22 unchanged sentences
Under guidelines established by the SEC, companies are allowed to exclude acquisitions from their first assessment of internal control over financial reporting following the date of the acquisition.
−Removed: SBH’s management excluded the acquisitions of Armitage Pet Products, which was completed on October 26, 2020, and For Life Products, LLC, which was completed on May 28, 2021, from the assessment of the effectiveness of internal control over financial reporting.
−Removed: The total assets of $532.8 million and total net sales of $117.4 million associated with the acquisitions are included in the consolidated financial statements of SBH as of and for the year ended September 30, 2021.
+Added: SBH’s management excluded the acquisition of the Tristar Business, which was completed on February 18, 2022, from the assessment of the effectiveness of internal control over financial reporting.
+Added: The total assets of $381.9 million and total net sales of 189.7 million associated with the acquisition are included in the consolidated financial statements of SBH as of and for the year ended September 30, 2022.
Changes in Internal Control Over Financial Reporting .
−Removed: As disclosed in Part II Item 9A Controls and Procedures in our Annual Report on Form 10-K for the fiscal year ended September 30, 2020, we identified a material weakness in internal control over financial reporting related to ineffective information technology general controls (ITGCs) related to user access and role change reviews over certain information technology (IT) systems in the EMEA region.
−Removed: During the year ended September 30, 2021, we implemented our previously-disclosed remediation plan that included (1) developing and enhancing IT compliance oversight capabilities with specific focus over identification and execution of appropriate ITGCs within the EMEA region;
−Removed: (2) enhancing user access reviews and role change testing control activities with focus in the EMEA region including enhanced documentation, training and knowledge sharing access reviews and role change testing control activities and policies within the EMEA IT operations, including documentation evidencing the specific control procedures to be performed;
−Removed: and (3) maintaining process and control documentation underlying user access reviews and roll change processes within the EMEA region to promote knowledge transfer and transition upon personnel changes.
−Removed: In addition, we validated the underlying data and financial reports generated by the impacted information systems supporting business process controls and operations in the EMEA region.
−Removed: Other than those described above, there were no additional changes to our internal control over financial reporting that occurred during the year ended September 30, 2021 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
+Added: There was no change in SBH's internal control over financial reporting (as defined in Rules 13a15(f) and 15d-15(f) under the Securities Exchange Act of 1934 as amended) that occurred during our fiscal fourth quarter that has materially affected, or is reasonably likely to materially affect, SBH's internal control over financial reporting.
SB/RH Holdings, LLC
5 unchanged sentences
Accordingly, even effective disclosure controls and procedures can only provide reasonable, not absolute, assurance of achieving their control objectives.
+Added: Table of Conten t s
Management’s Annual Report on Internal Control over Financial Reporting .
12 unchanged sentences
Under guidelines established by the SEC, companies are allowed to exclude acquisitions from their first assessment of internal control over financial reporting following the date of the acquisition.
−Removed: SB/RH’s management excluded the acquisitions of Armitage Pet Products, which was completed on October 26, 2020, and For Life Products, LLC, which was completed on May 28, 2021, from the assessment of the effectiveness of internal control over financial reporting.
−Removed: The total assets of $532.8 million and total net sales of $117.4 million associated with the acquisitions are included in the consolidated financial statements of SB/RH as of and for the year ended September 30, 2021.
+Added: SB/RH’s management excluded the acquisition of the Tristar Business, which was completed on February 18, 2022, from the assessment of the effectiveness of internal control over financial reporting.
+Added: The total assets of $381.9 million and total net sales of $189.7 million associated with the acquisition are included in the consolidated financial statements of SB/RH as of and for the year ended September 30, 2022.
This annual report does not include an attestation report of SB/RH's registered public accounting firm due to the established rules of the SEC.
Changes in Internal Control Over Financial Reporting .
−Removed: As disclosed in Part II Item 9A Controls and Procedures in our Annual Report on Form 10-K for the fiscal year ended September 30, 2020, we identified a material weakness in internal control over financial reporting related to ineffective information technology general controls (ITGCs) related to user access and role change reviews over certain information technology (IT) systems in the EMEA region.
−Removed: During the year ended September 30, 2021, we implemented our previously-disclosed remediation plan that included (1) developing and enhancing IT compliance oversight capabilities with specific focus over identification and execution of appropriate ITGCs within the EMEA region;
−Removed: (2) enhancing user access reviews and role change testing control activities with focus in the EMEA region including enhanced documentation, training and knowledge sharing access reviews and role change testing control activities and policies within the EMEA IT operations, including documentation evidencing the specific control procedures to be performed;
−Removed: and (3) maintaining process and control documentation underlying user access reviews and roll change processes within the EMEA region to promote knowledge transfer and transition upon personnel changes.
−Removed: In addition, we validated the underlying data and financial reports generated by the impacted information systems supporting business process controls and operations in the EMEA region.
−Removed: Other than those described above, there were no additional changes to our internal control over financial reporting that occurred during the year ended September 30, 2021 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
+Added: There was no change in SB/RH's internal control over financial reporting (as defined in Rules 13a15(f) and 15d-15(f) under the Securities Exchange Act of 1934 as amended) that occurred during our fiscal fourth quarter that has materially affected, or is reasonably likely to materially affect, SB/RH's internal control over financial reporting.
OTHER INFORMATION
+Added: Table of Conten t s
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
24 unchanged sentences
The information required by Item 407(a) of Regulation S-K is incorporated herein by reference from the disclosures which will be included in a subsequent amendment to the Form 10-K.
+Added: Table of Conten t s
PRINCIPAL ACCOUNTING FEES AND SERVICES
3 unchanged sentences
Audit-Related Fees 5.1 4.4
−Removed: Tax Fees — 0.1
All Other Fees 0.3 —
6 unchanged sentences
Pre-Approval of Independent Auditors Services and Fees
−Removed: The Audit Committee pre-approved the audit services engagement performed by KPMG LLP for the year ended September 30, 2021.
+Added: The Audit Committee approved the audit services engagement performed by KPMG LLP for the year ended September 30, 2022.
In accordance with the Audit Committee’s Pre-Approval Policy, the Audit Committee has pre-approved other specified audit, or audit related services, provided that the fees incurred by KPMG LLP in connection with any individual engagement do not exceed $200,000 in any 12-month period.
6 unchanged sentences
The exhibits listed in the Exhibit Index filed as part of this Annual Report on Form 10-K.
+Added: Table of Conten t s
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULE
2 unchanged sentences
The notes to the consolidated financial statements include consolidated SBH footnotes and certain footnotes related to SB/RH.
−Removed: Reports of Independent Registered Public Accounting Firm
+Added: Reports of Independent Registered Public Accounting Firm (PCAOB ID 185 )
Spectrum Brands Holdings, Inc.
14 unchanged sentences
Combined Notes to Consolidated Financial Statements
+Added: Table of Conten t s
Report of Independent Registered Public Accounting Firm
18 unchanged sentences
We believe that our audits provide a reasonable basis for our opinion.
−Removed: Critical Audit Matter
−Removed: The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that:
−Removed: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.
−Removed: The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
−Removed: Recoverability of deferred tax assets associated with the Company's net operating
−Removed: As discussed in Note 16 to the consolidated financial statements, the Company had $734.0 million of deferred tax assets as of September 30, 2021.
−Removed: The deferred tax assets arose primarily due to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases, as well as, net operating losses, capital losses, and other carryforwards.
−Removed: The Company records a valuation allowance on the deferred tax assets not expected to be recoverable.
−Removed: In assessing the recoverability of the deferred tax assets, the Company considers both historical and forecasted income and expected timing of when temporary differences will reverse.
−Removed: We identified the evaluation of the recoverability of the deferred tax assets associated with the Company’s net operating losses as a critical audit matter due to the subjectivity involved in evaluating the recoverability of those deferred tax assets.
−Removed: This subjectivity is primarily driven by the Company’s ability to generate sufficient taxable income of the appropriate character in the future so as to recover those deferred tax assets.
−Removed: Further, there is complexity in the application of the relevant tax regulations to the Company’s forecasted taxable income.
+Added: Critical Audit Matters
+Added: The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that:
+Added: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.
+Added: The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
+Added: Sufficiency of audit evidence related to held for sale classification
+Added: As discussed in Notes 1and 3 to the consolidated financial statements, on September 8, 2021, the Company entered a definitive agreement with ASSA ABLOY AB (ASSA) to sell its Hardware and Home Improvement (HHI) segment, subject to certain antitrust approvals, and has presented the HHI segment as assets held for sale since then.
+Added: On September 15, 2022, the Department of Justice (DOJ) issued a petition to enjoin and block the HHI transaction.
+Added: Both the Company and ASSA have stated their disagreement with the purported concerns of the DOJ and have made proposals to address them.
+Added: The Company expects that the parties will obtain all required governmental clearances and will close the HHI transaction.
+Added: As such, the Company continued to classify the HHI segment as held for sale, with total assets held for sale and total liabilities held for sale of $1,816.7 million and $463.7 million, respectively, as of September 30, 2022.
+Added: We identified the sufficiency of audit evidence over the held for sale classification of the HHI segment as a critical audit matter.
+Added: Specifically, subjective auditor judgment was required to evaluate management's assertion that it expects a favorable resolution of the DOJ petition, which is necessary for the sale of HHI to ASSA to be completed.
The following are the primary procedures we performed to address this critical audit matter.
−Removed: We evaluated the design and tested the operating effectiveness of certain internal controls related to the critical audit matter.
−Removed: This included controls related to the development of forecasted income, utilization of net operating losses, and the application of the relevant tax regulations.
−Removed: We assessed the likelihood of the Company’s ability to recover its net operating loss deferred tax assets in the future, which included evaluating projected financial information used to forecast taxable income.
−Removed: To assess the Company’s ability to forecast, we compared the Company’s previous forecasts to actual results.
−Removed: We involved U.S.
−Removed: tax professionals with specialized skills and knowledge, who assisted in assessing the Company’s application of the relevant tax regulations and evaluating the recoverability of deferred tax assets associated with the Company’s net operating losses
+Added: We applied auditor judgment to determine the nature and extent of procedures to be performed related to the held for sale classification of the HHI segment, including management’s assertion for a favorable resolution of the DOJ petition.
+Added: We evaluated the design and tested the operating effectiveness of an internal control related to the held for sale classification of the HHI segment as of September 30, 2022.
+Added: To evaluate management’s assertion that it expects a favorable resolution of the DOI petition, we:
+Added: • inspected management's analysis and evaluated the basis for management's conclusions related to the held for sale classification of the HHI segment, including its assessment of the specific facts and circumstances around legal and regulatory factors that were relevant in the Company’s conclusions
+Added: • inspected and evaluated internal and external documentation, including analysis of the DOJ petition against the pending sale of the HHI segment, as well as court rulings for similar transactions
+Added: • evaluated management's intent and ability to execute its plans to secure a favorable resolution of the DOJ petition and close the transaction.
+Added: We evaluated the sufficiency of audit evidence obtained by assessing the results of procedures performed, including the appropriateness of such evidence.
+Added: Valuation of contingent consideration and tradename in the Tristar Products, Inc.
+Added: business acquisitions
+Added: As discussed in Notes 2 and 4 to the consolidated financial statements, on February 18, 2022, the Company acquired all of the membership interests in HPC Brands, LLC, which consists of the home appliances and cookware business of Tristar Products, Inc., in a business combination for a total purchase price of $325.0 million.
+Added: The total purchase price included the estimated acquisition-date fair value of contingent consideration, which may be paid if the acquired business achieves certain targets in 2022 and 2023.
+Added: The acquisition-date fair value of the contingent consideration liability was estimated using a Monte Carlo simulation model.
+Added: In connection with this business combination, the Company acquired the PowerXL tradename intangible asset, for which the Company used the relief from royalty method to determine the acquisition-date fair value.
+Added: The acquisition-date fair values for the contingent consideration liability and the PowerXL tradename were $30.0 million and $66.0 million, respectively.
+Added: Table of Conten t s
+Added: We identified the assessment of the acquisition-date fair value measurement of the contingent consideration liability and the PowerXL tradename intangible asset as a critical audit matter.
+Added: A high degree of complex auditor judgment was required to evaluate the key assumptions used to estimate the acquisition-date fair value of the contingent consideration liability, including forecasted gross profit and volatility.
+Added: A high degree of complex auditor judgment was also required to evaluate the key assumptions used to estimate the acquisition-date fair value of the PowerXL tradename intangible asset, including forecasted revenue and the royalty rate.
+Added: Changes in these assumptions could have had a significant impact on the acquisition-date fair values of the contingent consideration liability and the tradename.
+Added: In addition, valuation professionals with specialized skills and knowledge were needed to assist in performing certain audit procedures related to the acquisition-date fair value measurement of both the contingent consideration liability and the PowerXL tradename intangible asset.
+Added: The following are the primary procedures we performed to address this critical audit matter.
+Added: We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s process of estimating the acquisition-date fair values of the contingent consideration liability and the PowerXL tradename intangible asset, including controls related to the key assumptions noted above.
+Added: We evaluated the forecasted gross profit and the forecasted revenue by comparing them to historical results of the Company and the acquired business.
+Added: We also assessed the Company's ability to accurately forecast by comparing the Company's forecasted gross profit and forecasted revenue of the acquired business to actual results since the acquisition date.
+Added: We performed sensitivity analyses over the Company's forecasted gross profit and volatility to assess the impact on the Company's determination of the acquisition-date fair value of the contingent consideration liability.
+Added: We performed sensitivity analyses over the Company's forecasted revenue and the royalty rate to assess the impact of the Company's determination of the acquisition-date fair value of the PowerXL tradename.
+Added: We involved valuation professionals with specialized skills and knowledge, who assisted in evaluating:
+Added: • volatility used in the Monte Carlo simulation model for the contingent consideration liability
+Added: • the forecasted long-term revenue growth rates underlying the forecasted revenue used in the PowerXL tradename valuation by comparing it to certain macroeconomic trend data, such as gross domestic product and inflation, and to relevant industry-specific data
+Added: • the PowerXL tradename royalty rate by comparing it against a range of royalty rates that was independently-developed using publicly-available market data for comparable tradenames.
We have served as the Company’s auditor since 2011.
1 unchanged sentence
November 22, 2022
+Added: Table of Conten t s
Report of Independent Registered Public Accounting Firm
6 unchanged sentences
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated statements of financial position of the Company as of September 30, 2022 and 2021, the related consolidated statements of income, comprehensive income, shareholders' equity, and cash flows for each of the years in the three-year period ended September 30, 2022, and the related notes (collectively, the consolidated financial statements), and our report dated November 22, 2022 expressed an unqualified opinion on those consolidated financial statements.
−Removed: The Company acquired Armitage Pet Care Limited and For Life Products, LLC during 2021, and management excluded from its assessment of the effectiveness of the Company’s internal control over financial reporting as of September 30, 2021, the internal control over financial reporting for both Armitage Pet Care Limited and For Life Products, LLC associated with total assets of $532.8 million and total revenues of $117.4 million included in the consolidated financial statements of the Company as of and for the year ended September 30, 2021.
−Removed: Our audit of internal control over financial reporting of the Company also excluded an evaluation of the internal control over financial reporting of Armitage Pet Care Limited and For Life Products, LLC.
+Added: The Company acquired Tristar Products, Inc.
+Added: during 2022, and management excluded from its assessment of the effectiveness of the Company’s internal control over financial reporting as of September 30, 2022, Tristar Products, Inc.’s internal control over financial reporting associated with total assets $381.9 million and total revenues of $189.7 million included in the consolidated financial statements of the Company as of and for the year ended September 30, 2022.
+Added: Our audit of internal control over financial reporting of the Company also excluded an evaluation of the internal control over financial reporting of Tristar Products, Inc.
Basis for Opinion
17 unchanged sentences
November 22, 2022
+Added: Table of Conten t s
Report of Independent Registered Public Accounting Firm
19 unchanged sentences
We believe that our audits provide a reasonable basis for our opinion.
−Removed: Critical Audit Matter
−Removed: The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that:
−Removed: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.
−Removed: The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
−Removed: Recoverability of deferred tax assets associated with the Company's net operating losses
−Removed: As discussed in Note 16 to the consolidated financial statements, the Company had $412.7 million of deferred tax assets as of September 30, 2021.
−Removed: The deferred tax assets arose primarily due to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases, as well as, net operating losses, capital losses, and other carryforwards.
−Removed: The Company records a valuation allowance on the deferred tax assets not expected to be recoverable.
−Removed: In assessing the recoverability of the deferred tax assets, the Company considers both historical and forecasted income and expected timing of when temporary differences will reverse.
−Removed: We identified the evaluation of the recoverability of the deferred tax assets associated with the Company’s net operating losses as a critical audit matter due to the subjectivity involved in evaluating the recoverability of those deferred tax assets.
−Removed: This subjectivity is primarily driven by the Company’s ability to generate sufficient taxable income of the appropriate character in the future so as to recover those deferred tax assets.
−Removed: Further, there is complexity in the application of the relevant tax regulations to the Company’s forecasted taxable income.
+Added: Critical Audit Matters
+Added: The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that:
+Added: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.
+Added: The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
+Added: Sufficiency of audit evidence related to held for sale classification
+Added: As discussed in Notes 1and 3 to the consolidated financial statements, on September 8, 2021, the Company entered a definitive agreement with ASSA ABLOY AB (ASSA) to sell its Hardware and Home Improvement (HHI) segment, subject to certain antitrust approvals, and has presented the HHI segment as assets held for sale since then.
+Added: On September 15, 2022, the Department of Justice (DOJ) issued a petition to enjoin and block the HHI transaction.
+Added: Both the Company and ASSA have stated their disagreement with the purported concerns of the DOJ and have made proposals to address them.
+Added: The Company expects that the parties will obtain all required governmental clearances and will close the HHI transaction.
+Added: As such, the Company continued to classify the HHI segment as held for sale, with total assets held for sale and total liabilities held for sale of $1,816.7 million and $463.7 million, respectively, as of September 30, 2022.
+Added: We identified the sufficiency of audit evidence over the held for sale classification of the HHI segment as a critical audit matter.
+Added: Specifically, subjective auditor judgment was required to evaluate management's assertion that it expects a favorable resolution of the DOJ petition, which is necessary for the sale of HHI to ASSA to be completed.
The following are the primary procedures we performed to address this critical audit matter.
−Removed: We evaluated the design and tested the operating effectiveness of certain internal controls related to the critical audit matter.
−Removed: This included controls related to the development of forecasted income, utilization of net operating losses, and the application of the relevant tax regulations.
−Removed: We assessed the likelihood of the Company’s ability to recover its net operating loss deferred tax assets in the future, which included evaluating projected financial information used to forecast taxable income.
−Removed: To assess the Company’s ability to forecast, we compared the Company’s previous forecasts to actual results.
−Removed: We involved U.S.
−Removed: tax professionals with specialized skills and knowledge, who assisted in assessing the Company’s application of the relevant tax regulations and evaluating the recoverability of deferred tax assets associated with the Company’s net operating losses
+Added: We applied auditor judgment to determine the nature and extent of procedures to be performed related to the held for sale classification of the HHI segment, including management’s assertion for a favorable resolution of the DOJ petition.
+Added: We evaluated the design and tested the operating effectiveness of an internal control related to the held for sale classification of the HHI segment as of September 30, 2022.
+Added: To evaluate management’s assertion that it expects a favorable resolution of the DOI petition, we:
+Added: • inspected management's analysis and evaluated the basis for management's conclusions related to the held for sale classification of the HHI segment, including its assessment of the specific facts and circumstances around legal and regulatory factors that were relevant in the Company’s conclusions
+Added: • inspected and evaluated internal and external documentation, including analysis of the DOJ petition against the pending sale of the HHI segment, as well as court rulings for similar transactions
+Added: • evaluated management's intent and ability to execute its plans to secure a favorable resolution of the DOJ petition and close the transaction.
+Added: We evaluated the sufficiency of audit evidence obtained by assessing the results of procedures performed, including the appropriateness of such evidence.
