Sunbeam 2004 Annual Report Download - page 75

Jarden Corporation
Notes to Consolidated Financial Statements (cont’d)
December 31, 2004
19. Subsequent Events (Unaudited)
On January 24, 2005, the Company completed its acquisition of AHI, a privately held company, for
approximately $745.6 million in cash for the equity and the repayment of approximately $100 million of
indebtedness. AHI is the parent of The Coleman Company, Inc. (“Coleman”) and Sunbeam Products,
Inc. (“SPI”), leading producers of global consumer products through brands such as BRK®,
Campingaz®, Coleman®, First Alert®, Health o meter®, Mr. Coffee®, Oster®and Sunbeam®. Product
lines added include appliances, personal care and wellness, home safety equipment and outdoor leisure
and camping products. Had AHI been a part of the Company from January 1, 2004, the unaudited pro
forma consolidated net sales of the Company (including the pro forma effect of the USPC Acquisition)
(see Note 4) would have been $2.7 billion. The SPI business will be integrated within the Company’s
existing consumer solutions segment in 2005 and the Coleman business will form a new segment of the
Company called “outdoor solutions.”
In connection with the AHI Acquisition, the Company issued $350 million of equity securities
pursuant to a purchase agreement (“Equity Purchase Agreement”). The securities issued were as follows:
(i) 714,286 shares of the Company’s common stock for approximately $21.4 million at a price of
$30 per share;
(ii) 128,571 shares or approximately $128.6 million of a new class of the Company’s preferred
stock, Series B Convertible Participating Preferred Stock (“Series B Preferred Stock”), par value
$.01 per share, at a price of $1,000 per share; and
(iii) 200,000 shares or approximately $200 million of a new class of the Company’s preferred stock,
Series C Mandatory Convertible Participating Preferred Stock (“Series C Preferred Stock”), par
value $.01 per share, at a price of $1,000 per share.
In accordance with the Equity Purchase Agreement and a related Assignment and Joinder
Agreement, approximately $300 million of the Company’s equity securities were issued to Warburg
Pincus Private Equity VIII, LP and its affiliates and approximately $50 million were issued to Catterton
Partners V, LP and its affiliates, both private equity investors (collectively “Private Equity Investors”). The
cash raised in connection with the Equity Purchase Agreement was used to fund a portion of the cash
purchase price of AHI.
The terms of the Equity Purchase Agreement require shareholder approval of the mandatory
conversion of the Series C Preferred Stock into a combination of Series B Preferred Stock and common
stock of the Company. Subsequent to shareholder approval and mandatory conversion, the total new
equity of the Company issued to the Private Equity Investors will consist of $300 million of Series B
Preferred Stock and 1,666,667 shares of common stock valued at $50 million, without taking into effect
any other conversion, market value increases or the accrual of dividends.
Additionally, the AHI Acquisition was also funded through a new $1.05 billion senior credit facility,
consisting of a term loan facility in the aggregate principal amount of $850 million and a revolving credit
facility with an aggregate commitment of $200 million. This facility replaces the Company’s Second
Amended Credit Agreement (see Note 8 for details of the debt balances at December 31, 2004).
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