UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM10-Q
(Mark One)
| UNITED STATES | ||||||||||||||
| SECURITIES AND EXCHANGE COMMISSION | ||||||||||||||
| Washington, D. C. 20549 | ||||||||||||||
| FORM 10-Q | ||||||||||||||
☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||||||||||||||
For the quarterly period ended June 30, 2018
| For the Quarterly period ended September 30, 2022 | ||||||||||||||
| or | ||||||||||||||
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||||||||||||||
For the transition period fromto
Commission FileNo. 001-38518
GS Acquisition Holdings Corp
(Exact name of registrant as specified in its charter)
| Commission File No. 001-38518 | ||||||||||||||||
| Vertiv Holdings Co | ||||||||||||||||
| (Exact name of registrant as specified in its charter) | ||||||||||||||||
Delaware (State or other jurisdiction of incorporation or organization) | 81-2376902 ( Identification No.) | |||||||||||||||
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| 1050 Dearborn Dr, Columbus, Ohio 43085 | ||||||||||||||||
| (Address of | ||||||||||||||||
| 614-888-0246 | ||||||||||||||||
| ( | ||||||||||||||||
(212)902-1000
(Registrant’s telephone number, including area code)
N/A
(Former name, former address and former fiscal year, if changed since last report)
| Securities registered pursuant to Section 12(b) of the Act: | ||||||||||||||
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
| Class A common stock, $0.0001 par value per share | VRT | New York Stock Exchange | ||||||||||||
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| Large accelerated filer | ☒ | Accelerated filer | ☐ | ||||||||||||
| Non-accelerated filer | ☐ | Smaller reporting company | ☐ | ||||||||||||
| Emerging growth company | |||||||||||||||
☒
GS ACQUISITION HOLDINGS CORP
Quarterly Report on Form10-Q
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ASSETS Current assets: Cash Receivable from GS Sponsor LLC Total current assets Cash and cash equivalents held in Trust Account Accrued dividends receivable held in Trust Account Total assets LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable Accrued offering costs Income tax payable Total current liabilities Deferred underwriting compensation Total liabilities Commitments and contingencies Class A common stock subject to possible redemption; 66,176,298 shares at conversion value at June 30, 2018 Stockholders’ equity: Preferred stock, $0.0001 par value, 5,000,000 shares authorized, none issued and outstanding Class A common stock, $0.0001 par value, 500,000,000 shares authorized, 2,823,702 issued and outstanding (excluding 66,176,298 shares subject to possible redemption) Class B common stock, $0.0001 par value, 20,000,000 shares authorized, 17,250,000 issued and outstanding Additionalpaid-in capital Retained earnings/(Accumulated deficit) Total stockholders’ equity Total liabilities and stockholders’ equity CONSOLIDATED STATEMENTS OF EARNINGS (LOSS) Unaudited Condensed Consolidated Financial Statements Revenues Dividend income General and administrative expenses Income (loss) before income tax (provision) benefit Provision for income tax Net Income/ (loss) Weighted average shares outstanding of Class A common stock Basic and diluted net income per share, Class A Weighted average shares outstanding of Class B common stock Basic and diluted net income per share, Class B COMPREHENSIVE INCOME (LOSS) Unaudited Condensed Consolidated Financial Statements Cash flows from operating activities: Net income Change in operating assets and liabilities: Increase in dividend receivable Decrease in receivable from GS DC Sponsor I LLC Increase in accounts payable Increase in accrued tax payable Net cash provided by operating activities Cash flows from investing activities: Proceeds deposited into Trust account Net cash used in investing activities Cash flows from financing activities: Proceeds from sale of Units in Public Offering Proceeds from sale of Private Placement Warrants Payment of underwriting discounts Payment of offering costs Proceeds from GS DC Sponsor I LLC promissory note Repayment of GS DC Sponsor I LLC promissory note Net cash provided by financing activities Increase in cash Cash at beginning of period Cash at end of period Supplemental disclosure ofnon-cash financing activities Accrued offering costs Deferred underwriting compensation stock-based compensation of $5.7. services, respectively. related to the replacement of the LIBOR reference rate, the Company did not apply the optional expedients within the standard. deductible for tax purposes. The adjusted preliminary goodwill allocation of $277.0 and $476.2 is allocated to the Americas and the Europe, Middle East & Africa segments, respectively. range of loss that may result from the ultimate resolution of these matters, other than those described below.PART I—sINFORMATIONBALANCE SHEETS June 30, 2018 December 31, 2017 (Unaudited) $ 1,811,153 $ — — 25,000 1,811,153 25,000 690,000,000 — 613,686 — $ 692,424,839 $ 25,000 $ 126,022 $ 1,276 693,044 — 104,212 923,278 1,276 24,150,000 — 25,073,278 1,276 662,351,552 — — — 282 — 1,725 1,725 4,916,910 326,693 81,092 (304,694 ) 5,000,009 23,724 $ 692,424,839 $ 25,000 Three months ended September 30, 2022 Three months ended September 30, 2021 Nine months ended September 30, 2022 Nine months ended September 30, 2021 Net sales Net sales - products $ 1,135.4 $ 894.8 $ 3,039.8 $ 2,625.1 Net sales - services 345.7 334.1 997.1 962.5 Net sales 1,481.1 1,228.9 4,036.9 3,587.6 Costs and expenses Cost of sales - products 838.5 653.4 2,301.7 1,870.4 Cost of sales - services 213.3 193.8 630.8 568.2 Cost of sales 1,051.8 847.2 2,932.5 2,438.6 Operating expenses Selling, general and administrative expenses 295.2 257.8 875.0 779.6 Amortization of intangibles 54.2 31.6 167.7 95.3 Restructuring costs (1.5) (3.8) 0.1 (0.7) Foreign currency (gain) loss, net 0.2 4.9 1.8 2.1 Asset impairments — 8.7 — 8.7 Other operating expense (income) 1.2 0.7 (1.2) 0.2 Operating profit (loss) 80.0 81.8 61.0 263.8 Interest expense, net 38.8 22.4 101.5 66.5 Loss on extinguishment of debt — — — 0.4 Change in fair value of warrant liabilities 9.8 (32.5) (124.0) 52.3 Income (loss) before income taxes 31.4 91.9 83.5 144.6 Income tax expense 10.2 35.7 33.5 47.0 Net income (loss) $ 21.2 $ 56.2 $ 50.0 $ 97.6 Earnings (loss) per share: Basic $ 0.06 $ 0.16 $ 0.13 $ 0.28 Diluted $ 0.06 $ 0.15 $ (0.20) $ 0.27 Weighted-average shares outstanding: Basic 377,016,981 352,482,900 376,531,805 351,439,095 Diluted 377,444,002 363,198,701 378,038,809 355,974,628 notesNotes to financial statementsGS Acquisition Holdings CorpOPERATIONS Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 (Unaudited) (Unaudited) $ — $ — — — 613,686 — 613,686 — (122,900 ) — (123,688 ) — 490,786 — 489,998 — (104,404 ) — (104,212 ) — $ 386,382 $ — $ 385,786 $ — 69,000,000 — 69,000,000 — $ 0.00 $ — $ 0.00 $ — 17,250,000 17,250,000 17,250,000 17,250,000 $ 0.00 $ — $ 0.00 $ — Three months ended September 30, 2022 Three months ended September 30, 2021 Nine months ended September 30, 2022 Nine months ended September 30, 2021 Net income (loss) $ 21.2 $ 56.2 $ 50.0 $ 97.6 Other comprehensive income (loss), net of tax: Foreign currency translation (146.1) (28.0) (332.3) (43.9) Interest rate swaps 30.9 2.7 107.1 28.0 Tax receivable agreement — 2.2 — (3.1) Pension 0.1 0.1 0.2 (0.5) Other comprehensive income (loss), net of tax (115.1) (23.0) (225.0) (19.5) Comprehensive income (loss) $ (93.9) $ 33.2 $ (175.0) $ 78.1 notesNotes to financial statementsGS Acquisition Holdings CorpSeptember 30, 2022 December 31, 2021 ASSETS Current assets: Cash and cash equivalents $ 258.0 $ 439.1 Accounts receivable, less allowances of $15.9 and $14.1, respectively 1,743.8 1,536.4 Inventories 804.3 616.3 Other current assets 167.7 106.8 Total current assets 2,973.8 2,698.6 Property, plant and equipment, net 466.0 489.3 Other assets: Goodwill 1,247.3 1,330.1 Other intangible assets, net 1,801.6 2,138.2 Deferred income taxes 43.3 47.9 Other 295.0 235.5 Total other assets 3,387.2 3,751.7 Total assets $ 6,827.0 $ 6,939.6 LIABILITIES AND EQUITY Current liabilities: Current portion of long-term debt $ 21.8 $ 21.8 Accounts payable 882.9 858.5 Accrued expenses and other liabilities 900.3 953.4 Income taxes 33.4 21.1 Total current liabilities 1,838.4 1,854.8 Long-term debt, net 3,223.8 2,950.5 Deferred income taxes 152.1 198.8 Warrant liabilities 25.6 149.6 Other long-term liabilities 320.0 368.2 Total liabilities 5,559.9 5,521.9 Equity Preferred stock, $0.0001 par value, 5,000,000 shares authorized, none issued and outstanding — — Common stock, $0.0001 par value, 700,000,000 shares authorized, 377,058,727 and 375,801,857 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively — — Additional paid-in capital 2,621.9 2,597.5 Accumulated deficit (1,165.4) (1,215.4) Accumulated other comprehensive income (loss) (189.4) 35.6 Total equity 1,267.1 1,417.7 Total liabilities and equity $ 6,827.0 $ 6,939.6 Six Months Ended June 30, 2018 2017 (Unaudited) $ 385,786 $ — (613,686 ) — 25,000 124,746 — 104,212 26,058 — (690,000,000 ) — (690,000,000 ) — 690,000,000 — 15,800,000 — (13,800,000 ) — (214,905 ) — 300,000 — (300,000 ) — 691,785,095 — 1,811,153 — — — $ 1,811,153 $ — $ 693,044 $ — $ 24,150,000 $ — Nine months ended September 30, 2022 Nine months ended September 30, 2021 Cash flows from operating activities: Net income (loss) $ 50.0 $ 97.6 Adjustments to reconcile net income (loss) to net cash used for operating activities: Depreciation 53.3 51.6 Amortization 178.6 105.5 Deferred income taxes (22.0) (22.3) Amortization of debt discount and issuance costs 7.4 4.6 Loss on extinguishment of debt — 0.4 Change in fair value of warrant liabilities (124.0) 52.3 Asset impairment — 8.7 Changes in operating working capital (448.0) (160.0) Stock-based compensation 20.1 17.5 Payment of contingent consideration (8.7) — Changes in tax receivable agreement — 3.3 Other (40.2) 15.2 Net cash provided by (used for) operating activities (333.5) 174.4 Cash flows from investing activities: Capital expenditures (61.7) (43.3) Investments in capitalized software (8.0) (9.5) Acquisition of business, net of cash acquired (5.0) — Proceeds from disposition of property, plant and equipment — 6.1 Net cash used for investing activities (74.7) (46.7) Cash flows from financing activities: Borrowings from ABL revolving credit facility and short-term borrowings 578.4 — Repayments of ABL revolving credit facility and short-term borrowings (281.5) — Repayment of long-term debt (10.9) (16.4) Debt issuance costs (0.5) — Proceeds from the exercise of warrants — 107.5 Payment of tax receivable agreement (25.0) — Payment of contingent consideration (12.8) — Exercise of employee stock options 1.3 2.6 Employee taxes paid from shares withheld (4.3) (7.2) Net cash provided by (used for) financing activities 244.7 86.5 Effect of exchange rate changes on cash and cash equivalents (14.9) (5.2) Increase (decrease) in cash, cash equivalents and restricted cash (178.4) 209.0 Beginning cash, cash equivalents and restricted cash 447.1 542.6 Ending cash, cash equivalents and restricted cash $ 268.7 $ 751.6 Changes in operating working capital Accounts receivable $ (257.0) $ (67.8) Inventories (202.3) (147.7) Other current assets (4.2) 2.4 Accounts payable 42.2 63.1 Accrued expenses and other liabilities (15.7) 5.7 Income taxes (11.0) (15.7) Total changes in operating working capital $ (448.0) $ (160.0) notesNotes to financial statementsGS ACQUISITIONUnaudited Condensed Consolidated Financial