Form 8-K - Current report
18 Juillet 2023 - 10:30PM
Edgar (US Regulatory)
0001762322
false
0001762322
2023-07-14
2023-07-14
iso4217:USD
xbrli:shares
iso4217:USD
xbrli:shares
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): July 18, 2023 (July 14, 2023)
SHIFT
TECHNOLOGIES, INC.
(Exact
name of registrant as specified in charter)
Delaware |
|
001-38839 |
|
82-5325852 |
(State
or Other Jurisdiction
of Incorporation) |
|
(Commission
File Number) |
|
(I.R.S.
Employer
Identification No.) |
290
Division Street, Suite 400, San Francisco, CA |
|
94103 |
(Address
of Principal Executive Offices) |
|
(Zip
Code) |
Registrant’s
telephone number, including area code: (855) 575-6739
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:
☐ |
Written communications pursuant to Rule 425 under the
Securities Act (17 CFR 230.425) |
☐ |
Soliciting material pursuant to Rule 14a-12 under the
Exchange Act (17 CFR 240.14a-12) |
☐ |
Pre-commencement communications pursuant to Rule 14d-2(b)
under the Exchange Act (17 CFR 240.14d-2(b)) |
☐ |
Pre-commencement communications pursuant to Rule 13e-4(c)
under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities
registered pursuant to Section 12(b) of the Act:
Title
of each class |
|
Trading
Symbol(s) |
|
Name
of each exchange on which registered |
Class
A common stock, par value $0.0001 per share |
|
SFT |
|
Nasdaq
Capital Market |
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.
On
July 14, 2023, Shift Technologies, Inc. (the “Company”) entered into a Second Amendment to Inventory Financing and
Security Agreement (the “Second Amendment”), by and among the Company, certain of the Company’s wholly owned
subsidiaries (collectively, the “Borrowers” and each, a “Borrower”), Ally Bank (“Ally
Bank”) and Ally Financial Inc. (“Ally Financial” and, together with Ally Bank, the “Lender”),
which amends the Company’s existing Inventory Financing and Security Agreement dated as of December 9, 2021, as amended by the
Amendment to Inventory Financing and Security Agreement dated as of February 7, 2023 (as so amended, the “Ally Facility”),
by and among the Company, the Borrowers and the Lender.
The
Second Amendment amends the Ally Facility to, among other things, (i) reduce the maximum available credit line (the “Credit
Line”) under the Ally Facility from $75 million to $30 million, (ii) eliminate the option for a Borrower to obtain financing
from the Lender for vehicles for which Dealership does not then hold a lien-free title, and (iii) eliminate the minimum liquidity financial
covenant. The Second Amendment also, in conjunction with the Borrowers entering into an amended Credit Balance Agreement with the Lender,
amends the Borrowers’ minimum cash balance requirement with the Lender to be an amount equal to the lesser of (i) at least 30%
of the amount of the Credit Line and (ii) 100% of the total outstanding principal balance under the Ally Facility.
The
foregoing description of the Second Amendment is qualified in its entirety by reference to the full text of the Second Amendment, which
is filed hereto as Exhibit 10.1 and is incorporated herein by reference.
The Company entered into the Second Amendment in connection with the previously
announced review of strategic alternatives by its Board of Directors, management team and advisors, which remains ongoing.
Item
2.03 Creation of a Direct Financial Obligation or an Obligation Under an Off-balance Sheet Arrangement of a Registrant.
The
information set forth under Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 2.03.
Item
9.01 Financial Statements and Exhibits.
(d)
Exhibits
10.1 |
|
Second Amendment to Inventory Financing and Security
Agreement, dated as of July 14, 2023, by and among Shift Technologies, Inc., CarLotz, Inc., a Delaware corporation, CarLotz Group,
Inc., CarLotz, Inc., an Illinois corporation, CarLotz California, LLC, Shift Operations LLC, Ally Bank and Ally Financial Inc. |
104 |
|
Cover Page Interactive Data File (embedded within the
Inline XBRL document). |
SIGNATURE
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.
