 3, 2024
/PRNewswire/ -- Hagerty, Inc. (NYSE: HGTY) (the
"Company" or "Hagerty"), an automotive
enthusiast brand and leading specialty vehicle insurance provider,
announced today that it has commenced an exchange offer (the
"Offer") and consent solicitation (the "Consent
Solicitation") relating to its outstanding (i) public
warrants (the "Public Warrants"), (ii) private
placement warrants (the "Private Warrants"), (iii)
underwriter warrants (the "Underwriter Warrants"),
(iv) OTM warrants (the "OTM Warrants" and
collectively with the Private Warrants and the Underwriter
Warrants, the "Private Placement Warrants") and (v)
PIPE warrants (the "PIPE Warrants" and, together with
the Public Warrants and the Private Placement Warrants, the
"Warrants"). The purpose of the Offer and Consent
Solicitation is to simplify the Company's capital structure and
reduce the potential dilutive impact of the Warrants.
Exchange Offer and Consent Solicitation Relating to
Warrants
The Company is offering to all holders of the Warrants the
opportunity to receive 0.20 shares of Class A Common Stock (the
"Shares") in exchange for each outstanding Warrant
tendered by the holder and exchanged pursuant to the Offer.
Pursuant to the Offer, the Company is offering up to an aggregate
of 3,896,707 Shares in exchange for the Warrants.
Concurrently with the Offer, the Company is also soliciting
consents from holders of the Warrants to amend the warrant
agreement that governs the Public Warrants and the Private
Placement Warrants (the "IPO Warrant
Agreement") and the warrant agreement that governs the PIPE
Warrants (the "Business Combination Warrant
Agreement" and together with the IPO Warrant Agreement, the
"Warrant Agreement") to permit the Company to require
that each Warrant that is outstanding upon the closing of the Offer
be exchanged for 0.18 Shares, which is a ratio 10% less than the
exchange ratio applicable to the Offer. Pursuant to the terms of
the IPO Warrant Agreement, all amendments except certain specified
modifications or amendments require the vote or written consent of
holders of at least both (i) 50% of the Public Warrants outstanding
and (ii) 50% of the Private Placement Warrants outstanding.
Pursuant to the terms of the Business Combination Warrant
Agreement, all amendments except certain specified modifications or
amendments require the vote or written consent of holders of at
least 50% of the PIPE Warrants outstanding. Parties representing
approximately 44.3% of the Public Warrants, 57.2% of the Private
Placement Warrants and 81.5% of the PIPE Warrants have agreed to
tender their Warrants in the Offer and to consent to the amendments
in the Consent Solicitation, pursuant to a tender and support
agreement. Accordingly, if holders of an additional approximately
5.7% of the Public Warrants consent to the IPO Warrant Amendment in
the Consent Solicitation, and the other conditions described herein
are satisfied or waived, then the IPO Warrant Amendment will be
adopted. As of the date hereof, a sufficient number of holders of
the PIPE Warrants have consented to the adoption of the Business
Combination Warrant Amendment.
The Offer and Consent Solicitation are being made pursuant to a
prospectus/offer to exchange, dated June 3,
2024 (the "Prospectus/Offer to Exchange"), and
Schedule TO, dated June 3, 2024 (the
"Schedule TO"), each of which have been filed with
the U.S. Securities and Exchange Commission (the
"SEC") and more fully set forth the terms and
conditions of the Offer and Consent Solicitation. The offering
period will expire one minute after 11:59
p.m., Eastern Time, on July 2,
2024, or such later time and date to which the Company may
extend (the "Expiration Date"), as described in the
Company's Schedule TO and Prospectus/Offer to Exchange. Tendered
Warrants may be withdrawn by holders at any time prior to the
Expiration Date.
The Company's Class A Common Stock and Public Warrants are
listed on The New York Stock Exchange under the symbols "HGTY" and
"HGTY.WS," respectively. As of May 15,
2024, there were (i) 85,703,286 shares of Class A Common
Stock outstanding, (ii) 8,483,561 shares of Series A Preferred
Stock outstanding, (iii) 251,033,906 shares of Class V Common Stock
issued and outstanding and (iv) a total of 19,483,539 Warrants were
outstanding. Assuming all Warrant holders tender their Warrants for
exchange in the Offer, the Company would expect to issue up to
3,896,707 Shares, resulting in 89,599,993 shares of Class A Common
Stock outstanding (an increase of approximately 4.5%), and have no
Warrants outstanding.
