Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of the Registrant.
The information regarding the Company's material indebtedness following the
Business Combination is set forth in the section of the Proxy Statement entitled
"Vertiv's Management's Discussion and Analysis of Financial Condition and
Results of Operations -Capital resources and liquidity" beginning on page 232,
which information is incorporated by reference herein, as updated by the
Company's Current Report on Form 8-K, filed with the SEC on January 31, 2020,
which information is incorporated by reference herein.
As disclosed previously, to further Vertiv's objective to explore future
financing options to optimize its capital structure, including potential debt
refinancing, on January 31, 2020, Vertiv commenced a process to refinance its
existing term loan credit facility and amend and extend its existing asset-based
revolving credit facility. The proposed refinancing transaction is expected to
reduce Vertiv's debt service requirements and leverage and to extend the
maturity profile of its indebtedness. The proposed transaction is anticipated to
close during the first quarter of 2020. As the terms of the proposed refinancing
transaction have not been finalized, the structure, timing and anticipated
impact are subject to change.
In connection with the proposed refinancing transaction, on January 31, 2020,
Vertiv called all of its existing notes for conditional redemption on March 2,
2020, in accordance with the respective indentures. The redemptions are
conditioned upon the completion of the proposed refinancing transactions on
terms satisfactory to Vertiv and/or its affiliates. In addition, a total of
$500,000 principal amount of Vertiv's 9.250% senior notes due 2024 were tendered
in the change of control offer made in connection with the Business Combination
and were repurchased on February 7, 2020.
On the closing date, the Company used a portion of the proceeds from the
Business Combination to repay $176 million of the outstanding indebtedness under
its asset-based revolving credit facility and approximately $1.29 billion of the
outstanding indebtedness under its term loan facility.
Item 4.01 Changes in the Registrant's Certifying Accountant.
(a) Dismissal of independent registered public accounting firm
On February 7, 2020, the board of directors of the post-Business Combination
Company (the "Board") approved the dismissal of PricewaterhouseCoopers LLP
("PwC") as its independent registered public accounting firm, effective upon
completion of their audit of the Vertiv Holdings Co (formerly known as GS
Acquisition Holdings Corp) financial statements as of and for the year ended
December 31, 2019, and the issuance of their report thereon. The management of
the post-Business Combination Company communicated the Board's decision to PwC
on February 7, 2020. The reports of PwC on the GS Acquisition Holdings Corp
financial statements as of and for the most recent fiscal years ended
December 31, 2018 and 2017 did not contain an adverse opinion or a disclaimer of
opinion, and were not qualified or modified as to uncertainties, audit scope or
accounting principles, except that PwC's report for the fiscal year ended
December 31, 2017 included an explanatory paragraph indicating that there was
substantial doubt regarding the ability of GS Acquisition Holdings Corp to
continue as a going concern.
During the years ended December 31, 2018 and 2017 and the subsequent period
through February 7, 2020, there were no disagreements (as defined in Item
304(a)(1)(iv) of Regulation S-K) between GS Acquisition Holdings Corp and PwC on
any matter of accounting principles or practices, financial disclosure or
auditing scope or procedure, which disagreements, if not resolved to the
satisfaction of PwC, would have caused it to make reference to the subject
matter of the disagreements in its report on the GS Acquisition Holdings Corp
financial statements for such years.
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During the years ended December 31, 2018 and 2017 and the subsequent period
through February 7, 2020, there were no "reportable events" (as defined in Item
304(a)(1)(v) of Regulation S-K).
The Company has provided PwC with a copy of the foregoing disclosures and have
requested that PwC furnish it with a letter addressed to the SEC stating whether
it agrees with the statements made by the Company set forth above. A copy of
PwC's letter, dated February 7, 2020, is filed as Exhibit 16.1 to this Current
Report on Form 8-K.
(b) Engagement of new independent registered public accounting firm
On February 7, 2020, the Board approved the engagement of Ernst & Young LLP
("EY") as independent registered public accounting firm of the Company for the
fiscal year ending December 31, 2020. During the years ended December 31, 2018
and 2017 and the subsequent period through February 7, 2020, neither the
Company, nor anyone on the Company's behalf consulted with EY, on behalf of the
Company, regarding the application of accounting principles to a specified
transaction (either completed or proposed), the type of audit opinion that might
be rendered on the Company's financial statements, or any matter that was either
the subject of a "disagreement," as defined in Item 304(a)(1)(iv) of Regulation
S-K, or a "reportable event," as defined in Item 304(a)(1)(v) of Regulation S-K.
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