ARKO ARKO Corporation

ARKO Corp. (Nasdaq: ARKO) (“ARKO” or the “Company”), a Fortune 500 company and one of the largest convenience store operators in the United States, announced today that it has negotiated improved deferred payment terms and value related to the Company’s previously reported acquisition of the assets of Transit Energy Group and its affiliates (“TEG”).

As previously disclosed, on March 1, 2023, the Company closed on the acquisition from TEG of 135 convenience stores and gas stations, contracts to supply fuel to 181 dealer locations, and certain other assets. The purchase agreement originally provided for a total purchase price of approximately $370 million plus the value of inventory, of which $50 million was deferred and payable in two annual payments of $25 million on the first and second anniversaries of the closing, which ARKO could elect to pay in either cash or, subject to certain conditions, shares of ARKO’s common stock.

Pursuant to the original asset purchase agreement, on March 1, 2024, ARKO issued 3,417,915 shares of ARKO common stock to TEG (the “First Installment Shares”) at a price per share of $7.31 which was based on a 10-day volume weighted average price calculation outlined in the purchase agreement. The closing price of ARKO’s common stock on the date ARKO notified TEG of its election to pay the first $25.0 million installment in shares was $8.36 per share, and the closing price on the date prior to the date of issuance was $6.53 per share.

Subsequently, on March 26, 2024, ARKO entered into an amendment to the original purchase agreement with TEG, providing for ARKO’s repurchase of the First Installment Shares at $5.66 per share, a 22.6% discount to the price at which the shares were issued, for a payment of approximately $19.3 million. ARKO and TEG also agreed to settle the second $25 million installment payment (which would have been due on March 1, 2025) for approximately $17.2 million in cash. In aggregate, ARKO satisfied the $50 million deferred purchase price for the TEG transaction for $36.5 million and the release of certain obligations and liabilities, which was fully funded by ARKO’s existing liquidity through its Capital One Line of Credit. ARKO repurchased the First Installment Shares as part of its previously announced $100 million share repurchase program.

“Prior to the March 1, 2024 deferred purchase price payment being due, we chose to satisfy the $25 million liability through issuing shares to create additional liquidity in the stock and to deploy cash against strategic investments,” said Arie Kotler, Chairman, President, and Chief Executive Officer of ARKO. “However, we believe that the post-issuance decline in the price of ARKO’s common stock created a unique opportunity for us to buy back these recently issued shares at a value well below what we believe is ARKO’s intrinsic value. At the same time, we were able to also satisfy a future $25 million deferred payment for a reduced price of $17.2 million. We believe that our ability to be agile capital allocators and take advantage of changing market conditions and business opportunities continues to be one of our key strengths,” Kotler continued.

About ARKO Corp.

ARKO Corp. (Nasdaq: ARKO) is a Fortune 500 company that owns 100% of GPM Investments, LLC and is one of the largest operators of convenience stores and wholesalers of fuel in the United States. Based in Richmond, VA, our highly recognizable family of community brands offers delicious, prepared foods, beer, snacks, candy, hot and cold beverages, and multiple popular quick serve restaurant brands. Our high value fas REWARDS® loyalty program offers exclusive savings on merchandise and gas. We operate in four reportable segments: retail, which includes convenience stores selling merchandise and fuel products to retail customers; wholesale, which supplies fuel to independent dealers and consignment agents; GPM Petroleum, which sells and supplies fuel to our retail and wholesale sites and charges a fixed fee, primarily to our fleet fueling sites; and fleet fueling, which includes the operation of proprietary and third-party cardlock locations, and issuance of proprietary fuel cards that provide customers access to a nationwide network of fueling sites. To learn more about GPM stores, visit: www.gpminvestments.com. To learn more about ARKO, visit: www.arkocorp.com.

Forward-Looking Statements

This document includes certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may address, among other things, the Company’s expected financial and operational results and the related assumptions underlying its expected results. These forward-looking statements are distinguished by use of words such as “anticipate,” “aim,” “believe,” “continue,” “could,” “estimate,” “expect,” “guidance,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “will,” “would” and the negative of these terms, and similar references to future periods. These statements are based on management’s current expectations and are subject to uncertainty and changes in circumstances. Actual results may differ materially from these expectations due to, among other things, changes in economic, business and market conditions; the Company’s ability to maintain the listing of its common stock and warrants on the Nasdaq Stock Market; changes in its strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects and plans; expansion plans and opportunities; changes in the markets in which it competes; changes in applicable laws or regulations, including those relating to environmental matters; market conditions and global and economic factors beyond its control; and the outcome of any known or unknown litigation and regulatory proceedings. Detailed information about these factors and additional important factors can be found in the documents that the Company files with the Securities and Exchange Commission, such as Form 10-K, Form 10-Q and Form 8-K. Forward-looking statements speak only as of the date the statements were made. The Company does not undertake an obligation to update forward-looking information, except to the extent required by applicable law.

Media Contact & Investor Contact
Jordan Mann, Senior Vice President of Corporate Strategy, Capital Markets and Investor Relations
ARKO Corp.
investors@gpminvestments.com