United States securities and exchange commission logo
September 17, 2020
John M. Butler
President and Chief Executive Officer
Insurance Acquisition Corp.
2929 Arch Street, Suite 1703
Philadelphia, PA 19104-2870
Re: Insurance
Acquisition Corp.
Amendment No. 2 to
Registration Statement on Form S-4
Filed September 3,
2020
File No. 333-239896
Dear Mr. Butler:
We have reviewed your amended registration statement and have the
following
comments. In some of our comments, we may ask you to provide us with
information so we
may better understand your disclosure.
Please respond to this letter by amending your registration
statement and providing the
requested information. If you do not believe our comments apply to your
facts and
circumstances or do not believe an amendment is appropriate, please tell
us why in your
response.
After reviewing any amendment to your registration statement and
the information you
provide in response to these comments, we may have additional comments.
Unless we note
otherwise, our references to prior comments are to comments in our
September 1, 2020 letter.
Amendment No. 2 to Registration Statement on Form S-4, filed September
3, 2020
Background of the Merger, page 92
1. Please file the consent
of Steffen Frederiksen or explain why you believe a consent is not
required under Section
7 of the Securities Act and Rule 436.
Non-GAAP Financial Measures, page 187
2. We note your response
to our prior comment 9 in which you state the non-repair labor
adjustment is for
payroll costs for time spent by technicians on tasks that are not directly
related to the
reconditioning of vehicles, and the costs are largely incurred in
connection
with sub-optimal
utilization of the technician labor force due to the current stage of your
business. However,
since these costs appear to be normal, recurring cash expenses
John M. Butler
Insurance Acquisition Corp.
September 17, 2020
Page 2
inherent in operating your business at its current stage, it remains
unclear how this
adjustment is consistent with Question 100.01 of the Non-GAAP
Financial Measures
Compliance & Disclosure Interpretations, in regard to Rule 100(b) of
Regulation G.
Please remove the adjustment for non-repair labor in arriving at your
non-GAAP measure
"adjusted gross profit."
Key Operating Metrics, page 188
3. We note your tables here and on pages 192, 195 and 197 include the
non-GAAP measures
adjusted gross profit per unit ( Adjusted GPU ). Please expand your
disclosure to include
the most comparable GAAP measure (i.e., gross profit per unit) with equal
or greater
prominence. Refer to Item 10(e)(1)(i)(A) of Regulation S-K and Non-GAAP
Financial
Measures Compliance & Disclosure Interpretation Question 102.10. Please
also expand
your narrative disclosure following the table on page 188 to address how
you define and
determine the GAAP-based gross profit per unit.
General
4. We note your response to comment 11, including that "[t]he Company has
evaluated its
remaining contracts with Lithia and has determined that none of those
other agreements
are 'material contracts' within the meaning of Item 601(b)(10) of
Regulation S-K." Please
provide a detailed legal analysis as to why the relevant agreements with
Lithia are not
"material contracts" within the meaning of Item 601(b)(10) of Regulation
S-K.
You may contact James Giugliano at (202) 551-3319 or Doug Jones at (202)
551-3309 if
you have questions regarding comments on the financial statements and related
matters. Please
contact Katherine Bagley at (202) 551-2545 or Erin Jaskot at (202) 551-3442
with any other
questions.
Sincerely,
FirstName LastNameJohn M. Butler
Division of
Corporation Finance
Comapany NameInsurance Acquisition Corp.
Office of Trade &
Services
September 17, 2020 Page 2
cc: Sean M. Donahue
FirstName LastName