Company: UTZ
Filing Date: 2025-02-20
Form Type: 10-K
Source: 0001739566-25-000053
Chunk: 135

Company: Utz Brands, Inc.
Filing Date: 2025-02-20
Form: 10-K
Item: Item 8
Chunk 135
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 December 29, 2024, discussed within Note 8. Long-Term Debt, the Company determined that $36.7 million of hedged forecasted transactions were not probable of occurring. As such, effective February 1, 2024, the Company de-designated its interest rate hedge accounting on its Real Estate Term Loan and re-designated a new interest hedging relationship totaling $47.0 million. As a result, the Company immediately reclassified $0.3 million of accumulated other comprehensive income to earnings which is reflected as a decrease to interest expense within the Consolidated Statements of Operations and Comprehensive Income (Loss). As of December 29, 2024, $45.5 million and $35.6 million of the notional of the Company's interest rate swap was designated under interest rate hedge accounting and at fair value with mark-to-market adjustments recorded immediately in earnings, respectively. For the fiscal year ended December 29, 2024, the Company recognized $1.1 million as a decrease to interest expense within the Consolidated Statements of Operations and Comprehensive Income (Loss).  The balance that the hedge covers is designed to abate as principal payments on the Real Estate Term Loan are made. The Company entered into these transactions to reduce its exposure to changes in cash flows associated with the Real Estate Term Loan and has designated this derivative as a cash flow hedge. The Company assesses hedge effectiveness both at the onset of the hedge and at regular intervals throughout the life of the derivative instrument. If it is probable that the hedged forecasted transaction will not occur, the derivative instrument's gain or loss reported in accumulated other comprehensive income will be reclassified into earnings.As of December 29, 2024, the effective fixed interest rate on the long-term debt hedged by these contracts was 4.35%. For further treatment of the Company’s interest rate swap, refer to Note 10. Fair Value Measurements.

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Warrant LiabilitiesThe Company has outstanding private placement warrants ("Warrants") which are accounted for as derivative liabilities pursuant to ASC 815-40. See Note 17. Warrants for additional information on our warrant liabilities. A reconciliation of the changes in the warrant liability during the fiscal year ended December 29, 2024 is as follows:(in thousands)Fair value of warrant liabilities as of December 31, 2023$43,272 Gain on remeasurement of warrant liability(10,224)Fair value of warrant liabilities as of December