UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 4)
HAGERTY, INC.
(Name of Issuer)
Class A Common Stock, par value $0.0001 per share
(Title of Class of Securities)
405166109
(CUSIP Number)
Matthew D. Melick
State Farm Mutual Automobile Insurance Company
One State Farm Plaza
Bloomington, IL 61710
(309) 766-1311
(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)
June 3, 2024
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1 (e), 240.13d-1(f) or 240.13d-1(g), check the following box. ☐
| * | The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. |
The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (the “Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).
Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent.
| CUSIP No: 405166109 | Schedule 13D |
| 1 |
NAME OF REPORTING PERSONS
State Farm Mutual Automobile Insurance Company | |||||
| 2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions) (a) ☐ (b) ☒
| |||||
| 3 | SEC USE ONLY
| |||||
| 4 | SOURCE OF FUNDS (See Instructions)
WC | |||||
| 5 | CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e)
☐ | |||||
| 6 | CITIZENSHIP OR PLACE OF ORGANIZATION
Illinois | |||||
| NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
|
7 | SOLE VOTING POWER
63,240,881(1) | ||||
| 8 | SHARED VOTING POWER
0 | |||||
| 9 | SOLE DISPOSITIVE POWER
63,240,881(1) | |||||
| 10 | SHARED DISPOSITIVE POWER
0 | |||||
| 11 |
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
63,240,881 | |||||
| 12 | CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (See Instructions)
☐ | |||||
| 13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
63.9%(2) | |||||
| 14 | TYPE OF REPORTING PERSON (See Instructions)
IC | |||||
| (1) | Includes (i) 4,240,881 shares of Class A Common Stock that the Reporting Person has the right to acquire within 60 days upon conversion of 5,302,226 shares of Series A Preferred Stock (as defined in Item 4) that are held directly by the Reporting Person, at the current conversion rate; and (ii) 9,000,000 shares of Class A Common Stock that the Reporting Person has the right to acquire within 60 days upon exercise of Warrants (as defined in the Original 13D). Pursuant to the Offer (as defined in Item 3., below) State Farm has agreed to tender and exchange the Warrants for 0.20 shares of Class A Common Stock of the Issuer per warrant exchanged, resulting in State Farm receiving 1,800,000 shares of Class A Common Stock of the Issuer in exchange for its Warrants if and when the Offer is consummated pursuant to its terms and conditions. |
| (2) | Percentage based on the sum of (i) 85,703,286 shares of Class A Common Stock outstanding as of April 26, 2024 pursuant to the Issuer’s Form 10-Q for the quarterly period ended March 31, 2024, (ii) 4,240,881 shares of Class A Common Stock issuable upon conversion of Series A Preferred Stock held by the Reporting Person and (iii) 9,000,000 shares of Class A Common Stock issuable upon exercise of the Warrants, which have been added to the total Class A Common Stock shares outstanding for purposes of calculating the Reporting Person’s beneficial ownership percentage in accordance with Rule 13d-3(d)(1)(i) under the Act. Note, pursuant to the Offer (as defined in Item 3., below) State Farm has agreed to tender and exchange the Warrants for 0.20 shares of Class A Common Stock of the Issuer per warrant exchanged, resulting in State Farm receiving 1,800,000 shares of Class A Common Stock of the Issuer in exchange for its Warrants if and when the Offer is consummated pursuant to its terms and conditions. The percentage does not give effect to the issuance of shares of Class A Common Stock issuable upon exercise or conversion of warrants, options or shares of the Issuer’s Series A Preferred Stock or Class V Common Stock held by other parties. Notwithstanding the percentage reported in the Original 13D, based on the aggregate total of Class A Common Stock and Class V Common Stock outstanding, and the voting power assigned to each class, the Reporting Person controls approximately 2.4% of the voting power of the Issuer. |
| CUSIP No: 405166109 | Schedule 13D |
Explanatory Note: This Amendment No. 4 (“Amendment No. 4”) amends the Schedule 13D filed by State Farm Mutual Automobile Insurance Company (“State Farm” or “Reporting Person”) on December 10, 2021 (the “Original 13D”), as amended by the Schedule 13D Amendment No. 1 filed by State Farm on February 10, 2023, the Schedule 13D Amendment No. 2 filed by State Farm on March 1, 2023 and the Schedule 13D Amendment No. 3 filed by State Farm on June 23, 2023 (collectively, the “Amended Schedule 13D”) related to shares of Class A common stock, par value $0.0001 per share (the “Class A Common Stock” and, together with the Class V common stock, par value $0.0001 per share (the “Class V Common Stock”), the “Common Stock”), of Hagerty, Inc., a Delaware corporation (the “Issuer” or “Company”).
