Business Context and Reporting Period
This Form 8-K, dated November 2, 2021, reports the completion of a merger by Procore Technologies, Inc. (Procore). On this date, Procore finalized the acquisition of Express Lien, Inc. (d/b/a Levelset), making Levelset a wholly-owned subsidiary. The transaction was executed pursuant to a Merger Agreement entered into on September 20, 2021.
Key Financial Metrics and Transaction Details
The filing details the consideration paid for the acquisition but does not provide Procore's standalone revenue, profit, or cash flow metrics for the period.
- Total Consideration: Approximately $500 million.
- Cash Component: Approximately $425 million, subject to customary adjustments for working capital, transaction expenses, cash, and indebtedness.
- Stock Component: Approximately $75 million in Procore common stock.
- Shares Issued: 810,169 shares of Common Stock (PCOR), valued based on the 30-day volume-weighted average trading price prior to closing.
- Escrow: A portion of the cash consideration is held in escrow to secure indemnification obligations.
Material Changes
The primary material change is the expansion of Procore's business through the acquisition of Levelset. Levelset continues as the surviving entity and a wholly-owned subsidiary. The transaction involved the issuance of unregistered equity securities to accredited investors among Levelset's former interest holders, while non-accredited investors received cash in lieu of stock.
Guidance, Outlook, and Risks
The filing contains forward-looking statements regarding expected benefits, integration plans, and future performance, which are subject to substantial risks.
- Integration Risks: Failure to realize anticipated benefits, inability to successfully integrate Levelset, and diversion of management attention.
- Operational Risks: Potential business disruption, customer loss, and increased operating costs.
- External Risks: Changes in laws/regulations, market conditions, litigation outcomes, security incidents, and the impact of COVID-19.
- Human Capital: Challenges in recruiting and retaining qualified team members.
Procore explicitly states it undertakes no obligation to update forward-looking statements to reflect future events or new information.
Investor Verification Checklist
- Verify the final adjusted purchase price after working capital and transaction expense adjustments.
- Review the full Merger Agreement (Exhibit 99.1) for specific indemnification terms and escrow release conditions.
- Monitor future 10-Q filings for the financial impact of the acquisition on Procore's consolidated revenue and expenses.
- Assess the integration progress and any potential customer churn or operational disruptions post-closing.