+Added: Valuation of contingent consideration and tradename in the Tristar Products, Inc.
+Added: business acquisitions
+Added: As discussed in Notes 2 and 4 to the consolidated financial statements, on February 18, 2022, the Company acquired all of the membership interests in HPC Brands, LLC, which consists of the home appliances and cookware business of Tristar Products, Inc., in a business combination for a total purchase price of $325.0 million.
+Added: The total purchase price included the estimated acquisition-date fair value of contingent consideration, which may be paid if the acquired business achieves certain targets in 2022 and 2023.
+Added: The acquisition-date fair value of the contingent consideration liability was estimated using a Monte Carlo simulation model.
+Added: In connection with this business combination, the Company acquired the PowerXL tradename intangible asset, for which the Company used the relief from royalty method to determine the acquisition-date fair value.
+Added: The acquisition-date fair values for the contingent consideration liability and the PowerXL tradename were $30.0 million and $66.0 million, respectively.
+Added: Table of Conten t s
+Added: We identified the assessment of the acquisition-date fair value measurement of the contingent consideration liability and the PowerXL tradename intangible asset as a critical audit matter.
+Added: A high degree of complex auditor judgment was required to evaluate the key assumptions used to estimate the acquisition-date fair value of the contingent consideration liability, including forecasted gross profit and volatility.
+Added: A high degree of complex auditor judgment was also required to evaluate the key assumptions used to estimate the acquisition-date fair value of the PowerXL tradename intangible asset, including forecasted revenue and the royalty rate.
+Added: Changes in these assumptions could have had a significant impact on the acquisition-date fair values of the contingent consideration liability and the tradename.
+Added: In addition, valuation professionals with specialized skills and knowledge were needed to assist in performing certain audit procedures related to the acquisition-date fair value measurement of both the contingent consideration liability and the PowerXL tradename intangible asset.
+Added: The following are the primary procedures we performed to address this critical audit matter.
+Added: We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s process of estimating the acquisition-date fair values of the contingent consideration liability and the PowerXL tradename intangible asset, including controls related to the key assumptions noted above.
+Added: We evaluated the forecasted gross profit and the forecasted revenue by comparing them to historical results of the Company and the acquired business.
+Added: We also assessed the Company's ability to accurately forecast by comparing the Company's forecasted gross profit and forecasted revenue of the acquired business to actual results since the acquisition date.
+Added: We performed sensitivity analyses over the Company's forecasted gross profit and volatility to assess the impact on the Company's determination of the acquisition-date fair value of the contingent consideration liability.
+Added: We performed sensitivity analyses over the Company's forecasted revenue and the royalty rate to assess the impact of the Company's determination of the acquisition-date fair value of the PowerXL tradename.
+Added: We involved valuation professionals with specialized skills and knowledge, who assisted in evaluating:
+Added: • volatility used in the Monte Carlo simulation model for the contingent consideration liability
+Added: • the forecasted long-term revenue growth rates underlying the forecasted revenue used in the PowerXL tradename valuation by comparing it to certain macroeconomic trend data, such as gross domestic product and inflation, and to relevant industry-specific data
+Added: • the PowerXL tradename royalty rate by comparing it against a range of royalty rates that was independently-developed using publicly-available market data for comparable tradenames.
We have served as the Company’s auditor since 1997.
1 unchanged sentence
November 22, 2022
+Added: Table of Conten t s
SPECTRUM BRANDS HOLDINGS, INC.
15 unchanged sentences
Intangible assets, net 1,202.2 1,204.1
−Removed: Noncurrent assets of business held for sale — 1,293.0
Total assets $ 5,775.6 $ 5,340.4
11 unchanged sentences
Other long-term liabilities 57.8 99.0
−Removed: Noncurrent liabilities of business held for sale — 125.1
Total liabilities 4,506.5 3,861.4
14 unchanged sentences
See accompanying notes to the consolidated financial statements.
+Added: Table of Conten t s
SPECTRUM BRANDS HOLDINGS, INC.
6 unchanged sentences
Cost of goods sold 2,142.1 1,963.5 1,744.0
−Removed: Restructuring and related charges 1.9 13.8 2.5
Gross profit 990.4 1,034.6 878.1
2 unchanged sentences
Research and development 26.7 29.8 29.2
−Removed: Restructuring and related charges 38.4 57.8 58.5
−Removed: Transaction related charges 56.3 23.1 20.9
+Added: Gain from remeasurement of contingent consideration liability ( 28.5 ) — —
Loss on sale of Coevorden operations — — 26.8
−Removed: Write-off from impairment of goodwill — — 116.0
Write-off from impairment of intangible assets — — 24.2
Total operating expenses 967.2 937.5 869.5
−Removed: Operating income (loss) 97.1 8.6 ( 152.4 )
+Added: Operating income 23.2 97.1 8.6
Interest expense 99.4 116.5 93.7
Gain from extinguishment of Salus CLO debt — — ( 76.2 )
−Removed: Other non-operating (income) expense, net ( 8.3 ) 16.2 43.4
+Added: Other non-operating expense (income), net 14.1 ( 8.3 ) 16.2
Loss from continuing operations before income taxes ( 90.3 ) ( 11.1 ) ( 25.1 )
Income tax (benefit) expense ( 13.3 ) ( 26.4 ) 27.3
−Removed: Net income (loss) from continuing operations 15.3 ( 52.4 ) ( 302.2 )
+Added: Net (loss) income from continuing operations ( 77.0 ) 15.3 ( 52.4 )
Income from discontinued operations, net of tax 149.7 174.3 150.9
1 unchanged sentence
Net income from continuing operations attributable to non-controlling interest 0.2 0.2 0.3
−Removed: Net (loss) income from discontinued operations attributable to non-controlling interest $ ( 0.2 ) $ 0.4 $ 0.5
+Added: Net income (loss) from discontinued operations attributable to non-controlling interest 0.9 $ ( 0.2 ) $ 0.4
Net income attributable to controlling interest $ 71.6 $ 189.6 $ 97.8
Amounts attributable to controlling interest
−Removed: Net income (loss) from continuing operations attributable to controlling interest $ 15.1 $ ( 52.7 ) $ ( 303.0 )
+Added: Net (loss) income from continuing operations attributable to controlling interest $ ( 77.2 ) $ 15.1 $ ( 52.7 )
Net income from discontinued operations attributable to controlling interest 148.8 174.5 150.5
12 unchanged sentences
See accompanying notes to the consolidated financial statements .
+Added: Table of Conten t s
SPECTRUM BRANDS HOLDINGS, INC.
6 unchanged sentences
Other comprehensive income
−Removed: Foreign currency translation gain (loss) 32.2 ( 18.5 ) ( 30.8 )
+Added: Foreign currency translation adjustment
+Added: Foreign currency translation (loss) gain ( 147.8 ) 26.0 14.5
+Added: Unrealized gain (loss) on net investment hedge 75.8 6.2 ( 33.0 )
+Added: Foreign currency translation adjustment before tax ( 72.0 ) 32.2 ( 18.5 )
Deferred tax effect ( 20.0 ) — 0.1
−Removed: Net unrealized gain (loss) on foreign currency translation 32.2 ( 18.4 ) ( 35.5 )
−Removed: Unrealized gain (loss) on derivative instruments
+Added: Net unrealized (loss) gain on foreign currency translation ( 92.0 ) 32.2 ( 18.4 )
+Added: Unrealized gain on derivative instruments
Unrealized gain (loss) on derivative instruments before reclassification 30.7 0.1 ( 6.2 )
−Removed: Net reclassification for loss (gain) to income from continuing operations 9.2 ( 4.6 ) ( 10.4 )
−Removed: Net reclassification for loss (gain) to income from discontinued operations 0.1 ( 0.4 ) ( 0.2 )
+Added: Net reclassification for (gain) loss to income from continuing operations ( 20.2 ) 9.2 ( 4.6 )
+Added: Net reclassification for (gain) loss to income from discontinued operations ( 2.4 ) 0.1 ( 0.4 )
Unrealized gain (loss) on derivative instruments after reclassification 8.1 9.4 ( 11.2 )
Deferred tax effect 2.3 ( 6.6 ) 11.7
−Removed: Net unrealized gain (loss) on derivative instruments 2.8 0.5 ( 3.4 )
+Added: Net unrealized gain on derivative instruments 10.4 2.8 0.5
Defined benefit pension gain (loss)
1 unchanged sentence
Net reclassification for loss to income from continuing operations 3.6 4.8 4.6
−Removed: Net reclassification for (gain) loss to income from discontinued operations ( 0.1 ) ( 0.3 ) 0.1
+Added: Net reclassification for gain to income from discontinued operations ( 0.1 ) ( 0.1 ) ( 0.3 )
Defined benefit pension gain (loss) after reclassification 21.8 16.4 ( 0.9 )
4 unchanged sentences
Comprehensive income 4.0 239.4 87.5
−Removed: Comprehensive income (loss) from continuing operations attributable to non-controlling interest — 0.1 ( 0.2 )
−Removed: Comprehensive income (loss) from discontinuing operations attributable to non-controlling interest 0.4 0.3 ( 0.3 )
+Added: Comprehensive (loss) income from continuing operations attributable to non-controlling interest ( 0.4 ) — 0.1
+Added: Comprehensive (loss) income from discontinuing operations attributable to non-controlling interest ( 0.5 ) 0.4 0.3
Comprehensive income attributable to controlling interest $ 4.9 $ 239.0 $ 87.1
See accompanying notes to the consolidated financial statements.
+Added: Table of Conten t s
SPECTRUM BRANDS HOLDINGS, INC.
13 unchanged sentences
Income from discontinued operations, net of tax — — — 150.5 — — 150.5 0.4 150.9
−Removed: Other comprehensive loss, net of tax — — — — ( 59.7 ) — ( 59.7 ) ( 0.5 ) ( 60.2 )
+Added: Other comprehensive (loss) income, net of tax — — — — ( 19.5 ) — ( 19.5 ) 0.4 ( 19.1 )
Sale and deconsolidation of discontinued operations — — — — 8.1 — 8.1 — 8.1
Treasury stock repurchases ( 4.2 ) — — — — ( 239.8 ) ( 239.8 ) — ( 239.8 )
+Added: Accelerated share repurchase final settlement ( 2.0 ) — ( 0.2 ) — — ( 124.8 ) ( 125.0 ) — ( 125.0 )
Restricted stock issued and related tax withholdings 0.5 — ( 14.2 ) — — 19.0 4.8 — 4.8
4 unchanged sentences
Balances at September 30, 2020 43.1 0.5 2,054.3 243.9 ( 284.7 ) ( 606.5 ) 1,407.5 8.3 1,415.8
−Removed: Net (loss) income from continuing operations — — — ( 52.7 ) — — ( 52.7 ) 0.3 ( 52.4 )
−Removed: Income from discontinued operations, net of tax — — — 150.5 — — 150.5 0.4 150.9
−Removed: Sale and deconsolidation of discontinued operations — — — — 8.1 — 8.1 — 8.1
−Removed: Other comprehensive (loss) income, net of tax — — — — ( 19.5 ) — ( 19.5 ) 0.4 ( 19.1 )
+Added: Net income from continuing operations — — — 15.1 — — 15.1 0.2 15.3
+Added: Income (loss) from discontinued operations, net of tax — — — 174.5 — — 174.5 ( 0.2 ) 174.3
+Added: Other comprehensive income, net of tax — — — — 49.4 — 49.4 0.4 49.8
Treasury stock repurchases ( 1.6 ) — — — — ( 125.8 ) ( 125.8 ) — ( 125.8 )
−Removed: Accelerated share repurchase final settlement ( 2.0 ) — ( 0.2 ) — — ( 124.8 ) ( 125.0 ) — ( 125.0 )
Restricted stock issued and related tax withholdings 0.3 — ( 20.2 ) — — 15.3 ( 4.9 ) — ( 4.9 )
2 unchanged sentences
Dividend paid by subsidiary to NCI — — — — — — — ( 1.6 ) ( 1.6 )
−Removed: Cumulative adjustment for adoption of new accounting standards (Note 2) — — — ( 0.3 ) 0.3 — — — —
Balances at September 30, 2021 41.8 0.5 2,063.8 359.9 ( 235.3 ) ( 717.0 ) 1,471.9 7.1 1,479.0
−Removed: Net income from continuing operations — — — 15.1 — — 15.1 0.2 15.3
−Removed: Income (loss) from discontinued operations, net of tax — — — 174.5 — — 174.5 ( 0.2 ) 174.3
−Removed: Other comprehensive income, net of tax — — — — 49.4 — 49.4 0.4 49.8
+Added: Net (loss) income from continuing operations — — — ( 77.2 ) — — ( 77.2 ) 0.2 ( 77.0 )
+Added: Income from discontinued operations, net of tax — — — 148.8 — — 148.8 0.9 149.7
+Added: Other comprehensive loss, net of tax — — — — ( 67.8 ) — ( 67.8 ) ( 0.9 ) ( 68.7 )
Treasury stock repurchases ( 1.4 ) — — — — ( 134.0 ) ( 134.0 ) — ( 134.0 )
5 unchanged sentences
See accompanying notes to the consolidated financial statements.
+Added: Table of Conten t s
SPECTRUM BRANDS HOLDINGS, INC.
7 unchanged sentences
Income from discontinued operations, net of tax 149.7 174.3 150.9
−Removed: Net income (loss) from continuing operations 15.3 ( 52.4 ) ( 302.2 )
−Removed: Adjustments to reconcile net income (loss) to net cash from operating activities:
−Removed: Depreciation and amortization 117.0 114.7 147.3
+Added: Net (loss) income from continuing operations ( 77.0 ) 15.3 ( 52.4 )
+Added: Adjustments to reconcile net (loss) income to net cash from operating activities:
+Added: Depreciation 49.0 51.9 59.3
+Added: Amortization 50.3 65.1 55.3
Share based compensation 10.2 28.9 31.8
−Removed: Unrealized loss on equity investments held — 7.5 12.1
−Removed: Realized (gain) loss on equity investments sold ( 6.9 ) 9.3 —
−Removed: Loss on sale of Coevorden operations — 26.8 —
−Removed: Write-off from impairment of goodwill — — 116.0
−Removed: Write-off from impairment of intangible assets — 24.2 35.4
Amortization of debt issuance costs and debt discount 7.1 5.6 6.4
Write-off of unamortized discount and debt issuance costs — 7.9 1.1
+Added: Gain from remeasurement of contingent consideration liability ( 28.5 ) — —
+Added: Non-cash purchase accounting adjustments 8.3 7.3 —
+Added: Gain on equity investment — ( 6.9 ) 16.8
+Added: Loss on sale of Coevorden operations — — 26.8
+Added: Write-off from impairment of intangible assets — — 24.2
Gain from extinguishment of Salus CLO debt — — ( 76.2 )
−Removed: Purchase accounting inventory adjustment 7.3 — —
Deferred tax (benefit) expense ( 44.6 ) ( 64.4 ) 24.6
5 unchanged sentences
Other 9.4 25.9 ( 19.3 )
−Removed: Net cash provided (used) by operating activities from continuing operations 89.2 201.8 ( 42.6 )
+Added: Net cash (used) provided by operating activities from continuing operations ( 231.5 ) 89.2 201.8
Net cash provided by operating activities from discontinued operations 177.7 199.2 88.5
−Removed: Net cash provided by operating activities 288.4 290.3 1.1
+Added: Net cash (used) provided by operating activities ( 53.8 ) 288.4 290.3
Cash flows from investing activities
9 unchanged sentences
Net cash (used) provided by investing activities ( 359.8 ) ( 423.5 ) 108.3
+Added: Table of Conten t s
(in millions)
7 unchanged sentences
Dividends paid to shareholders ( 68.6 ) ( 71.5 ) ( 75.2 )
−Removed: Dividends paid by subsidiary to non-controlling interest — — ( 1.1 )
Share based award tax withholding payments, net of proceeds upon vesting ( 24.5 ) ( 8.3 ) ( 12.6 )
1 unchanged sentence
Other financing activities, net — 3.5 0.3
−Removed: Net cash used by financing activities from continuing operations ( 206.9 ) ( 495.1 ) ( 2,721.6 )
+Added: Net cash provided (used) by financing activities from continuing operations 490.7 ( 206.9 ) ( 495.1 )
Net cash used by financing activities from discontinued operations ( 3.1 ) ( 3.0 ) ( 2.0 )
−Removed: Net cash used by financing activities ( 209.9 ) ( 497.1 ) ( 2,724.6 )
+Added: Net cash provided (used) by financing activities 487.6 ( 209.9 ) ( 497.1 )
Effect of exchange rate changes on cash and cash equivalents ( 20.1 ) 1.3 5.1
14 unchanged sentences
See accompany notes to the consolidated financial statements.
