Company: TRUE
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0001327318-25-000065
Chunk: 3

Company: TrueCar, Inc.
Filing Date: 2025-11-06
Form: 10-Q
Item: Part I, Item 4
Chunk 3
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 Merger Agreement.

The Merger Agreement contains customary mutual termination rights for us and Parent, which could prevent the consummation of the Merger, including the right for either party to terminate the Merger Agreement in certain cases if the Merger is not completed by February 28, 2026, subject to extension upon mutual agreement of the parties.

The Merger Agreement also contains customary termination rights for the benefit of each party, including if the other party breaches its representations, warranties or covenants under the Merger Agreement in a way that would result in the failure of the other party’s conditions to closing being satisfied (subject to certain procedures and cure periods). In the event that the Merger Agreement is terminated under certain specified circumstances, we will be required to pay Parent a termination fee of either $4.0 million or $8.0 million, or under certain other specified circumstances, we may be required to reimburse certain costs and fees incurred by Parent and its affiliates, up to a maximum amount of $3.0 million.  

There can be no assurance that a remedy will be available to us in the event of a breach of the Merger Agreement by Parent, or that we will be able to recover any damages incurred by us in connection therewith. A failed transaction may result in negative publicity and a negative impression of us among our customers or in the investment community or business community generally. Further, any disruptions to our business resulting from the announcement and pendency of the Merger, as described in greater detail under the Risk Factor “The announcement and pendency of the Merger may disrupt our business, and the Merger could divert management’s attention, disrupt our relationships with third parties and employees and result in negative publicity or legal proceedings, any of which could negatively impact our operating results and ongoing business,” below, could continue or accelerate in the event of a failed transaction or the perception that the transaction may be delayed or may not close.

If the Merger is not completed within the expected timeframe, or at all, we may be subject to a number of material risks, including that:

•the market price of our common stock may decline to the extent that current market prices reflect a market assumption that the Merger will be completed;

•some costs related to the Merger must be paid whether or not the Merger is consummated, and we have incurred, and will continue to incur, significant costs, expenses and fees for professional services and other transaction costs in connection with the proposed transaction;

•management’s attention and resources have been