Item 1.01 Entry Into A Material Definitive Agreement.
Business Combination Agreement
The Business Combination Agreement, dated June 5, 2020 (the "Effective Date"),
was entered into by and among PubCo, Utz, Series U of UM Partners, LLC, a series
of a Delaware limited liability company ("Series U") and Series R of UM
Partners, LLC, a series of a Delaware limited liability company ("Series R" and,
collectively with Series U, the "Sellers").
The Business Combination Agreement and the transactions contemplated thereby
were unanimously approved by the board of directors of PubCo and by the board of
managers of Utz.
The Business Combination
The Business Combination Agreement provides for the consummation of the
following transactions (collectively, the "Business Combination"): (a) PubCo
will change its jurisdiction of incorporation by deregistering as an exempted
company in the Cayman Islands and continuing and domesticating as a corporation
incorporated under the laws of the State of Delaware (the "Domestication"), upon
which PubCo will change its name to "Utz Brands, Inc."; (b) the Sellers will
amend and restate Utz's limited liability company agreement (the "Company A&R
LLCA") to, among other things, increase the capitalization of Utz to permit the
issuance and ownership of interests in Utz as contemplated by the Business
Combination Agreement and admit PubCo as the managing member of Utz; (c) PubCo
will acquire certain equity interests of Utz (i) Utz, which proceeds will be
used to pay transaction expenses and reduce existing indebtedness and (ii) from
the Sellers as well as certain equity interests of equityholders of the Sellers
(which will be immediately redeemed at the Closing by the Sellers for additional
equity interests of Utz), in exchange for a combination of cash consideration
and shares of newly issued Class V common stock, par value $0.0001 per share, of
PubCo, which will have no economic value, but will entitle the Sellers to one
vote per issued share and will be issued on a one-for-one basis for each
membership unit in Utz (each, an "Utz Unit") retained by the Sellers following
the Business Combination. The Company A&R LLCA will provide the Sellers the
right to exchange their retained Utz Units, together with the cancelation of an
equal number of shares of Class V common stock, for Class A common stock of
PubCo, subject to certain restrictions set forth therein. Certain of the Utz
Units retained by the Sellers will, subject to performance based vesting
conditions set forth in the Company A&R LLCA, (i) be restricted, (ii) not be
exchangeable for Class A common stock of PubCo until vested, and (iii) will
accrue the right to distributions on Utz Units from Utz, such distributions to
be payable upon vesting. Any such restricted Utz Units that have not vested by
the tenth anniversary of the Closing shall be automatically cancelled.
Immediately prior to the consummation of the Business Combination (the
"Closing"), PubCo will effect the Domestication pursuant to which (a) each Class
A ordinary share and each Class B ordinary share of PubCo will automatically
convert into one share of Class A common stock of PubCo (excluding, however, an
aggregate of 2,000,000 Class B ordinary shares held by Collier Creek Partners,
LLC (the "Sponsor") and PubCo's independent directors, which will instead
automatically be converted into 2,000,000 shares of Class B common stock of
PubCo pursuant to the Sponsor Side Letter Agreement (as defined below)) and (b)
the outstanding warrants to purchase Class A ordinary shares of PubCo will
automatically become exercisable for Class A common stock of PubCo.
Following the consummation of the Business Combination, the combined company
will be organized in an "Up-C" structure, in which substantially all of the
assets and business of PubCo will be held by Utz. The combined company's
business will continue to operate through the subsidiaries of Utz and PubCo's
sole direct asset will be the equity interests of Utz held by it.
Concurrent with the Closing, PubCo will enter into a tax receivable agreement
(the "Tax Receivable Agreement") with the Sellers. Pursuant to the Tax
Receivable Agreement, PubCo will be required to pay the Sellers 85% of the
amount of savings, if any, in U.S. federal, state and local income tax that
PubCo actually realizes as a result of the increases in tax basis and certain
other tax benefits related to the payment of the cash consideration pursuant to
the Business Combination Agreement and any exchanges of Utz Units for Class A
common stock of PubCo.