Except as specifically provided herein, this Amendment No. 4 does not modify any of the information previously reported in the Amended Schedule 13D. Capitalized terms used but not otherwise defined herein shall have the meaning set forth in the Original 13D.
Item 3. Source and Amount of Funds or Other Consideration.
Item 3 of the Amended Schedule 13D is hereby supplemented as follows:
On June 3, 2024, pursuant to Issuer’s Form S-4 Registration Statement filed on June 3, 2024, which is incorporated herein by reference (the “Offer”), Issuer is offering to the holders of certain warrants to purchase shares of Class A Common Stock of the Issuer (including the Warrants (as defined in the Original 13D), the opportunity to receive 0.20 shares of Class A Common Stock per warrant in exchange for each of its outstanding warrants tendered by each holder exchanged pursuant to the Offer.
Concurrently with the Offer, Issuer is also soliciting consents from holders to amend both the IPO Warrant Agreement (as defined in the Offer) and the Business Combination Warrant Agreement (as defined in the Offer) to permit the Issuer to require that each warrant that is outstanding upon the closing of the Offer be exchanged for 0.18 shares of Class A Common Stock per warrant, which is a ration 10% less than the exchange ratio applicable to the Offer. Pursuant to the terms of the IPO Warrant Agreement, amending the IPO Warrant Agreement will require the vote or written consent of holders of both (i) 50% of the Public Warrants (as defined in the Offer) outstanding and (ii) 50% of the Private Placement Warrants (as defined in the Offer) outstanding. Pursuant to the terms of the Business Combination Warrant Agreement, the amendment to the Business Combination Warrant Agreement will require the vote or written consent of holders of 50% of the PIPE Warrants (as defined in the Offer) outstanding.
State Farm owns 9,000,000 PIPE Warrants. It has agreed to tender the Warrants in the Offer and consent to the amendment to the Business Combination Warrant Agreement pursuant to the Tender and Support Agreement, dated June 3, 2024, by and among Hagerty, Inc. and Holders party thereto (the “Tender and Support Agreement”), which is included as Exhibit 10.37 of Issuer’s Form S-4 filed on June 3, 2024, which is incorporated herein by reference. As of the date of the filing of the Offer by the Issuer, holders representing approximately 44.3% of the Public Warrants and 57.2% of the Private Placement Warrants have agreed to tender their warrants in the Offer and to consent to the amendment of the IPO Warrant Agreement pursuant to the Tender and Support Agreement. Additionally, holders representing approximately 81.5% of the PIPE Warrants have agreed to tender their warrants in the Offer and to consent to the amendment to the Business Combination Warrant Agreement pursuant to tender and support agreements.
The Class A Common Stock State Farm would receive upon closing of the Offer would be due to the tender and exchange of the Warrants. No cash or other consideration will be exchanged by State Farm. No funds will be borrowed by State Farm. The Offer will expire on the Expiration Date (as defined in the Offer), which is one minute after 11:59 p.m., Eastern Time, on July 2, 2024, or such later time and date with the Issuer may determine. After the exchange of the Warrants by State Farm pursuant to the Offer, the Warrants will no longer exist.
The Issuer may withdraw the Offer and Consent Solicitation only if the conditions of the Offer and Consent Solicitation are not satisfied or waived prior to the Expiration Date. Upon such withdrawal, the Issuer will return the tendered warrants (and any related consent to the applicable warrant amendments will be revoked).
Item 4. Purpose of Transaction.
