UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 26, 2024 |
ARKO Corp.
(Exact name of Registrant as Specified in Its Charter)
Delaware |
001-39828 |
85-2784337 |
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(State or Other Jurisdiction |
(Commission File Number) |
(IRS Employer |
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8565 Magellan Parkway Suite 400 |
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Richmond, Virginia |
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23227-1150 |
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(Address of Principal Executive Offices) |
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(Zip Code) |
Registrant’s Telephone Number, Including Area Code: (804) 730-1568 |
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(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Securities registered pursuant to Section 12(b) of the Act:
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Trading |
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Common Stock, $0.0001 par value per share |
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ARKO |
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The Nasdaq Stock Market LLC |
Warrants, each warrant exercisable for one share of Common Stock at an exercise price of $11.50 |
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ARKOW |
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The Nasdaq Stock Market LLC |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01 Entry into a Material Definitive Agreement.
Amendment to TEG Purchase Agreement
As previously reported, on March 1, 2023 (the “Closing Date”), GPM Investments, LLC, a Delaware limited liability company (“GPM”) and a subsidiary of ARKO Corp., a Delaware corporation (“ARKO” or the “Company”), and certain of GPM’s subsidiaries, including GPM Petroleum, LLC, a Delaware limited liability company (such subsidiaries, together with GPM, “Buyer”), completed their acquisition of certain assets of Transit Energy Group, LLC, a Delaware limited liability company (“Transit”), and certain of its affiliated entities (together with Transit, “Seller”) pursuant to the Asset Purchase Agreement entered into by and between Buyer and Seller on September 9, 2022, as amended (the “Purchase Agreement”). As previously reported, $50 million of the approximately $370 million purchase price was deferred, and, on each of the first two anniversaries of the Closing Date, Buyer had agreed to pay Seller an amount equal to $25.0 million (each an “Installment Payment”), which Buyer could elect to pay either in cash or, subject to the satisfaction of certain conditions, shares of ARKO’s common stock, $0.0001 par value per share (the “Installment Shares”). Pursuant to the Purchase Agreement, on the Closing Date, ARKO and Transit entered into a registration rights agreement, pursuant to which ARKO agreed to prepare and file a registration statement (the “Registration Rights Agreement”), with the Securities and Exchange Commission, registering the Installment Shares, if any, for resale by Transit.
Pursuant to the Purchase Agreement, on March 1, 2024, ARKO issued 3,417,915 Installment Shares to Transit in respect of the first Installment Payment (the “First Installment Shares”) at a price per share of $7.31, which was based on the 10-day volume weighted average price calculation contained in the Purchase Agreement.
On March 26, 2024, Buyer and Seller entered into Amendment No. 2 to the Purchase Agreement (the “Purchase Agreement Amendment”), pursuant to which, in full satisfaction of all Installment Payments, (i) ARKO repurchased the First Installment Shares from Transit for an aggregate purchase price of approximately $19.3 million in cash, or $5.66 per share, and (ii) and Buyer paid to Seller an additional amount in cash equal to approximately $17.2 million in satisfaction of the second Installment Payment, which would have otherwise been due on March 1, 2025. The Purchase Agreement Amendment additionally terminated the Registration Rights Agreement, terminated Seller’s indemnity obligations under the Purchase Agreement and extended the transition services agreement entered into between Buyer and Seller.
Amendment to Capital One Line of Credit
As previously reported, on May 5, 2023, the Company’s subsidiary, GPM Petroleum LP, a Delaware limited partnership (“GPMP”), together with certain of its subsidiaries, Capital One, National Association, as administrative agent (the “Administrative Agent”), and the lenders party thereto, entered into a second amended and restated credit agreement, providing for a secured revolving credit facility in an aggregate principal amount of up to $800 million (including revolving loans and letters of credit), which availability could, at GPMP’s request, be increased up to $1.0 billion, subject to obtaining additional financing commitments and subject to certain terms and conditions (the “Credit Agreement”). On March 26, 2024, GPMP, the Administrative Agent and the guarantors and lenders party thereto entered into an amendment to the Credit Agreement (the “Credit Agreement Amendment”), which facilitated the borrowing and use of up to $36.5 million of the existing line of credit under the Credit Agreement for the settlement of the Installment Payments as provided for in the Purchase Agreement Amendment. Except as described in this Current Report on Form 8-K, the material terms of the Credit Agreement remain unchanged.
