ITEM 8.01. OTHER EVENTS.
As previously announced, on December 15, 2022, Trean Insurance Group, Inc., a
Delaware corporation (the "Company"), entered into an Agreement and Plan of
Merger (the "Merger Agreement"), with Treadstone Parent Inc., a Delaware
corporation ("Parent"), and Treadstone Merger Sub Inc., a Delaware corporation
and a direct, wholly-owned subsidiary of Parent ("Merger Sub"), pursuant to
which and subject to the terms and conditions set forth therein, Merger Sub will
be merged with and into the Company (the "Merger"), with the Company surviving
as a wholly owned subsidiary of Parent. Parent and Merger Sub are both
affiliates of Altaris, LLC, a Delaware limited liability company ("Altaris").
The consummation of the Merger is conditioned upon, among other things, the
receipt of required regulatory approvals or exemptions from such approval
requirements. The insurance laws and regulations of many states require that
prior to the acquisition of control of an insurance company domiciled or
"commercially domiciled" in those respective jurisdictions, the acquiring party
must file an application (a "Form A") seeking prior approval from the insurance
regulators of those jurisdictions. Parent, as the acquiring party in the Merger,
filed requests for exemptions from the Form A filing requirements with the
insurance regulatory authorities in the states of Arkansas, California, Kansas,
South Carolina and Utah, which are all the states in which insurance company
subsidiaries of the Company are domiciled or "commercially domiciled." As
previously disclosed, the relevant authorities in South Carolina, Arkansas, Utah
and Kansas granted Parent's exemptions on January 4, 2023, January 17, 2023,
February 2, 2023, and March 15, 2023, respectively. On March 20, 2023, the
California Department of Insurance granted Parent's Form A exemption. As a
result of the receipt of these exemptions, the Company believes that no further
approvals are required from state insurance regulatory authorities in connection
with the closing of the Merger. Additionally, as previously disclosed, the
required waiting period applicable to the Merger under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended, expired at 11:59 p.m. Eastern
Time on January 23, 2023. The closing of the Merger remains subject to the
satisfaction or waiver (in accordance with the terms of the Merger Agreement) of
the other closing conditions set forth in the Merger Agreement, including the
requisite adoption of the Merger Agreement and approval of the Merger by the
Company's stockholders pursuant to the Merger Agreement.
As previously disclosed, the Company will hold a special meeting of stockholders
of the Company on April 18, 2023 (the "Special Meeting"), at which the Company's
stockholders will be asked to consider and vote on a proposal to adopt the
Merger Agreement and approve the Merger and the other transactions contemplated
by the Merger Agreement. If the requisite stockholder approvals are received at
the Special Meeting and the remaining conditions to closing are satisfied or
waived in accordance with the Merger Agreement, the Merger is expected to close
in April 2023.
The description of the Merger Agreement and related transactions (including,
without limitation, the Merger) in this Current Report on Form 8-K does not
purport to be complete and is subject and qualified in its entirety by reference
to the full text of the Merger Agreement, which is attached as Exhibit 2.1 to
the Company's Current Report on Form 8-K filed with the Securities and Exchange
Commission (the "SEC") on December 19, 2022 and incorporated herein by
reference.
