Rayovac 2009 Annual Report Download - page 8

Table of Contents
Index to Financial Statements
Spectrum’s existing equity securities, including the existing common stock and stock options, were extinguished and deemed cancelled. Reorganized
Spectrum Brands, Inc. filed a certificate of incorporation authorizing new shares of common stock. Pursuant to and in accordance with the Plan, on the
Effective Date, reorganized Spectrum Brands, Inc. issued a total of 27,030,000 shares of common stock and $218,076,405 in aggregate principal amount of
12% Senior Subordinated Toggle Notes due 2019 (the “12% Notes”) to holders of allowed claims with respect to Old Spectrum’s 8 1 /2% Senior
Subordinated Notes due 2013 (the “8 1/2 Notes”), 7 3/8% Senior Subordinated Notes due 2015 (the “7 3/8 Notes”) and Variable Rate Toggle Senior
Subordinated Notes due 2013 (the “Variable Rate Notes”), (together, the “Senior Subordinated Notes”). Also on the Effective Date, reorganized Spectrum
Brands, Inc. issued a total of 2,970,000 shares of common stock to supplemental and sub−supplemental debtor−in−possession facility participants in respect
of the equity fee earned under the Debtors’ debtor−in−possession credit facility. The common stock is currently quoted on the OTC Bulletin Board and the
Pink Sheet Electronic Quotation Service. However, there can be no assurances that a broker−dealer will make a market in the common stock.
On the Effective Date, pursuant to the Plan, the Company entered into Amendment No. 1 to its senior secured term credit facility agreement reflecting
the terms of the Settlement as authorized by the Confirmation Order, including a new covenant restricting the Company from paying cash interest on the
12% Notes until the date that is 18 months from the Effective Date, or February 28, 2011. In addition, on the Effective Date, the Company entered into
Amendment No. 2 to the senior secured term credit facility agreement to give effect to certain technical amendments to the senior secured term credit
facility agreement. For a further description of the amendments see the “Debt Financing Activities—Senior Term Credit Facility” section of Item 7.
Management’s Discussion and Analysis of Financial Condition and Results of Operations.
In order to consummate the Plan, the Debtors also obtained a $242 million asset−based exit loan facility pursuant to a credit agreement among the
Debtors, General Electric Capital Corporation, as the administrative agent, co−collateral agent, swingline lender and supplemental loan lender, Bank of
America, N.A., as co−collateral agent and L/C Issuer, RBS Asset Finance, Inc., through its division RBS Business Capital, as syndication agent and the
lenders party thereto.
Internal Restructuring Transactions
The Plan contemplated that on, as of, or after the Effective Date, with the consent of its board of directors, each of the reorganized Debtors may take
such actions as may be necessary or appropriate to effect a corporate or operational restructuring of their respective businesses, to otherwise simplify the
overall corporate or operational structure of the reorganized Debtors, to achieve corporate or operational efficiencies, or to otherwise improve financial
results. On the Effective Date, the board of directors of Spectrum Brands, Inc. approved an internal restructuring of the reorganized Debtors to consolidate
the Company’s legal structure within its three business segments, global batteries and personal care, global pet supplies and home and garden. The
restructuring resulted in, among other things, that Aquaria, Inc.; Perfecto Manufacturing, Inc. and Aquarium Systems Inc., each a wholly owned subsidiary
of Spectrum Brands, Inc. and a guarantor of the 12% Notes, merging with and into Tetra Holding (US), Inc. (“Tetra”), another wholly owned subsidiary
guarantor, with Tetra surviving. In addition, Southern California Foam, Inc., a wholly owned subsidiary of Spectrum Brands, Inc., and guarantor, merged
with and into United Pet Group, Inc. (“UPG”), another wholly owned subsidiary guarantor, with UPG surviving. The internal restructuring became effective
on October 1, 2009.
The Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (the “Codification” or “ASC”)
In June 2009, the FASB issued Statement of Financial Accounting Standards (“SFAS”) No. 168, “The FASB Accounting Standards Codification and
the Hierarchy of Generally Accepted Accounting Principles, a replacement of FASB Statement No. 162,” an accounting standard which established the
Codification to become
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