StatementsShare Capital Shares Amount Additional Paid in Capital Accumulated Deficit Accumulated Other Comprehensive Income (Loss) Total Balance at December 31, 2020 342,024,612 $ — $ 1,791.8 $ (1,331.2) $ 51.5 $ 512.1 Net income (loss) — — — 31.7 — 31.7 Exercise of employee stock options 76,047 — 0.9 — — 0.9 Employee 401K match with Vertiv stock 69,309 — 1.3 — — 1.3 9,346,822 — 176.0 — — 176.0 Stock-based compensation — — 5.6 — — 5.6 Other comprehensive income (loss), net of tax — — — — 1.1 1.1 Balance at March 31, 2021 351,516,790 $ — $ 1,975.6 $ (1,299.5) $ 52.6 $ 728.7 Net income (loss) — $ — $ — $ 9.7 $ — $ 9.7 Exercise of employee stock options 120,721 — 1.4 — — 1.4 586,139 — (0.8) — — (0.8) Employee 401K match with Vertiv stock 107,890 — 2.3 — — 2.3 Other comprehensive income (loss), net of tax — — — — 2.4 2.4 Balance at June 30, 2021 352,331,540 $ — $ 1,978.5 $ (1,289.8) $ 55.0 $ 743.7 Net income (loss) — — $ — $ 56.2 $ — $ 56.2 Exercise of employee stock options 51,122 — 0.8 — — 0.8 27,069 — 5.5 — — 5.5 Employee 401K match with Vertiv stock 89,975 — 2.5 — — 2.5 Other comprehensive income (loss), net of tax — — — — (23.0) (23.0) Balance at September 30, 2021 352,499,706 $ — $ 1,987.3 $ (1,233.6) $ 32.0 $ 785.7 Balance at December 31, 2021 375,801,857 $ — $ 2,597.5 $ (1,215.4) $ 35.6 $ 1,417.7 Net income (loss) — — — 8.5 — 8.5 Exercise of employee stock options 89,566 — 1.0 — — 1.0 Stock-based compensation — — 6.6 — — 6.6 Employee 401K match with Vertiv stock 100,541 — 2.3 — — 2.3 Other comprehensive income (loss), net of tax — — — — 18.0 18.0 Balance at March 31, 2022 375,991,964 $ — $ 2,607.4 $ (1,206.9) $ 53.6 $ 1,454.1 Net income (loss) — $ — $ — $ 20.3 $ — $ 20.3 Exercise of employee stock options 4,279 — 0.1 — — 0.1 563,597 — 2.9 — — 2.9 Employee 401K match with Vertiv stock 161,333 — 2.2 — — 2.2 Other comprehensive income (loss), net of tax — — — — (127.9) (127.9) Balance at June 30, 2022 376,721,173 $ — $ 2,612.6 $ (1,186.6) $ (74.3) $ 1,351.7 Net income (loss) — $ — $ — $ 21.2 $ — $ 21.2 Exercise of employee stock options 20,649 — 0.2 — — 0.2 Stock-based compensation — — 6.3 — — 6.3 Employee 401K match with Vertiv stock 316,905 — 2.8 — — 2.8 Other comprehensive income (loss), net of tax — — — — (115.1) (115.1) Balance at September 30, 2022 377,058,727 $ — $ 2,621.9 $ (1,165.4) $ (189.4) $ 1,267.1 Organizationwarrants includes $107.5 of cash received during the three months ended March 31, 2021 for the exercise of public warrants.Business OperationsOrganizationstock-based compensation of $6.2.General(the “Company”) was incorporated as a Delaware corporation on April 25, 2016. The Company was formedprovides mission-critical infrastructure technologies and life cycle services for the purposedata centers, communication networks, and commercial and industrial environments. Vertiv’s offerings include AC and DC power management products, thermal management products, integrated rack systems, modular solutions, management systems for monitoring and controlling digital infrastructure, and service. Vertiv manages and reports results of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses (the “Initial Business Combination”). The Company is an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the “Securities Act”), as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”).All activityoperations for the period from April 25, 2016 (inception) through June 30, 2018 relates to the Company’s formationthree reportable segments: Americas; Asia Pacific; and its initial public offering (the “Public Offering”) described below and identifying and evaluating prospective acquisition targets for an Initial Business Combination. Europe, Middle East & Africa. Company will not generate any operating revenues until after completion of its Initial Business Combination, at the earliest. The Company will generatenon-operating income in the form of interest or dividend income on cash and cash equivalents from the proceeds derived from the Public Offering and the Private Placement (as defined below) (Note 4). The Company has selected December 31st as its fiscal year end.Sponsor and FinancingBetween April and June 2016, GS Sponsor LLC, a Delaware limited liability company that was initially formed for purposes of being the Company’s sponsor (the “GSAM Member”), began exploring an initial public offering for the Company. The GSAM Member ultimately decided to halt that effort, while continuing to refine its strategy and seek the right partner for this venture.On March 21, 2018, GS DC Sponsor I LLC, a Delaware limited liability company, was selected as the new sponsor of the Company (the “Sponsor”). The Sponsor is jointly owned by the GSAM Member and Cote SPAC 1 LLC, a Delaware limited liability company.The registration statement for the Company’s Public Offering was declared effective by the United States Securities and Exchange Commission (the “SEC”) on June 7, 2018. On June 8, 2018, the underwriters exercised their option to purchase additional units in full. The closing of the underwriters’ option to purchase additional units occurred concurrently with the closing of the Public Offering on June 12, 2018. The Company intends to finance its Initial Business Combination with the proceeds from the $690,000,000 Public Offering of Units (as defined below) (Note 3) and a $15,800,000 private placement of Private Placement Warrants (as defined below) (Note 4). Upon the closing of the Public Offering and the Private Placement, $690,000,000 was placed in a U.S.-based trust account (the “Trust Account”) at Wilmington Trust, N.A. (discussed below).The Trust AccountThe proceeds held in the Trust Account are invested in money market funds registered under the Investment Company Act and compliant with Rule2a-7 thereof that maintain a stable net asset value of $1.00. Unless and until the Company completes the Initial Business Combination, it may pay its expenses only from the net proceeds of the Public Offering and the Private Placement of $2,000,000 held outside the Trust Account less any offering expenses (not including underwriting commission) paid upon the closing of the Public Offering.Except with respect to interest earned on the funds held in the Trust Account that may be released to the Company to pay its taxes, the proceeds from the Public Offering and the Private Placement will not be released from the Trust Account until the earliest of: (i) the completion of the Initial Business Combination; (ii) the redemption of any public shares properly tendered in connection with a stockholder vote to amend the Company’s amended and restated certificate of incorporation to modify the substance or timing of the Company’s obligation to redeem 100% of its public shares if it does not complete the Initial Business Combination within 24 months from the closing of the Public Offering; and (iii) the redemption of all of the Company’s public shares if the Company is unable to complete the Initial Business Combination within 24 months from the closing of the Public Offering, subject to applicable law. The proceeds deposited in the Trust Account could become subject to the claims of the Company’s creditors, if any, which could have priority over the claims of the Company’s public stockholders.The balance in the Trust Account as of June 30, 3018 was $690,613,686, including $613,686 of accrued dividends.Initial Business CombinationThe Company’s management has broad discretion with respect to the specific application of the net proceeds of the Public Offering, although substantially all of the net proceeds of the Public Offering and the Private Placement are intended to be generally applied toward consummating an Initial Business Combination. The Initial Business Combination must occur with one or more businesses or assets with a fair market value equal to at least 80% of the net assets held in the Trust Account (excluding the amount of any deferred underwriting discount). There is no assurance that the Company will be able to successfully effect an Initial Business Combination.The Company, after signing a definitive agreement for an Initial Business Combination, will provide its public stockholders’ with the opportunity to redeem all or a portion of their shares upon the completion of the Initial Business Combination, either (i) in connection with a stockholder meeting called to approve the business combination or (ii) by means of a tender offer. However, in no event will the Company redeem its public shares in an amount that would cause its net tangible assets, after payment of deferred underwriting commissions, to be less than $5,000,001. In such case, the Company would not proceed with the redemption of its public shares and the related Initial Business Combination, and instead may search for an alternate Initial Business Combination.If the Company holds a stockholder vote or there is a tender offer for shares in connection with an Initial Business Combination, a public stockholder will have the right to redeem its shares for an amount in cash equal to its pro rata share of the aggregate amount then on deposit in the Trust Account as of two business days prior to the consummation of the Initial Business Combination, including interest but less taxes payable. As a result, such shares of Class A common stock are recorded at redemption amount and classified as temporary equity upon the completion of the Public Offering, in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, “Distinguishing Liabilities from Equity.”Pursuant to the Company’s amended and restated certificate of incorporation, if the Company is unable to complete the Initial Business Combination within 24 months from the closing of the Public Offering, the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but no more than ten business days thereafter redeem the public shares, at aper-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account including interest but less taxes payable (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the Company’s remaining stockholders and the Company’s board of directors, dissolve and liquidate, subject in each case to the Company’s obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law.The Sponsor and the Company’s officers and directors have entered into a letter agreement with the Company, pursuant to which they have waived their rights to liquidating distributions from the Trust Account with respect to any Founder Shares (as defined below) held by them if the Company fails to complete the Initial Business Combination within 24 months of the closing of the Public Offering. However, if the Sponsor or any of the Company’s directors or officers acquires shares of Class A common stock in or after the Public Offering, they will be entitled to liquidating distributions from the Trust Account with respect to such shares if the Company fails to complete the Initial Business Combination within the prescribed time period.In the event of a liquidation, dissolution or winding up of the Company after an Initial Business Combination, the Company’s stockholders are entitled to share ratably in all assets remaining available for distribution to them after payment of liabilities and after provision is made for each class of stock, if any, having preference over the common stock. The Company’s stockholders have no preemptive or other subscription rights. There are no sinking fund provisions applicable to the common stock, except that the Company will provide its stockholders with the opportunity to