|
SHIFT TECHNOLOGIES,
INC. |
|
|
|
Dated: July 18, 2023 |
By: |
/s/ Ayman
Moussa |
|
Name: |
Ayman Moussa |
|
Title: |
Chief Executive Officer |
2
Exhibit 10.1
SECOND AMENDMENT TO
INVENTORY FINANCING AND SECURITY AGREEMENT
I. THE PARTIES TO THIS AGREEMENT
This Second Amendment to Inventory Financing and
Security Agreement (“Amendment”) is effective as of July 14, 2023 (the “Amendment Effective Date”),
and is made by and among the following parties (the “Parties”):
A. | Ally Bank (Ally Capital in Hawaii, Mississippi, Montana and New Jersey) (together with its successors
and assigns, “Bank”), a Utah state-chartered bank with a local business office currently located at 5851 Legacy
Circle, Suite 200, Plano, Texas 75024; |
B. | Ally Financial Inc., a Delaware corporation (“Ally”) with a local business office
currently located at 5851 Legacy Circle, Suite 200, Plano, Texas 75024 (together with Bank, the “Ally Parties”
and Bank and Ally each being, an “Ally Party”); |
C. | Shift Operations LLC, a Delaware limited liability company, with its principal executive office
currently located at 290 Division Street, Suite 400, San Francisco, California 94103; |
D. | CarLotz, Inc., a Delaware corporation, with its principal executive office located at 290 Division
Street, Suite 400, San Francisco, California 94103; |
E. | CarLotz Group, Inc., a Delaware corporation, with its principal executive office located at 290 Division
Street, Suite 400, San Francisco, California 94103; |
F. | CarLotz, Inc., an Illinois corporation, with its principal executive office located at 290 Division
Street, Suite 400, San Francisco, California 94103; and |
G. | CarLotz California, LLC, a California limited liability company, with its principal executive office
located at 290 Division Street, Suite 400, San Francisco, California 94103; and |
H. | Shift Technologies, Inc., a Delaware corporation, with its principal executive office currently
located at 290 Division Street, Suite 400, San Francisco, California 94103 (“Guarantor”). |
Shift Operations LLC, CarLotz,
Inc., a Delaware corporation, CarLotz Group, Inc., a Delaware corporation, CarLotz, Inc., an Illinois corporation, and CarLotz California,
LLC, a California limited liability company, are collectively referred to herein as “Dealership.”
II. THE RECITALS
The essential facts relied on by Bank, Ally, Dealership
and Guarantor as true and complete, and giving rise to this Amendment, are as follows:
A. | The Ally Parties, Dealership, and Guarantor are parties to an Inventory Financing and Security Agreement,
effective as of December 9, 2021, as amended by the Amendment to Inventory Financing and Security Agreement, effective as of February 7,
2023 (as amended, modified, restated, or replaced, the “IFSA”). |
B. | The Parties to this Amendment desire to amend the IFSA as outlined in this Amendment. |
III. THE AGREEMENT
In consideration of the premises and the mutual
promises in this Amendment, which are acknowledged to be sufficient, the Parties agree to the following:
A. | Capitalized terms used but not defined herein have the meanings given to them in the IFSA. |
B. | Effective as of the Amendment Effective Date, Section III.A.2 of the IFSA is modified so that the
maximum aggregate amount of credit available pursuant to this IFSA (the “Credit Line”) is $30,000,000.00 at
any time outstanding. |
C. | Effective as of Amendment Effective Date, Section III.A.8 of the IFSA is deleted. This eliminates
the Advance Floorplan Accommodation. |
D. | Effective as of Amendment Effective Date, Section III.G.7 of the IFSA is deleted and replaced with
the following: |
| 7. | Dealership will comply in all material respects with all of Dealership’s obligations under the Credit
Balance Agreement in effect between Dealership and Ally Bank (and any amendments or modifications to such agreement), including, but not
limited to, maintaining the Minimum Required Balance (as defined in the Credit Balance Agreement). |
E. | Effective as of Amendment Effective Date, Section III.G.8 of the IFSA is deleted and replaced with the
following: |
| 8. | Financial Covenants. Dealership and Guarantor will comply with the following financial covenants,
tested monthly (as of month-end) based on Guarantor’s monthly financial statements: |
| (b) | Inventory Equity: Dealership will maintain Vehicle inventory equity of at least 10%, calculated
as follows: |
The amount by which
the value of Dealership’s Vehicle inventory exceeds Wholesale Outstandings, divided by the value of Dealership’s Vehicle inventory,
must be equal to or greater than 10%, where:
| i. | Vehicle inventory includes all vehicles owned by Dealership and covered by the Ally Parties’ security
interest, including wholesale vehicles, but excluding Vehicles held on consignment; |
| | |
| ii. | Vehicle inventory value is net of unpaid lien payoffs (and excludes the value of Vehicles held on consignment);
and |
| | |
| iii. | unrestricted cash and cash equivalents (i.e., cash maintained in the Dealership’s bank account(s),
plus outstanding deposits, less outstanding checks, less bank fees, plus any amounts maintained under the Credit Balance Agreement in
excess of any amounts used to establish the Minimum Required Balance under such agreement, all as of the month-end for which the covenant
applies) may be used to bolster Vehicle inventory value. |
| (c) | Monthly Certification. Dealership and Guarantor will provide a monthly certificate executed by
an officer affirming compliance with the Inventory Equity covenant, and providing the basis for such affirmations. |
F. | Except as provided above, the IFSA and all other agreements between each of the Ally Parties and Dealership
and Guarantor remain in full force and effect as written. In the event of a conflict between the terms of the IFSA and this Amendment,
the terms of this Amendment prevail. The Parties hereto ratify all terms of the IFSA as amended by this Amendment. |
G. | If any provision of this Amendment is held to be invalid or unenforceable by a court of competent jurisdiction,
all other provisions remain valid and enforceable. |
| a. | May be modified only by a writing signed by all Parties. |
| b. | May be signed in counterparts, each of which is deemed an original, and all of which taken together constitute
one and the same agreement. The signatures of the Parties, exchanged via fax or e-mail, shall constitute and be deemed original signatures
for all purposes. |
| c. | Binds and inures to the benefit of the Parties and their respective successors and assigns. |
| d. | Constitutes the entire agreement of the Parties with respect to its subject matter. |
Agreed to effective
as of the Amendment Effective Date.