Item 4 of the Amended Schedule 13D is hereby supplemented as follows:
State Farm has agreed to exchange the Warrants pursuant to the Offer for investment purposes and in furtherance of a strategic relationship between State Farm and the Issuer and in recognition of Issuer’s stated purpose for the Offer to attempt to simplify its capital structure and reduce potential dilutive impact of outstanding warrants. State Farm intends to review and evaluate its investment in the Issuer on a continuous basis. Depending upon various factors, including but not limited to the business, prospects and financial condition of the Issuer and other developments concerning State Farm and the Issuer, market conditions and other factors that State Farm may deem relevant to its investment decision, and subject to compliance with applicable laws, rules and regulations, State Farm may in the future take actions with respect to its investment in the Issuer as it deems appropriate with respect to any or all matters required to be disclosed in this Amended Schedule 13D.
Item 5. Interest in Securities of the Issuer.
Item 5 of the Amended Schedule 13D is hereby supplemented as follows:
(a) State Farm beneficially owns 63,240,881 shares of Class A Common Stock, inclusive of 4,240,881 shares of Class A Common Stock that State Farm has the right to acquire within 60 days upon conversion of 5,302,226 shares of Series A Preferred Stock that are held directly by State Farm, at the current Conversion Rate and 9,000,000 shares of Class A Common Stock that State Farm has the right to acquire within 60 days upon exercise of the Warrants. This represents, on an as if exercised basis, approximately 63.9% of the shares of Class A Common Stock outstanding. The percentage is calculated based on the sum of (i) 85,703,286 shares of Class A Common Stock outstanding as of April 24, 2024 pursuant to the Issuer’s Form 10-Q for the quarterly period ended March 31, 2024, (ii) 4,240,881 shares of Class A Common Stock issuable upon conversion of Series A Preferred Stock held by State Farm and (iii) 9,000,000 shares of Class A Common Stock issuable upon exercise of the Warrants, which have been added to the total Class A Common Stock shares outstanding for purposes of calculating State Farm’s beneficial ownership percentage in accordance with Rule 13d-3(d)(l)(i) under the Act. Note, pursuant to the Offer State Farm has agreed to tender and exchange the Warrants for 0.20 shares of Class A Common Stock of the Issuer per warrant exchanged, resulting in State Farm receiving 1,800,000 shares of Class A
| CUSIP No: 405166109 | Schedule 13D |
Common Stock of the Issuer in exchange for its Warrants if and when the Offer is consummated pursuant to its terms and conditions. The percentage does not give effect to the issuance of shares of Class A Common Stock issuable upon exercise or conversion of warrants, options or shares of the Issuer’s Series A Preferred Stock or Class V Common Stock held by other parties. Notwithstanding the percentage reported herein, based on the aggregate total of Class A Common Stock and Class V Common Stock outstanding, and the voting power assigned to each class, the Reporting Person controls approximately 2.4% of the voting power of the Issuer.
| (b) | Sole power to vote: 63,240,881 Sole power to dispose: 63,240,881 |
| (c) | Except as described in Item 3 above, State Farm has not transacted in the Class A Common Stock during the past sixty days. |
| (d) | NIA |
| (e) | NIA |
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer.
Item 6 of the Amended Schedule 13D is hereby supplemented as follows:
State Farm is a party to the Tender and Support Agreement, dated June 3, 2024, by and Among Hagerty, Inc. and Holders party thereto, which is included as Exhibit 10.37 of Issuer’s Form S-4 filed on June 3, 2024.
The foregoing references in this Amended Schedule 13D to, or descriptions of, the Offer, the Issuer’s Form S-4 Registration Statement filed on June 3, 2024, and Issuer’s Schedule to Tender Offer Statement Under Section 14(d)(1) or 13(e)(1) of the Securities Exchange Act of 1934 filed on June 3, 2024, which are hereby incorporated by reference, do not purport to be complete and are qualified in their entirety by reference to the text of such agreements.
Item 7. Material to Be Filed as Exhibits.
Item 7 of the Amended Schedule 13D is hereby supplemented as follows:
Exhibit 8 – Issuer’s Form S-4 Registration Statement filed on June 3, 2024, which is incorporated herein by reference.
| CUSIP No: 405166109 | Schedule 13D |
Signature
After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.
Date: June 5, 2024
| STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY | ||
| By: | /s/ Joseph P. Young | |
| Joseph P. Young, Senior Vice President | ||
| and Chief Investment Officer | ||