redeem their public shares for cash equal to their pro rata share of the aggregate amount then on deposit in the Trust Account, under the circumstances, and, subject to the limitations, described herein.Note 2—Summary of Significant Accounting PoliciesBasis of PresentationThe Company’s unaudited condensed consolidated interim financial statements have been prepared in accordance with generally accepted accounting principles generally accepted(“GAAP”) in the United States of America (“U.S. GAAP”) and the rules and regulations of the SEC forSecurities and Exchange Commission (“SEC”) and include the accounts of the Company and its subsidiaries in which the Company has a controlling interest. These unaudited condensed consolidated interim financial information and the instructions toForm 10-Q. Accordingly, the financial statements do not include all of the information and footnotes required by U.S. GAAP.for complete financial statements. In themanagement’s opinion, of management,these financial statements reflect all adjustments consideredof a normal, recurring nature necessary for a fair presentation have been included. Operatingof the results for the interim periods presented.sixnine months ended JuneSeptember 30, 2018 are not necessarily indicative2021, $31.2 and $121.4 of the results that may be expected for the year ending December 31, 2018 or any other period. The accompanying unaudited condensed interim financial statements should be read in conjunction with the Company’s audited financial statementsnet sales and notes thereto included in the Company’s prospectus filed with the SEC on June 8, 2018, as well as the Company’s audited balance sheet statement$25.0 and notes thereto included in the Company’sForm 8-K filed with the SEC on June 18, 2018.Emerging Growth CompanySection 102(b)(1)$87.6 of the JOBS Act exempts emerging growth companiescost of sales from being requiredproducts were reclassified to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply tonon-emerging growth companies but any such an election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard.This may make comparison of the Company’s financial statement with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.Net Income Per Common ShareThe Company complies with accounting and disclosure requirements of FASB ASC Topic 260, Earnings Per Share. Net income per share of common stock is computed by dividing net income by the weighted average number of common shares outstanding during the period. The Company applies the two-class method in calculating earnings per share.At June 30, 2018, the Company had outstanding warrants to purchase of up to 33,533,333 shares of Class A common stock. The weighted average of these shares was excluded from the calculation of diluted net income per share of common stock since the exercise of the warrants is contingent upon the occurrence of future events. At June 30, 2018, the Company did not have any dilutive securities or other contracts that could, potentially, be exercised or converted into shares of common stock and then share in the earnings of the Company. As a result, diluted net income per share of common stock is the same as basic net income per share of common stock for the period.Cash and Cash EquivalentsCash and cash equivalents include cash on hand and on deposit at banking institutions as well as all highly liquid short-term investments with original maturities of 90 days or less. As of June 30, 2018, the Company held deposits of $1,811,153 at custodian bank and $690,000,000 in Goldman Sachs Financial Square Treasury Investments Fund, a money market fund managed by an affiliate of the GSAM Member. Money market funds are characterized as Level I investments within the fair value hierarchy under ASC 820. Dividend income from money market funds is recognized on an accrual basis.Redeemable Shares of Class A Common StockAs discussed in Note 1, all of the 69,000,000 shares of Class A common stock sold as parts of the Units in the Public Offering contain a redemption feature. In accordance with FASB ASC 480, redemption provisions not solely within the control of the Company require the security to be classified outside of permanent equity. Ordinary liquidation events, which involve the redemption and liquidation of all of the entity’s equity instruments, are excluded from the provisions of FASB ASC 480. Although the Company has not specified a maximum redemption threshold, its amended and restated certificate of incorporation provides that in no event will the Company redeem its public shares in an amount that would cause its net tangible assets to be less than $5,000,001.Accordingly, at June 30, 2018, 66,176,298 of the 69,000,000 shares of Class A common stock included in the Units were classified outside of permanent equity at their redemption value.Concentration of Credit RiskFinancial instruments that potentially subject the Company to concentrations of credit risk consist of cash accounts in a financial institution, which, at times, may exceed the Federal Depository Insurance Coverage of $250,000. The Company has not experienced losses on these accounts and management believes the Company is not exposed to significant risks on such accounts.Financial InstrumentsThe fair value of the Company’s assets and liabilities, which qualify as financial instruments under the FASB ASC 820, “Fair Value Measurements and Disclosures,” approximates the carrying amounts represented in the balance sheet, primarily due to their short term nature.Use of EstimatesCompany’s managementCompany to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual resultsamounts could differ from the estimates. On an ongoing basis, management reviews its estimates based on currently available information. Changes in facts and circumstances may result in revised estimates. Results for these interim periods are not necessarily indicative of results to be expected for the full year due to, among other reasons, the continued uncertainty of general economic conditions due to the COVID-19 pandemic that has impacted, and may continue to impact, the Company's sales channels, supply chain, manufacturing operations, workforce, or other key aspects of the Company’s operations.estimates.Offering Costscomplies withalso intends to transition our Term Loan due 2027 and our interest rates swaps to another reference rate prior to the requirementsdiscontinuance of the FASB ASC340-10-S99-1 and SEC Staff Accounting Bulletin Topic 5A —“Expenses of Offering.”LIBOR. The Company incurred offering costsdoes not expect the adoption of this ASU to have a material impact on its Condensed Consolidated Financial Statements.connection with its Public Offering of $907,949. These costs, together with the upfront underwriter discountIreland and deferred discount, of $37,950,000 were charged toVertiv International Holding Corporation, an Ohio corporation, acquired the shares of Class A common stockE&I Engineering Ireland Limited, a private company limited by shares incorporated in Ireland, and warrants uponits affiliate Powerbar Gulf LLC (“E&I”).closingE&I acquisition, the value of the Public Offering.Income TaxesThe Companycontingent earnout is taxed as a corporation for U.S. federal income tax purposes. As a corporation, for tax purposes, the Company is subject to U.S. federal and various state and local income taxeszero based on its earnings.E&I’s projected future results. For the period from April 25, 2016 (inception) through March 20, 2018,nine months ended September 30, 2022 the Companydecrease in the fair value of contingent consideration of $3.7 is included withwithin “Other operating expense (income)” on the Goldman Sachs Group Inc. and subsidiaries (the “Group Inc.”) inUnaudited Condensed Consolidated Statements of Earnings (Loss).consolidated corporate federal income tax return as well as consolidated/combined state and local tax returns. The Company computed its tax liability on a modified separate company basis and will settle such liability withmeasurement period there was one change to the Group Inc. pursuantpurchase price allocation related to a tax sharing arrangement.To the extent the Company generates tax benefits from losses during such time that it is consolidated with the Group Inc.; the amounts will be reimbursed by the Group Inc., pursuantfinal working capital adjustment to the tax sharing arrangement.purchase price. The Company’s statemeasurement period adjustment did not have a material impact on the Unaudited Condensed Consolidated Statements of Earnings (Loss). The following is the preliminary purchase price allocation of assets acquired and local tax liabilities are allocated to reflect its shareassumed as of the consolidated/combined stateacquisition date and local income tax liability.Following changes in ownership on March 21, 2018,related adjustments thereafter:Preliminary Allocation Adjustments Adjusted Preliminary Allocation Accounts receivable $ 87.7 $ — $ 87.7 Inventories 50.1 — 50.1 Other current assets 15.7 — 15.7 Property, plant and equipment 87.1 — 87.1 Goodwill 748.2 5.0 753.2 Other intangible assets 1,004.2 — 1,004.2 Other assets 10.4 — 10.4 Accounts payable 33.9 — 33.9 Accrued expenses and other liabilities 50.0 — 50.0 Deferred income taxes 129.8 — 129.8 Other long-term liabilities 24.3 — 24.3 Net assets acquired and liabilities assumed $ 1,765.4 $ 5.0 $ 1,770.4 Company deconsolidated fromdifference between the Group Inc. for tax purposesacquisition date fair value of the consideration transferred and the tax sharing arrangement with the Group Inc. was terminated. Beginning March 21, 2018, the Company will file separate corporate federal and state and local income tax returns. To the extent the Company generates tax losses after it ceases being consolidated with the Group Inc., tax benefits from losses will be accrued if it is more likely than not the losses may be carried forward and utilized against future expected profits.Income taxes are provided for using thefair value of net assets and liabilities method under which deferred tax assets and liabilities are recognized for temporary differences betweenE&I, and represents the financial reportingfuture economic benefits, including synergies, and tax bases of assets and liabilities.Deferred Income TaxesThe Company follows the asset and liability method of accounting for income taxes under FASB ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differencesassembled workforce, that are expected to be recovered or settled.achieved as a result of the consummation of the acquisition of E&I. The effect on deferred tax assets and liabilities of a change in tax ratesgoodwill arising from the acquisition is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amountnot expected to be realized.Unrecognized Tax BenefitsUseful Life Preliminary Fair Value Customer relationships 15 to 16 years $ 731.6 Developed technology 13 years 180.7 Trademarks 15 to 16 years 52.3 Backlog 1 year 39.6 Total intangible assets $ 1,004.2 Unaudited proforma information Three months ended September 30, 2021 Nine months ended September 30, 2021 Net sales $ 1,322.2 $ 3,884.4 Net income (loss) 43.9 63.0 tax positions in the financial statements only when it is more likely than not that the position will be sustained on examination by the relevant taxing authority based on the technical merits of the position. A position that meets this standard is measured at the largest amount of benefit that will more likely than not be realized on settlement. A liability is established for differences between positions taken in a tax return and amounts recognized in the financial statements. There were no unrecognized tax benefits as of June 30, 2018. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. No amounts were accrued for interest expense and penalties related to income tax matters as of June 30, 2018. The Company is subject to income tax examinations by major taxing authorities since inception.During the six months ended June 30, 2018, the Company recorded income tax expense of $104,212, primarily related to dividend income earned on the Trust Account.Recent Accounting PronouncementsManagement does not believe that any recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company’s financial statements.Note 3—Public OfferingIn the Public Offering, the Company sold 69,000,000 units at an offering price of $10.00 per unit (the “Units”). The Sponsor purchased an aggregate of 10,533,333 Private Placement Warrants (as defined below) at a price of $1.50 per Private Placement Warrant in a private placement that closed simultaneously with the closing of the Public Offering.Each Unit consists of one share of the Company’s Class A common stock, $0.0001 par value, andone-third of one redeemable warrant, with each whole warrant exercisable for one share of Class A common stock (each, a “Warrant” and, collectively, the “Warrants”). One Warrant entitles the holder thereof to purchase one whole share of Class A common stock at a price of $11.50 per share. No fractional shares will be issued upon exercise of the Warrants and only whole Warrants will trade. Each Warrant will become exercisable on the later of 30 days after the completion of the Initial Business Combination and 12 months from the closing of the Public Offering and will expire at 5:00 p.m., New York City time, five years after the completion of the Initial Business Combination or earlier upon redemption or liquidation. Once the Warrants become exercisable, the Company may redeem the outstanding Warrants in whole and not in part at a price of $0.01 per Warrant upon a minimum of 30 days’ prior written notice of redemption, if and only if the last reported sale price of the Company’s Class A common stock equals or exceeds $18.00 per share for any 20 trading days within a30-trading day period ending on the third trading day prior to the date on which the Company sent the notice of redemption to the Warrant holders.The Company paid an underwriting commission of 2.0% of the gross proceeds of the Public Offering, or $13,800,000, to the underwriters at the closing of the Public Offering, with an additional fee (the “Deferred Discount”) of 3.5% of the gross proceeds (or $24,150,000) payable upon the Company’s completion of the Initial Business Combination. The Deferred Discount will become payable to the underwriters from the amounts held in the Trust Account solely in the event the Company completes the Initial Business Combination. The Deferred Discount has been recorded as a deferred liability on the balance sheet at June 30, 2018 as management has deemed the consummation of an Initial Business Combination to be probable.Note 4—Related Party TransactionsFounder SharesIn May 2016, the GSAM Member purchased 2,875,000 shares of Class B common stock (the “Founder Shares”) for an aggregate price of $25,000, or approximately $0.0087 per share. On May 17, 2018, the Company conducted a 1:6 stock split, resulting in the Sponsor holding 17,250,000 Founder Shares. The financial statements reflect the changes of the split retroactively for all periods prior to May 17, 2018. In May 2018, the Sponsor transferred 35,000 Founder Shares to each of the Company’s independent director nominees at their original purchase price. As used herein, unless the context otherwise requires, Founder Shares shall be deemed to include the shares of Class A common stock issuable upon conversion thereof. The Founder Shares are identical to the Class A common stock included in the Units sold in the Public Offering, except that only holders of the Founder Shares have the right to vote on the election of the Company’s directors prior to the Initial Business Combination; the Founder Shares automatically convert into shares of Class A common stock at the time of the Initial Business Combination and are subject to certain transfer restrictions, as described in more detail below, and the holders of the Founder Shares, as described in more detail below, have agreed to certain restrictions and will have certain registration rights with respect thereto. Holders of Founder Shares may also elect to convert their shares of Class B common stock into an equal number of shares of Class A common stock, subject to anti-dilution adjustments, at any time. None of the Founder Shares are subject to forfeiture by the Sponsor since the underwriters’ option to purchase additional units was fully exercised. The number of Founder Shares issued was determined based on the expectation that the Founder Shares would represent 20% of the outstanding shares of common stock upon completion of the Public Offering.The Company’s initial stockholders, officers and directors have agreed not to transfer, assign or sell any Founder Shares held by them until the earlier to occur of: (i) one year after the completion of the Initial Business Combination, (ii) the last sale price of Class A common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any30-trading day period commencing at least 150 days after the Initial Business Combination, or (iii) the date following the completion of the Initial Business Combination on which the Company completes a liquidation, merger, stock exchange, reorganization or other similar transaction that results in all of the public stockholders having the right to exchange their shares of common stock for cash, securities or other property.The Sponsor has purchased an aggregate of 10,533,333 private placement warrants at a price of $1.50 per whole warrant (approximately $15,800,000 in the aggregate) in a private placement (the “Private Placement”) that closed concurrently with the closing of the Public Offering (the “Private Placement Warrants”). Each Private Placement Warrant is exercisable for one whole share of Class A common stock at a price of $11.50 per share. Proceeds from the Private Placement Warrants were added to the proceeds from the Public Offering deposited in the Trust Account such that at the closing of the Public Offering, $690.0 million was held in the Trust Account. If the Initial Business Combination is not completed within 24 months from the closing of the Public Offering, the proceedsrevenue from the sale of manufactured products and services when control of promised goods or services are transferred to customers in an amount that reflects the Private Placement Warrants held consideration the Company expects to be entitled to in exchange for those goods or services.Three months ended September 30, 2022 Americas Asia Pacific Europe, Middle East, & Africa Total Sales by Product and Service Offering: Critical infrastructure & solutions $ 417.3 $ 265.7 $ 224.3 $ 907.3 Services & spares 203.6 113.3 71.1 388.0 Integrated rack solutions 91.7 57.1 37.0 185.8 Total $ 712.6 $ 436.1 $ 332.4 $ 1,481.1 Timing of revenue recognition: Products and services transferred at a point in time $ 492.7 $ 343.4 $ 231.8 $ 1,067.9 Products and services transferred over time 219.9 92.7 100.6 413.2 Total $ 712.6 $ 436.1 $ 332.4 $ 1,481.1 Three months ended September 30, 2021 Americas Asia Pacific Europe, Middle East, & Africa Total Sales by Product and Service Offering: Critical infrastructure & solutions $ 291.9 $ 234.0 $ 180.4 $ 706.3 Services & spares 180.2 104.4 80.8 365.4 Integrated rack solutions 65.1 56.2 35.9 157.2 Total $ 537.2 $ 394.6 $ 297.1 $ 1,228.9 Timing of revenue recognition: Products and services transferred at a point in time $ 363.5 $ 316.0 $ 253.3 $ 932.8 Products and services transferred over time 173.7 78.6 43.8 296.1 Total $ 537.2 $ 394.6 $ 297.1 $ 1,228.9 Nine months ended September 30, 2022 Americas Asia Pacific Europe, Middle East, & Africa Total Sales by Product and Service Offering: Critical infrastructure & solutions $ 1,080.5 $ 692.5 $ 642.6 $ 2,415.6 Services & spares 555.9 330.8 208.0 1,094.7 Integrated rack solutions 258.5 152.8 115.3 526.6 Total $ 1,894.9 $ 1,176.1 $ 965.9 $ 4,036.9 Timing of revenue recognition: Products and services transferred at a point in time $ 1,323.3 $ 909.5 $ 681.9 $ 2,914.7 Products and services transferred over time 571.6 266.6 284.0 1,122.2 Total $ 1,894.9 $ 1,176.1 $ 965.9 $ 4,036.9 Nine months ended September 30, 2021 Americas Asia Pacific Europe, Middle East, & Africa Total Sales by Product and Service Offering: Critical infrastructure & solutions $ 877.2 $ 690.0 $ 494.1 $ 2,061.3 Services & spares 513.4 305.8 229.9 1,049.1 Integrated rack solutions 213.0 154.1 110.1 477.2 Total $ 1,603.6 $ 1,149.9 $ 834.1 $ 3,587.6 Timing of revenue recognition: Products and services transferred at a point in time $ 1,111.1 $ 913.3 $ 696.6 $ 2,721.0 Products and services transferred over time 492.5 236.6 137.5 866.6 Total $ 1,603.6 $ 1,149.9 $ 834.1 $ 3,587.6 Balances at December 31, 2021 $ 278.7 $ 238.9 45.8 59.9 48.2 52.1 Trust Accountnext 13 to 24 months, the next 25 to 36 months, and thereafter, respectively.Three months ended September 30, 2022 Three months ended September 30, 2021 Nine months ended September 30, 2022 Nine months ended September 30, 2021 Americas $ 0.4 $ 0.3 $ 1.4 $ 2.4 Asia Pacific (1.7) — (1.7) 3.4 (0.1) (4.1) 0.6 (6.8) Corporate (0.1) — (0.2) 0.3 Total $ (1.5) $ (3.8) $ 0.1 $ (0.7) December 31, 2021 Expense Paid/Utilized September 30, 2022 Severance and benefits $ 33.8 $ (1.7) $ (15.7) $ 16.4 Plant closing and other 0.2 1.8 (1.8) 0.2 Total $ 34.0 $ 0.1 $ (17.5) $ 16.6 December 31, 2020 Expense Paid/Utilized September 30, 2021 Severance and benefits $ 68.9 $ (4.8) $ (21.0) $ 43.1 Plant closing and other 0.4 4.1 (3.9) 0.6 Total $ 69.3 $ (0.7) $ (24.9) $ 43.7 September 30, 2022 December 31, 2021 Term Loan due 2027 at 5.30% and 2.84% at September 30, 2022 and December 31, 2021, respectively $ 2,150.7 $ 2,161.7 Senior Secured Notes due 2028 at 4.125% at both September 30, 2022 and December 31, 2021 850.0 850.0 ABL Revolving Credit Facility 280.0 — Unamortized discount and issuance costs (35.1) (39.4) 3,245.6 2,972.3 Less: Current Portion (21.8) (21.8) Total long-term debt, net of current portion $ 3,223.8 $ 2,950.5 Three months ended September 30, 2022 Three months ended September 30, 2021 Nine months ended September 30, 2022 Nine months ended September 30, 2021 Operating lease cost $ 13.7 $ 14.0 $ 42.0 $ 42.6 Short-term and variable lease cost 6.0 5.6 18.3 16.1 Total lease cost $ 19.7 $ 19.6 $ 60.3 $ 58.7 Nine months ended September 30, 2022 Nine months ended September 30, 2021 Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflows - Payments on operating leases $ 42.2 $ 42.1 Right-of-use assets obtained in exchange for new lease obligations: Operating leases $ 37.9 $ 52.5 Financial statement line item September 30, 2022 December 31, 2021 Operating lease right-of-use assets Other assets $ 144.6 $ 152.9 Operating lease liabilities Accrued expenses and other liabilities $ 42.6 $ 42.1 Operating lease liabilities Other long-term liabilities 105.9 113.6 Total lease liabilities $ 148.5 $ 155.7 September 30, 2022 December 31, 2021 Weighted-average remaining lease term 5.7 years 5.5 years Weighted-average discount rate 5.5 % 5.2 % September 30, 2022 