Ally Bank |
|
Shift Operations LLC |
|
|
By Shift Platform, Inc., its Managing Member |
|
|
|
By: |
/s/ Mehul Desai |
|
By: |
/s/ Oded Shein |
Name: |
Mehul Desai |
|
Name: |
Oded Shein |
Title: |
Authorized Representative |
|
Title: |
Chief Financial Officer |
|
|
|
Ally Financial Inc. |
|
CarLotz, Inc., a Delaware corporation |
|
|
|
By: |
/s/ Mehul Desai |
|
By: |
/s/ Oded Shein |
Name: |
Mehul Desai |
|
Name: |
Oded Shein |
Title: |
Authorized Representative |
|
Title: |
Chief Financial Officer |
|
|
|
CarLotz
California, LLC, |
|
CarLotz Group, Inc., a Delaware corporation |
a California limited liability company |
|
|
|
|
|
By: |
/s/ Oded Shein |
|
By: |
/s/ Oded Shein |
Name: |
Oded Shein |
|
Name: |
Oded Shein |
Title: |
Chief Financial Officer |
|
Title: |
Chief Financial Officer |
|
|
|
Shift Technologies, Inc. |
|
CarLotz, Inc., an Illinois corporation |
|
|
|
By: |
/s/ Oded Shein |
|
By: |
/s/ Oded Shein |
Name: |
Oded Shein |
|
Name: |
Oded Shein |
Title: |
Chief Financial Officer |
|
Title: |
Chief Financial Officer |
3
v3.23.2
Cover
|
Jul. 14, 2023 |
Cover [Abstract] |
|
Document Type |
8-K
|
Amendment Flag |
false
|
Document Period End Date |
Jul. 14, 2023
|
Entity File Number |
001-38839
|
Entity Registrant Name |
SHIFT
TECHNOLOGIES, INC.
|
Entity Central Index Key |
0001762322
|
Entity Tax Identification Number |
82-5325852
|
Entity Incorporation, State or Country Code |
DE
|
Entity Address, Address Line One |
290
Division Street
|
Entity Address, Address Line Two |
Suite 400
|
Entity Address, City or Town |
San Francisco
|
Entity Address, State or Province |
CA
|
Entity Address, Postal Zip Code |
94103
|
City Area Code |
855
|
Local Phone Number |
575-6739
|
Written Communications |
false
|
Soliciting Material |
false
|
Pre-commencement Tender Offer |
false
|
Pre-commencement Issuer Tender Offer |
false
|
Title of 12(b) Security |
Class
A common stock, par value $0.0001 per share
|
Trading Symbol |
SFT
|
Security Exchange Name |
NASDAQ
|
Entity Emerging Growth Company |
true
|
Elected Not To Use the Extended Transition Period |
false
|
X |
- DefinitionBoolean flag that is true when the XBRL content amends previously-filed or accepted submission.
+ References
+ Details
Name: |
dei_AmendmentFlag |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:booleanItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionFor the EDGAR submission types of Form 8-K: the date of the report, the date of the earliest event reported; for the EDGAR submission types of Form N-1A: the filing date; for all other submission types: the end of the reporting or transition period. The format of the date is YYYY-MM-DD.
+ References
+ Details
Name: |
dei_DocumentPeriodEndDate |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:dateItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionThe type of document being provided (such as 10-K, 10-Q, 485BPOS, etc). The document type is limited to the same value as the supporting SEC submission type, or the word 'Other'.
