Sec Form 13D Filing - GLAZER AVRAM A filing for INNOVATE Corp. (VATE) - 2020-09-10

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

SCHEDULE 13D

(Rule 13d-101)

Information to be Included in Statements Filed Pursuant to § 240.13d-1(a) and Amendments Thereto Filed Pursuant to § 240.13d-2(a)

Under the Securities Exchange Act of 1934

(Amendment No. 4)*

HC2 Holdings, Inc.

(Name of Issuer)

Common Stock, par value $0.001 per share

(Title of Class of Securities)

404139107

(CUSIP Number)

Avram Glazer

Lancer Capital LLC

777 South Flagler Drive

Suite 800, West Tower

West Palm Beach, Florida 33401

(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)

September 9, 2020

(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. o

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See § 240.13d-7 for other parties to whom copies are to be sent.

* 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 (“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).

(1)Includes 456,621 shares of Common Stock of HC2 Holdings, Inc. (the “Issuer”) issuable upon conversion of $2,000,000 principal amount of the Issuer’s 7.5% Convertible Senior Notes due 2022.

(2) Based on 46,550,384 shares of Common Stock of the Issuer outstanding as of May 22, 2020, as reported in the Issuer’s Schedule 14A Definitive Proxy Statement filed with the Securities and Exchange Commission on May 27, 2020.

(1)Includes 456,621 shares of Common Stock of HC2 Holdings, Inc. (the “Issuer”) issuable upon conversion of $2,000,000 principal amount of the Issuer’s 7.5% Convertible Senior Notes due 2022.

(2)Based on 46,550,384 shares of Common Stock of the Issuer outstanding as of May 22, 2020, as reported in the Issuer’s Schedule 14A Definitive Proxy Statement filed with the Securities and Exchange Commission on May 27, 2020.

Explanatory Note

This Amendment No. 4 to Schedule 13D (“Amendment No. 4”) amends and supplements the Schedule 13D filed with the United States Securities and Exchange Commission on April 23, 2020 (the “Schedule 13D”), relating to the common stock, $0.001 par value per share (the “Common Stock”), of HC2 Holdings, Inc., a Delaware corporation (the “Issuer”). Capitalized terms used herein without definition shall have the meaning set forth in the Schedule 13D.

Item 6.   Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer.

Investment Agreement

On September 9, 2020, Lancer entered into an Investment Agreement with the Issuer in connection with a rights offering by the Issuer (the “Rights Offering”).  Subject to the terms and conditions of the Investment Agreement, Lancer has agreed to purchase up to $35 million aggregate amount (the “Equity Commitment Amount”) of the Issuer’s newly issued Non-Voting Participating Convertible Preferred Stock, liquidation preference $0.01 per share (the “Preferred Stock”), for an issue price of $1,000 per share. Prior to the consummation of the Rights Offering, the Company may request the funding of up to $10 million of the Equity Commitment Amount in minimum installments of at least $1.0 million per funding request without the consent of Lancer, provided that the Issuer may request funding in excess of $10 million up to the full amount of the Equity Commitment Amount with the prior written consent of Lancer (such funding, collectively, the “Initial Funding Amount”).

In connection with the Rights Offering, the Investment Agreement provides that, to the extent that Lancer is precluded by applicable rules and regulations (including those of the New York Stock Exchange (“NYSE”) and Texas Department of Insurance (“TDI”) and any other applicable regulators) from purchasing voting common stock by exercising rights received in the Rights Offering, Lancer will purchase additional Preferred Stock (in excess of any Initial Funding Amount) equivalent to its allocable right to participate in the Rights Offering (i.e., its basic subscription right in the Rights Offering with respect to its common equity ownership percentage on an as-exercised basis on the Rights Offering record date without giving effect to any issuance of shares of Preferred Stock, plus any exercise of the oversubscription privilege) in an aggregate amount not to exceed the Equity Commitment Amount (the “Allocable Participation Right”). The Investment Agreement also restricts Lancer from purchasing or otherwise acquiring any other subscription rights issued by the Issuer in the Rights Offering.

The Investment Agreement includes customary standstill provisions that restrict the ability of Lancer and its affiliates and associates (collectively, the “Lancer Entities”) from, among other things, acquiring (i) equity securities of the Issuer that would result in the Lancer Entities having beneficial ownership of more than 33% of the Issuer’s then-outstanding common stock, (ii) equity securities of the Issuer subsidiaries or (iii) any debt securities or indebtedness of the Issuer or its subsidiaries, until the first anniversary of the execution of the Investment Agreement (the “Standstill Period”).  Any acquiror of a block of greater than 9.9% of the Issuer’s