December 31, 2021 Operating Leases 2022 $ 12.7 $ 50.5 2023 46.8 41.5 2024 35.3 30.0 2025 23.2 18.7 2026 14.4 10.3 Thereafter 43.8 32.3 Total Lease Payments 176.2 183.3 Less: Imputed Interest (27.7) (27.6) Present value of lease liabilities $ 148.5 $ 155.7 used to fund the redemptiondue on or before November 30, 2022. Upon receipt of the public shares (subjectthird installment payment, the Tax Receivable Agreement will terminate and the Company will not be required to make any further payments to the requirementsVertiv Stockholder under the Tax Receivable Agreement.applicable law)accretion expense in “Interest expense, net” in the Unaudited Condensed Consolidated Statement of Earnings (Loss). For the three and nine months ended September 30, 2021, an unrealized gain (loss) of $2.2 and $(3.1) was recorded in “Accumulated other comprehensive income (loss), net” in the Unaudited Condensed Consolidated Balance Sheets, related to the change in fair value of the tax receivable liability.September 30, 2022 December 31, 2021 Reconciliation of cash, cash equivalents, and restricted cash Cash and cash equivalents $ 258.0 $ 439.1 Restricted cash included in other current assets 10.7 8.0 Total cash, cash equivalents, and restricted cash $ 268.7 $ 447.1 September 30, 2022 December 31, 2021 Inventories Finished products $ 268.8 $ 236.5 Raw materials 360.4 274.8 Work in process 175.1 105.0 Total inventories $ 804.3 $ 616.3 September 30, 2022 December 31, 2021 Property, plant and equipment, net Machinery and equipment $ 385.8 $ 373.6 Buildings 293.5 304.8 Land 42.0 42.1 Construction in progress 44.5 34.8 Property, plant and equipment, at cost 765.8 755.3 Less: Accumulated depreciation (299.8) (266.0) Property, plant and equipment, net $ 466.0 $ 489.3 September 30, 2022 December 31, 2021 Accrued expenses and other liabilities Deferred revenue (see Note 4) $ 278.7 $ 238.9 Accrued payroll and other employee compensation 115.2 125.8 Restructuring (see Note 5) 16.6 34.0 Operating lease liabilities (see Note 7) 42.6 42.1 Product warranty 24.3 30.0 Contract liabilities (see Note 4) 48.2 52.1 Tax Receivable Agreement (see Note 9) 75.0 100.0 Other 299.7 330.5 Total $ 900.3 $ 953.4 Nine months ended September 30, 2022 Nine months ended September 30, 2021 Change in product warranty accrual Balance at the beginning of the period $ 30.0 $ 36.5 Provision charge to expense 10.8 11.2 Paid/utilized (16.5) (17.8) Balance at the end of the period $ 24.3 $ 29.9 Private Placement Warrants will expire worthless. valuation does not require significant management judgment. For other financial instruments, pricing inputs are less observable in the marketplace and may require management judgment.As of September 30, 2022 Balance Sheet Location Total Quoted prices in active markets for identical assets (Level 1) Other observable inputs (Level 2) Unobservable inputs (Level 3) Assets: Interest rate swaps Other current assets $ 30.7 $ — $ 30.7 $ — Interest rate swaps Other noncurrent assets 85.1 — 85.1 — Total assets $ 115.8 $ — $ 115.8 $ — Liabilities: Private warrants Warrant liabilities $ 25.6 $ — $ 25.6 $ — Total liabilities $ 25.6 $ — $ 25.6 $ — As of December 31, 2021 Balance Sheet Location Total Quoted prices in active markets for identical assets (Level 1) Other observable inputs (Level 2) Unobservable inputs (Level 3) Assets: Interest rate swaps Other noncurrent assets $ 16.1 $ — $ 16.1 $ — Total assets $ 16.1 $ — $ 16.1 $ — Liabilities: Interest rate swaps Accrued expenses and other liabilities $ 7.4 $ — $ 7.4 $ — Contingent consideration Accrued expenses and other liabilities 3.7 — — 3.7 Private warrants Warrant liabilities 149.6 — 149.6 — Total liabilities $ 160.7 $ — $ 157.0 $ 3.7 Private Placement WarrantsCompany uses interest rate swaps to manage the interest rate mix of the Company’s total debt portfolio and related overall cost of borrowing. At September 30, 2022 and December 31, 2021, interest rate swap agreements designated as cash flow hedges effectively swapped a notional amount of $1,000.0 of LIBOR based floating rate debt for fixed rate debt. The Company’s interest rate swaps mature in March 2027. During the three and nine months ended September 30, 2022 and 2021, the Company recognized $(1.6), $2.7, $2.7, and $7.9 respectively, within “Other operating expense (income)” on the Unaudited Condensed Consolidated Statements of Earnings (Loss).non-redeemable reclassified from accumulated other comprehensive income (loss) into earnings during the next twelve months.exercisablecreditworthiness of the counterparty through the Company’s credit valuation adjustment (“CVA”). The CVA is calculated at the counterparty level utilizing the fair value exposure at each payment date and applying a weighted probability of the appropriate survival and marginal default percentages.Warrant valuation inputs September 30, 2022 December 31, 2021 Stock price $ 9.72 $ 24.97 Strike price $ 11.50 $ 11.50 Remaining life 2.35 3.10 Volatility 46.0 % 34.2 % 4.23 % 0.98 % 0.10 % 0.04 % a cashless basis so longquoted market prices. The following table presents the estimated fair value and carrying value of long-term debt, including the current portion of long-term debt as theyof September 30, 2022 and December 31, 2021. September 30, 2022 December 31, 2021 Fair Value Fair Value Term Loan due 2027 $ 2,053.9 $ 2,150.7 $ 2,148.2 $ 2,161.7 Senior Secured Notes due 2028 683.3 850.0 853.2 850.0 ABL Revolving Credit Facility due 2025 280.0 280.0 — — Three months ended September 30, 2022 Three months ended September 30, 2021 Nine months ended September 30, 2022 Nine months ended September 30, 2021 Foreign currency translation, beginning $ (146.4) $ 89.0 $ 39.8 $ 104.9 Other comprehensive income (loss) (146.1) (28.0) (332.3) (43.9) Foreign currency translation, ending (292.5) 61.0 (292.5) 61.0 Interest rate swaps, beginning 84.9 (7.5) 8.7 (32.8) 30.9 2.7 107.1 28.0 Interest rate swaps, ending 115.8 (4.8) 115.8 (4.8) Pension, beginning (12.8) (20.3) (12.9) (19.7) Actuarial gain (losses) recognized during the period, net of income taxes 0.1 0.1 0.2 (0.5) Pension, ending (12.7) (20.2) (12.7) (20.2) Tax Receivable Agreement, beginning — (6.2) — (0.9) — 2.2 — (3.1) Tax Receivable Agreement, ending — (4.0) — (4.0) Accumulated other comprehensive income (loss) $ (189.4) $ 32.0 $ (189.4) $ 32.0 heldmanaged internally for the products and services sold to customers, including how the results are reviewed by the Sponsorchief operating decision maker, which includes determining resource allocation methodologies used for reportable segments.Sales Three months ended September 30, 2022 Three months ended September 30, 2021 Nine months ended September 30, 2022 Nine months ended September 30, 2021 Americas $ 722.5 $ 542.1 $ 1,925.8 $ 1,616.2 Asia Pacific 460.3 417.2 1,250.7 1,211.1 Europe, Middle East & Africa 381.1 306.4 1,096.7 867.0 1,563.9 1,265.7 4,273.2 3,694.3 Eliminations (82.8) (36.8) (236.3) (106.7) Total $ 1,481.1 $ 1,228.9 $ 4,036.9 $ 3,587.6 Three months ended September 30, 2022 Three months ended September 30, 2021 Nine months ended September 30, 2022 Nine months ended September 30, 2021 Americas $ 9.9 $ 4.9 $ 30.9 $ 12.6 Asia Pacific 24.2 22.6 74.6 61.2 Europe, Middle East & Africa 48.7 9.3 130.8 32.9 Total $ 82.8 $ 36.8 $ 236.3 $ 106.7 Operating profit (loss) Three months ended September 30, 2022 Three months ended September 30, 2021 Nine months ended September 30, 2022 Nine months ended September 30, 2021 Americas $ 115.2 $ 113.4 $ 255.6 $ 368.4 Asia Pacific 83.3 69.4 193.3 185.3 Europe, Middle East & Africa 57.4 59.0 152.4 154.8 Total reportable segments 255.9 241.8 601.3 708.5 Foreign currency gain (loss) (0.2) (4.9) (1.8) (2.1) Corporate and other (121.5) (123.5) (370.8) (347.3) Total corporate, other and eliminations (121.7) (128.4) (372.6) (349.4) Amortization of intangibles (54.2) (31.6) (167.7) (95.3) Operating profit (loss) $ 80.0 $ 81.8 $ 61.0 $ 263.8 (In millions, except share and per share amounts) Three months ended September 30, 2022 Three months ended September 30, 2021 Nine months ended September 30, 2022 Nine months ended September 30, 2021 Basic earnings (loss) per share computation: Net income (loss) $ 21.2 $ 56.2 $ 50.0 $ 97.6 Weighted-average number of shares outstanding - basic 377,016,981 352,482,900 376,531,805 351,439,095 Basic earnings per share 0.06 0.16 $ 0.13 $ 0.28 Diluted earnings (loss) per share computation: Net income (loss) 21.2 $ 56.2 $ 50.0 $ 97.6 — — (124.0) — Net income (loss) adjusted for the gain on fair value of warrant liabilities $ 21.2 $ 56.2 $ (74.0) $ 97.6 Weighted-average number of shares outstanding - basic 377,016,981 352,482,900 376,531,805 351,439,095 Dilutive effect of private warrants — 5,976,022 1,507,004 — Dilutive effect of equity-based compensation 427,021 4,739,779 — 4,535,533 Weighted-average number of shares outstanding - diluted 377,444,002 363,198,701 378,038,809 355,974,628 Diluted earnings (loss) per share 0.06 0.15 $ (0.20) $ 0.27 its permitted transferees.Sponsorpurchase agreement contained a provision for contingent consideration in the form of an earn-out payment based on the achievement of 2018 operating results. The range of payment outcomes was zero to $34.5. On June 4, 2019, Vertiv notified the selling stockholders of Energy Labs of Vertiv’s determination that the applicable 2018 operating results had not been achieved and that no contingent consideration was due to the selling stockholders. On September 6, 2019, the selling stockholders of Energy Labs notified Vertiv of their dispute regarding the contingent consideration allegedly due to them. The selling stockholders asserted that the applicable 2018 operating results were exceeded and that Vertiv owed $34.5 in earn-out, the highest amount of earn-out possible under the agreement. On December 21, 2021, the parties agreed to a settlement term sheet, which includes, among other terms, the following: the Company agreed to pay $21.5 to the selling stockholders of Energy Labs; a full and complete mutual waiver, release and discharge of all claims and liabilities; and a dismissal of the pending lawsuit. The parties executed a Settlement Agreement on December 30, 2021 consistent with the aforementioned terms. On January 12, 2022, the Company paid the agreed upon settlement of $21.5.have agreed, subject to limited exceptions, not to transfer, assign or sell anyand other defendants in the Southern District of their Private Placement Warrants until 30 days after the completionNew York. Plaintiffs filed an amended complaint on September 16, 2022. The amended complaint alleges that certain of the Initial Business Combination.Registration RightsThe holders of Founder SharesCompany’s public statements were materially false and/or misleading with respect to inflationary and Private Placement Warrants are,supply chain pressures and holders of warrants that may be issued upon conversion of working capital loans, if any, will be, entitled to registration rights to require the Company to register the resale of any of its securities held by them (in the casepricing issues, and asserts claims under Sections 10(b) and 20(a) of the Founder Shares, only after conversionSecurities Exchange Act of such shares to shares1934, as amended, and Sections 11, 12(a)(2), and 15 of Class A common stock) as stated in the registration rights agreement signed on the date of the prospectus for the Public Offering. These holders are also entitled to certain piggyback registration rights. However, the registration rights agreement provides