+Added: Table of Conten t s
SB/RH Holdings, LLC
15 unchanged sentences
Intangible assets, net 1,202.2 1,204.1
−Removed: Noncurrent assets of business held for sale — 1,293.0
Total assets $ 5,861.1 $ 5,417.7
11 unchanged sentences
Other long-term liabilities 65.6 106.3
−Removed: Noncurrent liabilities of business held for sale — 125.1
Total liabilities 4,728.0 4,084.3
9 unchanged sentences
See accompanying notes to the consolidated financial statements
+Added: Table of Conten t s
SB/RH Holdings, LLC
6 unchanged sentences
Cost of goods sold 2,142.1 1,963.5 1,744.0
−Removed: Restructuring and related charges 1.9 13.8 2.5
Gross profit 990.4 1,034.6 878.1
2 unchanged sentences
Research and development 26.7 29.8 29.2
−Removed: Restructuring and related charges 38.4 57.8 58.5
−Removed: Transaction related charges 56.3 23.1 20.9
+Added: Gain from remeasurement of contingent consideration liability ( 28.5 ) — —
Loss on sale of Coevorden operations — — 26.8
−Removed: Write-off from impairment of goodwill — — 116.0
Write-off from impairment of intangible assets — — 24.2
Total operating expenses 964.5 933.8 862.5
−Removed: Operating income (loss) 100.8 15.6 ( 147.7 )
+Added: Operating income 25.9 100.8 15.6
Interest expense 99.8 116.8 93.2
−Removed: Other non-operating (income) expense, net ( 8.3 ) 16.3 43.6
+Added: Other non-operating expense (income), net 14.0 ( 8.3 ) 16.3
Loss from continuing operations before income taxes ( 87.9 ) ( 7.7 ) ( 93.9 )
Income tax (benefit) expense ( 12.9 ) ( 25.0 ) 14.5
−Removed: Net income (loss) from continuing operations 17.3 ( 108.4 ) ( 261.3 )
+Added: Net (loss) income from continuing operations ( 75.0 ) 17.3 ( 108.4 )
Income from discontinued operations, net of tax 149.7 174.3 150.9
1 unchanged sentence
Net income from continuing operations attributable to non-controlling interest 0.2 0.2 0.3
−Removed: Net (loss) income from discontinued operations attributable to non-controlling interest ( 0.2 ) 0.4 0.5
+Added: Net income (loss) from discontinued operations attributable to non-controlling interest 0.9 ( 0.2 ) 0.4
Net income attributable to controlling interest $ 73.6 $ 191.6 $ 41.8
Amounts attributable to controlling interest
−Removed: Net income (loss) from continuing operations attributable to controlling interest $ 17.1 $ ( 108.7 ) $ ( 262.1 )
+Added: Net (loss) income from continuing operations attributable to controlling interest $ ( 75.2 ) $ 17.1 $ ( 108.7 )
Net income from discontinued operations attributable to controlling interest 148.8 174.5 150.5
1 unchanged sentence
See accompanying notes to the consolidated financial statements
+Added: Table of Conten t s
SB/RH Holdings, LLC
5 unchanged sentences
Other comprehensive income
−Removed: Foreign currency translation gain (loss) 32.2 ( 18.5 ) ( 30.8 )
+Added: Foreign currency translation adjustment
+Added: Foreign currency translation (loss) gain ( 147.8 ) 26.0 14.5
+Added: Unrealized gain (loss) on net investment hedge 75.8 6.2 ( 33.0 )
+Added: Foreign currency translation adjustment before tax ( 72.0 ) 32.2 ( 18.5 )
Deferred tax effect ( 20.0 ) — 0.1
−Removed: Net unrealized gain (loss) on foreign currency translation 32.2 ( 18.4 ) ( 35.5 )
−Removed: Unrealized gain (loss) on derivative instruments
+Added: Net unrealized (loss) gain on foreign currency translation ( 92.0 ) 32.2 ( 18.4 )
+Added: Unrealized gain on derivative instruments
Unrealized gain (loss) on derivative instruments before reclassification 30.7 0.1 ( 6.2 )
−Removed: Net reclassification for loss (gain) to income from continuing operations 9.2 ( 4.6 ) ( 10.4 )
−Removed: Net reclassification for loss (gain) to income from discontinued operations 0.1 ( 0.4 ) ( 0.2 )
+Added: Net reclassification for (gain) loss to income from continuing operations ( 20.2 ) 9.2 ( 4.6 )
+Added: Net reclassification for (gain) loss to income from discontinued operations ( 2.4 ) 0.1 ( 0.4 )
Unrealized gain (loss) on derivative instruments after reclassification 8.1 9.4 ( 11.2 )
Deferred tax effect 2.3 ( 6.6 ) 11.7
−Removed: Net unrealized gain (loss) on derivative instruments 2.8 0.5 ( 3.4 )
+Added: Net unrealized gain on derivative instruments 10.4 2.8 0.5
Defined benefit pension gain (loss)
1 unchanged sentence
Net reclassification for loss to income from continuing operations 3.6 4.8 4.6
−Removed: Net reclassification for (gain) loss to income from discontinued operations ( 0.1 ) ( 0.3 ) 0.1
+Added: Net reclassification for gain to income from discontinued operations ( 0.1 ) ( 0.1 ) ( 0.3 )
Defined benefit pension gain (loss) after reclassification 21.8 16.4 ( 0.9 )
4 unchanged sentences
Comprehensive income 6.0 241.4 31.5
−Removed: Comprehensive income (loss) from continuing operations attributable to non-controlling interest — 0.1 ( 0.2 )
−Removed: Comprehensive income (loss) from discontinuing operations attributable to non-controlling interest 0.4 0.3 ( 0.3 )
+Added: Comprehensive (loss) income from continuing operations attributable to non-controlling interest ( 0.4 ) — 0.1
+Added: Comprehensive (loss) income from discontinuing operations attributable to non-controlling interest ( 0.5 ) 0.4 0.3
Comprehensive income attributable to controlling interest $ 6.9 $ 241.0 $ 31.1
See accompanying notes to the consolidated financial statements
+Added: Table of Conten t s
SB/RH Holdings, LLC
10 unchanged sentences
Net (loss) income from continuing operations — ( 108.7 ) — ( 108.7 ) 0.3 ( 108.4 )
−Removed: Loss from discontinued operations, net of tax — 803.4 — 803.4 0.5 803.9
+Added: Income from discontinued operations, net of tax — 150.5 — 150.5 0.4 150.9
Sale and deconsolidation of discontinued operations — — 8.1 8.1 — 8.1
−Removed: Other comprehensive loss, net of tax — — ( 59.7 ) ( 59.7 ) ( 0.5 ) ( 60.2 )
+Added: Other comprehensive (loss) income, net of tax — — ( 19.5 ) ( 19.5 ) 0.4 ( 19.1 )
Restricted stock issued and related tax withholdings 4.5 — — 4.5 — 4.5
4 unchanged sentences
Balances at September 30, 2020 2,154.1 ( 614.2 ) ( 284.6 ) 1,255.3 9.9 1,265.2
−Removed: Net (loss) income from continuing operations — ( 108.7 ) — ( 108.7 ) 0.3 ( 108.4 )
−Removed: Income from discontinued operations, net of tax — 150.5 — 150.5 0.4 150.9
−Removed: Sale and deconsolidation of discontinued operations — — 8.1 8.1 — 8.1
−Removed: Other comprehensive (loss) income, net of tax — — ( 19.5 ) ( 19.5 ) 0.4 ( 19.1 )
+Added: Net income from continuing operations — 17.1 — 17.1 0.2 17.3
+Added: Income (loss) from discontinued operations, net of tax — 174.5 — 174.5 ( 0.2 ) 174.3
+Added: Other comprehensive income, net of tax — — 49.4 49.4 0.4 49.8
Restricted stock issued and related tax withholdings ( 7.3 ) — — ( 7.3 ) — ( 7.3 )
2 unchanged sentences
Dividend paid by subsidiary to NCI — — — — ( 1.6 ) ( 1.6 )
−Removed: Cumulative adjustment for adoption of new accounting standards — ( 0.3 ) 0.3 — — —
Balances at September 30, 2021 2,174.8 ( 614.9 ) ( 235.2 ) 1,324.7 8.7 1,333.4
−Removed: Net income from continuing operations — 17.1 — 17.1 0.2 17.3
+Added: Net (loss) income from continuing operations — ( 75.2 ) — ( 75.2 ) 0.2 ( 75.0 )
Income from discontinued operations, net of tax — 148.8 — 148.8 0.9 149.7
−Removed: Other comprehensive income, net of tax — — 49.4 49.4 0.4 49.8
+Added: Other comprehensive loss, net of tax — — ( 67.8 ) ( 67.8 ) ( 0.9 ) ( 68.7 )
Restricted stock issued and related tax withholdings ( 24.5 ) — — ( 24.5 ) — ( 24.5 )
4 unchanged sentences
See accompanying notes to the consolidated financial statements.
+Added: Table of Conten t s
SB/RH Holdings, LLC
7 unchanged sentences
Income from discontinued operations, net of tax 149.7 174.3 150.9
−Removed: Net income (loss) from continuing operations 17.3 ( 108.4 ) ( 261.3 )
−Removed: Adjustments to reconcile net income (loss) to net cash from operating activities:
−Removed: Depreciation and amortization 117.0 114.7 147.3
+Added: Net (loss) income from continuing operations ( 75.0 ) 17.3 ( 108.4 )
+Added: Adjustments to reconcile net (loss) income to net cash from operating activities:
+Added: Depreciation 49.0 51.9 59.3
+Added: Amortization 50.3 65.1 55.3
Share based compensation 9.1 27.2 30.5
−Removed: Unrealized loss on equity investments held — 7.5 12.1
−Removed: Realized (gain) loss on equity investments sold ( 6.9 ) 9.3 —
−Removed: Loss on sale of Coevorden operations — 26.8 —
−Removed: Write-off from impairment of goodwill — — 116.0
−Removed: Write-off from impairment of intangible assets — 24.2 35.4
Amortization of debt issuance costs and debt discount 7.1 5.6 5.5
Write-off of unamortized discount and debt issuance costs — 7.9 1.1
−Removed: Purchase accounting inventory adjustment 7.3 — —
+Added: Gain from remeasurement of contingent consideration liability ( 28.5 ) — —
+Added: Non-cash purchase accounting adjustments 8.3 7.3 —
+Added: Gain on equity investment — ( 6.9 ) 16.8
+Added: Loss on sale of Coevorden operations — — 26.8
+Added: Write-off from impairment of intangible assets — — 24.2
Deferred tax (benefit) expense ( 44.2 ) ( 63.0 ) 11.8
5 unchanged sentences
Other 9.9 26.2 ( 12.2 )
−Removed: Net cash provided (used) by operating activities from continuing operations 81.7 ( 8.3 ) ( 34.9 )
+Added: Net cash (used) provided by operating activities from continuing operations ( 263.5 ) 81.7 ( 8.3 )
Net cash provided by operating activities from discontinued operations 177.7 199.2 88.5
−Removed: Net cash provided by operating activities 280.9 80.2 14.8
+Added: Net cash (used) provided by operating activities ( 85.8 ) 280.9 80.2
Cash flows from investing activities
14 unchanged sentences
Payment of cash dividends to parent ( 194.7 ) ( 192.3 ) ( 241.0 )
−Removed: Dividends paid by subsidiary to non-controlling interest — — ( 1.1 )
Payment of contingent consideration ( 1.9 ) — ( 197.0 )
−Removed: Net cash used by financing activities from continuing operations ( 197.1 ) ( 283.8 ) ( 2,693.4 )
+Added: Net cash provided (used) by financing activities from continuing operations 523.1 ( 197.1 ) ( 283.8 )
Net cash used by financing activities from discontinued operations ( 3.1 ) ( 3.0 ) ( 2.0 )
−Removed: Net cash used by financing activities ( 200.1 ) ( 285.8 ) ( 2,696.4 )
+Added: Net cash provided (used) by financing activities 520.0 ( 200.1 ) ( 285.8 )
Effect of exchange rate changes on cash and cash equivalents ( 20.1 ) 1.3 5.1
21 unchanged sentences
The Company manufactures, markets and/or distributes its products globally in the North America (“NA”), Europe, Middle East & Africa (“EMEA”), Latin America (“LATAM”) and Asia-Pacific (“APAC”) regions through a variety of trade channels, including retailers, wholesalers and distributors.
−Removed: We enjoy strong name recognition in our regions under our various brands and patented technologies across multiple product categories.
+Added: We enjoy strong name recognition under our various brands and patented technologies across multiple product categories.
Global and geographic strategic initiatives and financial objectives are determined at the corporate level.
Each segment is responsible for implementing defined strategic initiatives and achieving certain financial objectives and has a president responsible for sales and marketing initiatives and the financial results for all product lines within that segment.
−Removed: The segments are supported through center-led corporate shared service operations consisting of finance and accounting, information technology, legal and human resource, supply chain and commercial operations.
+Added: The segments are supported through center-led shared service enabling functions consisting of finance and accounting, information technology, legal and human resource, supply chain and commercial operations.
See Note 21 – Segment Information for more information pertaining to segments of continuing operations.
2 unchanged sentences
Home Appliances:
−Removed: Small kitchen appliances including toaster ovens, coffeemakers, slow cookers, blenders, hand mixers, grills, food processors, juicers, toasters, irons, kettles, and breadmakers.
+Added: Small kitchen appliances including toaster ovens, coffeemakers, slow cookers, air fryers, blenders, hand mixers, grills, food processors, juicers, toasters, irons, kettles, and breadmakers.
Personal Care:
1 unchanged sentence
Home Appliances:
−Removed: Black & Decker®, Russell Hobbs®, George Foreman®, Toastmaster®, Juiceman®, Farberware®, and Breadman®
+Added: Black & Decker®, Russell Hobbs®, George Foreman®, PowerXL®, Emeril Legasse®, Copper Chef ®, Toastmaster®, Juiceman®, Farberware®, and Breadman®
Personal Care:
−Removed: Remington®, and LumaBella®
GPC Companion Animal:
96 unchanged sentences
Customer lists, proprietary technology and certain trade name intangibles are amortized, using the straight-line method, over their estimated useful lives.
−Removed: The range and weighted average useful lives for definite-lived intangibles assets are as follows:
−Removed: Weighted Average
+Added: The ranges of useful lives for definite-lived intangibles assets are as follows:
Customer relationships
+Added: 12 - 20 years
Technology assets
38 unchanged sentences
Debt issuance costs are deferred and amortized to interest expense using the effective interest method over the lives of the related debt agreements.
−Removed: Debt issuance costs for the Company were $ 35.6 million and $ 36.5 million as of September 30, 2021 and 2020, respectively.
Debt issuance costs are included as a reduction to Long Term Debt, Net of Current Portion in the Consolidated Statements of Financial Position.
7 unchanged sentences
Depending on the nature of derivatives designated as hedging instruments, changes in fair value are either offset against the change in fair value of the hedged assets or liability through earnings, or recognized in equity through other comprehensive income until the hedged item is recognized.
−Removed: Derivative instruments that hedge the exposure to variability in expected future cash flows and are designated as cash flow hedges, and the entire change in the fair value of the hedging instrument is recorded as a component of Accumulated Other Comprehensive (Loss) Income (“AOCI”) in Stockholders’ Equity.
+Added: Derivative instruments that hedge the exposure to variability in expected future cash flows and are designated as cash flow hedges, and the entire change in the fair value of the hedging instrument is recorded as a component of Accumulated Other Comprehensive (Loss) Income (“AOCI”) in Shareholders’ Equity.
Those amounts are subsequently reclassified to earnings in the same line item in the Consolidated Statement of Income as impacted by the hedge item when the hedged item affects earnings.
25 unchanged sentences
The services are often associated with the sale of product but are also provided separately and are considered a distinct performance obligation separate from product sales.
+Added: With the acquisition of the Tristar Business, the Company also sells extended warranty coverage for certain Tristar Business products that are sold directly to consumers, which is sold as a separate contract and recognized as a separate performance obligation that is distinct from the product.
+Added: The extended warranty is initially recognized as deferred revenue and amortized on a straight-line basis to Net Sales over the life of the contracts.
Variable Consideration and Cash Paid to Customers
15 unchanged sentences
For the anticipated value of the returns, the Company will recognize a return liability in Other Current Liabilities and a separate return asset included in the Prepaid Expenses and Other Current Assets, when applicable.
−Removed: As of September 30, 2021 and 2020, the Company recognized an expected returns liability of $ 11.8 million and $ 12.8 million, respectively, most of which the Company does not expect or anticipate a return asset.
+Added: See Note 6 - Revenue Recognition for further discussion on product returns.
Product returns do not include provisions for warranties provided to end-consumers of the Company's products, which are recognized as a component of the Company's cost of goods sold.
26 unchanged sentences
The estimated liability is not reduced for possible recoveries from insurance carriers.
+Added: Environmental costs include initial site surveys, costs for remediation and restoration and ongoing monitoring costs, as well as fines, damages and other costs, when applicable and estimable.
+Added: Adjustments to initial estimates are recorded, from time to time, to reflect changing circumstances and estimates based upon additional information developed in subsequent periods.
Estimated environmental remediation expenditures are included in the determination of the net realizable value recorded for assets held for sale.
−Removed: See Note 21 - Commitments and Contingencies for further detail.
−Removed: Restructuring and Related Charges
−Removed: Restructuring charges include, but are not limited to, the costs of one-time termination benefits such as severance costs and retention bonuses, and contract termination costs consisting primarily of lease termination costs.
−Removed: Related charges, as defined by the Company, include, but are not limited to, other costs directly associated with exit and relocation activities, including impairment of property and other assets, departmental costs of full-time incremental employees, and any other items related to the exit or relocation activities.
−Removed: Costs for such activities are estimated by management after evaluating detailed analyses of the costs to be incurred.
−Removed: Liabilities from restructuring and related charges are recorded for estimated costs of facility closures, significant organizational adjustments and measures undertaken by management to exit certain activities.
−Removed: Costs for such activities are estimated by management after evaluating detailed analyses of the costs to be incurred.
−Removed: Such liabilities or asset reductions could include amounts for items such as severance costs and related benefits, lease termination payments and any other items directly related to the exit activities.
−Removed: Impairment of property and equipment and other current or long-term assets as a result of restructuring related initiatives are recognized as a reduction of the appropriate asset.
+Added: See Note 20 - Commitments and Contingencies for further discussion.
+Added: Restructuring Charges
+Added: The Company regularly enters into various restructuring initiatives, optimization projects, strategic transactions, and other business development activities that may include the recognition of exit or disposal costs.
+Added: Exit or disposal costs include, but are not limited to, the costs of termination benefits, such as a one-time involuntary severance or retention bonuses, one-time contract termination costs (excluding leases), and other costs associated with non-termination type costs related to restructuring initiatives such as incremental costs for the sale or termination of a line of business, closure or consolidation of operating facilities or business locations in a country or region, relocation of business activities and employees from one location to another, change in management structure, transition of third-party providers and a fundamental reorganization that affects the nature and focus of operations, among others.
+Added: Restructuring charges associated with manufacturing are recorded as Cost of Goods Sold.
+Added: Restructuring charges associated with administrative functions are recorded as operating expenses, such as initiatives impacting sales, marketing, distribution or other non-manufacturing related functions.
SPECTRUM BRANDS HOLDINGS INC.
2 unchanged sentences
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES (continued)
−Removed: Restructuring and related charges associated with manufacturing and related initiatives are recorded in Cost of Goods Sold.
−Removed: Restructuring and related charges reflected in Cost of Goods Sold include, but are not limited to, termination and related costs associated with manufacturing employees, asset impairments relating to manufacturing initiatives and other costs directly related to the manufacturing component of a restructuring initiative.
−Removed: Restructuring and related charges associated with administrative functions are recorded in operating expenses, such as initiatives impacting sales, marketing, distribution or other non-manufacturing related functions.
−Removed: Restructuring and related charges reflected in operating expenses include, but are not limited to, termination and related costs, any asset impairments relating to the administrative functions and other costs directly related to the administrative components of the restructuring initiatives implemented.
−Removed: See Note 5 - Restructuring and Related Charges for further detail.
+Added: Liabilities from restructuring charges are recorded for estimated costs of facility closures, significant organizational adjustments and measures undertaken by management to exit certain activities.
+Added: Costs for such activities are estimated by management after evaluating detailed analyses of the costs to be incurred.
+Added: Such liabilities or asset reductions could include amounts for items such as severance costs and related benefits, lease termination payments and any other items directly related to the exit activities.
+Added: Impairment of property and equipment and other current or long-term assets as a result of a restructuring initiative is recognized as a reduction of the appropriate asset.
+Added: See Note 5 - Restructuring Charges for further detail.
The Company determines if an arrangement is a lease at inception, considering whether the contract conveys a right to control the use of the identified asset for a period of time in exchange for consideration.
19 unchanged sentences
If impairment is determined to exist, any related impairment loss is calculated based on fair value.
−Removed: Transaction related charges
−Removed: Transaction related charges consist of costs towards (1) a qualifying strategic transaction or business development opportunity, including an acquisition or divestiture, whether or not consummated, associated with the purchase or sale of net assets or equity interest of a business such as a business combination, equity investment, joint venture or purchase or sale of non-controlling interest;
−Removed: (2) subsequent integration related project costs directly associated with an acquisition including realized costs for the integration of acquired operations into the Company’s shared service platforms, termination of redundant or duplicative positions and locations, operations and/or products, employee transition costs, professional fees, and other post business combination expenses;
−Removed: and (3) divestiture support and separation costs consisting of incremental costs incurred to facilitate separation of a divested business or operation, including the development of shared service operations impacted by a separation, including impacts to shared platforms and personnel impacted by the transaction.
−Removed: Qualifying cost types include, but are not limited to, banking, advisory, legal, accounting, valuation, or other professional fees;
−Removed: and including impairment loss on existing assets considered duplicative or redundant and directly attributable to the respective transactions.
−Removed: See Note 3 - Divestitures and Note 4 – Acquisitions for further discussion.
−Removed: The following table summarizes transaction related charges incurred by the Company during the years ended September 30, 2021, 2020 and 2019:
−Removed: (in millions)
−Removed: 2021 2020 2019
−Removed: HHI divestiture and separation $ 9.6 $ — $ —
−Removed: Rejuvenate acquisition and integration 10.8 — —
−Removed: Armitage acquisition and integration 10.9 — —
−Removed: Coevorden operations divestiture and separation 5.4 5.5 —
−Removed: GBL divestiture and separation 3.2 10.2 9.5
−Removed: PetMatrix integration — — —
−Removed: Omega Sea acquisition and integration 0.2 1.6 —
−Removed: Other 16.2 5.8 11.4
−Removed: Total transaction-related charges $ 56.3 $ 23.1 $ 20.9
−Removed: SPECTRUM BRANDS HOLDINGS INC.
−Removed: SB/RH HOLDINGS, LLC
−Removed: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
−Removed: NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES (continued)
Income taxes are accounted for under the asset and liability method.
14 unchanged sentences
Newly Adopted Accounting Standards
−Removed: In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses:
−Removed: Measurement of Credit Losses on Financial Instruments , which was further updated and clarified by the FASB through the issuance of additional related ASUs.
