SEC Filings
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| 10-Q | |
| HRG GROUP, INC. filed this Form 10-Q on 02/07/2017 | |
| Entire Document | |
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On November 17, 2016, the Company and Mr. Asali entered into a Transition Agreement (the “Transition Agreement”), which provides that Mr. Asali’s options and restricted stock awards that (i) were scheduled to vest and settle on November 29, 2016 vested and settled on such date and (ii) were scheduled to vest and settle on November 29, 2017 will vest and settle on the earlier of March 31, 2017 or such earlier dates specified in the Transition Agreement. In addition, the Transition Agreement provides that, subject to the terms thereof, Mr. Asali will receive from the Company (i) for the fiscal year ended September 30, 2016, a bonus of $8.0 in cash; and (ii) for the fiscal year ending September 30, 2017, (x) a bonus of $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 (such transaction, a “Transaction”); and (y) an additional payment of $3.0 (or such higher amount as determined by the Board of Directors), if the Company enters into definitive documentation with respect to a Transaction, Mr. Asali remains employed through the announcement date of such Transaction and shareholder approval for such Transaction is obtained or upon certain other events specified in the Transition Agreement. Under certain circumstances, Mr. Asali will also receive $0.5 in severance and 12 months of COBRA reimbursements. As a result of the foregoing, for the three months ended December 31, 2016, the Company recorded $3.5 of severance liability and corresponding expense with respect to the Transition Agreement. Spectrum Brands Spectrum Brands granted restricted stock units representing approximately 688 thousand shares during the three months ended December 31, 2016. Of these grants, 78 thousand restricted stock units vested immediately and 212 thousand restricted stock units are time-based and vest over a period of less than 1 year. The remaining 398 thousand are both performance and time-based and vest over a period of 1 to 3 years. The total market value of the restricted stock units on the dates of the grants was approximately $87.3. The remaining unrecognized pre-tax compensation cost related to restricted stock units at December 31, 2016 was $60.8. Spectrum Brands granted restricted stock units representing approximately 442 thousand shares during the three months ended December 31, 2015. The 442 thousand restricted stock units granted during the three months ended December 31, 2015 included 112 thousand restricted stock units that vested immediately and 33 thousand restricted stock units are time-based and vest within a period of 1 year. The remaining 297 thousand shares are both performance and time-based and vest over a period ranging from 1 to 2 years. The total market value of the restricted stock units on the dates of the grants was approximately $42.1. The remaining unrecognized pre-tax compensation cost related to restricted stock units at December 31, 2015 was $44.5. The fair value of restricted stock units is determined based on the market price of Spectrum Brands’ common stock on the grant date. (11) Income Taxes For the three months ended December 31, 2016, the Company’s effective tax rate of 92.7% differed from the expected U.S. statutory tax rate of 35.0% and was primarily impacted by U.S. pretax losses in the Company’s Corporate and Other segment where the tax benefits are not more-likely-than-not to be realized resulting in the recording of valuation allowance. For the three months ended December 31, 2015, the Company’s effective tax rate of (143.6)% differed from the expected U.S. statutory tax rate of 35.0% and was impacted by the expected utilization of a portion of Spectrum Brand’s U.S. net operating losses that were previously recorded with valuation allowance against Spectrum Brand’s earnings during the fiscal year 2016 and recognition of tax benefits on losses from the Corporate and Other segment in the U.S. during the fiscal year 2016. The Company determined that a portion of the fiscal year 2016 losses related to the Corporate and Other segment were more-likely-than-not to be realized based on the expected taxable gain from the FGL Merger. 28 | |
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