In addition, in connection with the consummation of the Business Combination,
PubCo will, among other things, enter into at Closing with the applicable
Sellers, the Sponsor and certain other parties, (i) an investor rights agreement
relating to, among other things, the composition of the board of directors of
PubCo following the Business Combination, certain customary registration rights
and lockup restrictions and (ii) a standstill agreement relating to certain
prohibited actions regarding acquisition of additional common stock of PubCo and
certain governance matters for a specified period of time after the Closing.
Representations and Warranties, Covenants
Under the Business Combination Agreement, the parties to the agreement made
customary representations and warranties for transactions of this type regarding
themselves. The representations and warranties made under the Business
Combination Agreement generally will not survive the Closing, subject to certain
exceptions, including, among others, representations and warranties relating to
certain prohibited affiliate transactions. In addition, the parties to the
Business Combination Agreement agreed to be bound by certain covenants that are
customary for transactions of this type. The covenants made under the Business
Combination generally will not survive the Closing, subject to certain
exceptions, including, among others, certain covenants and agreements that by
their terms are to be performed in whole or in part after the Closing.
Conditions to Each Party's Obligations
The consummation of the Business Combination is subject to the satisfaction or
waiver of certain customary closing conditions of the respective parties,
including, without limitation: (a) the approval and adoption by PubCo's
shareholders of the Business Combination Agreement and transactions contemplated
thereby; (b) if required, the expiration or termination of any applicable
waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976,
as amended; (c) the absence of a Material Adverse Effect (as defined in the
Business Combination Agreement) since the Effective Date; and (d) the cash
proceeds from the trust account established for the purpose of holding the net
proceeds of Collier Creek's initial public offering, net of any amounts paid to
PubCo's shareholders that exercise their redemption rights in connection with
the Business Combination, plus the aggregate proceeds of any permitted equity
financing under the Business Combination Agreement and aggregate gross proceeds
of the forward purchase agreements by and among the Sponsor, PubCo and PubCo's
independent directors, equaling no less than $300,000,000 at the Closing.
Termination
The Business Combination Agreement may be terminated under certain customary and
limited circumstances at any time prior to the Closing, including (i) by written
notice from the Sellers or PubCo to the other party or parties, if the Closing
has not occurred by October 11, 2020, which date shall be automatically extended
to no later than the six month anniversary of the Effective Date upon the
occurrence of certain events (the "Outside Date"), provided that such right to
terminate is not available to either the Sellers or PubCo if such party
exercising the right is in material breach of its representations, warranties,
covenants or agreements under the Business Combination Agreement (including,
with respect to the Sellers, any breach by Utz).
A copy of the Business Combination Agreement is attached as Exhibit 2.1 hereto
and is incorporated herein by reference, and the foregoing description of the
Business Combination Agreement is qualified in its entirety by reference
thereto.
Sponsor Side Letter Agreement
Concurrent with the execution of the Business Combination Agreement, the
Sponsor, certain equityholders of the Sponsor and PubCo's independent directors
entered into a Sponsor Side Letter Agreement (the "Sponsor Side Letter
Agreement"), pursuant to which, at Closing, an aggregate of 2,000,000 Class B
ordinary shares of PubCo held by the Sponsor and PubCo's independent directors
will automatically convert into 2,000,000 shares of Class B common stock of
PubCo, comprised of 1,000,000 shares of Series B-1 non-voting common stock, par
value $0.0001 per share, and 1,000,000 shares of Series B-2 non-voting common
stock, par value $0.0001 per share. All such shares of Class B common stock are
restricted shares that are subject to certain performance-based conversion
events and upon the occurrence of which such Class B common stock would convert
on a one-for-one basis into Class A common stock of PubCo. The shares of Class B
common stock will accrue and be entitled to dividends paid on the Class A common
stock, with such dividends payable upon the conversion of the shares of Class B
common stock into shares of Class A common stock. Any shares of Class B common
stock that have not converted into shares of Class A common stock by the tenth
anniversary of the Closing shall be automatically cancelled.
