SEC Filings
 |
| 10-K | |
| HRG GROUP, INC. filed this Form 10-K on 11/23/2016 | |
| Entire Document | |
| << Previous Page | Next Page >> | |
of classifying FGL as held for sale, all segmented information has been adjusted to exclude FGL from the Insurance segment. See Note 4, Divestitures. Transactions and Activities during Fiscal 2016 Consumer Products During Fiscal 2016, Spectrum Brands completed a cash tender offer to purchase any and all of Spectrum Brands’ 6.375% Notes due 2020 (the “6.375% Notes”). As part of the transaction, Spectrum Brands received tenders from the holders of $390.3 of its outstanding 6.375% Notes and has accepted for purchase all 6.375% Notes which were validly tendered. In addition, on October 20, 2016, Spectrum Brands redeemed the remaining $129.7 aggregate principal amount of 6.375% Notes with a call premium of $4.6. See Note 15, Debt. On September 20, 2016, SBI issued €425.0 aggregate principal amount of 4.00% Notes at par value, due October 1, 2026 (“4.00% Notes”). See Note 15, Debt. On October 6, 2016, subsequent to the end of the fiscal year, SBI replaced all of its U.S. dollar-denominated term loans with new U.S. dollar-denominated term loans that carry lower interest rate margins, but otherwise are on the same terms as the old term loans, including the maturity date. See Note 15, Debt. Oil and Gas Properties During the first quarter of Fiscal 2016, Compass Production Partners (“Compass”), a majority-owned subsidiary of HGI Energy at the time, completed the sale of its Holly, Waskom, and Danville assets (the “Compass Asset Sale”) for a total cash consideration of $153.4. Proceeds were primarily used to reduce Compass’ borrowings under its credit facility (the “Compass Credit Agreement”). During the fourth quarter of Fiscal 2016, HGI Energy completed the sale of its equity interests in Compass to a third party for a cash purchase price of $145.0 (the “Compass Sale”). The proceeds received by HGI Energy from the Compass Sale were reduced by the outstanding balance of Compass’ existing credit facility of $125.2. Following the completion of the Compass Sale, the Company no longer owns, directly or indirectly, any oil and gas properties and accordingly, the results of Compass are presented as discontinued operations in the accompanying Consolidated Statements of Operations and the operations of HGI Energy are included in the Corporate and Other segment. Corporate and Other On November 17, 2016, subsequent to the end of the fiscal year, the Company announced that Mr. Omar Asali, President, Chief Executive Officer and a director of the Company, plans to leave the Company in the second half of the fiscal year ending September 30, 2017 (“Fiscal 2017”). In addition, on November 17, 2016, the Company announced that its Board had initiated a process to explore and evaluate strategic alternatives available to the Company with a view toward enhancing shareholder value. Strategic alternatives may include, but are not limited to, a merger, sale or other business combination involving the Company or its assets. The Company has not set a definitive schedule to complete its review of strategic alternatives and there can be no assurance that this process will result in a transaction, or if a transaction is undertaken, as to its terms or timing. In connection with Mr. Asali’s anticipated departure, on November 17, 2016, the Company and Mr. Asali entered into a Transition Agreement (the “Transition Agreement”). The Transition Agreement provides that Mr. Asali will, subject to the terms of the Transition Agreement, receive from the Company (i) for Fiscal 2016, a bonus of $8.0 in cash; and (ii) for Fiscal 2017, a bonus for $3.0 in cash, on the earlier of March 31, 2017 and the date on which the Company announces that it has entered into definitive documentation which, if the transactions contemplated thereby were consummated, would result in a sale, merger, change in control or other strategic transaction of or involving the Company and substantially all of its assets; and an additional payment of $3.0 (or such higher amount as determined by the Board of Directors). Mr. Asali will also receive certain other payments and vesting of prior issued equity grants. During Fiscal 2016, Salus and Front Street received a partial recovery on the loan to a significant borrower of Salus, RadioShack Corporation (“RadioShack”), of $45.4, excluding $22.7 repayment on FGL’s participation on the loan. As a result of the aforementioned partial recovery, the Company also reversed $18.0 of previously recorded allowance for bad debt, excluding $9.0 of realized gains by FGL recorded in “(Loss) income from discontinued operations, net of tax” in the accompanying Consolidated Statements of Operations. During Fiscal 2016, Salus determined to focus its efforts primarily on monitoring, servicing and collecting its existing loans and winding-down its business. Salus may, however, pursue other opportunities that it may consider strategically advantageous or complimentary to its efforts to collect its existing loans. During the fourth quarter of Fiscal 2016, the Company sold all of its 51.0% interest in CorAmerica Capital, LLC, its former subsidiary engaged in the business of asset management (“CorAmerica”), to a third party for $0.5. During Fiscal 2016, the Company also wound down the operations of Energy & Infrastructure Capital, LLC (“EIC”), its other asset manager. The sale of CorAmerica and the wind down of EIC did not represent a strategic shift for the Company. The operations of Salus, CorAmerica and EIC were historically presented in the Asset Management Segment. As a result of the diminished operations in that segment, F-10 | |
| << Previous Page | Next Page >> | |