The foregoing descriptions of the Purchase Agreement Amendment and the Credit Agreement Amendment are only summaries and are qualified in their entirety by reference to the full text of the Purchase Agreement Amendment and the Credit Agreement Amendment,which are filed as Exhibit 10.1 and Exhibit 10.2, respectively, to this Current Report on Form 8-K and incorporated by reference in this Item 1.01.
Item 1.02 Termination of a Material Definitive Agreement.
As disclosed in Item 1.01 of this Current Report on Form 8-K, pursuant to the Purchase Agreement Amendment, the Registration Rights Agreement terminated. The Registration Rights Agreement had provided for ARKO’s registration for resale under the Securities Act of 1933, as amended, of any Installment Shares issued to Seller.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit |
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Description |
10.1 + |
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10.2 |
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104 |
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Cover Page Interactive Data File (embedded within the Inline XBRL document) |
+ Pursuant to Item 601(a)(5) of Regulation S-K, schedules and similar attachments to this exhibit have been omitted because they do not contain information material to an investment or voting decision and such information is not otherwise disclosed in such exhibit. The Company will supplementally provide a copy of any omitted schedule or similar attachment to the U.S. Securities and Exchange Commission or its staff upon request.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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ARKO Corp. |
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Date: |
March 28, 2024 |
By: |
/s/ Arie Kotler |
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Name: Title: |
Arie Kotler |
Exhibit 10.1
AMENDMENT NO. 2 TO ASSET PURCHASE AGREEMENT
This Amendment No. 2 to Asset Purchase Agreement (this “Amendment”) is entered into as of March 26, 2024 (the “Effective Date”) by and among TRANSIT ENERGY GROUP, LLC, a Delaware limited liability company (“Transit”) and the entities listed on Schedule I attached to the Purchase Agreement, as hereinafter defined (collectively, “Seller”), GPM INVESTMENTS, LLC, a Delaware limited liability company (“GPMI”), GPM EMPIRE, LLC, a Delaware limited liability company (“GPME”), GPM SOUTHEAST, LLC, a Delaware limited liability company (“GPMSE”), GPM TRANSPORTATION COMPANY, LLC, a Delaware limited liability company (“GPM Transportation”) and, solely with respect to the Supplier Based Intangibles, GPM Petroleum, LLC, a Delaware limited liability company (“GPMP,” and collectively with GPMI, GPME, GPM Transportation, and GPMSE, “Buyer”) and ARKO Corp, a Delaware corporation, solely with respect to Section 5 of this Amendment (“ARKO”). Seller and Buyer are collectively referred to herein as the “Parties,” and each, a “Party.”
RECITALS:
AGREEMENT:
NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound, agree as follows:
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Seller hereby represents and warrants to Buyer that: (i) Transit owns, of record and beneficially, all of the Issued Installment Shares free and clear of all Encumbrances, and, upon consummation of the Installment Shares Closing, ARKO shall be the sole owner of record and beneficially of all of the Issued Installment Shares, free and clear of all Encumbrances (other than any Encumbrances that may be created by or arise from any act, contract or obligation of Buyer or ARKO); and (ii) consummation of the transactions contemplated by this Amendment, including the Installment Shares Closing, will not violate, breach or otherwise contravene the provisions of (a) any Contract to which Seller or any of its Affiliates is a party or beneficiary or by which such any such Person or its properties or assets is subject or (b) any preemptive or similar rights of any Person.
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Seller further hereby represents and warrants to Buyer that: (i) TEGGV, LLC, one of the Seller entities, has been dissolved and is therefore no longer in existence; (ii) Seller has all necessary limited liability company power and authority to enter into this Amendment, to carry out its obligations hereunder and to consummate the transactions contemplated hereby; (iii) the execution and delivery by Seller of this Amendment, the performance by Seller of its obligations hereunder and the consummation by Seller of the transactions contemplated hereby have been duly authorized by all requisite limited liability company action on the part of Seller; and (iv) this Amendment has been duly executed and delivered by Seller, and (assuming due authorization, execution and delivery by Buyer) this Amendment constitutes a legal, valid and binding obligation of Seller, enforceable against Seller in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar Laws affecting creditors’ rights generally and by general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).
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[Signature Page Follows]
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IN WITNESS WHEREOF, each Party has each caused this Amendment to be executed as of the date first above written.
