Cash America 2014 Annual Report Download - page 110

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CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
95
by the Company to certain of its officers, directors and employees and certain Director Deferred Shares payable to
the Company’s directors relating to the Company’s common stock awards that were outstanding under the
Company's long-term incentive plans as of the date of the Enova Spin-off. Such RSU awards and Director Deferred
Shares will be payable by the Company in both shares of Company common stock and Enova common stock,
subject to the terms of the Company’s long-term incentive plans and the applicable award agreement. The delivery
of the Enova shares of common stock will occur periodically based on the vesting terms of the award agreements. In
the event the award does not vest, the shares will be retained by the Company and sold. The total number of Enova
shares of common stock subject to award agreements was 685,087 as of December 31, 2014, representing
approximately 2.1% of the then-outstanding shares of Enova common stock.
All of the retained shares of Enova common stock (including shares retained for delivery under the
Company’s long-term incentive plans) are classified as “available-for-sale securities” in accordance with ASC 320.
Activity during the year ended December 31, 2014 for the Enova shares retained by the Company is shown below:
Enova Shares
Held by the
Company (a)
Enova Shares to
be Issued for
RSU awards
Enova Shares to
be Issued for
Director
Deferred Shares Total
Enova shares retained upon Enova Spin-off
5,890,116
677,918
28,893
6,596,927
Forfeitures (b) 21,724
(21,724
)
—
—
Shares held as of December 31, 2014
5,911,840
656,194
28,893
6,596,927
% ownership of Enova as of December 31, 2014
17.9
%
2.0
%
0.1
%
20.0
%
(a) Does not include shares retained for delivery under the Company’s long-term incentive plans.
(b) Shares allocated to satisfy future RSU award issuances, upon forfeit, are re-allocated to Enova shares that are held and are to be disposed
of by the Company.
In connection with the Enova Spin-off, the Company recorded a $82.2 million reduction to retained
earnings and a $2.6 million increase to AOCI. Additionally, the Company recorded a $0.3 million deferred tax
liability difference between the tax basis in the retained shares of Enova common stock of approximately $20.0
million and the basis for financial reporting purposes. ASC 320 requires the shares to be marked to market with
unrealized gains and losses recorded in AOCI until realized or until losses are deemed to be other-than-temporary.
As of December 31, 2014, the investment in Enova shares was adjusted to $131.6 million and AOCI was adjusted
by $72.0 million, net of tax, which is included in “Marketable equity securities, net of tax” in the consolidated
statements of equity. The Company does not have the ability to significantly influence the operating or financial
policies of Enova.
As the Enova Spin-off represents a strategic shift that will have a major effect on the Company’s operations,
the net assets, operating results, and cash flows of the Company’s previously-held Enova business are presented
separately as discontinued operations for all periods presented.
Enova is now a stand-alone public company that separately reports its financial results. Due to differences
between the basis of presentation for discontinued operations and the basis of presentation as a stand-alone
company, the financial results of Enova included within discontinued operations for the Company may not be
indicative of actual financial results of Enova as a stand-alone company.
The results of Enova’s business included in discontinued operations for the years ended December 31, 2014,
2013 and 2012 are summarized in the following tables.
The carrying amounts of the major classes of the assets and liabilities for the discontinued operations as of
December 31, 2013 are shown below (dollars in thousands). Amounts for “Cash and cash equivalents” and
“Accounts payable and accrued expenses,” respectively, shown below were decreased by $2.0 million from amounts