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Cautionary Statement Regarding Forward-Looking Statements
This communication contains and the Company's other filings and press releases
may contain forward-looking statements, which include all statements that do not
relate solely to historical or current facts, such as statements regarding the
Company's expectations, intentions or strategies regarding the future. In some
cases, you can identify forward-looking statements by the following words:
"may," "will," "could," "would," "should," "expect," "intend," "plan,"
"anticipate," "believe," "estimate," "predict," "project," "aim," "potential,"
"continue," "ongoing," "goal," "can," "seek," "target" or the negative of these
terms or other similar expressions, although not all forward-looking statements
contain these words. These forward-looking statements are based on management's
beliefs, as well as assumptions made by, and information currently available to
the Company. Because such statements are based on expectations as to future
financial and operating results and are not statements of fact, actual results
may differ materially from those projected and are subject to a number of known
and unknown risks and uncertainties, including: (i) the risk that the proposed
Merger may not be completed in a timely manner or at all, which may adversely
affect the Company's business and the price of the Company's common stock; (ii)
the failure to satisfy any of the conditions to the consummation of the proposed
transaction, including the adoption of the Merger Agreement by the Company's
stockholders and the receipt of certain regulatory approvals; (iii) the
occurrence of any event, change, or other circumstance or condition that could
give rise to the termination of the Merger Agreement, including in circumstances
requiring the Company to pay a termination fee; (iv) the effect of the
announcement or pendency of the proposed transaction on the Company's business
relationships, operating results and business generally; (v) risks that the
proposed transaction disrupts the Company's current plans and operations; (vi)
the Company's ability to retain and hire key personnel in light of the proposed
transaction? (vii) risks related to diverting management's attention from the
Company's ongoing business operations; (viii) unexpected costs, charges or
expenses resulting from the proposed transaction; (ix) potential litigation
relating to the Merger that could be instituted against Altaris, the Company, or
their respective directors, managers or officers, including the effects of any
outcomes related thereto; (x) certain restrictions during the pendency of the
Merger that may impact the Company's ability to pursue certain business
opportunities or strategic transactions; (xi) unpredictability and severity of
catastrophic events, including but not limited to acts of terrorism, war or
hostilities, or pandemics, including the COVID-19 pandemic, as well as
management's response to any of the aforementioned factors; (xii) other risks
described in the Company's filings with the SEC, such risks and uncertainties
described under the headings "Forward-Looking Statements," "Risk Factors" and
other sections of the Company's Annual Report on Form 10-K filed with the SEC on
March 16, 2023 and subsequent filings; and (xiii) those risks and uncertainties
that are described in the definitive proxy statement that was filed with the
SEC, including any considerations taken into account by the Special Committee
(as defined in the Merger Agreement) and the Board of Directors (as defined in
the Merger Agreement) in approving the Merger Agreement and recommending to the
Company's stockholders that they adopt and approve the Merger Agreement. While
the list of risks and uncertainties presented here, and the discussion of risks
and uncertainties presented in the proxy statement, is considered
representative, no such list or discussion should be considered a complete
statement of all potential risks and uncertainties. Unlisted factors may present
significant additional obstacles to the realization of forward-looking
statements. Consequences of material differences in results as compared with
those anticipated in the forward-looking statements could include, among other
things, business disruption, operational problems, financial loss, and legal
liability to third parties and similar risks, any of which could have a material
adverse effect on the completion of the Merger and/or the Company's consolidated
financial condition, results of operations, or liquidity. The forward-looking
statements speak only as of the date they are made. The Company undertakes no
obligation to update any forward-looking statements, whether as a result of new
information, future events, or otherwise.
Additional Information and Where to Find it
On March 16, 2023, in connection with the Merger, the Company filed a definitive
proxy statement on Schedule 14A and form of proxy card with the SEC. The Company
and Parent jointly filed a transaction statement on Schedule 13E-3 (the
"Schedule 13E-3") with the SEC on March 16, 2023. On or about March 17, 2023,
the Company mailed the definitive proxy statement and form of proxy card to
stockholders of the Company entitled to vote at the Special Meeting relating to
the Merger. BEFORE MAKING ANY VOTING OR INVESTMENT DECISION, COMPANY
STOCKHOLDERS ARE URGED TO READ THE DEFINITIVE PROXY STATEMENT, THE SCHEDULE
13E-3, AND ANY OTHER RELEVANT DOCUMENTS THAT HAVE BEEN FILED OR WILL BE FILED
WITH THE SEC (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO) CAREFULLY AND IN
THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION ABOUT THE MERGER. Stockholders will be able to obtain the documents
(when they become available) free of charge at the SEC's website,
http://www.sec.gov. In addition, stockholders may obtain free copies of the
documents (when they become available) on the Company's website, www.trean.com,
under the heading "Investor Relations."
Participants in the Solicitation
The Company and certain of its directors, executive officers and other
employees, under the SEC's rules, may be deemed to be participants in the
solicitation of proxies of the Company's stockholders in connection with the
Merger. Additional information regarding the interests of those participants and
other persons who may be deemed participants in the Merger and their respective
direct and indirect interests in the Merger, by security holdings or otherwise,
are included in the definitive proxy statement and other materials to be filed
with the SEC in connection with the Merger. Information relating to the
foregoing can also be found in the Company's definitive proxy statement for its
2022 Annual Meeting of Stockholders (the "2022 Proxy Statement"), which was
filed with the SEC on April 5, 2022. To the extent that holdings of Company's
securities have changed since the amounts printed in the 2022 Proxy Statement,
such changes have been or will be reflected on Statements of Change in Ownership
on Form 4 filed with the SEC. Free copies of these documents may be obtained as
described in the preceding paragraph.
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