Sunbeam 2002 Annual Report Download - page 40

Jarden Corporation
Notes to Consolidated Financial Statements (Continued)
Net income (loss) and earnings (loss) per share amounts on an adjusted basis to reflect the add back of
goodwill amortization would be as follows:
Year Ended December 31,
(in thousands, except per share amounts) 2002 2001 2000
Reported net income (loss) ...................................... $36,309 $(85,429) $4,922
Add back: goodwill amortization (net of tax expense of
$0, $2,020 and $2,510, respectively) ............................ — 3,133 3,894
Adjusted net income (loss) ...................................... $36,309 $(82,296) $8,816
Basic earnings (loss) per share:
Reported net income (loss) ...................................... $ 2.60 $ (6.71) $ 0.39
Goodwill amortization ......................................... — 0.24 0.31
Adjusted net income (loss) ...................................... $ 2.60 $ (6.47) $ 0.70
Diluted earnings (loss) per share:
Reported net income (loss) ...................................... $ 2.52 $ (6.71) $ 0.39
Goodwill amortization ......................................... — 0.24 0.30
Adjusted net income (loss) ...................................... $ 2.52 $ (6.47) $ 0.69
9. Debt and Interest
The Acquisition (see Note 3) was financed by (i) an offering of $150 million of 9
3
⁄ 4 % senior subordinated
notes (‘‘Notes’’) to qualified institutional buyers in a private placement pursuant to Rule 144A under the
Securities Act of 1933, which were later wholly exchanged pursuant to an offering for 9
3
⁄ 4 % senior
subordinated notes which are registered under the Securities Act of 1933, as amended (‘‘New Notes’’), (ii) a
refinancing of the Company’s existing indebtedness with a new $100 million five-year senior secured credit
facility, which included a $50 million term loan facility and a $50 million revolving credit facility (‘‘New Credit
Agreement’’), (iii) seller debt financing and (iv) cash on hand.
The Notes were issued at a discount such that the Company received approximately $147.7 million in net
proceeds. The Notes will mature on May 1, 2012, however, on or after May 1, 2007, the Company may redeem
all or part of the Notes at any time at a redemption price ranging from 100% to 104.875% of the principal
amount, plus accrued and unpaid interest and liquidated damages, if any. Prior to May 1, 2005, the Company
may redeem up to 35% of the aggregate principal amount of the Notes with the net cash proceeds from certain
public equity offerings at a redemption price of 109.75% of the principal amount, plus accrued and unpaid
interest and liquidated damages, if any. Interest on the Notes accrues at the rate of 9.75% per annum and is
payable semi-annually in arrears on May 1 and November 1, with the first payment having occurred on
November 1, 2002.
During December 2002, the Company completed an offering to the holders of the Notes to exchange the
Notes for the New Notes. The New Notes are substantially similar to the Notes except that certain mandatory
redemption provisions and the transfer restrictions applicable to the Notes are not applicable to the New Notes.
As of December 31, 2002, the New Notes trade at a premium, resulting in an estimated fair value, based upon
quoted market prices, of approximately $154.5 million.
The New Credit Agreement matures on April 24, 2007. The revolving credit facility and the term loan
facility bear interest at a rate equal to (i) the Eurodollar Rate pursuant to an agreed formula or (ii) a Base Rate
equal to the higher of (a) the Bank of America prime rate and (b) the federal funds rate plus .50%, plus, in each
case, an applicable margin ranging from 2.00% to 2.75% for Eurodollar Rate loans and from .75% to 1.5% for
Base Rate loans.
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