−Removed: The ASU introduces a forward-looking approach, based on expected losses, to estimate credit losses on certain types of financial instruments, including trade receivables.
−Removed: The estimate of expected credit losses will require entities to incorporate considerations of historical information, current information, and reasonable and supportable forecasts.
−Removed: This ASU also expands the disclosure requirements to enable users of financial statements to understand the entity’s assumptions, models, and methods for estimating expected credit losses.
−Removed: The guidance is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2019.
−Removed: The Company adopted ASU 2016-13 on a modified retrospective basis effective October 1, 2020.
−Removed: The adoption of ASU 2016-13 did not have a material impact on the Company’s consolidated financial statements.
−Removed: Refer to Note 8 - Receivables and Concentration of Credit Risk for further discussion on the Company's receivables and allowance for uncollectible receivables.
−Removed: In August 2018, the FASB issued ASU 2018-15, Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract .
−Removed: This standard provides guidance on accounting for costs of implementation activities performed in a cloud computing arrangement that is a service contract.
−Removed: ASU 2018-15 aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software and hosting arrangements that include an internal-use software license.
−Removed: ASU 2018-15 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2019.
−Removed: The Company adopted ASU 2018-15 prospectively to all implementation costs incurred after October 1, 2020, the date of adoption.
−Removed: Before the adoption of the standard, the implementation costs in cloud computing arrangements were expensed as incurred.
−Removed: Effective October 1, 2020, implementation costs attributable to cloud computer arrangements are recognized as Deferred Charges and Other on the Consolidated Statements of Financial Position and subsequently amortized over the respective term of the cloud computing arrangement.
−Removed: The adoption of ASU 2018-15 did not have a material impact on the Company’s consolidated financial statements.
−Removed: In August 2018, the FASB issued ASU 2018-14, Compensation-Retirement Benefits-Defined Benefit Plans-General (Subtopic 715-20):
−Removed: Disclosure Framework-Changes to the Disclosure Requirements for Defined Benefit Plans .
−Removed: ASU 2018-14 requires entities to disclose the weighted-average interest crediting rates used, reasons for significant gains and losses affecting benefit obligations, and an explanation of any other significant changes in the benefit obligation or plan assets.
−Removed: The amendment also removed certain previously required disclosures.
−Removed: The Company adopted this guidance as of September 30, 2021.
−Removed: The provisions of the new standard have been recognized in Note 15 - Employee Benefit Plans for all periods.
−Removed: Recently Issued Accounting Standards
−Removed: In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848):
−Removed: Facilitation of the Effects of Reference Rate Reform on Financial Reporting.
−Removed: This ASU provides optional expedient and exceptions for applying generally accepted accounting principles to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met.
−Removed: In response to the concerns about structural risks of interbank offered rates (“IBORs”) and, particularly, the risk of cessation of the London Interbank Offered Rate (“LIBOR”), regulators in several jurisdictions around the world have undertaken reference rate reform initiatives to identify alternative reference rates that are more observable or transaction based and less susceptible to manipulation.
−Removed: The ASU provides companies with optional guidance to ease the potential accounting burden associated with transitioning away from reference rates that are expected to be discontinued.
−Removed: In January 2021, the FASB issued ASU 2021-01, which adds implementation guidance to clarify certain optional expedients in Topic 848.
−Removed: The ASUs can be adopted no later than December 31, 2022 with early adoption permitted.
−Removed: The Company is currently evaluating the impacts of adoption of the new guidance to its consolidated financial statements.
In December 2019, the FASB issued ASU No.
3 unchanged sentences
The new standard also adds guidance to reduce complexity in certain areas, including recognizing deferred taxes for tax goodwill and allocating taxes to members of a consolidated group.
−Removed: The ASU is effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years.
−Removed: Depending on the amendment, adoption may be applied on a retrospective, modified retrospective or prospective basis.
−Removed: The Company is currently evaluating the impacts of adoption of the new guidance to its consolidated financial statements.
+Added: The ASU is effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years and was adopted by the Company on October 1, 2021.
+Added: The adoption did not have a material impact on the Company's consolidated financial statements.
SPECTRUM BRANDS HOLDINGS INC.
1 unchanged sentence
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Added: NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES (continued)
+Added: Recently Issued Accounting Standards
+Added: In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848):
+Added: Facilitation of the Effects of Reference Rate Reform on Financial Reporting .
+Added: In January 2021, the FASB clarified the scope of that guidance with the issuance of ASU 2021-01 ,“Reference Rate Reform:
+Added: Scope.” This ASU provides optional expedient and exceptions for applying generally accepted accounting principles to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met.
+Added: In response to the concerns about structural risks of interbank offered rates (“IBORs”) and, particularly, the risk of cessation of the London Interbank Offered Rate (“LIBOR”), regulators in several jurisdictions around the world have undertaken reference rate reform initiatives to identify alternative reference rates that are more observable or transaction based and less susceptible to manipulation.
+Added: The ASU provides companies with optional guidance to ease the potential accounting burden associated with transitioning away from reference rates that are expected to be discontinued.
+Added: In January 2021, the FASB issued ASU 2021-01, which adds implementation guidance to clarify certain optional expedients in Topic 848.
+Added: The ASUs can be adopted no later than December 31, 2022 with early adoption permitted.
+Added: The adoption will not have a material impact on the Company's consolidated financial statements.
+Added: In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805):
+Added: Accounting for Contract Assets and Contract Liabilities from Contracts with Customers .
+Added: This ASU requires that an acquirer recognize, and measure contract assets and contract liabilities acquired in a business combination in accordance with ASC 606 “Revenue from Contracts with Customers” (Topic 606) as if it had originated the contracts.
+Added: Generally, this would result in an acquirer recognizing and measuring the acquired contract assets and contract liabilities consistent with how they were recognized and measured in the acquiree’s financial statements if the acquiree prepared financial statements in accordance with US GAAP.
+Added: This standard is effective for fiscal years beginning after December 15, 2023 including interim periods within the fiscal year.
+Added: Early adoption is permitted.
+Added: The standard is applied prospectively to business combinations occurring on or after the effective date of the amendments.
+Added: The impact will be based on future business combinations after we adopt the standard.
NOTE 3 – DIVESTITURES
3 unchanged sentences
Income from discontinued operations before income taxes - HHI $ 253.3 $ 288.2 $ 227.8
−Removed: (Loss) income from discontinued operations before income taxes - GBL ( 7.2 ) 4.2 997.6
−Removed: Loss from discontinued operations before income taxes - GAC ( 0.1 ) ( 0.1 ) ( 115.7 )
+Added: (Loss) income from discontinued operations before income taxes - Other ( 3.8 ) ( 7.3 ) 4.1
Interest on corporate debt allocated to discontinued operations 46.4 44.5 47.3
2 unchanged sentences
Income from discontinued operations, net of tax 149.7 174.3 150.9
−Removed: (Loss) income from discontinued operations, net of tax attributable to noncontrolling interest ( 0.2 ) 0.4 0.5
+Added: Income (loss) from discontinued operations, net of tax attributable to noncontrolling interest 0.9 ( 0.2 ) 0.4
Income from discontinued operations, net of tax attributable to controlling interest $ 148.8 $ 174.5 $ 150.5
Interest from corporate debt allocated to discontinued operations includes interest on Term Loans required to be paid down using proceeds received on disposal on sale of a business, and interest expense from corporate debt not directly attributable to or related to other operations based on the ratio of net assets of the disposal group held for sale to the consolidated net assets plus consolidated debt, excluding debt assumed in transaction, required to be repaid, or directly attributable to other operations of the Company.
−Removed: Corporate debt, including Term Loans required to be paid down, are not classified as held for sale as they are not directly attributable to the identified disposal groups.
−Removed: For the year ended September 30, 2019, SBH recognized interest expense associated with corporate debt directly held by the SBH parent company and not included as part of the consolidated financial statements of SB/RH.
−Removed: As a result, there was only $ 75.2 million of interest on corporate debt from SB/RH allocated to discontinued operations, excluding allocated interest attributable to debt held directly by the SBH parent company, and further impacting the intraperiod income tax expense from discontinued operations to $ 223.4 million as part of the SB/RH Consolidated Statement of Income for the year ended September 30, 2019 .
−Removed: The Company paid down the outstanding debt held by SBH parent company following the divestitures of GBL and GAC during the year ended September 30, 2019 and for the years ended September 30, 2021 and September 30, 2020, all corporate debt and applicable interest allocated to discontinued operations was attributable to debt held by SBI, a wholly owned subsidiary of both SBH and SB/RH.
+Added: Corporate debt, including Term Loans, are not classified as held for sale as they are not directly attributable to the identified disposal groups.
+Added: Hardware and Home Improvement ("HHI")
On September 8, 2021, the Company entered into a definitive Asset and Stock Purchase Agreement (the "ASPA") with ASSA ABLOY AB ("ASSA") to sell its HHI segment for cash proceeds of $ 4.3 billion, subject to customary purchase price adjustments.
8 unchanged sentences
The consummation of the transaction is not subject to any financing condition.
−Removed: The transaction is expected to be consummated prior to September 30, 2022.
−Removed: The ASPA also contains certain termination rights, including the right of either party to terminate the ASPA if the consummation of the acquisition has not occurred on or before December 8, 2022 (the “Termination Date”).
−Removed: Further, if the acquisition has not been consummated by the Termination Date and all conditions precedent to ASSA's obligation to consummate the acquisition have otherwise been satisfied except for one or more of the Antitrust Conditions, then ASSA would be required to pay the Company a termination fee of $ 350 million.
SPECTRUM BRANDS HOLDINGS, INC.
2 unchanged sentences
NOTE 3 – DIVESTITURES (continued)
+Added: The ASPA also contains certain termination rights, including the right of either party to terminate the ASPA if the consummation of the acquisition has not occurred on or before December 8, 2022 (the “Termination Date”).
+Added: Further, if the acquisition has not been consummated by the Termination Date and all conditions precedent to ASSA's obligation to consummate the acquisition have otherwise been satisfied except for one or more of the Antitrust Conditions, then ASSA would be required to pay the Company a termination fee of $ 350 million.
+Added: On July 14, 2022, the parties entered into an amendment to the ASPA (the “Amendment”) pursuant to which the Termination Date was extended to June 30, 2023.
+Added: Except for the foregoing amendment to the Termination Date, the ASPA remains in full force and effect as written, including with respect to the termination fee of $ 350 million.
+Added: The Company continues to engage with antitrust regulators in the regulatory review of the HHI transaction and the extension is intended to provide the parties with additional time (to the extent needed) to satisfy the conditions related to receipt of governmental clearances.
+Added: On September 15, 2022, the Department of Justice ("DOJ") filed a complaint seeking to enjoin the transaction and block the acquisition of the HHI division by ASSA.
+Added: Both the Company and ASSA have stated their disagreement with the DOJ's concerns.
+Added: The Company expects that the trial will occur in April 2023.
+Added: The Company and ASSA will jointly defend the transaction in the litigation.
+Added: ASSA has also announced that, to resolve all the alleged competitive concerns surrounding the acquisition of HHI, it has initiated a process to sell its Emtek and its smart residential business in the U.S.
+Added: The Company continues to recognize the HHI division as held for sale and as a component of our discontinued operations.
+Added: The parties are committed to closing the HHI transaction and the Company and ASSA both continue to expect that they will obtain all the required governmental clearances and will close the HHI transaction.
The following table summarizes the assets and liabilities of the HHI disposal group classified as held for sale as of September 30, 2022 and 2021:
33 unchanged sentences
No impairment loss was recognized on the asset held for sale as the purchase price of the business less estimated cost to sell is more than its carrying value.
+Added: SPECTRUM BRANDS HOLDINGS, INC.
+Added: SB/RH HOLDINGS, LLC
+Added: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Added: NOTE 3 – DIVESTITURES (continued)
The following table presents significant non-cash items and capital expenditures of discontinued operations from the HHI divestiture:
4 unchanged sentences
Purchases of property, plant and equipment $ 23.9 $ 22.8 $ 16.9
−Removed: On January 2, 2019, the Company completed the sale of its GBL business pursuant to the GBL acquisition agreement with Energizer for cash proceeds of $ 1,956.2 million, resulting in a pre-tax gain on sale of $ 989.8 million, during the year ended September 30, 2019, including the settlement of customary purchase price adjustments for working capital and assumed indebtedness, recognition of tax and legal indemnifications under the acquisition agreement and an estimated contingent purchase price adjustment of $ 200 million for the settlement of the planned divestiture of the Varta® consumer batteries business by Energizer.
−Removed: The results of operations and gain on sale for disposal of the GBL business were recognized as a component of discontinued operations.
−Removed: SPECTRUM BRANDS HOLDINGS, INC.
−Removed: SB/RH HOLDINGS, LLC
−Removed: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
−Removed: NOTE 3 – DIVESTITURES (continued)
−Removed: The GBL acquisition agreement provided for a purchase price adjustment that was contingent upon the completion of the divestiture of the Varta® consumer battery, chargers, portable power and portable lighting business in the EMEA region by Energizer.
−Removed: The Company settled the outstanding balance with Energizer for $ 197 million and recognized an incremental adjustment to gain on sale of $ 3.0 million as a component of income from discontinued operations, net of tax, during the year ended September 30, 2020.
−Removed: The Company and Energizer agreed to indemnify each other for losses arising from certain breaches of the GBL acquisition agreement and for certain other matters.
−Removed: The Company agreed to indemnify Energizer for certain liabilities relating to the assets retained by the Company, and Energizer agreed to indemnify the Company for certain liabilities assumed by Energizer, in each case as described in the acquisition agreement.
−Removed: As of September 30, 2021 and 2020, the Company recognized $ 35.0 million and $ 50.2 million, respectively, related to indemnifications in accordance with the acquisition agreement, including $ 17.3 million and $ 33.0 million, respectively, within Other Current Liabilities on the Company’s Consolidated Statement of Financial Position primarily attributable to current income tax indemnifications and $ 17.7 million and $ 17.2 million, respectively, within Other Long-Term Liabilities on the Company’s Consolidated Statement of Financial Position primarily attributable to income tax indemnifications associated with previously recognized uncertain tax benefits.
−Removed: During the years ended September 30, 2021 and 2020, the Company recognized incremental pre-tax loss on sale for changes to tax and legal indemnifications and other agreed-upon funding under the GBL acquisition agreement with Energizer.
−Removed: During the year ended September 30, 2020, the Company recognized a $ 10.5 million tax benefit to discontinued operations from the return to provision adjustments related to the divestitures of GBL, primarily from changes to US GILTI on the non-US portions of the sold business.
−Removed: The Company and Energizer entered into related agreements that became effective upon the consummation of the acquisition including a customary transition services agreement (“TSA”) and reverse TSA.
−Removed: The TSA and reverse TSA are recognized as a component of continuing operations for periods following the completion of the GBL sale.
−Removed: See Note 17 – Related Party Transactions for additional discussion.
−Removed: The following table summarizes the components of income from discontinued operations before income taxes associated with the GBL operations in the accompanying Consolidated Statements of Operations for the years ended September 30, 2019 with the close of the GBL divestiture on January 2, 2019.
−Removed: (in millions)
−Removed: Cost of goods sold
−Removed: Operating expenses
−Removed: Operating income
−Removed: Interest expense
−Removed: Other non-operating expense, net 0.5
−Removed: Reclassification of accumulated other comprehensive income
−Removed: Income from discontinued operations before income taxes
−Removed: The Company ceased the recognition of depreciation and amortization of long-lived assets associated with the GBL disposal group when classified as held for sale prior to the year ended September 30, 2019 and therefore no depreciation and amortization was recognized from the GBL disposal group during the year ended September 30, 2019 prior to close of the transaction.
−Removed: Interest expense consists of interest from debt directly attributable to GBL operations that primarily consist of interest from finance leases.
−Removed: Additionally, the Company incurred transaction costs of $ 12.9 million associated with the divestiture, which were recognized as a component of income from discontinued operations for the year ended September 30, 2019.
−Removed: Transaction costs were expensed as incurred and include fees for investment banking services, legal, accounting, due diligence, tax, valuation and various other services necessary to complete the transaction.
−Removed: On January 28, 2019, the Company completed the sale of its GAC business pursuant to the GAC acquisition agreement with Energizer for $ 938.7 million in cash proceeds and $ 242.1 million in stock consideration of common stock of Energizer, resulting in a loss on sale of business of $ 111.0 million during the year ended September 30, 2019, including the estimated settlement of customary purchase price adjustments for working capital and assumed indebtedness, and recognition of tax and legal indemnifications in accordance with the GAC acquisition agreement.
−Removed: The results of operations and loss on the disposal of the GAC business were recognized as a component of discontinued operations.
−Removed: The Company and Energizer agreed to indemnify each other for losses arising from certain breaches of the GAC acquisition agreement and for certain other matters.
−Removed: The Company agreed to indemnify Energizer for certain liabilities relating to the assets retained by the Company, and Energizer agreed to indemnify the Company for certain liabilities assumed by Energizer, in each case as described in the acquisition agreement.
−Removed: As of September 30, 2021 and 2020, the Company recognized $ 1.5 million and $ 1.4 million, respectively, related to indemnifications in accordance with the acquisition agreement within Other Long-Term Liabilities on the Company’s Consolidated Statement of Financial Position primarily attributable to income tax indemnifications associated with previously recognized uncertain tax benefits.
−Removed: The Company and Energizer entered into related agreements ancillary to the GAC acquisition that became effective upon the consummation of the acquisition, including a TSA and reverse TSA, a supply agreement with the Company’s H&G business, as well as a shareholder agreement.
−Removed: The TSA and reverse TSA are recognized as a component of continuing operations for periods following the completion of the GAC sale.
−Removed: The supply agreement with the Company’s H&G business was recognized as a component of net sales and continuing operations.
−Removed: The supply agreement had a contracted term of 24 months, and expired in January 2021.
−Removed: Sales from the Company’s H&G segment to GAC discontinued operations prior to the divestiture have been recognized as a component of net sales and continuing operations for all comparable periods.
−Removed: See Note 17 – Related Party Transactions for additional discussion.
−Removed: SPECTRUM BRANDS HOLDINGS, INC.
−Removed: SB/RH HOLDINGS, LLC
−Removed: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
−Removed: NOTE 3 – DIVESTITURES (continued)
−Removed: The following table summarizes the components of income from discontinued operations before income taxes associated with the GAC business in the accompanying Consolidated Statements of Operations for the year ended 2019, with the close of the GAC divestiture on January 28, 2019:
+Added: Loss from discontinued operations before income taxes – other includes incremental pre-tax loss for changes to tax and legal indemnifications and other agreed-upon funding under the acquisition agreements for the sale and divestiture of the Global Batteries & Lighting ("GBL") and Global Auto Care ("GAC") divisions to Energizer Holdings, Inc.
+Added: ("Energizer") during the year ended September 30, 2019.
+Added: The Company and Energizer agreed to indemnify each other for losses arising from certain breaches of the acquisition agreement and for certain other matters.
+Added: The Company has agreed to indemnify for certain liabilities relating to the assets retained, and Energizer agreed to indemnify the Company for certain liabilities assumed, in each case as described in the acquisition agreements.
+Added: Subsequently, effective January 2, 2020, Energizer closed its divestitures of the European based Varta® consumer battery business in the EMEA region to Varta AG and transferred all respective rights and indemnifications attributable to the Varta® consumer battery business provided by the GBL sale to Varta AG.
+Added: As of September 30, 2022 and 2021, the Company recognized $ 22.3 million and $ 36.5 million respectively, related to indemnification payables in accordance with the acquisition agreements, including $ 7.0 million and $ 17.3 million within Other Current Liabilities, respectively, and $ 15.3 million and $ 19.2 million, within Other Long-Term Liabilities, respectively, on the Company’s Consolidated Statements of Financial Position, primarily attributable to income tax indemnifications associated with previously recognized uncertain tax benefits.
+Added: The Company entered into a series of transition services agreements ("TSAs") and reverse TSAs with Energizer to support various shared back office administrative functions including finance, sales and marketing, information technology, human resources, real estate and supply chain, customer service and procurement.
