| Item 1.01 | Entry into a Material Definitive Agreement |
On May 24, 2024 (the “Amendment Effective Date”), Resideo Technologies, Inc. (the “Company”, “we”, “our”, or “Resideo”) entered into a Third Amendment to the Amended and Restated Credit Agreement, dated as of the Amendment Effective Date (the “Amendment”), by and among the Company, Resideo Holding Inc., a Delaware corporation, Resideo Intermediate Holding Inc., a Delaware corporation, Resideo Funding Inc., a Delaware corporation, the lenders and issuing banks party thereto, and JPMorgan Chase Bank, N.A., as administrative agent, which amended the existing Amended and Restated Credit Agreement dated as of February 12, 2021 (as amended by that certain First Amendment to Amended and Restated Credit Agreement dated as of March 28, 2022, that certain Second Amendment to Amended and Restated Credit Agreement dated as of June 30, 2023, and as further amended, restated, supplemented or otherwise modified from time to time prior to the date hereof, the “Existing Credit Agreement”).
Pursuant to the Amendment, all of the existing senior secured term B loans under the Existing Credit Agreement (the “Existing Term Loans”) were repriced as follows:
| • | | the interest rate margin was reduced by 25 basis points, from Term SOFR plus 2.25% to Term SOFR plus 2.00%; |
| • | | the Term SOFR credit spread adjustment was eliminated, which was previously 0.11448% for one month interest periods, 0.26161% for three month interest periods and 0.42826% for six month interest periods; |
| • | | the Term SOFR floor was reduced to 0%, which was previously 0.50%; and |
| • | | the call protection (which had expired on August 12, 2021) was reinstated such that any prepayments of the Existing Term Loans made in connection with certain repricing transactions with respect to the Existing Term Loans within six months after the Amendment Effective Date will be subject to a 1.00% prepayment premium. |
No other material changes were made to the terms of the Existing Term Loans (including the aggregate principal amount, being $1,116,965,994.94 as of the Amendment Effective Date) or the Existing Credit Agreement.
The foregoing description of the Amendment is qualified in its entirety by reference to the Amendment, a copy of which is filed herewith as Exhibit 10.1 and incorporated herein by reference.
| Item 2.03 | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement |
The information set forth in Item 1.01 is incorporated herein by reference.
As previously reported, on April 14, 2024, the Company entered into that certain Agreement and Plan of Merger by and among the Company, Snap One Holdings Corp. (“Snap One”) and the other parties named therein. The waiting period applicable to the transactions contemplated by the Merger Agreement (and the related equity financing with affiliates of Clayton Dubilier & Rice LLC) under the Hart Scott Rodino Antitrust Improvements Act of 1976 expired at 11:59 p.m. on May 20, 2024. In addition, Snap One has advised the Company that, on or about May 24, 2024, it mailed to its shareholders the Information Statement contemplated by the Merger Agreement. In light of the foregoing, and subject to the satisfaction or waiver of the conditions to the closing of the transactions contemplated by the Merger Agreement (and related financing transactions), the Company presently expects the transactions contemplated by the Merger Agreement (and related financing transactions) to be consummated prior to the end of June 2024.
The information set forth in this Item 8.01 contains “forward-looking statements” within the meaning of the federal securities laws. All statements, other than statements of fact, that address activities, events or developments that we or our management intend, expect, project, believe or anticipate will or may occur in the future are forward-looking statements. Although we believe forward-looking statements are based upon reasonable assumptions, such statements involve known and unknown risks, uncertainties, and other factors, which may cause the actual results or performance to be materially different from any future results or performance expressed or implied by such forward-looking statements. Such risks and uncertainties include, but are not limited to, (1) the ability of the conditions to the closing of the Snap One transaction (and related financing transactions) to be timely satisfied and the timing for the consummation of such transactions, and (2) the other risks described under the headings “Risk Factors” and “Cautionary Statement Concerning Forward-Looking Statements” in Resideo’s Annual Report on Form 10-K for the year ended December 31, 2023 and the other risks described under the headings “Risk Factors” and “Cautionary Statement Concerning Forward-Looking Statements” in Snap One’s Annual Report on Form 10-K for the fiscal year ended December 29, 2023 and such other periodic filings as each of Resideo and Snap One make from time to time with the Securities and Exchange Commission. You are cautioned not to place undue reliance on these forward-looking statements. Forward-looking statements are not guarantees of future performance, and actual results, developments, and business decisions may differ from those envisaged by our forward-looking statements. Except as required by law, we undertake no obligation to update such statements to reflect events or circumstances arising after the date hereof, and we caution investors not to place undue reliance on any such forward-looking statements.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
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| 10.1 | | Third Amendment to Amended and Restated Credit Agreement, dated as of May 24, 2024, among Resideo Technologies, Inc., a Delaware corporation, Resideo Holding Inc., a Delaware Corporation, Resideo Intermediate Holding Inc., a Delaware corporation, Resideo Funding Inc., a Delaware corporation, the financial institutions party thereto as Lenders and Issuing Banks and JPMorgan Chase Bank, N.A., as Administrative Agent |
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| 104 | | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
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