that the Company will not permit any registration statement filed under the Securities Act to become effective until termination of the applicablelock-up period for the1933, as amended. These claims are asserted on behalf of a putative class of all persons and entities that (i) purchased Vertiv securities to be registered. The Company will bear the expenses incurredbetween February 24, 2021 and February 22, 2022; and/or (ii) purchased Vertiv securities in connection with the filing of any such registration statements.Related Party Sponsor NoteOn April 9, 2018, the GSAM Member agreed to loan the Company an aggregate amount of up to $300,000 to be used to pay a portion of the expenses relatedor traceable to the Public OfferingNovember 4, 2021 secondary public offering by a selling stockholder pursuant to a promissory note (the “Note”). The Note wasnon-interest bearing, unsecured and payable on the earlier of December 31, 2018 and the closing of the Public Offering. On April 9, 2018,resale registration statement. While the Company borrowed $300,000 underbelieves it has meritorious defenses against the Note. On June 12, 2018, the full $300,000 balance of the Note was repaid to the Sponsor.Administrative Support AgreementThe Company has entered into an agreement to pay an affiliate of the Sponsor a total of $10,000 per month for office space, utilities, administrative and support services. Upon the earlier of the completion of the Initial Business Combination and the Company’s liquidation, the Company will cease paying these monthly fees.Note 5—Stockholders’ EquityCommon StockThe authorized common stock of the Company includes up to 500,000,000 shares of Class A common stock and 20,000,000 shares of Class B common stock. If the Company enters into an Initial Business Combination, it may (depending on the terms of such an Initial Business Combination) be required to increase the number of shares of Class A common stock whichplaintiffs' claims, the Company is authorized to issueunable at the same time as the Company’s stockholders vote on the Initial Business Combination to the extent the Company seeks stockholder approval in connection with the Initial Business Combination. Holders of the Company’s common stock are entitled to one vote for each share of common stock; provided that only holders of the Founder Shares have the right to vote on the election of the Company’s directors prior to the Initial Business Combination. At June 30, 2018, there were 69,000,000 shares of Class A common stock issued and outstanding, of which 66,176,298 shares were subject to possible redemption and are classified outside of permanent equity at the balance sheet, and 17,250,000 shares of Class B common stock issued and outstanding. In connection with issuance of shares of Class A common stock, the Company issued 23,000,000 warrants. The Company has determined that the warrants are accounted for separately from shares of Class A common stock.Preferred StockThe Company is authorized to issue 5,000,000 shares of preferred stock with such designations, voting and other rights and preferences as may be determined fromthis time to time bypredict the Company’s boardoutcome of directors. this dispute or the amount of any cost associated with its resolution.JuneSeptember 30, 2018,2022, other than as described above, there were no sharesknown contingent liabilities (including guarantees, taxes and other claims) that management believes were or will be material in relation to the Company’s Unaudited Condensed Consolidated Financial Statements, nor were there any material commitments outside the normal course of preferred stock issued or outstanding.Note 6—Subsequent EventsManagement has performed an evaluationbusiness.
otherwise, except as may be required under applicable securities laws. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond Vertiv’s control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. Should one or more of these risks or uncertainties materialize, or should any of the assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. Vertiv has previously disclosed risk factors in its Securities and Exchange Commission (“SEC”) reports, including those set forth in the 2021 Form 10-K. These risk factors and those identified elsewhere in this Quarterly Report on Form 10-Q, among others, could cause actual results to differ materially from historical performance and include, but are not limited to: risks relating to the continued growth of Vertiv’s customers’ markets; disruption of Vertiv’s customers’ orders or Vertiv’s customers’ markets; less favorable contractual terms with large customers; risks associated with governmental contracts; failure to mitigate risks associated with long-term fixed price contracts; competition in the infrastructure technologies industry; failure to obtain performance and other guarantees from financial institutions; failure to realize sales expected from Vertiv’s backlog of orders and contracts; failure to properly manage Vertiv’s supply chain or difficulties with third-party manufacturers; our ability to forecast changes in prices, including due to inflation in material, freight and/or labor costs, and timely implement measures necessary to mitigate the impacts of any such changes; risks associated with our significant backlog, including that the impacts of any measures taken to mitigate inflation will not be reflected in our financial statements immediately; failure to meet or anticipate technology changes; risks associated with information technology disruption or security; risks associated with the implementation and enhancement of information systems; failure to realize the expected benefit from any rationalization, restructuring and improvement efforts; Vertiv’s ability to realize cost savings in connection with Vertiv’s restructuring program; disruption of, or changes in, Vertiv’s independent sales representatives, distributors and original equipment manufacturers; changes to tax law; ongoing tax audits; costs or liabilities associated with product liability; the global scope of Vertiv’s operations; risks associated with Vertiv’s sales and operations in emerging markets; risks associated with future legislation and regulation of Vertiv’s customers’ markets both in the U.S. and abroad; Vertiv’s ability to comply with various laws and regulations and the costs associated with legal compliance; adverse outcomes to any legal claims and proceedings filed by or against Vertiv; risks associated with current or potential litigation or claims against Vertiv; Vertiv’s ability to protect or enforce its proprietary rights on which its business depends; third party intellectual property infringement claims; liabilities associated with environmental, health and safety matters, including risks associated with the COVID-19 pandemic; failure to realize the value of goodwill and intangible assets; exposure to fluctuations in foreign currency exchange rates; exposure to increases in interest rates set by central banking authorities; failure to maintain internal controls over financial reporting; the unpredictability of Vertiv’s future operational results, including the ability to grow and manage growth profitably; potential net losses in future periods; Vertiv’s level of indebtedness and the ability to incur additional indebtedness; Vertiv’s ability to comply with the covenants and restrictions contained in our credit agreements, including restrictive covenants that restrict operational flexibility; Vertiv’s ability to financing markets on acceptable terms. and Estimates OPERATIONS.References in this Quarterly Report on Form10-Q (this “Quarterly Report”)OPERATIONS“us,”“us” and “our” or the “Company” are to GS Acquisition Holdings Corp. References to our “management” or our “management team” refer to our officersVertiv Holdings Co, a Delaware corporation, and directors. Theits consolidated subsidiaries. In addition, dollar amounts are stated in millions, except for per share amounts. You should read the following discussion and analysis should be readof our financial condition and results of operations in conjunction with ourthe unaudited condensed consolidatedfinancial statements and relatedthe notes thereto included elsewhere in this Quarterly Report.Forward-LookingReport on Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on March 1, 2022 (the “2021 Form 10-K”).statements. All statements, other thanand are not guarantees of performance. Vertiv cautions that forward-looking statements ofare subject to numerous assumptions, risks and uncertainties, which change over time. Such statements can be identified by the fact that they do not relate strictly to historical fact includedor current facts. When used in this Quarterly Report including, without limitation, statements in this “Management’s Discussionon Form 10-Q, words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “strive,” “would” and Analysis of Financial Condition and Results of Operations” regarding the Company’s financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. In some cases, you cansimilar expressions may identify forward-looking statements, by terminology such as “may,” “should,” “could,” “would,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “continue,” orbut the negativeabsence of such terms or other similar expressions. We have based these words does not mean that a statement is not forward-looking.ourForm 10-Q are based on current expectations and projections aboutbeliefs concerning future events. Forward-looking statements are subject to knowndevelopments and unknown risks, uncertainties and assumptions about ustheir potential effects on Vertiv. There can be no assurance that may cause our actual results, levels of activity, performance or achievements tofuture developments affecting Vertiv will be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. Factorsthose that might cause or contribute to such a discrepancy include, but are not limited to, those described in the Risk Factors section of our final prospectus for our Public Offering (as defined below) and in our other Securities and Exchange Commission (“SEC”) filings. Except as expressly required by applicable securities law, we disclaim any intention orVertiv has anticipated. Vertiv undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.blank check company incorporatedglobal leader in the design, manufacturing and servicing of critical digital infrastructure technology that powers, cools, deploys, secures and maintains electronics that process, store and transmit data. We provide this technology to data centers, communication networks and commercial and industrial environments worldwide. We aim to help create a world where critical technologies always work, and where we empower the vital applications of the digital world.Delaware corporationresult of the pricing actions that we undertook in the fourth quarter of 2021, the first nine months of 2022, and formedwhich we will continue to take throughout the remainder of 2022.