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):  October 28, 2019

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):

Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934:

Indicate by check mark whether the registrant is an emerging growth company as defined in 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 x

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.  ¨

On October 28, 2019, the Company issued a press release announcing the execution of the Purchase Agreement (as defined below). A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein in its entirety by reference.

The information in this Item 7.01 and the Exhibit attached hereto is furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such document or filing. 

On October 28, 2019, NI Holdings, Inc., a North Dakota corporation (the “Company”), entered into a Stock Purchase Agreement (the “Purchase Agreement”) with Westminster American, LLC, a Maryland limited liability company (“Seller”), and John Scott, Sr. (“Scott, Sr.”), pursuant to which the Company will, among other things, purchase from Seller all of the issued and outstanding shares of common stock (the “Shares”) of Westminster American Insurance Company, a Maryland corporation (“Westminster”), and a commercial real estate insurance company located in Owings Mills, Maryland, after all of the closing conditions set forth in the Purchase Agreement have been satisfied or waived (the “Closing”). The transactions contemplated by the Purchase Agreement are referred to herein as the “Transactions”. The Company will retain Westminster’s current President and Chief Executive Officer, John Scott, Jr., as the President of Westminster following the Closing pursuant to an employment agreement between John Scott, Jr. and Westminster. Westminster will pay John Scott, Jr. a retention bonus in the aggregate amount of $5,000,000, payable over the five-year period from the date of Closing.

As consideration for the Transactions, the Company will pay Seller $40,000,000 as follows:

The Company’s payment obligations will be secured by a Pledge Agreement entered into with Seller, pursuant to which the Company will pledge to Seller the Shares until such time as all payment obligations of the Company to Seller have been satisfied.

The Transactions are expected to close early next year and are subject to customary closing conditions, including regulatory approvals. The Purchase Agreement contains representations, warranties, and covenants of the parties customary for a transaction of this type, including, among other things, a covenant of Seller not to solicit alternative transactions or to provide information or enter into discussions in connection with alternative transactions.

EXHIBIT INDEX

SIGNATURE

 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.