Business Context and Reporting Period
Company: Fox Factory Holding Corp.
Filing Type: Form 8-K (Current Report)
Date of Report: November 14, 2023
Reporting Period: Event-based reporting for the completion of the Marucci Merger on November 14, 2023.
Key Financial Metrics and Transaction Details
- Acquisition Target: Wheelhouse Holdings Inc. (parent of Marucci Sports, LLC), a leading designer and manufacturer of premium baseball and softball products.
- Enterprise Value: $572 million (subject to adjustments for transaction taxes, expenses, net working capital, cash, and debt).
- Financing Structure:
- Incremental Term A Loan: $400 million (fully funded on November 14, 2023).
- Delayed Draw Term Loan: $200 million (available for up to six months commencing December 6, 2023).
- Total Incremental Term Loans: $600 million.
- Debt Terms:
- Maturity Date: April 5, 2027.
- Amortization: Quarterly principal payments at 5.0% per annum.
- Interest Rates: Term SOFR loans (1.50% to 2.50% margin) or Base Rate loans (0.5% to 1.50% margin).
Material Changes Versus Prior Period
This filing reports a material change in the Company's capital structure and asset base due to the completion of the Marucci Merger. The Company has increased its debt load by $400 million immediately, with an additional $200 million in committed but undrawn debt capacity. The Company now owns 100% of Wheelhouse Holdings Inc., adding Marucci Sports to its portfolio. No prior period financial metrics (revenue, profit, cash flow) are provided in this specific filing as it is an event-driven report rather than a periodic financial statement.
Guidance, Outlook, and Risks
- Management Commentary: The Delayed Draw Term Loan is intended to support the Company's capital allocation strategy.
- Financial Statement Filing: Historical financial statements and pro forma financial information regarding the Marucci Merger are not included in this filing. They will be filed in an amendment to this 8-K no later than 71 calendar days after the report is due.
- Risks/Contingencies: The purchase price is subject to adjustments based on net working capital, cash, and debt balances at closing. The new debt obligations are subject to the terms of the Existing Credit Agreement and the First Incremental Facility Amendment.
Investor Verification Checklist
- Verify the final purchase price adjustments once the closing balance sheet of Wheelhouse is finalized.
- Review the upcoming amendment to this 8-K (due within 71 days) for historical and pro forma financial data to assess the impact on earnings and leverage ratios.
- Monitor the utilization of the $200 million Delayed Draw Term Loan and its impact on future liquidity.
- Confirm the integration timeline and synergies between Fox Factory and Marucci Sports as disclosed in the press release (Exhibit 99.1).