D.F. King & Co., Inc. has been appointed as the information
agent and consent solicitor for the Offer and Consent Solicitation
(the "Information Agent" and "Consent
Solicitor") and Continental Stock Transfer & Trust
Company has been appointed as the exchange agent (the
"Exchange Agent").
Important Additional Information Has Been Filed with the
SEC
Copies of the Schedule TO and Prospectus/Offer to Exchange will
be available free of charge at the website of the SEC at
www.sec.gov. Requests for documents may also be directed to the
Information Agent at (888) 564-8149 (for Warrant holders) or (212)
269-5550 (for banks and brokers) or via the following email
address: HGTY@dfking.com. A registration statement on Form S-4 (the
"Registration Statement") relating to the Shares to
be issued in the Offer has been filed with the SEC but has not yet
become effective. The Shares may not be sold nor may offers to buy
be accepted prior to the time the Registration Statement becomes
effective.
This announcement is for informational purposes only and shall
not constitute an offer to purchase or a solicitation of an offer
to sell the Warrants or an offer to sell or a solicitation of an
offer to buy any Shares in any jurisdiction in which such offer,
solicitation, or sale would be unlawful before registration or
qualification under the laws of any such jurisdiction. The Offer
and Consent Solicitation are being made only through the Schedule
TO and Prospectus/Offer to Exchange, and the complete terms and
conditions of the Offer and Consent Solicitation are set forth in
the Schedule TO and Prospectus/Offer to Exchange.
Holders of the Warrants are urged to read the Schedule TO and
Prospectus/Offer to Exchange carefully before making any decision
with respect to the Offer and Consent Solicitation because they
contain important information, including the various terms of, and
conditions to, the Offer and Consent Solicitation.
None of the Company, any of its management or its board of
directors, or the Information Agent, the Consent Solicitor or the
Exchange Agent makes any recommendation as to whether or not
holders of Warrants should tender Warrants for exchange in the
Offer or consent to the amendments in the Consent Solicitation.
Cautionary Statement Regarding Forward-Looking
Statements
This press release contains forward-looking statements within
the meaning of the federal securities laws, including statements
regarding the expected timing and effect of the Offer and Consent
Solicitation, and any other statement that is not historical fact.
These forward-looking statements generally are identified by words
such as "aim," anticipate," "expect," "intend," "future,"
"opportunity," "plan," "potential," "may," "should," "will,"
"would," and similar expressions, but the absence of these words
does not mean that a statement is not forward-looking.
Forward-looking statements are predictions, projections, and other
statements about future events that are based on current
expectations and assumptions and, as a result, are subject to risks
and uncertainties. Many factors could cause actual future events to
differ materially from these forward-looking statements, including
the Company's ability to (i) compete effectively within its
industry and attract and retain insurance policy holders and paid
HDC subscribers; (ii) maintain key strategic relationships
with its insurance distribution and underwriting carrier partners;
(iii) prevent, monitor and detect fraudulent activity;
(iv) manage risks associated with disruptions, interruptions,
outages with its technology platforms or third-party services;
(v) accelerate the adoption of its membership products as well
as any new insurance programs and products; (vi) manage the
cyclical nature of the insurance business including through any
periods of recession, eco-nomic downturn or inflation;
(vii) address unexpected increases in the frequency or
severity of claims; (viii) comply with the numerous laws and
regulations applicable to its business, including state, federal
and foreign laws relating to insurance and rate increases, privacy,
the internet and accounting matters; (ix) manage risks
associated with being a controlled company; (x) successfully
defend any litigation, government inquiries and investigations, and
(xi) address other risks and uncertainties described under the
section entitled "Risk Factors" in the Registration Statement and
the other documents the Company files from time to time with the
SEC, which are accessible on the SEC's website at www.sec.gov.
Forward-looking statements speak only as of the date they are
made. Readers are cautioned not to put undue reliance on
forward-looking statements, and the Company assumes no obligation
and does not intend to update or revise these forward-looking
statements, whether as a result of new information, future events
or otherwise.
About Hagerty, Inc. (NYSE: HGTY)
Hagerty is an automotive enthusiast brand committed to saving
driving and to fueling car culture for future generations. The
company is a leading provider of specialty vehicle insurance,
expert car valuation data and insights, live and digital car
auction services, immersive events and automotive entertainment
custom made for the 67 million Americans who self-describe as car
enthusiasts. Hagerty also operates in Canada and the U.K. and is home to Hagerty
Drivers Club, a community of over 800,000 who can't get enough of
cars. For more information, please visit www.hagerty.com or connect
with us on Facebook, Instagram, Twitter and LinkedIn. For more
information, visit newsroom.hagerty.com.
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SOURCE Hagerty