Primo Brands Corp

NOTES TO FINANCIAL STATEMENTS

NOTE 1—DESCRIPTION OF THE BUSINESS

On June 10, 2024, Primo Brands Corporation (formerly known as Triton US HoldCo, Inc.), a Delaware corporation (“Primo Brands”, or the “Company”) was formed in contemplation of transactions detailed by the Arrangement Agreement and Plan of Merger, dated as of June 16, 2024, as later amended by Amendment No. 1 thereto, dated as of October 1, 2024 (as amended, the “Arrangement Agreement”). Through a series of transactions Triton Water Parent, Inc. (“BlueTriton”) and Primo Water Corporation (“Primo Water”) merged, becoming wholly owned subsidiaries of the Company (the actions which are collectively referred to hereafter as the “Merger”).

As of September 30, 2024, Primo Brands had not commenced operations, had no significant assets or liabilities and had not conducted any material activities, other than those incidental to its formation and those undertaken in connection with the transactions pursuant to the Arrangement Agreement.

On November 8, 2024, Primo Brands consummated the transactions contemplated by the Arrangement Agreement. Immediately following the completion of the Merger, former Primo Water stockholders and the former BlueTriton stockholder owned approximately 43% and 57% of Fully Diluted Shares (as defined below), respectively.

As used herein, “Fully Diluted Shares” refers to the sum of (i) the aggregate number of shares of Class A common stock, par value $0.01 per share, of the Company (the “Class A common stock”) and Class B common stock, par value $0.01 per share, of the Company (the “Class B common stock”), issued and outstanding, plus (ii) the aggregate maximum number of Class A common stock issuable in respect of any equity interests of the Company, including with respect to replacement share-based compensation awards to associates of Primo Water, in each case, that were outstanding or deemed outstanding (and assuming the vesting in full of any of the foregoing subject to vesting or similar conditions).

Following the Merger, Primo Brands, through its subsidiaries, produces and sells national and regional spring water brands, purified national water and flavored water brands which are sold direct to wholesalers, grocery stores or other retailers and direct-to-consumer, office and retailer beverage delivery services. The Company is also a distributor for select third-party beverage brands.

Since the Merger was completed after the end of the third quarter ended September 30, 2024, this Form 10-Q reflects the results of Primo Brands on a stand-alone basis for periods prior to the Merger.

NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

These interim financial statements and related notes (collectively referred to herein as the “Financial Statements”), represent the accounts of the Company.

To date, the Company has not conducted any material activities other than those incidental to its formation and the matters contemplated by the Arrangement Agreement. The singular transaction to take place occurred on June 10, 2024 and was funded by a related party. As such, there was no activity to report during the three months ended September 30, 2024, and the Company has a $2 thousand obligation to a related party.

Net loss is equal to comprehensive loss.

The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial reporting, using the U.S. dollar as the reporting currency. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the reported amounts of revenues and expenses during the reporting period and disclosure of contingent assets and liabilities at the date of the financial statements. Actual results could differ from those estimates.

NOTE 3—COMMITMENTS AND CONTINGENCIES

The Company may be subject to legal proceedings that arise in the ordinary course of business.

NOTE 4—SUBSEQUENT EVENTS

Mergers and Closing

On November 8, 2024, the Merger contemplated by the Arrangement Agreement was completed. See Note 1—Description of the Business for further details.

The Merger is being accounted for as a business combination in accordance with U.S. GAAP, with BlueTriton as accounting acquirer.

The fair value of the consideration, or the purchase price, is approximately $3,949.5 million. The estimated fair value of the 160,395,822 shares of Class A common stock of Primo Brands issued to former Primo Water stockholders, including replacement share-based compensation awards, was $24.21 per share, based on the quoted market price of Primo Water common shares as of close of trading on November 8, 2024.

Primo Brands has allocated the purchase price to the identifiable tangible and intangible assets acquired and liabilities assumed based on their respective fair values, with any excess purchase price allocated to goodwill. The purchase price allocation below has been developed based on preliminary estimates of fair value using the historical carrying values of Primo Water as of November 8, 2024, other than a preliminary estimate for intangible assets. The allocation of the purchase price is subject to final management analysis, with the assistance of third-party valuation advisers.

The actual amounts recorded when the final allocations are complete may differ materially from the amounts presented below ($ in millions):

Unaudited Pro Forma Results

The pro forma information reflects the “acquisition” method of accounting in accordance with the Financial Accounting Standards Board issued Accounting Standards Codification 805, Business Combinations. As previously noted, BlueTriton, which was merged into Primo Brands upon completion of the Merger, has been determined to be the acquirer in the Merger for accounting purposes. BlueTriton is considered the predecessor and its historical financial results will be reflected in the historical financial information of Primo Brands.

The unaudited pro forma combined financial information reflects the historical information of BlueTriton and Primo Water based on available data and upon assumptions that management believes are reasonable to reflect, on a pro forma basis, the impact of the transaction on the historical financial statements. Net income from discontinued operations in the historical financial statements of Primo Water has not been included in the unaudited pro forma financial information below.

These amounts are preliminary and may be subject to refinement as additional information becomes available. The unaudited pro forma financial information is not necessarily indicative of the results of operations that would have been achieved had the Merger been consummated as of the dates indicated, nor is it indicative of any future results. In addition, the unaudited pro forma financial information does not reflect the expected realization of any synergies or cost savings associated with the Merger.

The following unaudited pro forma financial information is presented to illustrate the estimated effects of the Merger as if the business combination had occurred on January 1, 2023, the beginning of the comparable period, and includes primarily the impacts of the following: the alignment of Primo Water accounting policies to those of BlueTriton, non-recurring expenses related to transaction costs incurred by BlueTriton, the estimated amortization expense associated with the fair value of the acquired intangible assets and the tax impact of these adjustments.

Dividends Declared

On November 8, 2024, the Board of Directors of Primo Brands declared a quarterly dividend of $0.09 per share on the outstanding Class A common stock and Class B common stock of the Company. The dividend was payable to stockholders of record as of the close of business on November 22, 2024, and was paid on December 5, 2024.