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United States securities and exchange commission logo
May 17, 2021
JD Ellis
Chief Legal Officer
Snap One Holdings Corp.
1800 Continental Boulevard, Suite 200
Charlotte, North Carolina 28273
Re: Snap One Holdings
Corp.
Draft Registration
Statement on Form S-1
Submitted April 20,
2021
CIK No. 0001856430
Dear Mr. Ellis:
We have reviewed your draft registration statement and have the
following comments. In
some of our comments, we may ask you to provide us with information so
we may better
understand your disclosure.
Please respond to this letter by providing the requested
information and either submitting
an amended draft registration statement or publicly filing your
registration statement on
EDGAR. If you do not believe our comments apply to your facts and
circumstances or do not
believe an amendment is appropriate, please tell us why in your
response.
After reviewing the information you provide in response to these
comments and your
amended draft registration statement or filed registration statement, we
may have additional
comments.
Draft Registration Statement on Form S-1
General
1. Please provide us
supplemental copies of all written communications as defined in Rule
405 under the
Securities Act that you or anyone authorized to do so on your behalf have
presented or expect to
present to potential investors in reliance on Section 5(d) of the
Securities Act, whether
or not you retained or intend to retain copies of these
communications. Please
contact legal staff associated with the review of this filing to
discuss how to submit
the materials, if any, to us for review.
JD Ellis
FirstName LastNameJD
Snap One Holdings Corp.Ellis
Comapany
May NameSnap One Holdings Corp.
17, 2021
May 17,
Page 2 2021 Page 2
FirstName LastName
Table of Contents and certain references, page i
2. We note that you define the Equity Conversion on page ii. Given that
this transaction will
occur in connection with the Offering, please provide a clearer and
fuller description of
the Equity Conversion in a more prominent section of the filing, such
as in the Prospectus
Summary or near Use of Proceeds, Capitalization, or Dilution sections,
that addresses the
following:
Explain how the number of common shares of the Company held by
the Investor will
be distributed to the holders of vested units of the Investor.
Disclose the total number of common shares of the Company
currently held by the
Investor and the number of vested units subject to distribution,
along with the
conversion or exchange ratio that will be used in determining the
number of common
shares of the Company that will be distributed.
Explain whether the percentage of common shares currently held
by the Investor will
change once such shares are distributed to the Investor's vested
unit holders, whom
we presume to be the Sponsor. If not the Sponsor, please tell us
and disclose the
holder of the vested units.
Disclose the computation for the replacement of unvested
Incentive Units with newly
issued shares of restricted common stock and/or stock options of
the Company, and
the ownership percentage of the Company before and after the
replacement.
Consider providing an organizational chart giving effect to the
Company before and
after the Equity Conversion and Offering, that reflects the
ownership percentages of
the Company as well.
Prospectus Summary
Company Overview, page 1
3. Please revise your discussions of net sales on a pro forma basis
assuming the acquisitions
of MRI, CPD, and Control4 in the last paragraph of this section and
elsewhere in the filing
to also include disclosure of the corresponding pro forma net loss
amount. We note the
information presented on page F-19.
Corporate Information, page 7
4. It appears from your website address that you do business as SnapAV.
Please revise your
disclosure in the Company Overview section to make this clear.
Summary Consolidated Financial and Other Data, page 11
5. We note that a portion of the net proceeds from the IPO will be used
to repay a portion of
the term loan outstanding under your Credit Agreement, plus accrued
interest thereon.
Please provide supplemental pro forma earnings (loss) per share data,
for the most recent
fiscal year end and any subsequent interim period only, that gives
effect to the number of
shares whose proceeds would be used to repay the debt. Include a
footnote to the table to
JD Ellis
Snap One Holdings Corp.
May 17, 2021
Page 3
explain this presentation and your computation. Refer to analogous
guidance in SAB
Topic 1.B(3).
6. Refer to your reconciliation of net loss to Adjusted EBITDA on page 13
and to the
explanation for adjustment (e). Please expand to disclose the specific
periods of time over
which the deferred payments will be made to employees associated with
your Control4
acquisition and other historical acquisitions. In this regard, we note
you disclose these
payments are incremental to your typical compensation costs incurred.
Please disclose if
these cash retention awards for key personnel were one-time awards
only and are not
reflective in ongoing increased base compensation costs.
Risk Factors
Risks Related to Our Business and Industry
Our strategy includes pursuing acquisitions and our potential inability to
identify good
opportunities...may harm our financial results., page 21
7. In the opening paragraph, please provide additional disclosure as to
the recent acquisition
of HCA Distributing in 2021. This acquisition, if material, should
also be further
described in a Recent Developments section and also in MD&A, including
the date of
acquisition and purchase consideration.
Our Properties, page 99
8. It does not appear that you have included your five distribution
centers in this section.
Please revise, and please consider providing the states in which the
distribution centers are
located since the only other place you have provided their locations
is in the image on
page 97.
Certain Relationships and Related Party Transactions
Stockholders' Agreement, page 117
9. Please revise to state exactly how many nominees Hellman & Friedman
will be entitled to
nominate to the board following the completion of the offering and the
"certain other
stockholders" who are a party to the agreement.
You may contact Beverly Singleton at 202-551-3328 or Martin James at
202-551-3671 if
you have questions regarding comments on the financial statements and related
matters. Please
contact Erin Purnell at 202-551-3454 or Geoffrey Kruczek at 202-551-3641 with
any other
questions.
FirstName LastNameJD Ellis Sincerely,
Comapany NameSnap One Holdings Corp.
May 17, 2021 Page 3 Division of
Corporation Finance
FirstName LastName Office of
Manufacturing