Item 2.01 Completion of Acquisition or Disposition of Assets.
On December 9, 2022, Shift Technologies, Inc., a Delaware corporation ("Shift"),
completed the previously announced acquisition of CarLotz, Inc., a Delaware
corporation (the "Company," "CarLotz," "we" or "us"), pursuant to the Agreement
and Plan of Merger dated as of August 9, 2022 (the "Merger Agreement"), by and
among Shift, Shift Remarketing Operations, Inc., a Delaware corporation and
direct wholly owned subsidiary of Shift ("Merger Sub"), and CarLotz. Pursuant to
the Merger Agreement, Merger Sub merged with and into CarLotz, with CarLotz
continuing as the surviving corporation and a wholly owned subsidiary of Shift
(the "Merger").
Merger Consideration
Pursuant to the Merger Agreement, each outstanding share of Class A common
stock, par value $0.0001 per share, of CarLotz ("CarLotz Common Stock") (other
than CarLotz Common Stock owned or held in treasury by CarLotz, which was
cancelled for no consideration) was converted into the right to receive 0.705241
(the "Exchange Ratio") of a share of Class A common stock, par value $0.0001 per
share, of Shift ("Shift Common Stock"), rounded up to the nearest whole share
for any fractional shares of Shift Common Stock that would have been issued to
any stockholder resulting from the calculation (the "Merger Consideration").
Treatment of CarLotz Equity Awards, Earnout Shares, Earnout Acquiror RSUs and
Warrants
At the effective time of the Merger (the "Effective Time"), (i) each vested
time-based and performance-based CarLotz restricted stock unit award (including
any such awards that vested at the Effective Time) was converted into the right
to receive the Merger Consideration in respect of each underlying share of
CarLotz Common Stock, less applicable tax withholding, and (ii) each other
CarLotz restricted stock unit award was assumed by Shift and converted into an
award relating to Shift Common Stock, with appropriate adjustments to the
numbers of shares and share price thresholds to reflect the Exchange Ratio, in
each case in accordance with the terms set forth the Merger Agreement. In
addition, at the Effective Time, each option to purchase CarLotz Common Stock
was assumed by Shift and converted into an option to purchase Shift Common
Stock, with appropriate adjustments to the numbers of shares and exercise prices
to reflect the Exchange Ratio, in accordance with the terms set forth in the
Merger Agreement.
Also at the Effective Time, each outstanding warrant (the "Warrants") to
purchase shares of CarLotz Common Stock was assumed by Shift and converted into
a warrant to purchase Shift Common Stock, with appropriate adjustments to the
warrant shares and exercise price to reflect the Exchange Ratio, in accordance
with the terms set forth in the Merger Agreement. In connection with such
conversion of the Warrants, on December 9, 2022, Shift, American Stock Transfer
& Trust Company, LLC, a New York limited liability trust company ("AST"),
CarLotz and Continental Stock Transfer & Trust Company, a New York corporation
("CST"), entered into a Warrant Assumption and Amendment Agreement (the "Warrant
Amendment"), pursuant to which among other things, (i) Shift assumed all of
CarLotz's rights, interests and obligations under that certain Warrant Agreement
dated as of February 21, 2019, between CarLotz and AST, as Warrant agent; (ii)
each of the issued and outstanding Warrants will no longer be exercisable for
shares of CarLotz Common Stock but instead will be exercisable for shares of
Shift Common Stock; (iii) the Warrants will be adjusted such that the number of
. . .
Item 3.01 Notice of Delisting or Failure to Satisfy a Continued Listing Rule or
Standard; Transfer of Listing.
The information set forth in Item 2.01 of this Current Report on Form 8-K is
incorporated into this Item 3.01 by reference.
On December 9, 2022, in connection with the consummation of the Merger, the
Company (i) notified The Nasdaq Global Market ("Nasdaq") of the consummation of
the Merger and (ii) requested that Nasdaq remove the CarLotz Common Stock and
the Warrants from listing and file a Form 25 with the SEC to report the
delisting of the CarLotz Common Stock and the Warrants from Nasdaq. The Company
expects that, in accordance with its request, Nasdaq will file a Notification of
Removal from Listing and/or Registration on Form 25 on December 9, 2022 to
provide notification of such delisting and to effect the deregistration of the
CarLotz Common Stock and the Warrants under Section 12(b) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"). Following effectiveness
of the Form 25, the Company intends to file with the SEC a Certification and
Notice of Termination on Form 15 with the SEC to suspend the Company's reporting
obligations under Sections 13 and 15(d) of the Exchange Act. Trading of the
CarLotz Common Stock and the Warrants on Nasdaq was halted prior to the opening
of trading on December 9, 2022.