+Added: TSAs associated with the Varta® consumer battery business were transferred to Varta AG as part of the subsequent divestiture by Energizer.
+Added: Charges associated with TSAs were recognized as bundled service costs under a fixed fee structure by the respective service or function and geographic location, including one-time pass-through charges for warehousing, freight, amongst others, with variable expiration dates up to 24 months.
+Added: Charges associated with TSAs and reverse TSAs are recognized as a reduction to or increase in the respective costs, as a component of operating expense or cost of goods sold, depending upon the functions supported by or provided to the Company.
+Added: Additionally, due to the commingled nature of the shared administrative functions, cash would be received or paid on behalf of the respective counterparty's operations, resulting in cash flow being commingled with operating cash flow of the Company which would settle on a net basis with TSA charges.
+Added: The Company had exited all outstanding TSAs with Energizer and Varta by January 2021.
+Added: The following table summarizes the TSA income and expenses during the years ended September 30, 2021 and 2020:
(in millions) 2021 2020
−Removed: Cost of goods sold
−Removed: Operating expenses
−Removed: Operating loss ( 0.5 )
−Removed: Interest expense
−Removed: Other non-operating expense, net
−Removed: Loss on sale of business
−Removed: Reclassification of accumulated other comprehensive income
−Removed: Loss from discontinued operations before income taxes $ ( 115.7 )
−Removed: Beginning in November 2018, the Company ceased the recognition of depreciation and amortization of long-lived assets associated with the GAC disposal group classified as held for sale.
−Removed: During the year ended September 30, 2019, there is depreciation and amortization expense included in income from discontinued operations of $ 1.4 million.
−Removed: Interest expense consists of interest from debt directly attributable to GAC operations that primarily consists of interest from finance leases.
−Removed: During the year ended September 30, 2019, the Company recognized a $ 111.0 million loss on sale associated with the GAC divestiture attributable to the expected fair value to be realized from the sale, net of transaction costs.
−Removed: Additionally, the Company incurred transaction costs of $ 8.8 million associated with the divestiture, which were recognized as a component of income from discontinued operations for the year ended September 30, 2019.
−Removed: Transaction costs were expensed as incurred and include fees for investment banking services, legal, accounting, due diligence, tax, valuation and various other services necessary to complete the transaction.
+Added: TSA income $ 0.9 $ 9.6
+Added: TSA expense 2.6 13.5
+Added: Net TSA (loss) income $ ( 1.7 ) $ ( 3.9 )
Coevorden Operations
5 unchanged sentences
The Company will continue to operate its commercial DCF business following the divestiture of the Coevorden Operations and entered into a manufacturing agreement with UPP to supply the continuing DCF business, subject to an incremental tolling charge.
−Removed: Additionally, the Company leases and operates the distribution center on behalf of UPP for up to 18 months following the divestiture under a lease agreement.
NOTE 4 – ACQUISITIONS
+Added: Tristar Business Acquisition
+Added: On February 18, 2022, the Company acquired all of the membership interests in HPC Brands, LLC, which consist of the home appliances and cookware business of Tristar Products, Inc.
+Added: (the "Tristar Business") for a purchase price of $ 325.0 million, net of customary purchase price adjustments and transaction costs, plus a potential earn-out payment of up to $ 100.0 million if certain gross profit targets are achieved in calendar year 2022, and another earn-out payment of $ 25.0 million if certain other gross profit targets are achieved in calendar year 2023.
+Added: The acquisition of the Tristar Business was funded by a combination of cash on hand and incremental borrowings incurred as a new tranche under the Company's existing credit agreement.
+Added: See Note 12 - Debt for further detail on the amendment to the credit agreement.
+Added: The Tristar Business includes a portfolio of home appliances and cookware products sold under the PowerXL®, Emeril Legasse®, and Copper Chef® brands.
+Added: The PowerXL® and Copper Chef® brands were acquired outright by the Company while the Emeril Legasse® brand remains subject to a trademark license agreement with the license holder (the "Emeril License").
+Added: Pursuant to the Emeril License, the Company will continue to license the Emeril Legasse® brands in the US, Canada, Mexico, and the United Kingdom for certain designated product categories of household appliances within the Home and Personal Care ("HPC") segment, including small kitchen food preparation products, indoor and outdoor grills and grill accessories, and cookbooks.
+Added: The Emeril License is set to expire effective December 31, 2022 with options of up to three one-year renewal periods following the initial expiration.
+Added: Under the terms of the agreement, we agreed to pay the license holder a percentage of sales, with minimum annual royalty payments of $ 1.5 million, that increase to $ 1.8 million in subsequent renewal periods.
+Added: The net assets and operating results of the Tristar Business, since the acquisition date of February 18, 2022, are included in the Company’s Consolidated Statements of Income and reported within the HPC reporting segment for the year ended September 30, 2022.
+Added: SPECTRUM BRANDS HOLDINGS INC.
+Added: SB/RH HOLDINGS, LLC
+Added: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Added: NOTE 4 – ACQUISITIONS (continued)
+Added: The Company has recorded a preliminary allocation of the purchase price to tangible and identifiable intangible assets acquired and liabilities assumed based on their fair values as of the February 18, 2022 acquisition date.
+Added: The excess of the purchase price over the fair value of the net tangible assets and identifiable intangible assets of $ 108.1 million was recorded as goodwill, which is deductible for tax purposes.
+Added: Goodwill includes value associated with profits earned from market and expansion capabilities including the success of new product launches through direct response television and direct to consumer channels, new brand development and products brought to market by the Company, synergies from integration and streamlining operational activities, the going concern of the business, and the value of the assembled workforce.
+Added: The preliminary fair values recorded were determined based upon a valuation with estimates and assumptions used in such valuation that are subject to change within the measurement period (up to one year from the acquisition date).
+Added: The primary areas of acquisition accounting that are not finalized relate to amounts for deferred taxes, goodwill, and components of working capital.
+Added: The calculation of the preliminary purchase price is as follows:
+Added: (in millions) Purchase Price
+Added: Cash paid at closing $ 314.6
+Added: Cash received for purchase price settlement ( 42.2 )
+Added: Contingent consideration 30.0
+Added: Total purchase price $ 302.4
+Added: As of the transaction date, the Company recorded a contingent consideration liability of $ 30.0 million to reflect the estimated fair value of the contingent consideration for the earn-out payments.
+Added: The fair value was determined using a Monte Carlo simulation model to value the earn-out based on the likelihood of reaching specific targets.
+Added: The fair value measurement is determined based on significant unobservable inputs and thus represents a Level 3 fair value measurement.
+Added: The key assumptions considered include the estimated amount and timing of projected gross profits, volatility, estimated discount rates, and risk-free interest rate.
+Added: The inputs and assumptions may not be observable in the market but reflect the assumptions the Company believes would be made by a market participant.
+Added: After the acquisition date, the Company and the acquired Tristar Business experienced a downturn in operating results attributable to significant shifts in retail customer purchasing resulting from high retail inventory levels and lower replenishment orders, especially with significant mass retail customers, along with continued inflationary cost pressures and incremental margin risk from promotional spending.
+Added: As a result, the Company has adjusted the forecasted results of the Tristar Business, which impacted the value of the contingent consideration.
+Added: The fair value of the contingent consideration liability as of September 30, 2022, was estimated to be $ 1.5 million, recognized as Other Current Liabilities on the Company’s Consolidated Statements of Financial Position, and the Company recognized a decrease of $ 28.5 million since the initial valuation as of the acquisition date.
+Added: The following table summarizes the preliminary fair value of assets acquired and liabilities assumed as of the date of acquisition:
+Added: (in millions) Purchase Price Allocation
+Added: Cash and cash equivalents $ 0.3
+Added: Trade receivables, net 49.7
+Added: Other receivables 0.4
+Added: Inventories 102.0
+Added: Prepaid expenses and other current assets 4.4
+Added: Property, plant and equipment, net 0.4
+Added: Operating lease assets 23.3
+Added: Goodwill 108.1
+Added: Intangible assets, net 95.0
+Added: Deferred charges and other 3.7
+Added: Accounts payable ( 52.5 )
+Added: Accrued wages and salaries ( 0.6 )
+Added: Other current liabilities ( 20.7 )
+Added: Long-term operating lease liabilities ( 11.1 )
+Added: Net assets acquired $ 302.4
+Added: The values allocated to intangible assets and the weighted average useful lives are as follows:
+Added: (in millions) Carrying Amount Weighted Average Useful Life (Years)
+Added: Tradename $ 66.0 Indefinite
+Added: Customer relationships 29.0 13 years
+Added: Total intangibles acquired $ 95.0
+Added: SPECTRUM BRANDS HOLDINGS INC.
+Added: SB/RH HOLDINGS, LLC
+Added: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Added: NOTE 4 – ACQUISITIONS (continued)
+Added: The Company performed a valuation of the acquired inventories, tradenames, and customer relationships.
+Added: The fair value measurements are based on significant inputs not observable in the market, and therefore, represent Level 3 measurements.
+Added: The following is a summary of significant inputs to the valuation:
+Added: Inventory – Acquired inventory consists of branded finished goods that were valued based on the comparative sales method, which estimates the expected sales price of the finished goods inventory, reduced for all costs expected to be incurred in its completion or disposition and a profit on those costs.
+Added: Tradename – The Company valued the PowerXL® tradename using an income approach, the relief-from-royalty method.
+Added: Under this method, the asset value was determined by estimating the hypothetical royalties that would have to be paid if the tradenames were not owned.
+Added: Royalty rate of 3 % for valuation of PowerXL® was selected based on consideration of several factors, including prior transactions, related trademarks and tradenames, other similar trademark licensing and transaction agreements and the relative profitability and perceived contribution of the tradenames.
+Added: The discount rate applied to the projected cash flow was 16 % based on the implied transaction internal rate of return for the overall business, excluding cost synergies.
+Added: The resulting discounted cash flows were then tax-effected at the applicable statutory rate.
+Added: Customer relationships – The Company values customer relationships using the multi-period excess earnings method under a market participant distributor method of the income approach.
+Added: In determining the fair value of the customer relationships, the multi-period excess earnings approach values the intangible asset at the present value of the incremental after-tax cash flows attributable only to the customer relationship after deducting contributory asset charges.
+Added: Only expected sales from current retail customers were used, which are estimated using average annual expected growth rate of 2.7 %.
+Added: The Company assumed a customer attrition rate of 5 %, which is supported by historical attrition rates.
+Added: The discount rate applied to the projected cash flow was 12 % based upon a weighted average cost of capital for the overall business and income taxes were estimated at the applicable statutory rate.
+Added: During the year ended September 30, 2022, the Company has recognized $ 189.7 million of net sales from the acquired Tristar Business since the transaction date.
+Added: The following pro forma financial information summarizes the combined results of operations for the Company and the acquired Tristar Business as though the companies were combined as of the beginning of the Company’s fiscal 2021.
+Added: The unaudited pro forma financial information was as follows:
+Added: (in millions) 2022 2021
+Added: Proforma net sales $ 3,332.6 $ 3,588.1
+Added: Proforma net (loss) income from continuing operations ( 80.4 ) 51.4
+Added: Proforma net income 69.3 225.7
+Added: Proforma diluted earnings from continuing operations per share ( 1.96 ) 1.19
+Added: Proforma diluted earnings per share 1.69 5.22
+Added: The pro forma financial information includes, where applicable, adjustments for:
+Added: (i) additional amortization expense that would have been recognized related to the acquired intangible assets, (ii) additional operating expense from the excess fair value adjustments on operating lease assets for below market rents (iv) additional cost of sales related to the inventory valuation adjustment, (v) transaction costs and other one-time non-recurring costs and (vi) the estimated income tax effect on the acquired Tristar Business and pro forma adjustments.
+Added: During the year ended September 30, 2022, the Company recognized $ 13.5 million of transaction costs attributable to the acquisition of the Tristar Business, included in General and Administrative Expense on the Consolidated Statement of Income.
+Added: Through the acquisition of the Tristar Business, the Company acquired substantially all of the operations, employees and net assets of Tristar Products, Inc.
+Added: and entered into a series of TSAs for various shared back office administrative functions including finance, sales and marketing, information technology, human resources, real estate and supply chain, customer service and procurement, to support the excluded product groups that did not convey with the transaction.
+Added: Charges associated with TSAs are recognized as bundled service charges under a fixed fee structure by the respective service or function along with one-time pass-through charges, including warehousing, and freight, among others, from the acquired Tristar Business that settle on a net basis between the two parties.
+Added: Charges for TSA services are recognized as a reduction to the respective operating costs as a component of operating expense or cost of goods sold depending upon the functions supported by the acquired Tristar Business.
+Added: During the year ended September 30, 2022, the Company recognized TSA income of $ 0.9 million.
+Added: Additionally, the Company assumed the cash accounts supporting both the acquired Tristar Business and the excluded product groups, and due to the commingled nature of operations, cash would be received or paid on behalf of the excluded product groups' operations, resulting in cash flow being commingled with operating cash flow of the Company which would settle on a net basis with TSA charges.
+Added: As of September 30, 2022, there was an outstanding payable to Tristar Products, Inc.
+Added: of $ 2.1 million included within Accounts Payable on the Company’s Consolidated Statements of Financial Position.
Rejuvenate Acquisition
1 unchanged sentence
FLP is a leading manufacturer of household cleaning, maintenance, and restoration products sold under the Rejuvenate® brand.
−Removed: The net assets and operating results of FLP, since the acquisition date of May 28, 2021, are included in the Company’s Consolidated Statements of Income and reported within the H&G reporting segment for the year ended September 30, 2021.
+Added: The net assets and operating results of FLP, since the acquisition date of May 28, 2021, are included in the Company’s Consolidated Statements of Income and reported within the H&G reporting segment for the years ended September 30, 2022 and 2021.
The Company has recorded an allocation of the purchase price to tangible and identifiable intangible assets acquired and liabilities assumed based on their fair values as of the May 28, 2021 acquisition date.
44 unchanged sentences
The discount rate applied to the projected cash flow was 10.5 % and income taxes were estimated at the applicable statutory rate.
+Added: During the year ended September 30, 2021, the Company recognized $ 5.3 million of transaction costs attributable to the acquisition, included in General and Administrative Expense on the Consolidated Statement of Income.
Pro forma results have not been presented as the Rejuvenate acquisition is not considered individually significant to the consolidated results of the Company.
2 unchanged sentences
Armitage is a premium pet treats and toys business headquartered in Nottingham, United Kingdom, including a portfolio of brands that include Armitage's dog treats brand, Good Boy®, cat treats brand, Meowee!® and Wildbird®, bird feed products, among others, that are predominantly sold within the United Kingdom.
−Removed: The net assets and operating results of Armitage, since the acquisition date of October 26, 2020, are included in the Company’s Consolidated Statements of Income and reported within the GPC reporting segment for the year ended September 30, 2021.
−Removed: The Company has recorded an allocation of the purchase price to tangible and identifiable intangible assets acquired and liabilities assumed based on their fair values as of the October 26, 2020 acquisition date.
−Removed: The excess of the purchase price over the fair value of the net tangible assets and identifiable intangible assets of $ 90.7 million was recorded as goodwill, which is not deductible for foreign tax purposes.
−Removed: Goodwill includes value associated with profits earned from market and expansion capabilities, synergies from integration and streamlining operational activities, the going concern of the business and the value of the assembled workforce.
+Added: The net assets and operating results of Armitage, since the acquisition date of October 26, 2020, are included in the Company’s Consolidated Statements of Income and reported within the GPC reporting segment for the year ended September 30, 2022 and 2021.
SPECTRUM BRANDS HOLDINGS INC.
2 unchanged sentences
NOTE 4 – ACQUISITIONS (continued)
+Added: The Company has recorded an allocation of the purchase price to tangible and identifiable intangible assets acquired and liabilities assumed based on their fair values as of the October 26, 2020 acquisition date.
+Added: The excess of the purchase price over the fair value of the net tangible assets and identifiable intangible assets of $ 90.7 million was recorded as goodwill, which is not deductible for foreign tax purposes.
+Added: Goodwill includes value associated with profits earned from market and expansion capabilities, synergies from integration and streamlining operational activities, the going concern of the business and the value of the assembled workforce.
The calculation of purchase price and purchase price allocation is as follows:
39 unchanged sentences
These costs primarily consider the costs that would be incurred to re-create the customer relationships in terms of employee salaries and the revenues and associated profits forgone due to the absence of the relationships for a period of time.
+Added: During the year ended September 30, 2021, the Company recognized $ 5.1 million of transaction costs attributable to the acquisition, included in General and Administrative Expense on the Consolidated Statement of Income.
Pro forma results have not been presented as the Armitage acquisition is not considered individually significant to the consolidated results of the Company.
−Removed: Omega Sea Acquisition
−Removed: On March 10, 2020, the Company entered into an asset purchase agreement with Omega Sea, LLC (“Omega”), a manufacturer and marketer of premium fish foods and consumable goods for the home and commercial aquarium markets, primarily consisting of the Omega brand, for a purchase price of approximately $ 16.9 million.
−Removed: The results of Omega’s operations since March 10, 2020 are included in the Company’s Consolidated Statements of Income and reported within the GPC reporting segment for the year ended September 30, 2021 and 2020.
−Removed: The Company has recorded an allocation of the purchase price to the Company’s tangible and identifiable intangible assets acquired and liabilities assumed based on their fair values as of March 10, 2020, the acquisition date.
−Removed: The excess of the purchase price over the fair value of the net tangible assets and identifiable intangible assets was recorded as goodwill, resulting in the recognition of $ 4.4 million for the indefinite lived intangible asset Omega trade name and the allocation of goodwill of $ 8.6 million, allocated to the GPC segment and deductible for tax purposes.
−Removed: Pro forma results have not been presented as the Omega acquisition is not considered individually significant to the consolidated results of the Company.
SPECTRUM BRANDS HOLDINGS, INC.
1 unchanged sentence
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
−Removed: NOTE 5 - RESTRUCTURING AND RELATED CHARGES
−Removed: Global Productivity Improvement Program – During the year ended September 30, 2019, the Company initiated a company-wide, multi-year program, which consists of various restructuring related initiatives to redirect resources and spending to drive growth, identify cost savings and pricing opportunities through standardization and optimization, develop organizational and operating optimization, and reduce overall operational complexity across the Company.
−Removed: Since the announcement of the project and completion of the Company’s divestitures in GBL and GAC during the year ended September 30, 2019, the project focus includes the transitioning of the Company’s continuing operations in a post-divestiture environment and separation with Energizer TSAs and reverse TSAs.
−Removed: Refer to Note 3 – Divestitures and Note 17 – Related Party Transactions for further discussion.
−Removed: The initiative includes review of global processes, opportunity spending and organization design and structures;
−Removed: headcount reductions and transfers;
−Removed: and rightsizing the Company’s shared operations and commercial business strategy in certain regions and local jurisdictions;
−Removed: among others.
−Removed: Total cumulative costs incurred associated with the project were $ 152.2 million as of September 30, 2021, with approximately $ 2.5 million forecasted in the foreseeable future.
−Removed: The project costs are anticipated to be incurred through the fiscal year ending September 30, 2022.
−Removed: GPC Edwardsville 3PL Transition - During the year ended September 30, 2021, the GPC segment entered into an initiative to transition its third party logistics (3PL) service provide at its Edwardsville, IL distribution center to optimize its operations and improve fill rates to meet customer requirements and handle projected growth.
−Removed: Costs incurred to facilitate the transition service providers include one-time implementation and start-up costs with the new service provider, including the integration of the provider systems and technology, incremental compensation and incentive-based compensation to maintain performance during the transition period, duplicative and redundant costs between providers, and incremental costs for various disruptions in the operations during the transition period, including supplemental transportation and storage costs as the new 3PL operations are fully integrated and transitioned.
−Removed: Total cumulative costs incurred associated with the project were $ 11.5 million as of September 30, 2021, with approximately $ 12.2 million forecasted in the foreseeable future.