+ References
+ Details
Name: |
dei_DocumentType |
Namespace Prefix: |
dei_ |
Data Type: |
dei:submissionTypeItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionAddress Line 1 such as Attn, Building Name, Street Name
+ References
+ Details
Name: |
dei_EntityAddressAddressLine1 |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:normalizedStringItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionAddress Line 2 such as Street or Suite number
+ References
+ Details
Name: |
dei_EntityAddressAddressLine2 |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:normalizedStringItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- Definition
+ References
+ Details
Name: |
dei_EntityAddressCityOrTown |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:normalizedStringItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionCode for the postal or zip code
+ References
+ Details
Name: |
dei_EntityAddressPostalZipCode |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:normalizedStringItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionName of the state or province.
+ References
+ Details
Name: |
dei_EntityAddressStateOrProvince |
Namespace Prefix: |
dei_ |
Data Type: |
dei:stateOrProvinceItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionA unique 10-digit SEC-issued value to identify entities that have filed disclosures with the SEC. It is commonly abbreviated as CIK.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Exchange Act -Number 240 -Section 12 -Subsection b-2
+ Details
Name: |
dei_EntityCentralIndexKey |
Namespace Prefix: |
dei_ |
Data Type: |
dei:centralIndexKeyItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionIndicate if registrant meets the emerging growth company criteria.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Exchange Act -Number 240 -Section 12 -Subsection b-2
+ Details
Name: |
dei_EntityEmergingGrowthCompany |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:booleanItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionCommission file number. The field allows up to 17 characters. The prefix may contain 1-3 digits, the sequence number may contain 1-8 digits, the optional suffix may contain 1-4 characters, and the fields are separated with a hyphen.
+ References
+ Details
Name: |
dei_EntityFileNumber |
Namespace Prefix: |
dei_ |
Data Type: |
dei:fileNumberItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionTwo-character EDGAR code representing the state or country of incorporation.
+ References
+ Details
Name: |
dei_EntityIncorporationStateCountryCode |
Namespace Prefix: |
dei_ |
Data Type: |
dei:edgarStateCountryItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionThe exact name of the entity filing the report as specified in its charter, which is required by forms filed with the SEC.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Exchange Act -Number 240 -Section 12 -Subsection b-2
+ Details
Name: |
dei_EntityRegistrantName |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:normalizedStringItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionThe Tax Identification Number (TIN), also known as an Employer Identification Number (EIN), is a unique 9-digit value assigned by the IRS.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Exchange Act -Number 240 -Section 12 -Subsection b-2
+ Details
Name: |
dei_EntityTaxIdentificationNumber |
Namespace Prefix: |
dei_ |
Data Type: |
dei:employerIdItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionLocal phone number for entity.
+ References
+ Details
Name: |
dei_LocalPhoneNumber |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:normalizedStringItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionBoolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Exchange Act -Number 240 -Section 13e -Subsection 4c
+ Details
Name: |
dei_PreCommencementIssuerTenderOffer |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:booleanItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionBoolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Exchange Act -Number 240 -Section 14d -Subsection 2b
+ Details
Name: |
dei_PreCommencementTenderOffer |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:booleanItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionTitle of a 12(b) registered security.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Exchange Act -Number 240 -Section 12 -Subsection b
+ Details
Name: |
dei_Security12bTitle |
Namespace Prefix: |
dei_ |
Data Type: |
dei:securityTitleItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionName of the Exchange on which a security is registered.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Exchange Act -Number 240 -Section 12 -Subsection d1-1
+ Details
Name: |
dei_SecurityExchangeName |
Namespace Prefix: |
dei_ |
Data Type: |
dei:edgarExchangeCodeItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionBoolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as soliciting material pursuant to Rule 14a-12 under the Exchange Act.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Exchange Act -Section 14a -Number 240 -Subsection 12
+ Details
Name: |
dei_SolicitingMaterial |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:booleanItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionTrading symbol of an instrument as listed on an exchange.
+ References
+ Details
Name: |
dei_TradingSymbol |
Namespace Prefix: |
dei_ |
Data Type: |
dei:tradingSymbolItemType |
Balance Type: |
na |
Period Type: |
duration |
|
X |
- DefinitionBoolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as written communications pursuant to Rule 425 under the Securities Act.
+ ReferencesReference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Securities Act -Number 230 -Section 425
+ Details
Name: |
dei_WrittenCommunications |
Namespace Prefix: |
dei_ |
Data Type: |
xbrli:booleanItemType |
Balance Type: |
na |
Period Type: |
duration |
|
Shift Technologies (NASDAQ:SFT)
Graphique Historique de l'Action
De Avr 2024 à Mai 2024
Shift Technologies (NASDAQ:SFT)
Graphique Historique de l'Action
De Mai 2023 à Mai 2024