(Dollars in millions) Three months ended September 30, 2022 Three months ended September 30, 2021 $ Change % Change Net sales $ 1,481.1 $ 1,228.9 $ 252.2 20.5 % Cost of sales 1,051.8 847.2 204.6 24.2 Gross profit 429.3 381.7 47.6 12.5 Selling, general and administrative expenses 295.2 257.8 37.4 14.5 Amortization of intangibles 54.2 31.6 22.6 71.5 Restructuring costs (1.5) (3.8) 2.3 (60.5) Foreign currency (gain) loss, net 0.2 4.9 (4.7) (95.9) Asset impairments — 8.7 (8.7) (100.0) Other operating expense (income) 1.2 0.7 0.5 71.4 Operating profit (loss) 80.0 81.8 (1.8) (2.2) Interest expense, net 38.8 22.4 16.4 73.2 Change in fair value of warrant liabilities 9.8 (32.5) 42.3 (130.2) Income tax expense 10.2 35.7 (25.5) (71.4) Net income (loss) $ 21.2 $ 56.2 $ (35.0) (62.3) % purposethird quarter of effecting2022, which was a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses (the “Initial Business Combination”).We intend to effectuate an Initial Business Combination using cash$12.0 increase from the proceedsthird quarter of our2021. The increase was primarily due to an increase in amortization of intangibles of $22.6 associated with the acquisition of E&I on November 1, 2021, offset by a decrease in asset impairments of $8.7.(the “Public Offering”) that closedof our predecessor GS Acquisition Holdings Corp. The change in fair value of the outstanding warrants during the third quarter of 2022 and 2021 resulted in a loss of $9.8 and a gain of $32.5, respectively. The change in fair value of warrants is the result of changes in market prices of our common stock and other observable inputs deriving the value of the financial instruments.June 12, 2018 (the “Closing Date”)our interest rate swaps as described in “Note 11 — Financial Instruments and Risk Management” to the Unaudited Condensed Consolidated Financial Statements. As interest rates increase, our interest expense will increase although the effect will be mitigated by our interest rate swaps.(Dollars in millions) Three months ended September 30, 2022 Three months ended September 30, 2021 $ Change % Change Net sales $ 712.6 $ 537.2 $ 175.4 32.7 % Operating profit (loss) 115.2 113.4 1.8 1.6 Margin 16.2 % 21.1 % (Dollars in millions) Three months ended September 30, 2022 Three months ended September 30, 2021 $ Change % Change Net sales $ 436.1 $ 394.6 $ 41.5 10.5 % Operating profit (loss) 83.3 69.4 13.9 20.0 Margin 19.1 % 17.6 % (Dollars in millions) Three months ended September 30, 2022 Three months ended September 30, 2021 $ Change % Change Net sales $ 332.4 $ 297.1 $ 35.3 11.9 % Operating profit (loss) 57.4 59.0 (1.6) (2.7) Margin 17.3 % 19.9 % (Dollars in millions) Nine months ended September 30, 2022 Nine months ended September 30, 2021 $ Change % Change Net sales $ 4,036.9 $ 3,587.6 $ 449.3 12.5 % Cost of sales 2,932.5 2,438.6 493.9 20.3 Gross profit 1,104.4 1,149.0 (44.6) (3.9) Selling, general and administrative expenses 875.0 779.6 95.4 12.2 Amortization of intangibles 167.7 95.3 72.4 76.0 Restructuring costs 0.1 (0.7) 0.8 (114.3) Foreign currency (gain) loss, net 1.8 2.1 (0.3) (14.3) Asset impairments — 8.7 (8.7) (100.0) Other operating expense (income) (1.2) 0.2 (1.4) (700.0) Operating profit (loss) 61.0 263.8 (202.8) (76.9) Interest expense, net 101.5 66.5 35.0 52.6 Loss on extinguishment of debt — 0.4 (0.4) (100.0) Change in fair value of warrant liabilities (124.0) 52.3 (176.3) (337.1) Income tax expense 33.5 47.0 (13.5) (28.7) Net income (loss) $ 50.0 $ 97.6 $ (47.6) (48.8) % (Dollars in millions) Nine months ended September 30, 2022 Nine months ended September 30, 2021 $ Change % Change Net sales $ 1,894.9 $ 1,603.6 $ 291.3 18.2 % Operating profit (loss) 255.6 368.4 (112.8) (30.6) Margin 13.5 % 23.0 % (Dollars in millions) Nine months ended September 30, 2022 Nine months ended September 30, 2021 $ Change % Change Net sales $ 1,176.1 $ 1,149.9 $ 26.2 2.3 % Operating profit (loss) 193.3 185.3 8.0 4.3 Margin 16.4 % 16.1 % (Dollars in millions) Nine months ended September 30, 2022 Nine months ended September 30, 2021 $ Change % Change Net sales $ 965.9 $ 834.1 $ 131.8 15.8 % Operating profit (loss) 152.4 154.8 (2.4) (1.6) Margin 15.8 % 18.6 % warrants4.125% per annum and mature on November 15, 2028.purchase shares of our Class A common stock (“Private Placement Warrants”) that closed on the Closing Date,invest for growth in existing businesses and from additional issuances of, if any,manage our capital stockstructure on a short- and long-term basis. We expect to continue to opportunistically access the capital and financing markets from time to time. Access to capital and the availability of financing on acceptable terms in the future will be affected by many factors, including our debt, or a combinationcredit rating, economic conditions, and the overall liquidity of cash, stockcapital markets. There can be no assurance that we will continue to have access to the capital and debt.JuneSeptember 30, 2018,2022, we had $258.0 in cash and cash equivalents, which includes amounts held outside of $1,811,153, currentthe U.S., primarily in Europe and Asia. Non-U.S. cash is generally available for repatriation without legal restrictions, subject to certain taxes, mainly withholding taxes. We are not asserting indefinite reinvestment of cash or outside basis for our non-U.S. subsidiaries due to the outstanding debt obligations in instances where alternative repatriation options other than dividends are not available. Our ABL Revolving Credit Facility provides for up to $570.0 of revolving borrowings, with separate sublimits for letters of credit and swingline borrowings and an uncommitted accordion of up to $30.0. At September 30, 2022, Vertiv Group and certain other subsidiaries of the Company had $273.1 of availability under the ABL Revolving Credit Facility, net of letters of credit outstanding in the aggregate principal amount of $16.9, and taking into account the borrowing base limitations set forth in the ABL Revolving Credit Facility. At September 30, 2022, there was a $280.0 balance on the ABL Revolving Credit Facility.(Dollars in millions) 2022 2021 $ Change % Change Net cash provided by (used for) operating activities $ (333.5) $ 174.4 $ (507.9) (291.2) % Net cash used for investing activities (74.7) (46.7) (28.0) (60.0) Net cash provided by (used for) financing activities 244.7 86.5 158.2 182.9 Capital expenditures (61.7) (43.3) (18.4) (42.5) Investments in capitalized software (8.0) (9.5) 1.5 15.8 $923,278$124.0 and deferred underwritingtaxes of $22.0, offset by depreciation and amortization of $231.9, non-cash stock-based compensation expense of $24,150,000. Further, we expect$20.1 and amortization of debt discount and issuance costs of $7.4. Trade working capital used $448.0 in comparison to continue to incur significant costs$160.0 in the pursuitfirst nine months of our acquisition plans. We cannot assure you that our plans2021, primarily as a result of increased accounts receivable associated with higher sales volume, inventory build to complete an Initial Business Combination will be successful.Resultssupport forecasted sales and to meet customer demand, and a $8.7 payment related to a litigation settlement. Refer to “Note 15 — Commitments and Contingencies” in Part I. Item I. of OperationsForthis Form 10-Q for additional information related to this settlement.sixfirst nine months ended June 30, 2018of 2022 compared to net cash used for investing activities of $46.7 in the first nine months of 2021. The increased use of cash over the comparable period was primarily the result of increased capital expenditures and 2017, we had net incomea $5.0 increase related to measurement period adjustment due to a final working capital adjustment to the purchase price.$385,786 and $0, respectively. Our income consists solely2022 compared to $86.5 provided by in the first nine months of dividends earned. Our business activities from inception to June 30, 2018 consisted2021. The increase was primarily of our formation and completing our Public Offering, and since the offering, our activity has been limited to identifying and evaluating prospective acquisition targets for an Initial Business Combination.Liquidity and Capital ResourcesUntil the closingresult of the Public Offering, our only sourcenet borrowings of liquidity was an initial sale$280.0 under the ABL Revolving Credit Facility, partially offset by the lack of shares (the “Founder Shares”) of Class B common stock, par value $0.0001 per share, to our sponsor, GS DC Sponsor I LLC, a Delaware limited liability company (the “Sponsor”), and the proceeds of a promissory note (the “Note”) from the Sponsor,exercise of public warrants totaling $107.5 in the amount2021.United StatesU.S. requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the condensed financial statements,Unaudited Condensed Consolidated Financial Statements, and income and expenses during the periods reported. Actual results could materially differ from those estimates. We have identifiedThe preceding discussion and analysis of our consolidated results of operations and financial condition should be read in conjunction with our Unaudited Condensed Consolidated Financial Statements included elsewhere in this Quarterly Report on Form 10-Q. The 2021 financial statements, as part of the following as2021 Form 10-K, includes additional information about us, our operations, our financial condition, our critical accounting policies:Net Income Per Common ShareWe complypolicies and accounting estimates, and should be read in conjunction with this Quarterly Report on Form 10-Q. Our significant accounting and disclosure requirementspolicies are described in “Note 1 - Summary of FASB ASC Topic 260, Earnings Per Share. Net income per share of common stock is computed by dividing net income by the weighted average number of common shares outstanding during the period. We apply the two-class method in calculating earnings per share.At June 30, 2018, we had outstanding warrants to purchase of up to 33,533,333 shares of Class A common stock. The weighted average of these shares was excluded from the calculation of diluted net income per share of common stock since the exerciseSignificant Accounting Policies” of the warrants is contingent upon the occurrence of future events. At June 30, 2018, we did not have any dilutive securities or other contracts that could, potentially, be exercised or converted into shares of common stock and then share in our earnings. As a result, diluted net income per share of common stock is the same as basic net income per share of common stock for the period.Redeemable Shares of Class A Common StockAll of the 69,000,000 shares of Class A common stock sold as parts of the Units in the Public Offering contain a redemption feature. In accordance with FASB ASC 480, redemption provisions not solely within our control require the security to be classified outside of permanent equity. Ordinary liquidation events, which involve the redemption and liquidation of all of the entity’s equity instruments, are excluded from the provisions of FASB ASC 480. Although we have not specified a maximum redemption threshold, our amended and restated certificate of incorporation provides that in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001.Accordingly, at June 30, 2018, 66,176,298 of the 69,000,000 shares of our Class A common stock were classified outside of permanent equity at its redemption value.Offering CostsWe comply with the requirements of the FASB ASC340-10-S99-1 and SEC Staff Accounting Bulletin Topic 5A —“Expenses of Offering.” We incurred offering costs in connection with our Public Offering of $907,949. These costs, together with the upfront underwriter discount and deferred discount of $37,950,000, were charged to the shares of our Class A common stock and warrants upon the closing of our Public Offering.Recent Accounting PronouncementsManagement does not believe that any recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on our financial statements.