−Removed: The project costs are anticipated to be incurred through the first half of the fiscal year ending September 30, 2022.
−Removed: SAP S4 ERP Transformation - During the year ended September 30, 2021, the Company entered into an initiative to transform its enterprise-wide operating system to SAP S4.
−Removed: The initiative is a multi-year project that will include various project costs, including software configuration and implementation costs that would be recognized as a capital expenditure or deferred cost in accordance with applicable accounting policies.
−Removed: Certain restructuring related costs associated with the initiative include project development and management costs, and professional services with business partners engaged towards planning, design and business process review that would not qualify as software implementation costs.
−Removed: The Company is currently in the planning and design stage of the project.
−Removed: Total cumulative costs incurred associated with the project were $ 4.3 million as of September 30, 2021 with approximately $ 13.0 million forecasted in the foreseeable future.
−Removed: The project is a multi-year implementation with various phases that will be realized throughout the project timeline, depending upon business unit and/or jurisdiction, and is anticipated to be incurred through September 30, 2024.
−Removed: Other Restructuring Activities – The Company may enter into small, less significant initiatives and restructuring related activities to reduce costs and improve margins throughout the organization.
+Added: NOTE 5 - RESTRUCTURING CHARGES
+Added: During the year ended September 30, 2022, the Company entered into a new initiative in response to changes observed within consumer products and retail markets, continued inflationary cost pressures and headwinds, and to facilitate changes in the management structure for enabling functions of the consolidated group, resulting in the realization of headcount reductions.
+Added: Total cumulative costs associated with the initiative were $ 9.8 million.
+Added: Substantially all costs associated with the initiative have been recognized, with no further significant costs expected to be incurred.
+Added: Additionally, during the year ended September 30, 2022, the Company initiated the exit of its in-country commercial operations in Russia, predominantly supporting the HPC segment, including costs for severance and other exit and disposal activity to close the operations.
+Added: Total cumulative costs associated, with the initiative were $ 0.6 million with total projected costs for the initiative to be approximately $ 2 million, excluding lease termination or asset impairment costs.
+Added: During the year ended September 30, 2021, the GPC segment entered into an initiative to update its supply chain and distribution operations within the U.S.
+Added: to address capacity needs, optimize and improve fill rates attributable to recent growth in the business and consumer demand, and improve overall operational effectiveness and throughput.
+Added: The initiative includes the transition of its third party logistics (3PL) service provider at its existing distribution center, incorporating new facilities into the distribution footprint by expanding warehouse capacity and securing additional space to support long-term distribution and fulfillment, plus updating engagement and processes with suppliers and its transportation and logistics handlers.
+Added: Incremental costs include one-time transition, implementation and start-up cost with the new 3PL service provider, including the integration of provider systems and technology, incentive-based compensation to maintain performance during transition, duplicative and redundant costs, and incremental costs for various disruptions in the operations during the transition period including supplemental transportation and storage costs, and incremental detention and demurrage costs.
+Added: As of September 30, 2022, total cumulative costs associated with the initiative were $ 41.9 million, with the project being complete and no further costs to be incurred.
+Added: During the year ended September 30, 2019, the Company initiated the Global Productivity Improvement Program, which was a company-wide, multi-year program, consisting of various initiatives to redirect resources and spending to drive growth, identify cost savings and pricing opportunities through standardization and optimization, develop organizational and operating optimization, and reduce overall operational complexity across the Company.
+Added: With the Company’s divestitures in GBL and GAC during the year ended September 30, 2019, the project focus included the transition of the Company’s continuing operations in a post-divestiture environment and exiting of TSAs which were fully exited in January 2022.
+Added: Refer to Note 3 – Divestitures for further discussion.
+Added: The initiative included a review of global processes and organization design and structures, headcount reductions and transfers, and rightsizing the Company’s shared operations and commercial business strategy, and exit of certain internal production to third-party supplies, among others, resulting in recognition of severance benefits and other exit and disposal costs to facilitate such activity.
+Added: As of September 30, 2022, total cumulative costs associated with the project were $ 157.3 million with the project being complete and no further costs to be incurred.
+Added: The Company may enter into small, less significant initiatives to reduce costs and improve margins throughout the organization.
Individually these activities are not substantial and occur over a shorter time period (generally less than 12 months).
−Removed: The following summarizes restructuring and related charges for the years ended September 30, 2021, 2020, and 2019:
+Added: The following summarizes restructuring charges for the years ended September 30, 2022, 2021, and 2020:
(in millions)
2022 2021 2020
+Added: Fiscal 2022 restructuring $ 9.8 $ — $ —
+Added: Russia dissolution 0.6 — —
+Added: GPC distribution center transition 30.4 11.5 —
Global productivity improvement program 5.1 21.2 71.1
−Removed: GPC Edwardsville 3PL transition 11.5 — —
−Removed: SAP S4 ERP transformation 4.3 — —
−Removed: Other restructuring activities 3.3 0.5 1.1
+Added: Other project costs 13.9 7.6 0.5
Total restructuring and related charges $ 59.8 $ 40.3 $ 71.6
Cost of goods sold $ 1.2 $ 1.9 $ 13.8
−Removed: Operating expense 38.4 57.8 58.5
−Removed: The following summarizes restructuring and related charges for the years ended September 30, 2021, 2020, and 2019, and cumulative costs of restructuring initiatives as of September 30, 2021, by cost type.
−Removed: Termination costs consist of involuntary employee termination benefits and severance pursuant to a one-time benefit arrangement recognized as part of a restructuring initiative.
−Removed: Other costs consist of non-termination type costs related to restructuring initiatives such as incremental costs to consolidate or close facilities, relocate employees, cost to retrain employees to use newly deployed assets or systems, transition of third-party providers, pervasive system implementations and redundant or incremental transitional operating costs, among others:
+Added: Selling expense 30.4 11.5 —
+Added: General and administrative expense 28.2 26.9 57.8
+Added: The following summarizes restructuring charges by segment for the years ended September 30, 2022, 2021, and 2020:
(in millions) 2022 2021 2020
+Added: HPC $ 10.0 $ 9.1 $ 4.6
+Added: GPC 37.9 15.2 20.8
+Added: H&G 0.7 0.4 0.5
+Added: Corporate 11.2 15.6 45.7
+Added: Total restructuring charges $ 59.8 $ 40.3 $ 71.6
+Added: The following is a summary of restructuring charges by cost type for the years ended September 30, 2022, 2021, and 2020.
+Added: (in millions)
For the year ended September 30, 2022 $ 12.0 $ 47.8 $ 59.8
1 unchanged sentence
For the year ended September 30, 2020 12.4 59.2 71.6
−Removed: Cumulative costs through September 30, 2021 29.2 123.0 152.2
−Removed: Future costs to be incurred
SPECTRUM BRANDS HOLDINGS, INC.
1 unchanged sentence
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
−Removed: NOTE 5 - RESTRUCTURING AND RELATED CHARGES (continued)
−Removed: The following is a rollforward of the accrual related to all restructuring and related activities, included within Other Current Liabilities, by cost type, for the years ended September 30, 2021, 2020, and 2019:
+Added: NOTE 5 - RESTRUCTURING CHARGES (continued)
+Added: The following is a rollforward of the accrual for restructuring charges by cost type for the years ended September 30, 2022, 2021, and 2020, included in Other Current Liabilities on the Consolidated Statements of Financial Position.
(in millions)
Accrual balance at September 30, 2020 $ 3.9 $ 6.3 $ 10.2
−Removed: Adoption of ASU 842 — ( 4.2 ) ( 4.2 )
Provisions 5.7 4.6 10.3
6 unchanged sentences
Accrual balance at September 30, 2022 $ 3.7 $ 0.3 $ 4.0
−Removed: Effective October 1, 2019, the Company adopted ASU 842 resulting in the recognition of ROU operating lease liabilities for outstanding payments on operating leases.
−Removed: Amounts previously recognized as a restructuring accrual associated with lease termination costs were recognized as a reduction of the ROU operating lease asset realized upon adoption of ASU 842 for the respective lease and the outstanding lease payments are captured as ROU operating lease liabilities.
−Removed: The following summarizes restructuring and related charges by segment for the years ended September 30, 2021, 2020, and 2019, cumulative costs of restructuring initiatives as of September 30, 2021 and future expected costs to be incurred by segment:
−Removed: (in millions)
−Removed: For the year ended September 30, 2021 $ 9.1 $ 15.2 $ 0.4 $ 15.6 $ 40.3
−Removed: For the year ended September 30, 2020 4.6 20.8 0.5 45.7 71.6
−Removed: For the year ended September 30, 2019 8.1 7.6 1.8 43.5 61.0
−Removed: Cumulative costs through September 30, 2021 20.6 30.3 2.7 98.6 152.2
−Removed: Future costs to be incurred
−Removed: 1.3 12.5 — 13.9 27.7
NOTE 6 - REVENUE RECOGNITION
The Company generates all of its revenue from contracts with customers.
−Removed: The following table disaggregates our revenue for the year ended September 30, 2021, by the Company’s key revenue streams, segments and geographic region (based upon destination):
+Added: The following tables disaggregate our revenue for the years ended September 30, 2022, 2021 and 2020 by the Company’s key revenue streams, segments and geographic regions (based upon destination):
September 30, 2022
8 unchanged sentences
Total Revenue $ 1,370.1 $ 1,175.3 $ 587.1 $ 3,132.5
−Removed: The following table disaggregates our revenue for the year ended September 30, 2020, by the Company’s key revenue streams, segments and geographic region (based upon destination):
September 30, 2021
8 unchanged sentences
Total Revenue $ 1,260.1 $ 1,129.9 $ 608.1 $ 2,998.1
−Removed: SPECTRUM BRANDS HOLDINGS, INC.
−Removed: SB/RH HOLDINGS, LLC
−Removed: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
−Removed: NOTE 6 – REVENUE RECOGNITION (continued)
−Removed: The following table disaggregates our revenue for the year ended September 30, 2019, by the Company’s key revenue streams, segments and geographic region (based upon destination):
September 30, 2020
8 unchanged sentences
Total Revenue $ 1,107.6 $ 962.6 $ 551.9 $ 2,622.1
−Removed: The Company has a broad range of customers including many large mass retail customers.
−Removed: During the year ended September 30, 2021, there were two large retail customers each exceeding 10% of consolidated Net Sales and representing 31.4 % of consolidated Net Sales.
−Removed: During the year ended September 30, 2020, there were two large retail customers each exceeding 10% of consolidated Net Sales and representing 31.8 % of consolidated Net Sales.
−Removed: During the year ended September 30, 2019, there was one large retail customer exceeding 10% of consolidated Net Sales and representing 20.9 % of consolidated Net Sales.
−Removed: A significant portion of our product sales from our HPC segment, primarily in the NA and LATAM regions, are subject to the continued use and access of the Black and Decker® brand (B&D) through a license agreement with Stanley Black and Decker, and its continued renewal.
+Added: SPECTRUM BRANDS HOLDINGS, INC.
+Added: SB/RH HOLDINGS, LLC
+Added: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Added: NOTE 6 – REVENUE RECOGNITION (continued)
+Added: With the acquisition of the Tristar Business on February 18, 2022, the Company recognized revenue attributable to extended warranties.
+Added: See Note 4 - Acquisitions for more details.
+Added: As of September 30, 2022, the Company had $ 1.1 million service warranty revenue deferred and included in Other Current Liabilities on the Consolidated Statements of Financial Position.
+Added: A significant portion of our product sales from our HPC segment, primarily in the NA and LATAM regions, are subject to the continued use and access of the Black and Decker® ("B&D")brand through a license agreement with Stanley Black and Decker.
+Added: The license agreement was renewed through June 30, 2025, including a sell-off period from April 1, 2025 to June 30, 2025 whereby the Company can continue to sell and distribute but no longer produce products subject to the license agreement.
Net sales from B&D product sales consist of $ 417.3 million, $ 400.2 million, and $ 337.7 million for the years ended September 30, 2022, 2021 and 2020, respectively.
−Removed: All other significant brands and tradenames used in the Company’s commercial operations are directly owned and not subject to further restrictions.
+Added: All other brands and tradenames used in the Company’s commercial operations are either directly owned and not subject to further restrictions, or do not aggregate to a significant portion of total product sales for the Company.
+Added: The Company has a broad range of customers including many large mass retail customers.
+Added: During the year ended September 30, 2022, 2021 and 2020, there were two large retail customers, each exceeding 10% of consolidated Net Sales and representing 32.9 %, 31.4 %, and 31.8 % of consolidated Net Sales, respectively.
In the normal course of business, the Company may allow customers to return product or take credit for product returns per the provisions in a sale agreement.
Estimated product returns are recorded as a reduction in reported revenues at the time of sale based upon historical product return experience, adjusted for known trends, to arrive at the amount of consideration expected to receive.
−Removed: The following is a rollforward of the allowance for product returns for the years ended September 30, 2021, 2020 and 2019:
+Added: The following is a rollforward of the liability for product returns for the years ended September 30, 2022, 2021 and 2020:
(in millions) Beginning
5 unchanged sentences
September 30, 2020 9.8 6.0 ( 3.3 ) 0.3 12.8
+Added: Other adjustments includes foreign currency translation and the liability for product returns assumed as part of the acquisition of the Tristar Business during the year ended September 30, 2022.
+Added: See Note 4 - Acquisitions for further discussion on the Tristar Business acquisition.
NOTE 7 - FAIR VALUE OF FINANCIAL INSTRUMENTS
−Removed: The fair value of the Company’s financial assets and liabilities are defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants.
−Removed: Fair value measurements are classified using a fair value hierarchy that is based upon the observability of inputs used in measuring fair value.
+Added: The fair value measurements of the Company’s financial assets and liabilities are defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants.
+Added: Fair value measurements are classified using a fair value hierarchy that is based on the observability of inputs used in measuring fair value.
Observable inputs (highest level) reflect market data obtained from independent sources, while unobservable inputs (lowest level) reflect internally developed assumptions about hypothetical transactions in the absence of market data.
9 unchanged sentences
(in millions)
−Removed: $ — $ — $ — $ — $ — $ 66.9 $ — $ — $ 66.9 $ 66.9
Derivative Assets
3 unchanged sentences
Debt — 2,815.9 — 2,815.9 3,156.8 — 2,628.2 — 2,628.2 2,506.3
−Removed: SPECTRUM BRANDS HOLDINGS, INC.
−Removed: SB/RH HOLDINGS, LLC
−Removed: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
−Removed: NOTE 7 - FAIR VALUE OF FINANCIAL INSTRUMENTS (continued)
−Removed: Investments consist of our investment in Energizer common stock and is valued at quoted market prices for identical instruments in an active market.
−Removed: As part of consideration received for the GAC divestiture, the Company received 5.3 million shares of Energizer common stock, valued at $ 242.1 million on January 28, 2019, the effective close date of the GAC divestiture.
−Removed: Unrealized income or loss from changes in fair value, realized income or loss from sale of equity investments, plus dividend income from equity investments, are recognized as components of Other Non-Operating (Income) Expense, Net on the Consolidated Statements of Income.
During the year ended September 30, 2021, the Company sold 1.7 million shares of Energizer common stock for cash proceeds of $ 73.1 million.
3 unchanged sentences
(in millions)
−Removed: 2021 2020 2019
Unrealized loss on equity investments held $ — $ ( 7.5 )
3 unchanged sentences
Gain (loss) from equity investments $ 7.1 $ ( 11.8 )
−Removed: The Company’s derivative instruments are valued on a recurring basis using internal models, which are based on market observable inputs including interest rate curves and both forward and spot prices for currencies and commodities, which are generally based on quoted or observed market prices (Level 2).
+Added: SPECTRUM BRANDS HOLDINGS, INC.
+Added: SB/RH HOLDINGS, LLC
+Added: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Added: NOTE 7 - FAIR VALUE OF FINANCIAL INSTRUMENTS (continued)
+Added: The Company’s derivative instruments are valued on a recurring basis using internal models, which are based on market observable inputs, including both forward and spot prices for currencies and commodities, which are generally based on quoted or observed market prices (Level 2).
The fair value of certain derivative financial instruments is estimated using pricing models based on contracts with similar terms and risks.
7 unchanged sentences
The carrying values of goodwill, intangible assets and other long-lived assets are tested annually or more frequently if an event occurs that indicates an impairment loss may have been incurred, using fair value measurements with unobservable inputs (Level 3).
−Removed: See Note 4 – Acquisitions for additional detail.
+Added: See Note 4 – Acquisitions and Note 11 - Goodwill and Intangible Assets for additional detail.
The carrying values of cash and cash equivalents, receivables, accounts payable and short term debt approximate fair value based on the short-term nature of these assets and liabilities.
1 unchanged sentence
The allowance for uncollectible receivables as of September 30, 2022 and 2021 was $ 7.3 million and $ 6.7 million, respectively.
−Removed: The following is a rollforward of the allowance for doubtful accounts for the years ended 2021, 2020 and 2019:
+Added: The following is a rollforward of the allowance for doubtful accounts for the years ended September 30, 2022, 2021 and 2020:
(in millions)
3 unchanged sentences
September 30, 2020 3.5 2.3 ( 0.5 ) — 5.3
+Added: Other adjustments includes foreign currency translation and the allowance for credit loss assumed as part of the acquisition of the Tristar Business during the year ended September 30, 2022.
+Added: See Note 4 - Acquisitions for further discussion on the Tristar Business acquisition.
The Company has a broad range of customers including many large retail outlet chains, some of which exceed 10% of consolidated Net Trade Receivables.
−Removed: There was one customer that exceeds 10% of the Company's consolidated Net Trade Receivables representing 14.7 % and two customers representing 33.2 % of the Company’s Trade Receivables as of September 30, 2021 and 2020, respectively.
−Removed: We have entered into various factoring agreements and early pay programs with our customers to sell our trade receivables under non-recourse agreements in exchange for cash proceeds.
−Removed: A loss on sale is recognized for any discount and factoring fees associated with the transfer.
−Removed: We utilize factoring arrangements as an integral part of our financing for working capital.
−Removed: These transactions are treated as a sale and are accounted for as a reduction in trade receivables because the agreements transfer effective control over and risk related to the receivables to buyers.
+Added: As of September 30, 2022, there were two customers that exceeded 10% of the Company's consolidated Net Trade Receivables representing 21.9 % of the Company’s Trade Receivables.
+Added: As of September 30, 2021, there was one customer that exceeded 10% of the Company's consolidated Net Trade Receivables representing 14.7 % of the Company’s Trade Receivables.
+Added: We have entered into various factoring agreements and early pay programs with our customers to sell our trade receivables under non-recourse agreements in exchange for cash proceeds and is an integral part of our financing for working capital.
+Added: These transactions are treated as a sale and accounted for as a reduction in trade receivables because the agreements transfer effective control and risk related to the receivables to the buyers.
+Added: A loss on sale is recognized for any discount and fees associated with the transfer, recognized as General and Administrative Expense on the Company's Consolidated Statements of Income, with cash proceeds recognized as cash flow from operating activities on the Company's Statements of Cash Flows.
In some instances, we may continue to service the transferred receivable after the factoring has occurred, but in most cases we do not service any factored accounts.
−Removed: Any servicing of the trade receivable does not constitute significant continuing involvement or preclude the recognition of a sale.
−Removed: We do not carry any material servicing assets or liabilities.
−Removed: Cash proceeds from these arrangements are reflected as operating activities.
−Removed: The aggregate gross amount factored under these facilities was $ 1,328.7 million, $ 1,206.5 million and $ 1,222.3 million for the years ended September 30, 2021, 2020 and 2019, respectively.
−Removed: The cost of factoring such trade receivables was $ 3.5 million, $ 4.8 million, and $ 7.4 million for the years ended September 30, 2021, 2020, and 2019, respectively, and are reflected in the Consolidated Statements of Income as General and Administrative Expense.
−Removed: SPECTRUM BRANDS HOLDINGS, INC.
−Removed: SB/RH HOLDINGS, LLC
−Removed: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Added: Any servicing of the trade receivable does not constitute significant continuing involvement or preclude the recognition of a sale and we do not carry any material servicing assets or liabilities on the Company's Consolidated Statements of Financial Position.
