Exhibit 10.1
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 9, 2021
| LMP Automotive Holdings, Inc. |
| (Exact name of registrant as specified in its charter) |
| Delaware | 333-236260 | 82-3829328 | ||
| (State or other jurisdiction | (Commission File Number) | (I.R.S. Employer | ||
| of incorporation) | Identification No.) |
| 500 East Broward Blvd., Suite 1900, Ft. Lauderdale, Florida | 33394 | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: (954) 895-0352
N/A
Former name or former address, if changed since last report
Securities registered or to be registered pursuant to Section 12(b) of the Act.
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
| Common Stock, $0.0001 par value per share | LMPX | NASDAQ Capital Market |
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)) |
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 Definitive Material Agreement.
On March 9, 2021, LMP Finance, LLC, a Delaware limited liability company (“LMP Finance”), a wholly-owned subsidiary of LMP Automotive Holdings, Inc., a Delaware corporation (the “Company”), entered into a membership interest purchase agreement (the “MIPA”) with Kevin Sisti, Murdo Smith and Randal Roberge (collectively, the “Sellers”), to acquire a fifty one percent (51%) interest in LTO Holdings, LLC, a Connecticut limited liability company (“LTO” and such acquisition, the “Acquisition”) in exchange for payment to the Sellers of an aggregate of $225,000 and issuance of 16,892 shares (the “Shares”) of the Company’s common stock, par value $0.00001 per share (the “Common Stock”). In the event that the closing price of the Common Stock on The NASDAQ Capital Market on the date that is six (6) months following March 9, 2021 (the “Closing Price”) is less than $37.00 per share (the “Target Price”), the Sellers shall be entitled to a cash payment in an aggregate amount equal to the positive difference between the Closing Price and the Target Price multiplied by the number of Shares.
The MIPA is attached to this Current Report on Form 8-K as Exhibit 10.1 and is incorporated herein by reference. The foregoing description of the MIPA and the transactions contemplated thereby is not complete and is qualified in its entirety by the contents of the MIPA
A copy of the press release announcing the transactions contemplated by the MIPA is furnished herewith as Exhibit 99.1 to this Current Report on Form 8-K.
Item 3.02. Unregistered Sales of Equity Securities
Reference is made to the disclosure under Item 1.01 above which is hereby incorporated in this Item 3.02 by reference. The Shares have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), or the securities laws of any state, and are being offered and sold in reliance on the exemption from registration under the Securities Act, afforded by Section 4(a)(2) and/or Rule 506 promulgated thereunder.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits
1
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| LMP AUTOMOTIVE HOLDINGS, INC. | ||
| March 10, 2021 | By: | /s/ Sam Tawfik |
| Name: | Sam Tawfik | |
| Title: | President and Chief Executive Officer | |
2
Exhibit 10.1
Exhibit 99.1
LMP Announces the Acquisition and Closing of a Majority Interest in LTO Holdings, LLC in a Cash and Stock Deal Through LMP’s Wholly-Owned Subsidiary, LMP Finance, LLC
March 9, 2021
FORT LAUDERDALE, FL / GLOBE NEWSWIRE / March 9, 2021/ LMP Automotive Holdings, Inc. (NASDAQ: LMPX), an e-commerce and facilities-based automotive retailer in the United States, today announced the acquisition and closing of a majority interest in LTO Holdings, LLC (“LTO”) in a cash and stock deal through LMP’s wholly-owned subsidiary, LMP Finance, LLC.
| ○ | Expands LMP’s e-commerce sales and subscription-leasing programs and fulfillment in the Northeast market, one of the nation’s most desirable markets |
| ○ | Adds profitable and cost-efficient reconditioning and collision center in region |
| ○ | Expands the company’s logistics and fulfillment footprint and free delivery radius |
| ○ | Strong, stable margins and immediately accretive to earnings |
| ○ | LMP will acquire a 51% interest in LTO in exchange for a contribution of $225,000 as working capital to LTO and $225,000 in cash to the selling stakeholders, along with 16,892 shares of LMP’s unregistered common stock with a floor price $37 and a true-up after the lapse of Rule 144 holding period |
Sam Tawfik, LMP’s Chairman and Chief Executive Officer, stated “We look forward to working with LTO’s seasoned, forward-thinking and trend-setting management team. We have already integrated our cloud-based shared network environment with LTO’s existing network environment. This enables LTO and LMP to have access to each other’s inventory, in addition to benefitting from both our backend and consumer facing e-commerce technology and applications. We continue to see extraordinary demand for our subscriptions and flexible leasing offerings, which we expect will continue to grow substantially in the coming years.”
Mr. Tawfik concluded “This partnership expands our inventory on our proprietary e-commerce platform as well as our sales and fulfillment footprint in one of the fastest growing regions in the United States. Importantly, we will also have a more cost-efficient e-commerce fulfillment, reconditioning, and service capacity network. This also increases our vehicle storage capacity by approximately 350 units, which enables us to expand our sales. Our e-commerce systems are already synchronized with LTO’s inventory and we intend to significantly expand moving forward.”
ABOUT LMP AUTOMOTIVE HOLDINGS, INC.
LMP Automotive Holdings, Inc. (NASDAQ: LMPX) is a growth company with a long-term plan to profitably consolidate and partner with automotive dealership groups in the United States. We offer a wide array of products and services fulfilling the entire vehicle ownership lifecycle, including new and used vehicles, finance and insurance products and automotive repair and maintenance.
Our proprietary e-commerce technology and strategy are designed to disrupt the industry by leveraging our experienced teams, growing selection of owned inventories and physical logistics network. We seek to provide customers with a seamless experience both online and in person. Our physical logistics network enables us to provide convenient free delivery points for customers and provide services throughout the entire ownership life cycle. We use digital technologies to lower our customer acquisition costs, achieve operational efficiencies and generate additional revenues. Our unique growth model generates significant cash flows, which funds our innovation and expansion into new geographical markets, along with strategically building out dealership networks, creating personal transportation solutions that consumers desire.
Investor Relations:
LMP Automotive Holdings, Inc.
500 East Broward Boulevard, Suite 1900
Fort Lauderdale, FL 33394
investors@lmpah.com
For more information visit: https://lmpmotors.com/.
FORWARD-LOOKING STATEMENTS:
This press release may contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, each as amended. Such statements include, but are not limited to, any statements relating to our expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar matters that are not historical facts. These statements may be preceded by, followed by or include the words “aim,” “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “intend,” “likely,” “outlook,” “plan,” “potential,” “project,” “projection,” “seek,” “can,” “could,” “may,” “should,” “would,” will,” the negatives thereof and other words and terms of similar meanings. Forward-looking statements are based on management’s current expectations and are subject to risks and uncertainties that could negatively affect our business, operating results, financial condition, and stock value. Factors that could cause actual results to differ materially from those currently anticipated include: our dependence upon external sources for the financing of our operations; our ability to effectively executive our business plan; our ability to maintain and grow our reputation and to achieve and maintain the market acceptance of our services and platform; our ability to manage the growth of our operations over time; our ability to maintain adequate protection of our intellectual property and to avoid violation of the intellectual property rights of others; our ability to maintain relationships with existing customers and automobile suppliers, and develop relationships; and our ability to compete and succeed in a highly competitive and evolving industry; as well as other risks described in our SEC filings. There is no assurance that any forward-looking statements will materialize. You are cautioned not to place undue reliance on forward-looking statements, which reflect expectations only as of this date. We expressly disclaim any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in our expectations or any changes in events, conditions, or circumstances on which any such statement is based, except as required by law.
SOURCE: LMP Automotive Holdings, Inc.