| Item 1.01 | Entry into a Material Definitive Agreement. |
Purchase and Sale Agreement
On August 1, 2023, EverQuote, Inc. (the “Company”) entered into a Purchase and Sale Agreement (the “Purchase Agreement”) with MyPlanAdvocate Insurance Solutions Inc. (the “Buyer”), a Delaware corporation, pursuant to which the Company agreed to sell to the Buyer assets relating to its health insurance vertical (as further described in the Purchase Agreement, the “Disposed Assets”), by selling to the Buyer all of the issued and outstanding membership interests of its subsidiary, Eversurance, LLC, an Indiana limited liability company, for cash consideration of $13.2 million, subject to customary post-closing adjustments (collectively, the “Transaction”). The Transaction closed concurrently with execution of the Purchase Agreement.
The Purchase Agreement contains customary representations and warranties by the Company, on the one hand, and the Buyer, on the other hand. It also contains customary covenants, including covenants preventing the Company, together with its direct and indirect subsidiaries, from engaging in the operation of a direct to consumer agency for the sale of health insurance and Medicare plans to consumers, subject to certain exceptions, for a period of three years following the closing.
The Purchase Agreement provides for customary post-closing indemnification by each party of certain liabilities specified in the Purchase Agreement, subject to customary limitations.
The foregoing description of the Purchase Agreement is qualified in its entirety by reference to the full text of the Purchase Agreement, which is attached as Exhibit 2.1 to this Current Report on Form 8-K and is incorporated herein by reference.
The Purchase Agreement has been attached as an exhibit to provide investors and security holders with information regarding its terms. It is not intended to provide any other factual information about the Company, the Disposed Assets or the Buyer. The representations, warranties and covenants contained in the Purchase Agreement were made only for the purposes of such agreement and as of specified dates, were solely for the benefit of the parties to such agreement and may be subject to limitations agreed upon by the contracting parties. The representations and warranties may have been made for the purposes of allocating contractual risk between the parties to the Purchase Agreement instead of establishing these matters as facts and may be subject to standards of materiality applicable to the contracting parties that differ from those applicable to investors. Investors are not third-party beneficiaries under the Purchase Agreement and should not rely on the representations, warranties and covenants or any descriptions thereof as characterizations of the actual state of facts or condition of the Company, the Disposed Assets or the Buyer or any of their respective subsidiaries or affiliates. In addition, the assertions embodied in the representations and warranties contained in the Purchase Agreement are qualified by information in a confidential disclosure schedule that the parties have exchanged. Accordingly, investors should not rely on the representations and warranties as characterizations of the actual state of facts, since (i) they were made only as of the date of such agreement or a prior, specified date, (ii) in some cases they are subject to qualifications with respect to materiality, knowledge and/or other matters, and (iii) they may be modified in important part by the underlying disclosure schedule. Moreover, information concerning the subject matter of the representations and warranties may change after the date of the Purchase Agreement, which subsequent information may or may not be fully reflected in the Company’s public disclosures.
Loan and Security Modification Agreement (August 1, 2023)
On August 1, 2023, the Company entered into a Loan and Security Modification Agreement (the “Consent and Release”) with Western Alliance Bank (the “Lender”), which modified the Amended and Restated Loan and Security Agreement, dated August 7, 2020 (as amended, restated, supplemented or otherwise modified from time to time, the “Loan Agreement”) between the Company and the Lender. Pursuant to the Consent and Release, the Lender consented to the Transaction and released its security interests in the Disposed Assets arising under the Loan Agreement.