+Added: The cost of factoring such trade receivables was $ 10.2 million, $ 3.5 million, and $ 4.8 million for the years ended September 30, 2022, 2021, and 2020, respectively.
NOTE 9 - INVENTORY
6 unchanged sentences
$ 780.6 $ 562.8
+Added: SPECTRUM BRANDS HOLDINGS, INC.
+Added: SB/RH HOLDINGS, LLC
+Added: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 10 - PROPERTY, PLANT AND EQUIPMENT
13 unchanged sentences
Depreciation expense from property, plant and equipment for the years ended September 30, 2022, 2021 and 2020 was $ 49.0 million, $ 51.9 million, and $ 59.3 million, respectively.
−Removed: During the year ended September 30, 2019 the Company recognized incremental depreciation of $ 13.5 million attributable to cumulative depreciation on property plant and equipment of HPC assets that were previously deferred when classified as held for sale.
NOTE 11 - GOODWILL AND INTANGIBLE ASSETS
Goodwill, by segment, consists of the following:
−Removed: (in millions) GPC H&G Total
+Added: (in millions) HPC GPC H&G Total
As of September 30, 2020 $ — $ 431.6 $ 195.6 $ 627.2
−Removed: Omega Sea acquisition (Note 4) 8.6 — 8.6
−Removed: Allocated to Coevorden Operations divestiture (Note 3) ( 10.6 ) — ( 10.6 )
+Added: Armitage acquisition (Note 4) — 90.7 — 90.7
+Added: Rejuvenate acquisition (Note 4) — — 147.0 147.0
Foreign currency impact — 2.3 — 2.3
As of September 30, 2021 $ — $ 524.6 $ 342.6 $ 867.2
−Removed: Rejuvenate acquisition (Note 4) — 147.0 147.0
−Removed: Armitage acquisition (Note 4) 90.7 — 90.7
+Added: Tristar Business acquisition (Note 4) 108.1 — — 108.1
Foreign currency impact — ( 22.2 ) — ( 22.2 )
As of September 30, 2022 $ 108.1 $ 502.4 $ 342.6 $ 953.1
−Removed: There were no impairments recognized during the years ended September 30, 2021 and 2020.
−Removed: During the year ended September 30, 2019, the Company recognized an impairment loss on goodwill from the HPC reporting unit of $ 116.0 million as a result of HPC being previously held for sale in addition to competitive market pressures, reduced margin realization and decline in operating results during the year ended September 30, 2019.
−Removed: There are no reporting units that were deemed at risk of impairment as of September 30, 2021 as all reporting units have significant excess of fair value over carrying value.
−Removed: SPECTRUM BRANDS HOLDINGS, INC.
−Removed: SB/RH HOLDINGS, LLC
−Removed: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
−Removed: NOTE 11 - GOODWILL AND INTANGIBLE ASSETS (continued)
The carrying value of indefinite lived intangible and definite lived intangible assets subject to amortization and accumulated amortization are as follows:
11 unchanged sentences
Total amortizable intangible assets 713.7 ( 409.8 ) 303.9 853.3 ( 520.0 ) 333.3
−Removed: 853.3 ( 520.0 ) 333.3 878.0 ( 507.2 ) 370.8
Indefinite-lived intangible assets - tradenames 898.3 — 898.3 870.8 — 870.8
−Removed: 870.8 — 870.8 675.9 — 675.9
Total intangible assets $ 1,612.0 $ ( 409.8 ) $ 1,202.2 $ 1,724.1 $ ( 520.0 ) $ 1,204.1
−Removed: $ 1,724.1 $ ( 520.0 ) $ 1,204.1 $ 1,553.9 $ ( 507.2 ) $ 1,046.7
−Removed: There were no impairments recognized for intangible assets during the year ended September 30, 2021.
+Added: There were no impairments recognized for goodwill or intangible assets during the years ended September 30, 2022, and 2021.
During the year ended September 30, 2020, the Company recognized an impairment loss of $ 16.6 million on indefinite-lived intangible assets and an impairment of $ 7.6 million on definite lived intangible assets due to the incremental cash flow risk associated with the commercial DCF business following the divestiture of the Coevorden Operations.
−Removed: During the year ended September 30, 2019, the Company recognized an impairment loss of $ 18.8 million and $ 16.6 million on indefinite life intangible assets associated with the with the HPC and GPC segments, respectively, due to the reduction in value on certain tradenames primarily due to reduced sales volume and response to changes in management’s strategy.
−Removed: As of September 30, 2021, there were no material intangible assets that would be deemed at risk of future impairment due to limited excess fair value.
−Removed: Amortization expense from intangible assets for the years ended September 30, 2021, 2020 and 2019 was $ 65.1 million, $ 55.3 million and $ 70.8 million, respectively.
−Removed: During the year ended September 30, 2019, there was an incremental amortization expense of $ 15.5 million recognized attributable to cumulative amortization expense on intangible assets of HPC that were previously deferred when classified as held for sale.
−Removed: Excluding the impact of any future acquisitions or changes in foreign currency, the Company anticipates the annual amortization expense of intangible assets for the next five fiscal years will be as follows:
−Removed: (in millions)
+Added: See Note 3 - Divestitures for further detail.
+Added: While we have not recognized an impairment of goodwill or intangible assets during the year ended September 30, 2022, we have identified a potential risk of impairment associated with the HPC reporting unit goodwill, with a carrying cost of $ 108.1 million as of September 30, 2022, and the Rejuvenate® tradename, with a carrying cost of $ 119.1 million as of September 30, 2022.
+Added: We do not anticipate that these assets will be subject to future impairment based upon our projections and forecasts used in evaluating the current market value but cannot guarantee that no future impairment will be realized.
+Added: The risk of future impairment for the HPC reporting unit is based upon the results realized during year ended September 30, 2022, macro-economic headwinds from inflationary costs and foreign currency fluctuations, retail and consumer spending activity, and risks associated with the Tristar Business integration and branding strategy transitions.
+Added: The risk of future impairment for the Rejuvenate® tradename is based upon the results realized during the year ended September 30, 2022, and dependency upon the timing and realization of market expansion milestones and synergies associated with the acquired business.
SPECTRUM BRANDS HOLDINGS, INC.
1 unchanged sentence
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Added: NOTE 11 - GOODWILL AND INTANGIBLE ASSETS (continued)
+Added: Amortization expense from intangible assets for the years ended September 30, 2022, 2021 and 2020 was $ 50.3 million, $ 65.1 million and $ 55.3 million, respectively.
+Added: Excluding the impact of any future acquisitions or changes in foreign currency, the Company anticipates the annual amortization expense of intangible assets for the next five fiscal years will be as follows:
+Added: (in millions)
NOTE 12 - DEBT
4 unchanged sentences
Term Loan Facility, variable rate, due March 3, 2028 394.0 5.2 % 398.0 2.5 %
−Removed: 6.125 % Notes, due December 15, 2024
−Removed: — — % 250.0 6.1 %
5.75 % Notes, due July 15, 2025
8 unchanged sentences
500.0 3.9 % 500.0 3.9 %
−Removed: Other notes and obligations — — % 3.2 7.6 %
Obligations under finance leases 92.7 5.1 % 101.9 4.9 %
14 unchanged sentences
The interest rate margins applicable to the facility were changed and a LIBOR floor of 0.75 % was installed.
−Removed: As of September 30, 2021, the Revolver Facility is subject to either adjusted LIBOR plus margin ranging from 1.75 % to 2.75 % per annum, or base rate plus margin ranging from 0.75 % to 1.75 % per annum.
−Removed: The LIBOR borrowings are subject to a 0.75 % LIBOR floor.
−Removed: Our Revolver Facility allows for the LIBOR rate to be phased out and replaced with the Secured Overnight Financing Rate and therefore we do not anticipate a material impact by the expected upcoming LIBOR transition.
−Removed: The Credit Agreement was otherwise provided on the same terms and conditions as the previously existing Revolver Facility.
−Removed: The Company incurred $ 3.5 million in connection with the Credit Agreement, which have been capitalized as debt issuance costs and amortized over the remaining term of the Credit Agreement.
The Credit Agreement, solely with respect to the Revolver Facility, contains a financial covenant test on the last day of each fiscal quarter on the maximum total leverage ratio.
2 unchanged sentences
As of September 30, 2022, we were in compliance with all covenants under the Credit Agreement.
−Removed: Pursuant to a guarantee agreement, SB/RH and the material wholly-owned domestic subsidiaries of SBI have guaranteed SBI’s obligations under the Credit Agreement and related loan documents.
−Removed: Pursuant to a security agreement, SBI and such subsidiary guarantors have pledged substantially all of their respective assets to secure such obligations and, in addition, SB/RH has pledged the capital stock of SBI to secure such obligations.
−Removed: The Credit Agreement also provides for customary events of default including payment defaults and cross-defaults to other material indebtedness.
−Removed: As a result of borrowings and payments under the Revolver Facility, at September 30, 2021, the Company had borrowing availability of $ 575.4 million, net outstanding letters of credit of $ 24.6 million.
+Added: Subsequent to the year ended September 30, 2022, on November 17, 2022, the Company entered into an amendment to the Credit Agreement to temporarily increase the maximum consolidated total net leverage ratio permitted to be no greater than 7.0 to 1.0 before returning to 6.0 to 1.0 at the earliest of (i) September 29, 2023, or (ii) 10 business days after the closing of the HHI divestiture or receipt of the related termination fee.
SPECTRUM BRANDS HOLDINGS, INC.
2 unchanged sentences
NOTE 12 - DEBT (continued)
+Added: Pursuant to a guarantee agreement, SB/RH and the material wholly-owned domestic subsidiaries of SBI have guaranteed SBI’s obligations under the Credit Agreement and related loan documents.
+Added: Pursuant to a security agreement, SBI and such subsidiary guarantors have pledged substantially all of their respective assets to secure such obligations and, in addition, SB/RH has pledged the capital stock of SBI to secure such obligations.
+Added: The Credit Agreement also provides for customary events of default including payment defaults and cross-defaults to other material indebtedness.
+Added: On December 10, 2021, the Company entered into the second amendment to the Amended and Restated Credit Agreement (the "Credit Agreement") dated as of June 30, 2020.
+Added: The second amendment includes certain modified terms from the existing Credit Agreement to provide for an alternate rate of interest to the Eurocurrency Rate applicable to Revolving Loans and Letters of Credit in Euro and Pounds Sterling.
+Added: Pursuant to the second amendment, Sterling Overnight Index Average ("SONIA") replaced LIBO Rate as a reference rate for Revolving Loans and Letters of Credit denominated in Pounds Sterling and Euro Interbank Offered Rate ("EURIBOR") replaced LIBO Rate as a reference rate for Revolving Loans and Letters of Credit denominated in Euro.
+Added: The Company currently has no borrowing under the Revolver Facility denominated in Euro or Pounds Sterling.
+Added: On February 3, 2022, the Company entered into a third amendment to the Credit Agreement.
+Added: The third amendment provides for incremental capacity on the Revolver Facility of $ 500 million that was used to support the acquisition of the Tristar Business and the continuing operations and working capital requirements of the Company.
+Added: See Note 4 - Acquisitions for further discussion on the Tristar Business acquisition.
+Added: Borrowings under the incremental capacity are subject to the same terms and conditions of the existing Revolver Facility, with a maturity date of June 30, 2025, other than a difference in borrowing rate which is subject to SOFR plus margin ranging from 1.75 % to 2.75 %, or base rate plus margin ranging from 0.75 % to 1.75 % per annum, with an increase by 25 basis points 270 days after the effective date of the third amendment and an additional 25 basis points on each 90 day anniversary of such date.
+Added: The SOFR is subject to a 0.50 % floor.
+Added: The Company incurred $ 7.6 million in connection with the third amendment, which have been capitalized as debt issuance costs and will be amortized over the remaining term of the Credit Agreement.
+Added: As of September 30, 2022, borrowings from the original revolver capacity of $ 600 million under the Revolver Facility are subject to either adjusted London Inter-Bank Offered Rate ("LIBOR") plus margin ranging from 1.75 % to 2.75 % per annum, or base rate plus margin ranging from 0.75 % to 1.75 % per annum;
+Added: and borrowings under the incremental revolver capacity of $ 500 million, per the third amendment to the Credit Agreement discussed below, are subject to Secured Overnight Financing Rate ("SOFR") plus margin ranging from 1.75 % to 2.75 % per annum or base rate plus margin ranging from 0.75 % to 1.75 %.
+Added: The LIBOR borrowings are subject to a 0.75 % LIBOR floor and the SOFR borrowings are subject to a 0.50 % SOFR floor.
+Added: Our Revolver Facility allows for the LIBOR rate to be phased out and replaced with the SOFR and therefore we do not anticipate a material impact by the expected upcoming LIBOR transition.
+Added: As a result of borrowings and payments under the Revolver Facility, at September 30, 2022, the Company had borrowing availability of $ 342.4 million, net outstanding letters of credit of $ 17.6 million.
Term Loan Facility
18 unchanged sentences
In addition, the 2031 Indenture provides for customary events of default, including failure to make required payments, failure to comply with certain agreements or covenants, failure to make payments when due or an acceleration of certain other indebtedness, and certain events of bankruptcy and insolvency.
+Added: SPECTRUM BRANDS HOLDINGS, INC.
+Added: SB/RH HOLDINGS, LLC
+Added: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Added: NOTE 12 - DEBT (continued)
The Company recorded $ 7.6 million of fees in connection with the offering of the 3.875 % Notes, which have been capitalized as debt issuance costs and are being amortized over the remaining life of the 3.875 % Notes.
13 unchanged sentences
The 5.00 % Notes are guaranteed by SB/RH as well as by SBI’s existing and future domestic subsidiaries.
−Removed: SPECTRUM BRANDS HOLDINGS, INC.
−Removed: SB/RH HOLDINGS, LLC
−Removed: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
−Removed: NOTE 12 - DEBT (continued)
On or after October 1, 2024, SBI may redeem some or all of the Notes at certain fixed redemption prices.
21 unchanged sentences
The Company recorded $ 7.7 million of fees in connection with the offering of the 4.00 % Notes, which have been capitalized as debt issuance costs and are being amortized over the remaining life of the 4.00 % Notes.
−Removed: Spectrum 5.75 % Notes
−Removed: On May 20, 2015, SBI issued $ 1,000 million aggregate principal amount of 5.75 % Notes at par value, due July 15, 2025 (the “ 5.75 % Notes”).
−Removed: The 5.75 % Notes are guaranteed by SB/RH as well as by SBI’s existing and future domestic subsidiaries.
−Removed: SBI may redeem all or a part of the 5.75 % Notes, at any time on or after July 15, 2020, at specified redemption prices.
−Removed: In addition, prior to July 15, 2020, SBI may redeem the notes at a redemption price equal to 100 % of the principal amount plus a “make-whole” premium.
−Removed: SBI is also entitled to redeem up to 35 % of the aggregate principal amount of the notes before July 15, 2018 with an amount of cash equal to the net proceeds that SBI raises in equity offerings at specified redemption prices.
−Removed: Further, the indenture governing the 5.75 % Notes (the “2025 Indenture”) requires SBI to make an offer, in cash, to repurchase all or a portion of the applicable outstanding notes for a specified redemption price, including a redemption premium, upon the occurrence of a change of control of SBI, as defined in the 2025 Indenture.
−Removed: The 2025 Indenture contains customary covenants that limit, among other things, the incurrence of additional indebtedness, payment of dividends on or redemption or repurchase of equity interests, the making of certain investments, expansion into unrelated businesses, creation of liens on assets, merger or consolidation with another company, transfer or sale of all or substantially all assets, and transactions with affiliates.
−Removed: In addition, the 2025 Indenture provides for customary events of default, including failure to make required payments, failure to comply with certain agreements or covenants, failure to make payments when due or on acceleration of certain other indebtedness, and certain events of bankruptcy and insolvency.
−Removed: Events of default under the 2025 Indenture arising from certain events of bankruptcy or insolvency will automatically cause the acceleration of the amounts due under the 5.75 % Notes.
−Removed: If any other event of default under the 2025 Indenture occurs and is continuing, the trustee for the 2025 Indenture or the registered holders of at least 25 % in the then aggregate outstanding principal amount of the 5.75 % Notes, may declare the acceleration of the amounts due under those notes.
−Removed: As of September 30, 2021, we were in compliance with all covenants under the indentures governing the 5.75 % Notes.
−Removed: The Company recorded $ 19.7 million of fees in connection with the offering of the 5.75 % Notes, which have been capitalized as debt issuance costs and are being amortized over the remaining life of the 5.75 % Notes.
−Removed: Using the proceeds received from the Term Loan Facility and 3.875 % Notes, the Company redeemed $ 550.0 million aggregate principal amount of the 5.75 % Notes in a cash tender offer, with a make whole premium of $ 17.7 million and a write-off of unamortized debt issuance costs of $ 5.7 million recognized as Interest Expense on the Company's Consolidated Statements of Income for the year ended September 30, 2021.
SPECTRUM BRANDS HOLDINGS, INC.
3 unchanged sentences
Spectrum 5.75 % Notes
−Removed: On December 4, 2014, SBI issued $ 250 million aggregate principal amount of 6.125 % Notes at par value, due December 15, 2024 (the” 6.125 % Notes”).
+Added: On May 20, 2015, SBI issued $ 1,000 million aggregate principal amount of 5.75 % Notes at par value, due July 15, 2025 (the “ 5.75 % Notes”).
The 5.75 % Notes are guaranteed by SB/RH as well as by SBI’s existing and future domestic subsidiaries.
−Removed: SBI may redeem all or a part of the 6.125 % Notes, at any time on or after December 15, 2019, at specified redemption prices.
−Removed: Prior to December 15, 2019, SBI may redeem the notes at a redemption price equal to 100 % of the principal amount plus a “make-whole” premium.
−Removed: SBI is also entitled to redeem up to 35 % of the aggregate principal amount of the notes before December 15, 2017 with an amount of cash equal to the net proceeds that SBI raises in equity offerings at specified redemption prices.
+Added: SBI may redeem all or a part of the 5.75 % Notes, at any time on or after July 15, 2020, at specified redemption prices.
+Added: In addition, prior to July 15, 2020, SBI may redeem the notes at a redemption price equal to 100 % of the principal amount plus a “make-whole” premium.
+Added: SBI is also entitled to redeem up to 35 % of the aggregate principal amount of the notes before July 15, 2018 with an amount of cash equal to the net proceeds that SBI raises in equity offerings at specified redemption prices.
Further, the indenture governing the 5.75 % Notes (the “2025 Indenture”) requires SBI to make an offer, in cash, to repurchase all or a portion of the applicable outstanding notes for a specified redemption price, including a redemption premium, upon the occurrence of a change of control of SBI, as defined in the 2025 Indenture.
6 unchanged sentences
Using the proceeds received from the Term Loan Facility and 3.875 % Notes, the Company redeemed $ 550.0 million aggregate principal amount of the 5.75 % Notes in a cash tender offer, with a make whole premium of $ 17.7 million and a write-off of unamortized debt issuance costs of $ 5.7 million recognized as Interest Expense on the Company's Consolidated Statements of Income for the year ended September 30, 2021.
−Removed: In February 2013, September 2013 and February 2015, Salus Capital Partners completed a collateralized loan obligation (“CLO”) securitization of up to $ 578.5 million notional aggregate principal amount.
−Removed: The outstanding notional aggregate principal amount of was taken up by unaffiliated entities, including a former subsidiary of HRG Group, Inc.
−Removed: and consisted entirely of subordinated debt.
−Removed: The obligations of the Salus CLO securitization were secured by the assets of the variable interest entity (the "VIE"), which primarily consisted of asset-based loan receivables and carry residual interest subject to maintenance of certain covenants.
−Removed: The obligations of the CLO were non-recourse to the Company.