A copy of the Sponsor Side Letter Agreement is attached as Exhibit 10.1 hereto
. . .
Item 7.01 Regulation FD Disclosure.
On June 5, 2020, Collier Creek issued a press release announcing the execution
of the Business Combination Agreement. The press release is attached hereto as
Exhibit 99.1 and incorporated by reference herein.
Furnished as Exhibit 99.2 hereto and incorporated into this Item 7.01 by
reference is the investor presentation that Collier Creek has prepared for use
in connection with various meetings and conferences with investors.
The foregoing (including Exhibits 99.1 and 99.2) is being furnished pursuant to
Item 7.01 and will not be deemed to be filed for purposes of Section 18 of the
Securities Exchange Act, of 1934, as amended (the "Exchange Act") or otherwise
be subject to the liabilities of that section, nor will it be deemed to be
incorporated by reference in any filing under the Securities Act of 1933, as
amended (the "Securities Act"), or the Exchange Act.
Additional Information
Collier Creek intends to file a registration statement with the Securities and
Exchange Commission (the "SEC") which will include a preliminary proxy statement
and preliminary prospectus of Collier Creek in connection with the proposed
Business Combination and, after the registration statement is declared
effective, will mail a proxy statement/prospectus and other relevant documents
to its shareholders. Collier Creek's shareholders and other interested persons
are advised to read, when available, the preliminary proxy statement/prospectus,
any amendments thereto, and the definitive proxy statement/prospectus in
connection with Collier Creek's solicitation of proxies for the special meeting
to be held to approve the Business Combination as these materials will contain
important information about Utz and Collier Creek and the proposed Business
Combination. The definitive proxy statement/prospectus will be mailed to the
shareholders of Collier Creek as of a record date to be established for voting
on the Business Combination. Such shareholders will also be able to obtain
copies of the proxy statement, without charge, once available, at the SEC's
website at http://www.sec.gov, or by directing a request to: Collier Creek
Holdings, 200 Park Avenue, 58th Floor, New York, NY 10166, attention: Bradford
Williams (williams@cc.capital).
Participants in the Solicitation
Collier Creek, Utz and their respective directors, executive officers, other
members of management, and employees, under SEC rules, may be deemed to be
participants in the solicitation of proxies of Collier Creek's shareholders in
connection with the Business Combination. Investors and security holders may
obtain more detailed information regarding the names and interests in the
Business Combination of Collier Creek's directors and officers in Collier
Creek's filings with the SEC, including Collier Creek's Annual Report on
Form 10-K for the fiscal year ended December 31, 2019, which was filed with the
SEC on March 12, 2020, and such information and names of Utz's directors and
executive officers will also be in the Registration Statement on Form S-4 to be
filed with the SEC by Collier Creek, which will include the proxy
statement/prospectus of Collier Creek for the Business Combination.Shareholders
can obtain copies of Collier Creek's filings with the SEC, without charge, at
the SEC's website at www.sec.gov, or by directing a request to: Collier Creek
Holdings, 200 Park Avenue, 58th Floor, New York, NY 10166, attention: Bradford
Williams (williams@cc.capital).
No Offer or Solicitation
This communication is for informational purposes only and is neither an offer to
purchase, nor a solicitation of an offer to sell, subscribe for or buy any
securities or the solicitation of any vote in any jurisdiction pursuant to the
Business Combination or otherwise, nor shall there be any sale, issuance or
transfer or securities in any jurisdiction in contravention of applicable law.
No offer of securities shall be made except by means of a prospectus meeting the
requirements of Section 10 of the Securities Act and otherwise in accordance
with applicable law.
