Vertiv Holdings Co

(10)RELATED PARTY TRANSACTIONS

Transactions with Affiliates of Advisors

On August 8, 2023 (the “Stock Sale Transaction date”), VPE Holdings, LLC (the “Vertiv Stockholder”), an affiliate of Platinum Equity Advisors, LLC (“Advisors”) completed the sale of 20,000,000 shares of Class A common stock of the Company (the “Stock Sale Transaction”). Subsequent to the Stock Sale Transaction, the Vertiv Stockholder holds less than 5% of the outstanding Class A common stock of the Company and as such is no longer considered a related person of the Company for purposes of Item 404 of Regulation S-K by virtue of its ownership in the Company.

The Company purchased and sold goods in the ordinary course of business with affiliates of Advisors. Purchases from the start of the current year through the Stock Sale Transaction date were $74.1. For the year ended December 31, 2022 and 2021 purchases were $137.0 and $98.0, respectively. Sales from the start of the current year through the Stock Sale Transaction date were $89.5. For the year ended December 31, 2022 and 2021 sales were $146.0 and $86.9, respectively. Accounts payable were $3.8 as of December 31, 2022. Accounts receivable were $33.3 as of December 31, 2022.

Tax Receivable Agreement

On December 31, 2021, the Company and an affiliate of the Vertiv Stockholder agreed to amend and supplement the tax receivable agreement entered into by the Company and the Vertiv Stockholder on February 7, 2020, (the “Tax Receivable Agreement”) to replace the Company’s remaining payment obligations under the Tax Receivable Agreement with an obligation to pay $100.0 in cash intwo equal installments. The first installment payment was scheduled to be on or before June 15, 2022 and the second payment 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 15, 2022, the second installment of $12.5 became due and was paid on September 15, 2022, and the third installment of $75.0 became due and was paid on November 30, 2022. The Tax Receivable Agreement terminated on November 30, 2022 upon receipt of final payment.

For the year ended December 31, 2021 the Company recorded $4.5 of accretion expense in “Interest expense, net”, in the Consolidated Statement of Earnings (Loss). An unrealized loss of $(3.2) was recorded in “Accumulated other comprehensive (loss) income” in the Consolidated Balance Sheet, related to the change in fair value of the tax receivable liability for the year ended December 31, 2021. Upon execution of the amended Tax Receivable Agreement on December 31, 2021, the Company reversed $4.1 previously recorded in “Accumulated other comprehensive (loss) income”, and recognized a gain of $59.2, recorded in “Gain on tax receivable agreement” in the Consolidated Statement of Earnings (Loss), for the difference between the amount accrued for this obligation in comparison to the amount at which the obligation will be settled.