Sunbeam 2006 Annual Report Download - page 74

Company, and the restrictions on the remaining 64,995 2004 Shares lapse upon the latter of either the Company’s stock price
achieving a volume weighted average of $42.67 per share for ten consecutive business days or November 1,2008.All of the
2004 Shares were issued from the Company’s treasury stock.
Common Stock
In November 2006,the Company completed an equity offering which included four million newly issued shares of com-
mon stock that resulted in net proceeds to the Company of approximately $139 million. The proceeds were used to pay down
outstanding loans under its senior credit facility and securitization borrowings.
As discussed in Note 3,the Company issued 6,150,123 shares of common stock to partially fund the purchase price of the
THG Acquisition. Furthermore, in connection with the AHI Acquisition, the Company issued $350 million of equity securi-
ties pursuant to a purchase agreement (“Equity Purchase Agreement”). The securities issued were as follows:
•1,071,429 shares of the Company’s common stock (“Common Stock”) for approximately $21.4million at a price of $20
per share;
•128,571 shares or $128.6million of a new class of the Company’s preferred stock, Series B Convertible Participating
Preferred Stock (“Series B Preferred Stock”) with a paid-in-kind dividend rate of 3.5%per annum; these securities were
fully converted into common stock in the third quarter of 2005 (see discussion below);
•200,000 shares or $200 million of a new class of the Company’s preferred stock, Series C Mandatory Convertible
Participating Preferred Stock (“Series C Preferred Stock”) with a paid-in-kind dividend rate of 3.5%per annum; these
securities were fully converted into common stock and Series B Preferred Stock in the second quarter of 2005 (see dis-
cussion below).
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 approx-
imately $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.
Abeneficial conversion charge of $16.5million was recorded upon the issuance of the Series B Preferred Stock and
Common Stock issued on January 24,2005 and an additional beneficial conversion charge of $22.4million was recorded
upon the conversion of the Series C Preferred Stock into Series B Preferred Stock and Common Stock (see discussion below).
Such charges reflect the difference between the respective conversion prices of the Series B Preferred Stock and C Preferred
Stock and the closing market price of the Company’s common stock on September 17,2004,the last business day before the
execution of the transaction documents (“Execution Date”). However, the terms of the preferred and common stock issuances
to the Private Equity Investors werenegotiated during the two months leading up to the Execution Date when the average mar-
ket price of the Company’s common stock was, in fact, less than the conversion price.
On June 9,2005,following requisite stockholder approval, all outstanding shares of Series C Preferred Stock were con-
verted into approximately 175,492 shares of Series B Preferred Stock and approximately 1,462,454 shares of Company’s com-
mon stock.
On August 14,2005,the Company converted all outstanding shares of Series B Preferred Stock and accrued paid-in kind
dividends thereon into 14,487,601 shares of Company common stock, in accordance with the terms of the Company’s
Certificate of Designations of Powers, Preferences and Rights of the Series B Preferred Stock.
In connection with a 2005 share repurchase program approved by the Board, during 2005,the Company had repurchased
558,900 shares in the open market and through a privately negotiated transaction for an average price per share of $34.55.
Additionally, the Company received 460,317 shares (at an average price of $34.50 per share) in return for payment of the
statutory minimum of withholding taxes relating to lapsing of certain shares of the Executive Award.
Notes to Consolidated Financial Statements
Jarden Corporation 2006 Annual Report
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