Forward-Looking Statements
This Current Report includes "forward-looking statements" within the meaning of
the "safe harbor" provisions of the Private Securities Litigation Reform Act of
1995. Collier Creek's and Utz's actual results may differ from their
expectations, estimates and projections and consequently, you should not rely on
these forward looking statements as predictions of future events. Words such as
"expect," "estimate," "project," "budget," "forecast," "anticipate," "intend,"
"plan," "may," "will," "could," "should," "believes," "predicts," "potential,"
"continue," and similar expressions are intended to identify such
forward-looking statements. These forward-looking statements include, without
limitation, Collier Creek's and Utz's expectations with respect to future
performance and anticipated financial impacts of the proposed Business
Combination, the satisfaction of the closing conditions to the Business
Combination and the timing of the completion of the Business Combination. These
forward-looking statements involve significant risks and uncertainties that
could cause the actual results to differ materially from the expected results.
Most of these factors are outside Collier Creek's and Utz's control and are
difficult to predict. Factors that may cause such differences include, but are
not limited to: (1) the occurrence of any event, change or other circumstances
that could give rise to the termination of the Business Combination Agreement;
(2) the outcome of any legal proceedings that may be instituted against Collier
Creek and Utz following the announcement of the Business Combination Agreement
and the transactions contemplated therein; (3) the inability to complete the
proposed Business Combination, including due to failure to obtain approval of
the shareholders of Collier Creek or other conditions to closing in the Business
Combination Agreement; (4) the occurrence of any event, change or other
circumstance that could give rise to the termination of the Business Combination
Agreement or could otherwise cause the Business Combination to fail to close;
(5) the amount of redemption requests made by Collier Creek's shareholders;
(6) the inability to obtain or maintain the listing of the post-business
combination company's common stock on the New York Stock Exchange following the
proposed Business Combination; (7) the risk that the proposed Business
Combination disrupts current plans and operations; (8) the ability to recognize
the anticipated benefits of the proposed Business Combination, which may be
affected by, among other things, competition, the ability of the combined
company to grow and manage growth profitably and retain its key employees;
(9) costs related to the proposed Business Combination; (10) changes in
applicable laws or regulations; (11) the possibility that Utz or the combined
company may be adversely affected by other economic, business, and/or
competitive factors; and (12) other risks and uncertainties indicated from time
to time in the proxy statement/prospectus relating to the proposed Business
Combination, including those included in the section "Risk Factors", and in
Collier Creek's other filings with the SEC. Some of these risks and
uncertainties may in the future be amplified by the COVID-19 outbreak and there
may be additional risks that Collier Creek considers immaterial or which are
unknown. It is not possible to predict or identify all such risks. Collier Creek
cautions that the foregoing list of factors is not exclusive. Collier Creek
cautions readers not to place undue reliance upon any forward-looking
statements, which speak only as of the date made. Collier Creek does not
undertake or accept any obligation or undertaking to release publicly any
updates or revisions to any forward-looking statements to reflect any change in
its expectations or any change in events, conditions or circumstances on which
any such statement is based, except as otherwise required by law.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit
Number Description
2.1† Business Combination Agreement, dated as of June 5, 2020, by and
among Collier Creek Holdings, Series U of UM Partners, LLC, Series R
of UM Partners, LLC and Utz Brands Holdings, LLC
10.1 Sponsor Side Letter Agreement, dated as of June 5, 2020, by and
among Collier Creek Holdings, Collier Creek Partners, LLC and the
other parties thereto
10.2 Unit Purchase Agreement, dated as of June 5, 2020, by and among
Collier Creek Holdings, BSOF SN LLC, Series U of UM Partners, LLC, and
Series R of UM Partners, LLC
99.1 Press Release, dated June 5, 2020
99.2 Investor Presentation, dated June 2020
† Certain of the exhibits and schedules to this exhibit have been omitted in
accordance with Regulation S-K Item 601(b)(2). Collier Creek agrees to
furnish supplementally a copy of all omitted exhibits and schedules to the
SEC upon its request.
© Edgar Online, source Glimpses
UTZ BRANDS, INC. 