SELLER:
TRANSIT ENERGY GROUP, LLC
By: /s/ Rahman D'Argenio
Name: Rahman D'Argenio
Title: Authorized Signatory
ENERGY DISTRIBUTORS, LLC
By: /s/ Rahman D'Argenio
Name: Rahman D'Argenio
Title: Authorized Signatory
ENERGY CARRIERS, LLC
By: /s/ Rahman D'Argenio
Name: Rahman D'Argenio
Title: Authorized Signatory
FLASH MARKET, LLC
By: /s/ Rahman D'Argenio
Name: Rahman D'Argenio
Title: Authorized Signatory
ROSE OIL COMPANY, LLC, LLC
By: /s/ Rahman D'Argenio
Name: Rahman D'Argenio
Title: Authorized Signatory
[Signature Page to Amendment No. 2 to Asset Purchase Agreement]
BUYER:
GPM INVESTMENTS, LLC
By: /s/ Arie Kotler
Name: Arie Kotler
Title: CEO
By: /s/ Maury Bricks
Name: Maury Bricks
Title: General Counsel
GPM EMPIRE, LLC
By: /s/ Arie Kotler
Name: Arie Kotler
Title: CEO
By: /s/ Maury Bricks
Name: Maury Bricks
Title: General Counsel
GPM SOUTHEAST, LLC
By: /s/ Arie Kotler
Name: Arie Kotler
Title: CEO
By: /s/ Maury Bricks
Maury Bricks
Title: General Counsel
GPM TRANSPORTATION COMPANY, LLC
By: /s/ Arie Kotler
Name: Arie Kotler
Title: CEO
By: /s/ Maury Bricks
Maury Bricks
Title: General Counsel
[continues on following page]
[Signature Page to Amendment No. 2 to Asset Purchase Agreement]
GPM PETROLEUM, LLC
By: /s/ Arie Kotler
Name: Arie Kotler
Title: CEO
By: /s/ Maury Bricks
Name: Maury Bricks
Title: General Counsel
ARKO IS SIGNING BELOW SOLELY TO
CONFIRM ITS ACKNOWLEDGEMENT AND
AGREEMENT TO THE PROVISIONS OF
SECTION 5 OF THIS AMENDMENT:
ARKO CORP.
By: /s/ Arie Kotler
Name: Arie Kotler
Title: CEO
By: /s/ Maury Bricks
Name: Maury Bricks
Title: General Counsel
[Signature Page to Amendment No. 2 to Asset Purchase Agreement]
Exhibit 10.2
FIRST AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
THIS FIRST AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT, dated as of March 25, 2024 (this “Agreement”) is by and among the Lenders party hereto, GPM PETROLEUM LP, a Delaware limited partnership (the “Borrower”), the Guarantors party hereto and CAPITAL ONE, NATIONAL ASSOCIATION, as Administrative Agent (the “Administrative Agent”), Swingline Lender and an Issuing Lender.
RECITALS:
WHEREAS, reference is hereby made to the Second Amended and Restated Credit Agreement, dated as of May 5, 2023, by and among the Borrower, the guarantors party thereto from time to time, the lenders party thereto (collectively, the “Lenders” and individually, a “Lender”) from time to time, and Capital One, National Association, as Administrative Agent and the other agents and parties party thereto from time to time (as may be further amended, restated, amended and restated, supplemented or otherwise modified from time to time, including by this Agreement, the “Credit Agreement”; capitalized terms used and not otherwise defined herein being used herein as therein defined); and
WHEREAS, the Borrower has requested, and the Administrative Agent and the Lenders party hereto have agreed, to make certain amendments to the Credit Agreement as more specifically described herein.
NOW, THEREFORE, in consideration of the premises and agreements, provisions and covenants herein contained, the parties hereto agree as follows:
“First Amendment” shall mean that certain First Amendment to Second Amended and Restated Credit Agreement, dated as of March 25, 2024, by and among the Borrower, the other Credit Parties party thereto, the Administrative Agent and the Lenders party thereto.
“Credit Documents” shall mean this Agreement, the First Amendment, the Notes, the Joinder Agreements (if any), the Letters of Credit, the LOC Documents, the GPM Investments Letter Agreement, the Security Documents, the Capital One Engagement Letter, and any other fee letter entered into between the Borrower or any other Credit Party and the Administrative Agent, the Arrangers or any Lender from time to time in respect of the Extensions of Credit, and all other agreements, instruments and certificates delivered to the Administrative Agent under or in connection with this Agreement.