RISK.As of June 30, 2018, we were not subject to anyRISKmarket or interest rate risk. The net proceeds of the Public Offeringchanges in our quantitative and the Private Placement Warrants, including amounts in the Trust Account, were invested in money market funds that meet certain conditions underRule 2a-7 under the Investment Company Act. Due to the short-term nature of these investments, we believe there was no associated material exposure to interest rate risk.We have not engaged in any hedging activities since our inception. We do not expect to engage in any hedging activities with respect to thequalitative market risk to which we are exposed.
PROCEDURESPROCEDURES.are(as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act), and (b) internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act).other procedures as of September 30, 2022 (the end of the period covered by this Quarterly Report on Form 10-Q). Based upon that are designed to ensureevaluation, the Chief Executive Officer and Chief Financial Officer have concluded that, as of September 30, 2022, the Company’s disclosure controls and procedures were effective in ensuring that material information for the Company, including its consolidated subsidiaries, required to be disclosed by the Company in our reports filedthat it files or submittedsubmits under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controlsforms, and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in company reports filed or submitted under the Exchange Actit is accumulated and communicated to management, including our Chief Executive Officer (who servesprincipal executive and financial officers, or persons performing similar functions, as our Principal Executive Officer and Principal Financial and Accounting Officer),appropriate to allow timely decisions regarding required disclosure.As required byRules 13a-15 and15d-15 under the Exchange Act, our Chief Executive Officer carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of June 30, 2018. Based upon his evaluation, our Chief Executive Officer concluded that our disclosure controls and procedures (as definedRules 13a-15(e) and15d-15(e) under the Exchange Act) were effective.During the most recently completed fiscal quarter, there has Internal Control Over Financial Reportingno changeany changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended September 30, 2022, that hashave materially affected, or isare reasonably likely to materially affect, our internal control over financial reporting.II—II. OTHER INFORMATION
PROCEEDINGS.None.
FACTORSFACTORS. that could cause our actual results to differ materially from those in this Quarterly Report are any of the risks described in our prospectus dated June 7, 2018 filed with the SEC on June 8, 2018. Any of these factors could result in a significant or material adverse effect on our results of operations or financial condition. Additional risk factors not presently known to us or that we currently deem immaterial may also impair our business or results of operations.As of the date of this Quarterly Report on Form10-Q,disclosedpresented in Part 1, Item 1A of the 2021 Form 10-K.prospectus datedexecutive management team may also cause disruptions in, and harm to, our business and failure to have an effective succession plan in place for our key executive officers could significantly delay or prevent us from achieving our business and/or development objectives and could materially harm our business. As previously disclosed, Rob Johnson, our Chief Executive Officer, announced that he will retire effective December 31, 2022, for health reasons, and Giordano Albertazzi was appointed to replace him as Chief Executive Officer effective January 1, 2023. Although the Company has taken a number of steps to facilitate an effective succession plan and reduce the challenges associated with a transition of this type, including the inclusion of a post-employment consulting agreement with Mr. Johnson, any failure to ensure effective transfer of knowledge and a smooth transition could disrupt or adversely affect our business, results of operations, financial condition, and prospects.7, 2018 filed with15, 2022 and the SECsecond installment was scheduled to be due on or before September 15, 2022. On June 15, 2022, the Company and the Vertiv Stockholder agreed to further amend the payment schedule under the Tax Receivable Agreement into three installment payments wherein the first installment payment of $12.5 became due and was paid on June 8, 2018. However,15, 2022, the second installment of $12.5 became due and was paid on September 15, 2022, and the third installment of $75 will be due on or before November 30, 2022. Upon receipt of the third installment payment, the Tax Receivable Agreement will terminate and we will not be required to make any further payments to the Vertiv Stockholder. In the event of a change of control of us prior to delivery of all installment payments, all unpaid installment payments (together with any accrued interest thereon) will accelerate and become payable upon the consummation of such change of control. In addition, in the event of a material breach by us of any of our material obligations under the amended Tax Receivable Agreement, all unpaid obligations will accelerate and become payable immediately and will accrue interest at a rate equal to the lesser of the Default Rate and the Maximum Rate (each, as defined in the amended Tax Receivable Agreement) until satisfied in full.disclose changesrealize in future periods, it is possible that the actual cash tax savings realized by us may be significantly less than the corresponding payments we are required to such factors or disclose additional factors from time to time in our future filings withmake under the SEC.amended Tax Receivable Agreement.
PROCEEDS.UnregisteredPROCEEDSEquityUnregistered SecuritiesOn June 12, 2018, simultaneously with the closing of the Public Offering, we completed the private sale of 10,533,333 Private Placement Warrants at a purchase price of $1.50 per Private Placement Warrant, to the Sponsor (GS DC Sponsor I LLC), generating gross proceeds to us of $15,800,000. The Private Placement Warrants are substantially identical to the warrants sold as part of the Units in the Public Offering (as described below), except that our Sponsor has agreed not to transfer, assign or sell any of the Private Placement Warrants (except to certain permitted transferees) until 30 days after the completion of our Initial Business Combination. The Private Placement Warrants are also not redeemable by us so long as they are held by our Sponsor or its permitted transferees, and they may be exercised by our Sponsor and its permitted transferees on a cashless basis. The Private Placement Warrants were issued in connection with our incorporation pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”).On June 12, 2018, we consummated the from our Initial Public Offering of 69,000,000 Units, including the issuanceCommon Stock9,000,000 Units as a resultShares or of the underwriters’ exercise of their option to purchase additional Units in full. Each Unit consists of one share of Class A common stock of the Company par value $0.0001 per share, andone-third of one redeemable warrant of the Company. Each whole warrant entitles the holder thereof to purchase one share of Class A Common Stock for $11.50 per share, and only whole warrants are exercisable. The warrants will become exercisable on the later of 30 days after the completion of our Initial Business Combination and 12 months from the closing of the Public Offering, and will expire five years after the completion of our Initial Business Combination or earlier upon redemption or liquidation. Subject to certain terms and conditions, we may redeem the warrants either for cash once the warrants become exercisable or for shares of our Class A Common Stock commencing 90 days after the warrants become exercisable.The Units were sold at a price of $10.00 per unit, generating gross proceeds to the Company of $690,000,000. Goldman Sachs & Co. LLC served as the sole book-running manager for the offering, and Deutsche BankEquity Securities served asco-manager. The securities sold in the Public Offering were registered under the Securities Act on a registration statement on FormS-1 (No.333-225035). The SEC declared the registration statements effective on June 7, 2018.We paid a total of $13,800,000 in underwriting discounts and commissions and $907,949 for other costs and expenses related to the Public Offering. The underwriters agreed to defer an additional $24,150,000 in underwriting discounts and commissions, payable upon consummation of our Initial Business Combination. Goldman Sachs & Co. LLC, an underwriter in the Public Offering, and an affiliate of us and our Sponsor (which Sponsor beneficially owns more than 10% of our common stock) received a portion of the underwriting discounts and commissions related to thePublic Offering. After deducting the underwriting discounts and commissions (excluding the deferred portion of $24,150,000 in underwriting discounts and commissions, which will be released from the Trust Account upon consummation of Initial Business Combination, if consummated) and incurred offering costs, the total net proceeds from our Public Offering and the sale of the Private Placement Warrants was $691,092,051, of which $690,000,000 (or $10.00 per unit sold in the Public Offering) was placed in the Trust Account. We also repaid $300,000 in non-interest bearing loans made to us by our Sponsor to cover expenses related to the Public Offering. Other than as described above, no payments were made by us to directors, officers or persons owning ten percent or more of our common stock or to their associates, or to our affiliates.
SECURITIESSECURITIES.
DISCLOSURESDISCLOSURES.
INFORMATIONINFORMATION.
Chief EXHIBITS.The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report on Form10-Q.31.2 32.1 32.1**32.2 101.INS The following financial statements from the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2022, formatted in Inline XBRL: (i) Unaudited Condensed Consolidated Statements of Earnings (Loss), (ii) Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss), (iii) Unaudited Condensed Consolidated Balance Sheets, (iv) Unaudited Condensed Consolidated Statements of Cash Flows, and (v) Notes to Unaudited Condensed Consolidated Financial Statements, tagged as blocks of text and including detailed tags 101.INS*101.SCHXBRL Instance Document.101.SCH*Inline XBRL Taxonomy Extension Schema Document.(filed herewith)101.CAL 101.CAL*Inline XBRL Taxonomy Extension Calculation Linkbase Document.(filed herewith)101.DEF 101.DEF*Inline XBRL Taxonomy Extension Definition Linkbase Document.(filed herewith)101.LAB 101.LAB*Inline XBRL Taxonomy Extension Label Linkbase Document.(filed herewith)101.PRE 101.PRE*Inline XBRL Taxonomy Extension Presentation Linkbase Document.(filed herewith)*104Filed herewith.**Furnished herewith.(1)Incorporated by reference toCover page from the Company’s CurrentQuarterly Report on Form8-K filed on June 13, 2018.SIGNATURESDate: October 31, 2022 Vertiv Holdings Co /s/ Rob Johnson GS Acquisition Holdings CorpName: Rob JohnsonTitle: Chief Executive Officer Date: August 7, 2018/s/ David M. CoteFallonName: David M. CoteFallonTitle: ExecutiveFinancial Officer President and Secretary, and Chairman of the Board of Directors(Principal Executive Officer and Principal Financial and Accounting Officer)20