IRON MOUNTAIN INCORPORATED (NYSE:IRM) Files An 8-K Entry into a Material Definitive AgreementItem 1.01. Entry into a Material Definitive Agreement.
On December11, 2017,IRM Data Centers Expansion LLC, our indirect, wholly-owned subsidiary, or Buyer, entered into a Purchase Agreement, or the Purchase Agreement, with IO Data Centers, LLC, or IODC, the Sellers referred to therein,Innovation Holdings, LLC, solely in its capacity as a representative of the Sellers, or the Sellers Representative, and, solely with respect to Articles 1, 10 and 11 of the Purchase Agreement, us, as a guarantor, to purchase the United States operations of IODC, a colocation data center services provider, and its United States subsidiaries. Upon the terms and subject to the conditions of the Purchase Agreement, at the closing, or the Closing, of the transactions contemplated by the Purchase Agreement, or the Acquisition, Buyer will acquire, directly or indirectly, all of the outstanding equity interests of IODC for an aggregate purchase price of $1,315,000,000 in cash, plus up to $60 million based on certain operational and financial metrics, subject to certain adjustments as set forth in the Purchase Agreement, or the Purchase Price. The payment of the Purchase Price is guaranteed by us to a customary guaranty.
to the Purchase Agreement and prior to the Closing, the Sellers and certain of their affiliates will undergo a corporate restructuring, or the Restructuring, such that following the Restructuring and at the Closing Buyer will acquire IODC and its subsidiaries utilized in the operation of IODC’s United States data center business.
The Purchase Agreement contains customary representations, warranties and covenants, including, among others, covenants requiring that the IODC business be operated in the ordinary course of business from the date of the Purchase Agreement until the Closing. In addition, in connection with the Acquisition we will obtain a representation and warranty insurance policy that will provide coverage for certain representations and warranties in the Purchase Agreement, subject to a retention amount, exclusions, policy limits and certain other terms and conditions.
The Acquisition is subject to customary closing conditions, including, among others, the receipt by Buyer of certain required consents, completion of the Restructuring and entry into certain ancillary agreements. The Purchase Agreement is not subject to a financing condition.
The Purchase Agreement also contains customary termination rights for the Buyer and the Sellers Representative, including the option of either party to terminate the Purchase Agreement if the Acquisition has not closed by February28, 2018.
The foregoing description of the Purchase Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Purchase Agreement, a copy of which will be filed by amendment as Exhibit2.1 to this Current Report on Form8-K, or this Form8-K, and incorporated herein by reference.
Item 7.01. Regulation FD Disclosure.
On December11, 2017, we issued a press release announcing the Acquisition. A copy of this press release is furnished as Exhibit99.1 to this Form8-K.
Item 8.01. Other Events.
Material United States Federal Income Tax Considerations
We are filing as Exhibit99.2 (which is incorporated by reference herein) a description of the material United States federal income tax considerations relating to the our qualification and taxation as a real estate investment trust for U.S. federal income tax purposes, or REIT, and the acquisition, ownership and disposition of our stock. This description contained in Exhibit99.2 replaces and supersedes prior descriptions of the federal income tax treatment of us and our stockholders to the extent they are inconsistent with the description contained in this Form8-K.