Item 3.03 Material Modification to Rights of Security Holders.
The information set forth in Items 2.01, 3.01, 5.01 and 5.03 of this Current
Report on Form 8-K is incorporated herein by reference into this Item 3.03.
Item 5.01 Changes in Control of Registrant.
The information set forth in Item 2.01 of this Current Report on Form 8-K is
incorporated into this Item 5.01 by reference.
As a result of the Merger, at the Effective Time, a change of control of the
Company occurred and CarLotz became a whollyowned subsidiary of Shift.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
The information set forth in Item 2.01 of this Current Report on Form 8-K is
incorporated into this Item 5.02 by reference.
Directors
Pursuant to the Merger Agreement, at the Effective Time all members of the
CarLotz board of directors (the "Board"), Linda B. Abraham, Steven G. Carrel,
Nanxi Liu, David R. Mitchell, Kimberly H. Sheehy, James E. Skinner and Luis
Ignacio Solorzano, ceased to be directors of CarLotz. Immediately following the
Effective Time, certain officers of Shift became directors of CarLotz.
Executive Officers
Pursuant to the Merger Agreement, at the Effective Time the resignations of
CarLotz's executive officers, Lev Peker, Ozan Kaya, Eugene Kovshilovsky, Thomas
W. Stoltz and Elizabeth Sanders, became effective. Immediately following the
Effective Time, certain officers of Shift became officers of CarLotz.
Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal
Year.
The information set forth in Item 2.01 of this Current Report on Form 8-K is
incorporated into this Item 5.03 by reference.
Pursuant to the Merger Agreement, at the Effective Time (i) the Second Amended
and Restated Certificate of Incorporation of the Company was amended and
restated to conform to Exhibit D attached to the Merger Agreement; and (ii) the
Amended and Restated Bylaws of the Company were amended and restated to conform
to the bylaws of Merger Sub, except that the name reflected in such bylaws was
changed to "CarLotz, Inc."
Item 7.01 Regulation FD Disclosure.
On December 9, 2022, Shift issued a press release announcing the closing of the
Merger. A copy of the press release is furnished as Exhibit 99.1 hereto. Such
press release shall not be deemed "filed" for purposes of Section 18 of the
Exchange Act or otherwise subject to the liabilities of that section, nor shall
it be deemed incorporated by reference in any filing made by the Company under
the Securities Act or the Exchange Act.
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Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
2.1 Agreement and Plan of Merger dated August 9, 2022, by and among Shift
Technologies, Inc., Shift Remarketing Operations, Inc. and CarLotz, Inc.
(incorporated by reference to Exhibit 2.1 to the Company's Form 8-K
(File No. 001-38818), filed with the SEC on August 12, 2022).†
99.1 Press Release of Shift Technologies, Inc. dated December 9, 2022.
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document)
† Schedules and similar attachments have been omitted pursuant to Item
601(a)(5) of Regulation S-K. CarLotz agrees to furnish a supplemental copy of
any omitted schedule or attachment to the SEC upon request.
Forward-Looking Statements
This Current Report on Form 8-K includes "forward-looking statements" within the
meaning of the "safe harbor" provisions of the United States Private Securities
Litigation Reform Act of 1995. Forward-looking statements may be identified by
the use of words such as "forecast," "intend," "seek," "target," "anticipate,"
"believe," "expect," "estimate," "plan," "outlook," and "project" and other
similar expressions that predict or indicate future events or trends or that are
not statements of historical matters. Such forward-looking statements involve
risks and uncertainties. CarLotz's experience and results may differ materially
from the experience and results anticipated in such statements. A number of
factors could cause actual results or outcomes to differ materially from those
indicated by such forward-looking statements. These factors include, but are not
limited to: (1) the ability of the combined company to retain and hire key
personnel; (2) unexpected costs, charges or expenses resulting from the
transaction; (3) potential adverse reactions or changes to business
relationships resulting from the completion of the transaction; (4) the combined
company's ability to achieve the synergies expected from the transaction, as
well as delays, challenges and expenses associated with integrating the combined
company's existing businesses; and (5) legislative, regulatory and economic
developments. Other factors that might cause such a difference include those
discussed in CarLotz's filings with the SEC, which include its Annual Reports on
Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, and
in the joint proxy statement/prospectus filed in connection with the Merger. For
more information, see the section entitled "Risk Factors" and the
forward-looking statements disclosure contained in CarLotz's Annual Reports on
Form 10-K and in other filings. The forward-looking statements included in this
Current Report on Form 8-K are made only as of the date hereof and, except as
required by federal securities laws and rules and regulations of the SEC,
CarLotz undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise.
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