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): February 25, 2021
FOCUS FINANCIAL PARTNERS INC.
(Exact name of registrant as specified in its charter)
| Delaware | 001-38604 | 47-4780811 |
| (State or other jurisdiction | (Commission | (IRS Employer |
| of incorporation) | File Number) | Identification No.) |
| | | |
| | 875 Third Avenue, 28th Floor | |
| | New York, NY 10022 | |
| | (Address of principal executive offices) | |
| | (Zip Code) | |
| | | |
| | (646) 519-2456 | |
| | Registrant’s Telephone Number, Including Area Code | |
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 (see General Instruction A.2. below):
| ¨ | 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 $0.01 per share | | FOCS | | Nasdaq Global Select 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. |
Underwriting Agreement
On February 25, 2021, Focus Financial Partners Inc. (the “Company”) entered into an underwriting agreement (the “Underwriting Agreement”) by and among the Company, certain selling stockholders of the Company named in Schedule B thereto (the “Selling Stockholders”), and Goldman Sachs & Co. LLC and BofA Securities, Inc., as representatives of the several underwriters named therein (the “Underwriters”), providing for the offer and sale of 6,737,694 shares of the Company’s Class A common stock, par value $0.01 per share (“Class A Common Stock”), by the Selling Stockholders and the offer and sale of 262,306 shares of Class A Common Stock, by the Company on behalf of certain of the existing unitholders of Focus Financial Partners, LLC (“Focus LLC”), at a price to the Company and the Selling Stockholders of $46.20 per share (representing a price to the public of $48.00 per share, less underwriting discounts and commissions of $1.80 per share) (the “Offering”). Pursuant to the Underwriting Agreement, the Selling Stockholders have granted the Underwriters a 30-day option to purchase up to 1,050,000 additional shares of Class A Common Stock to cover over-allotments, if any.
The material terms of the Offering are described in the prospectus supplement, dated February 25, 2021 to the prospectus, dated August 30, 2019 together forming a part of the registration statement on Form S-3 (Registration No. 333-233566), filed with the Securities and Exchange Commission on August 30, 2019.
The Offering closed on March 2, 2021, and the Company received net proceeds from the Offering of approximately $12.1 million, after deducting underwriting discounts payable by the Company. The Company will contribute the net proceeds from the sale of the Class A Common Stock offered by the Company to Focus LLC in exchange for newly issued common units in Focus LLC and Focus LLC will use such contributed net proceeds to redeem common units (including common units from the conversion of vested incentive units in connection with the Offering) in Focus LLC from certain unitholders, including certain of the Company’s employees and principals of its partner firms, but does not include the Company’s executive officers and directors, and in connection with such purchase, the Company will cancel the corresponding shares of the Company’s Class B common stock, as applicable. The Company will not receive any proceeds from the sale of the shares to be offered by the Selling Stockholders.
The Underwriting Agreement contains customary representations and warranties, agreements and obligations, closing conditions and termination provisions. The Company and the Selling Stockholders each have agreed to indemnify the Underwriters against certain liabilities, including liabilities under the Securities Act of 1933, and to contribute to payments the Underwriters may be required to make because of any of those liabilities.
Prior to the Offering, the Selling Stockholders, which are affiliates of KKR Capital Markets LLC (“KKR”) and Stone Point Capital LLC (“Stone Point”), underwriters in the Offering, owned more than 10% of the Company’s outstanding common stock. Affiliates of KKR have the right to nominate one member of the Company’s board pursuant to the nomination agreement dated July 30, 2018 that the Company entered into with entities affiliated with KKR. Affiliates of Stone Point have the right to nominate two members of the Company’s board pursuant to the nomination agreement dated July 30, 2018 that the Company entered into with entities affiliated with Stone Point.
The foregoing description is qualified in its entirety by reference to the full text of the Underwriting Agreement, which is attached as Exhibit 1.1 to this Current Report on Form 8-K and incorporated in this Item 1.01 by reference.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits.
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.
| | FOCUS FINANCIAL PARTNERS INC. |
| | | | |
| | By: | /s/ J. Russell McGranahan |
| | | Name: | J. Russell McGranahan |
| | | Title: | General Counsel and Corporate Secretary |
| | | | |
| Dated: March 2, 2021 | | | |