“(l) additional Indebtedness consisting of obligations under adjustments of purchase price, earnouts or similar arrangements in an aggregate amount not to exceed $2,500,000 at any time;”
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“(c) so long as no Default or Event of Default then exists and is continuing or would result therefrom, (i) at any time on or prior to the date on which the IPO is completed, the Borrower may make Restricted Payments up to the amount of Available Cash (as defined in the Partnership Agreement as of the Closing Date) from cash generated other than from an incurrence of Loans hereunder (provided that from and after March 25, 2024, up to $36,500,000 in the aggregate during the term of the Revolving Facility may come from the one-time incurrence of Loans hereunder so long as (x) in connection therewith, the deferred purchase price obligations arising under that certain Asset Purchase Agreement, dated as of September 9, 2022 (as in effect on the Closing Date), entered into in connection with the acquisition of certain assets from Transit Energy Group, LLC will be deemed satisfied in full and (y) no violation of any Securities Laws shall result from such Restricted Payment and any use thereof) and (ii) after the date on which the IPO is completed, the Borrower may make Restricted Payments in accordance with the cash distribution policy adopted by the General Partner pursuant to any amendment, restatement or replacement of the Partnership Agreement approved in writing by the Administrative Agent;”
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IN WITNESS WHEREOF, each of the undersigned has caused its duly authorized officer to execute and deliver this Agreement as of the date first set forth above.
GPM PETROLEUM LP, as the Borrower
By: GPM Petroleum GP, LLC, its general partner
By /s/ Robb Giammatteo
Name: Robb Giammatteo
Title: CFO
By /s/ Maury Bricks
Name: Maury Bricks
Title: General Counsel
GPM PETROLEUM, LLC,as a Guarantor
By /s/ Robb Giammatteo
Name: Robb Giammatteo
Title: CFO
By /s/ Maury Bricks
Name: Maury Bricks
Title: General Counsel
[Signature Page to First Amendment]
Consented to by:
CAPITAL ONE, NATIONAL ASSOCIATION
as Administrative Agent, a Lender, Swingline Lender and Issuing Lender
By: /s/ Gabrielle Uzdin
Name: Gabrielle Uzdin
Title: Duly Authorized Signatory
[Signature Page to First Amendment]
Consented to by:
BANK OF AMERICA, N.A.,
as a Lender
By: /s/ Colleen Landau
Name: Colleen Landau
Title: Senior Vice President
[Signature Page to First Amendment]
Consented to by:
KeyBank National Association,
as a Lender
By: /s/ J.E. Fowler
Name: J.E. Fowler
Title: Managing Director
[Signature Page to First Amendment]
Consented to by:
Santander Bank, N.A.
as a Lender
By: /s/ Peter Martin
Name: Peter Martin
Title: SVP
[Signature Page to First Amendment]
Consented to by:
Wells Fargo Bank, N.A.,
as a Lender
By: /s/ Denise Crouch
Name: Denise Crouch
Title: Vice President
[Signature Page to First Amendment]
Consented to by:
Fifth Third Bank, National Association,
as a Lender
By: /s/ Nate Calloway
Name: Nate Calloway
Title: Officer, Corporate Banking Associate
[Signature Page to First Amendment]
Consented to by:
RAYMOND JAMES BANK,
as a Lender
By: /s/ Mark Specht
Name: Mark Specht
Title: Senior Vice President
[Signature Page to First Amendment]
Consented to by:
JPMorgan Chase Bank, N.A.,
as a Lender
By: /s/ Caroline Eagan
Name: Caroline Eagan
Title: Vice President
[Signature Page to First Amendment]
Consented to by:
ATLANTIC UNION BANK,
as a Lender
By: /s/ Matthew Sawyer
Name: Matthew Sawyer
Title: Managing Director
[Signature Page to First Amendment]
Consented to by:
Truist Bank,
as a Lender
By: /s/ Lisa Garling
Name: Lisa Garling
Title: Director
[Signature Page to First Amendment]
Consented to by:
Primis Bank,
as a Lender
By: /s/ Mark S. Zuskin
Name: Mark S. Zuskin
Title: Sr. Vice President
[Signature Page to First Amendment]