−Removed: The CLO has effectively distributed the remaining assets and as of June 3, 2020, the CLO was discharged of its obligation under the indentures as there were no assets that remained with the CLO to service the outstanding debt and no recourse to the Company.
−Removed: Following the discharge of the debt, there are no substantial net assets remaining with the VIE and the CLO realized a non-cash gain on extinguishment of debt of $ 76.2 million attributable to the discharge of the debt, consisting of $ 77.0 million for the carrying value of the outstanding debt upon discharge, and $ 0.1 million for the unamortized discount on the associated debt and $ 0.7 million for debt issuance costs for the year ended September 30, 2020.
NOTE 13 - LEASES
The Company has leases primarily pertaining to manufacturing facilities, distribution centers, office space, warehouses, automobiles, machinery, computers, and office equipment that expire at various times through June 2035.
−Removed: We have identified embedded operating leases within certain third-party logistic agreements for warehouses and information technology services arrangements and recognized right of use assets identified in the arrangements as part of Operating Lease Assets on the Company’s Consolidated Statement of Financial Position.
+Added: We have embedded operating leases within certain third-party logistic agreements for certain warehousing and information technology services arrangements and recognized right of use assets identified in the arrangements as part of Operating Lease Assets on the Company’s Consolidated Statement of Financial Position.
We elected to exclude certain supply chain contracts that contain embedded leases for manufacturing facilities or dedicated manufacturing lines from our ROU asset and liability calculation based on the insignificant impact to our consolidated financial statements.
10 unchanged sentences
As of September 30, 2022, the Company had no significant commitments related to leases executed that have not yet commenced.
+Added: The Company records its operating lease and amortization of finance lease ROU assets within Cost of Goods Sold or Operating Expenses in the Consolidated Statement of Income depending on the nature and use of the underlying asset.
+Added: The Company records its finance interest cost within interest expense in the Consolidated Statement of Income.
SPECTRUM BRANDS HOLDINGS, INC.
2 unchanged sentences
NOTE 13 - LEASES (continued)
−Removed: The Company records its operating lease and amortization of finance lease ROU assets within Cost of Goods Sold or Operating Expenses in the Consolidated Statement of Income depending on the nature and use of the underlying asset.
−Removed: The Company records its finance interest cost within interest expense in the Consolidated Statement of Income.
The components of lease costs recognized in the Consolidated Statement of Income for the year ended September 30, 2022, 2021, and 2020 are as follows:
6 unchanged sentences
Total lease cost $ 52.8 $ 46.2 $ 42.9
−Removed: During the year ended September 30, 2021 and 2020 the Company recognized income attributable to leases and sub-leases of $ 2.3 million and $ 2.1 million, respectively.
+Added: During the year ended September 30, 2022, 2021, and 2020 the Company recognized income attributable to leases and sub-leases of $ 2.7 million, $ 2.3 million, and $ 2.1 million, respectively.
Income from leases and sub-leases is recognized as Other Non-Operating Income on the Consolidated Statement of Income.
31 unchanged sentences
Cash Flow Hedges
−Removed: Foreign exchange contracts.
The Company periodically enters into forward foreign exchange contracts to hedge a portion of the risk from forecasted foreign currency denominated third-party and intercompany sales or payments.
These obligations generally require the Company to exchange foreign currencies for Australian Dollars, Canadian Dollars, Euros, Japanese Yen, Pound Sterling or U.S.
−Removed: These foreign exchange contracts are cash flow hedges of fluctuating foreign exchange related to sales of product or raw material purchases.
−Removed: Until the sale or purchase is recognized, the fair value of the related hedge is recorded in AOCI and as a derivative hedge asset or liability, as applicable.
+Added: These foreign exchange contracts are cash flow hedges of fluctuating foreign exchange related to sales of products or raw material purchases.
+Added: Until the sale or purchase is recognized, the fair value of the related hedge is recorded in Accumulated Other Comprehensive Income (“AOCI”) and as a derivative hedge asset or liability, as applicable.
At the time the sale or purchase is recognized, the fair value of the related hedge is reclassified as an adjustment to Net Sales or purchase price variance in Cost of Goods Sold on the Consolidated Statements of Income.
2 unchanged sentences
At September 30, 2022 and 2021, the Company had foreign exchange derivative contracts designated as cash flow hedges with a notional value of $ 289.5 million and $ 279.9 million, respectively.
−Removed: For derivative instruments that are designated and qualify as cash flow hedges, the gain or loss on the effective portion of the derivative is reported as a component of Accumulated Other Comprehensive Income (“AOCI”) and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings.
−Removed: The following table summarizes the impact of the effective and ineffective portions of designated hedges and the gain (loss) recognized in the Consolidated Statement of Income for the years ended September 30, 2021, 2020 and 2019:
+Added: For derivative instruments that are designated and qualify as cash flow hedges, the gain or loss on the effective portion of the derivative is reported as a component of AOCI and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings.
+Added: The following table summarizes the impact of the effective and ineffective portions of designated hedges and the gain or loss recognized in the Consolidated Statement of Income for the years ended September 30, 2022, 2021 and 2020:
Gain (Loss) in OCI Reclassified to Continuing Operations
3 unchanged sentences
Total $ 31.1 $ ( 1.9 ) $ ( 7.1 ) $ 20.2 $ ( 9.2 ) $ 4.6
+Added: During the year ended September 30, 2022, the Company settled certain cash flow hedges prior to their stated maturity that were in place to hedge forecasted U.S.
+Added: Dollar denominated inventory purchases in exchange for Euros, but were subsequently discontinued due to changes in the Company's forecasted purchasing strategy of finished goods inventory within the EMEA region.
+Added: As a result, there was a realized gain of $ 8.2 million during the year ended September 30, 2022 and recognized as a component of Cost of Goods Sold, included in the activity summarized above.
Derivative Contracts Not Designated As Hedges for Accounting Purposes
−Removed: Foreign exchange contracts.
The Company periodically enters into forward and swap foreign exchange contracts to economically hedge a portion of the risk from third-party and intercompany payments resulting from existing obligations.
−Removed: These obligations generally require the Company to exchange foreign currencies for, among others, Australian Dollars, Canadian Dollars, Euros, Japanese Yen, Mexican Pesos, Philippine Pesos, Polish Zlotys, Pounds Sterling, Taiwanese Dollars or U.S.
+Added: These obligations generally require the Company to exchange foreign currencies for, among others, Australian Dollars, Canadian Dollars, Euros, Japanese Yen, Mexican Pesos, Colombian Peso, Philippine Pesos, Hungarian Forint, Turkish Lira, Pounds Sterling, Taiwanese Dollars or U.S.
These foreign exchange contracts are fair value hedges of a related liability or asset recorded in the accompanying Consolidated Statements of Financial Position.
2 unchanged sentences
At September 30, 2022 and 2021, the Company had $ 513.7 million and $ 198.4 million, respectively, of notional value for such foreign exchange derivative contracts outstanding.
−Removed: The following table summarizes the gain (loss) associated with derivative contracts not designated as hedges in the Consolidated Statements of Income for the years ended September 30, 2021, 2020 and 2019.
+Added: The following table summarizes the gain or loss associated with derivative contracts not designated as hedges in the Consolidated Statements of Income for the years ended September 30, 2022, 2021 and 2020.
(in millions)
1 unchanged sentence
Foreign exchange contracts
−Removed: Other non-operating (income) expense $ ( 3.2 ) $ ( 10.8 ) $ 45.5
+Added: Other non-operating expense (income) $ 25.6 $ ( 3.2 ) $ ( 10.8 )
Fair Value of Derivative Instruments
39 unchanged sentences
During the year ended September 30, 2020, the Company recognized a pre-tax loss of $ 1.2 million in earnings related to the translation of the undesignated portion of debt obligation.
−Removed: No pre-tax gain (loss) related to the translation of the undesignated portion of debt obligation was recognized in earnings during the year ended September 30, 2021.
+Added: No pre-tax gain (loss) related to the translation of the undesignated portion of debt obligation was recognized in earnings during the years ended September 30, 2022 and 2021.
SPECTRUM BRANDS HOLDINGS, INC.
18 unchanged sentences
Actuarial (gain) loss ( 16.1 ) ( 2.6 ) ( 45.7 ) ( 3.4 )
−Removed: Settlements and curtailments — ( 4.6 ) — ( 1.6 )
Plan Amendments — — — 0.1
7 unchanged sentences
Employer contributions 0.1 0.3 4.8 6.6
−Removed: Settlements and curtailments — ( 4.6 ) — —
Benefits paid ( 4.2 ) ( 4.3 ) ( 4.4 ) ( 5.0 )
38 unchanged sentences
Rate of compensation increase N/A N/A N/A 2.50 %
−Removed: 2.25 - 2.50 %
The discount rate is used to calculate the projected benefit obligation.
33 unchanged sentences
Subsequent to the Armitage acquisition and in accordance with the purchase agreement, the Company purchased a group annuity contract using plan assets and escrow funds withheld as part of the acquisition to cover the projected benefit obligation assumed in the purchase.
−Removed: The transaction represents an annuity buy-in, in accordance with U.K.
−Removed: pension regulations, where the assets of the plan were invested in a bulk-purchase annuity policy with an insurance company, under which the Company retains both the fair value of the annuity contract and the pension benefit obligations related to this plan.
+Added: The transaction represents an annuity buy-in, in accordance with United Kingdom ("UK") pension regulations, where the assets of the plan were invested in a bulk-purchase annuity policy with an insurance company, under which the Company retains both the fair value of the annuity contract and the pension benefit obligations related to this plan.
Following the buy-in, individual policies will replace the bulk annuity policy in a buy-out transaction, which is expected to be completed during the year ending September 30, 2023 where the Company would de-recognize the assets and liabilities of the pension plan and realize a settlement gain or loss as a component of the net periodic pension cost.
23 unchanged sentences
2022 2021 2020 2022 2021 2020
−Removed: Current tax expense (benefit):
+Added: Current tax expense:
$ 7.7 $ 3.0 $ 0.3 $ 7.7 $ 3.0 $ 0.3
2 unchanged sentences
( 1.1 ) 2.4 0.2 ( 1.1 ) 2.4 0.2
−Removed: Total current tax expense (benefit) 38.0 2.7 ( 16.0 ) 38.0 2.7 ( 16.0 )
+Added: Total current tax expense 31.3 38.0 2.7 31.3 38.0 2.7
Deferred tax (benefit) expense:
25 unchanged sentences
GILTI impact of retroactive law changes ( 3.2 ) ( 18.1 ) — ( 3.2 ) ( 18.1 ) —
−Removed: Foreign dividend received deduction tax law change — — 95.9 — — 95.9
−Removed: Tax reform act - mandatory repatriation — — ( 48.0 ) — — ( 48.0 )
Residual tax on foreign earnings 4.8 2.6 6.0 4.8 2.6 6.0
7 unchanged sentences
Income tax (benefit) expense $ ( 13.3 ) $ ( 26.4 ) $ 27.3 $ ( 12.9 ) $ ( 25.0 ) $ 14.5
−Removed: SPECTRUM BRANDS HOLDINGS, INC.
−Removed: SB/RH HOLDINGS, LLC
−Removed: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
−Removed: NOTE 16 - INCOME TAXES (continued)
The tax effects of temporary differences that give rise to deferred tax assets and deferred tax liabilities as of September 30, 2022 and 2021 are as follows:
27 unchanged sentences
Deferred taxes (noncurrent liability) 60.1 59.5 279.3 272.4
+Added: SPECTRUM BRANDS HOLDINGS, INC.
+Added: SB/RH HOLDINGS, LLC
+Added: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Added: NOTE 16 - INCOME TAXES (continued)
+Added: On April 4, 2022, the U.S.
+Added: District Court for the District of Colorado ruled that the IRC Section 245A temporary regulations (“June 2019 Regulations”) adopted by the Treasury Department in June of 2019 were invalid.
+Added: The ruling is expected to be appealed, and the Company has been advised that similar challenges are ongoing in other U.S.
+Added: During the year ended September 30, 2022, the Company filed a protective amended U.S.
+Added: income tax return consistent with the June 2019 Regulations being invalid.
+Added: The Company has determined that this position is not more likely than not to be upheld and therefore did not record a tax benefit for this amended return for the year ended September 30, 2022.
+Added: Should the June 2019 Regulations ultimately be found invalid, the Company estimates it would recognize a tax benefit of approximately $ 67.3 million.
On November 20, 2020, the U.S.
2 unchanged sentences
The Company expects that the sale of the HHI segment will allow use of tax benefits for years prior to Fiscal 2020 that would have been subject to federal and state tax limitations on the use of carryforwards absent the HHI sale.
−Removed: The Company expects to satisfy the requirements necessary to apply the Regulations retroactively and has therefore estimated and recorded a benefit of $ 11.4 million for the impact on years prior to Fiscal 2021 in the year ended September 30, 2021, with a benefit of $ 5.8 million recorded in the fourth quarter ended September 30, 2021 due to the HHI sale.
+Added: The Company has satisfied the requirements necessary to apply the Regulations retroactively and had therefore estimated and recorded a benefit of $ 11.4 million for the impact on years prior to Fiscal 2021 in the year ended September 30, 2021, with a benefit of $ 5.8 million recorded in the fourth quarter ended September 30, 2021 due to the HHI sale.
The Company also expects to apply the Regulations to Fiscal 2021 and has included the impact in Fiscal 2021 income tax expense.
+Added: The Company completed and filed the amended return implementing these November 2020 Regulations during Fiscal 2022 and recorded an additional $ 3.2 million tax benefit in the year ended September 30, 2022 for years prior to Fiscal 2020.
On July 20, 2020, Final Regulations were issued under Internal Revenue Code Section 951A relating to the treatment of income that is subject to a high rate of tax under the global intangible low taxed income (“GILTI“) regime (“July 2020 Regulations“).
2 unchanged sentences
The Company expects that the sale of the HHI segment will allow use of tax benefits for years prior to Fiscal 2020 that would have been subject to federal and state tax limitations on the use of carryforwards absent the HHI sale.
−Removed: The Company expects to apply the July 2020 Regulations to Fiscal 2019 by filing an amended return.
−Removed: Therefore a benefit of $ 6.7 million has been recorded for the year ended September 30, 2021.
−Removed: On June 14, 2019, the U.S.
−Removed: Department of the Treasury and the Internal Revenue Service issued Regulations (“June 2019 Regulations”) related to the foreign dividends received deduction and GILTI.
−Removed: The June 2019 Regulations contained language that modified certain provisions of the Tax Cuts and Jobs Act (the “Tax Reform Act“) and previously issued guidance.
−Removed: The June 2019 Regulations were retroactive to January 1, 2018 and caused certain distributions made by the Company’s non-U.S.
−Removed: subsidiaries during Fiscal 2018 to be taxable as Subpart F income on its Fiscal 2018 federal income tax return.
−Removed: The impacts of the Regulations were recorded in the year ended September 30, 2019.
−Removed: The Company used an additional $ 454.6 million in net operating losses and recognized $ 95.9 million in federal and state tax expense due to the impact on prior distributions among subsidiaries.
−Removed: The Company also recognized a $ 48.0 million tax benefit from recalculating its liability for one-time deemed mandatory repatriation of post-1986 undistributed foreign subsidiary earnings and profits after application of the June 2019 Regulations and the final calculations for its Fiscal 2018 federal income tax returns, including the ability for the Company to offset the liability in part by foreign tax credits.
−Removed: The Company also recorded $ 70.7 million of foreign tax credits, but concluded it is more likely than not these credits will expire unused and therefore recorded a $ 70.7 million valuation allowance against the deferred tax assets.
+Added: The Company implemented the July 2020 Regulations for Fiscal 2019 by filing an amended return.
+Added: Therefore, a benefit of $ 6.7 million was recorded for the year ended September 30, 2021.
The Tax Reform Act of December 22, 2017 included a tax on deemed repatriated accumulated earnings of foreign subsidiaries.
2 unchanged sentences
As of September 30, 2022, $ 16.9 million of the mandatory repatriation liability is still outstanding and $ 2.2 million is due and payable in the next 12 months but will be offset by previous payments and credits.
−Removed: SPECTRUM BRANDS HOLDINGS, INC.
−Removed: SB/RH HOLDINGS, LLC
−Removed: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
−Removed: NOTE 16 - INCOME TAXES (continued)
−Removed: During the year ended September 30, 2019, the Company recorded an increase of $ 12.2 million to tax expense from impairment of $ 116.0 million of book goodwill.
−Removed: A portion of the impairment resulted in a tax benefit since the goodwill had previously been amortized for income tax purposes and the Company therefore reversed a deferred tax liability.
To the extent necessary, the Company intends to utilize free cash flow from foreign subsidiaries in order to support management's plans to voluntarily accelerate pay down of U.S.
30 unchanged sentences
therefore, the Company released $ 29.2 million of valuation allowance on these deferred tax assets in Fiscal 2021.
−Removed: The income recognized for the year ended September 30, 2019 as a result of the June 2019 Regulations, the U.S.
−Removed: gain on the sale of the battery business, and the Fiscal 2019 U.S.
−Removed: operating results increased the likelihood that the Company can use federal net operating losses subject to certain limits;
−Removed: therefore, the Company released the $ 36.7 million of valuation allowance on these losses in Fiscal 2019.
+Added: SPECTRUM BRANDS HOLDINGS, INC.
+Added: SB/RH HOLDINGS, LLC
+Added: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Added: NOTE 16 - INCOME TAXES (continued)
As of September 30, 2022, the valuation allowance is $ 337.4 million, of which $ 257.5 million is related to U.S.
4 unchanged sentences
net deferred tax assets and $ 18.9 million is related to foreign net deferred tax assets.
−Removed: During the year ended September 30, 2021, the Company increased its valuation allowance for deferred tax assets by $ 46.9 million of which $ 30.6 million is related to a decrease in valuation allowance against U.S.
−Removed: net deferred tax assets and $ 77.5 million related to an increase in the valuation allowance against foreign net deferred tax assets.
−Removed: During the year ended September 30, 2020, the Company decreased its valuation allowance for deferred tax assets by $ 0.2 million, of which $ 10.1 million was related to an increase in valuation allowance against U.S.
+Added: During the year ended September 30, 2022, the Company decreased its valuation allowance for deferred tax assets by $ 12.0 million of which $ 4.5 million is related to an increase in valuation allowance against U.S.
net deferred tax assets and $ 16.5 million related to a decrease in the valuation allowance against foreign net deferred tax assets.
+Added: During the year ended September 30, 2021, the Company increased its valuation allowance for deferred tax assets by $ 46.9 million, of which $ 30.6 million was related to a decrease in valuation allowance against U.S.
+Added: net deferred tax assets and $ 77.5 million related to an increase in the valuation allowance against foreign net deferred tax assets.
As of September 30, 2022, the Company has recorded $ 46.2 million of valuation allowance against its U.S.
state net operating losses.
−Removed: SPECTRUM BRANDS HOLDINGS, INC.
−Removed: SB/RH HOLDINGS, LLC
−Removed: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
−Removed: NOTE 16 - INCOME TAXES (continued)
The total amount of unrecognized tax benefits at September 30, 2022 and 2021 are $ 100.9 million and $ 18.0 million, respectively.
1 unchanged sentence
The Company recognizes interest and penalties related to uncertain tax positions in income tax expense.
−Removed: As of September 30, 2021, and 2020 the Company had $ 1.5 million, of accrued interest and penalties related to uncertain tax positions.
+Added: As of September 30, 2022, and 2021 the Company had $ 1.4 million and $ 1.5 million of accrued interest and penalties related to uncertain tax positions.
+Added: The impact on income tax expense related to interests and penalties for the year ended September 30, 2022 was a net decrease of $ 0.1 million.
There was no impact on income tax expense related to interest and penalties for the years ended September 30, 2021.
−Removed: The impact during the years ended September 30, 2020 and 2019 was a net decrease of $ 1.0 million and a net increase of $ 0.2 million, respectively.
The following table summarizes the changes to the amount of unrecognized tax benefits for the years ended September 30, 2022, 2021 and 2020:
12 unchanged sentences
$ 100.9 $ 18.0 $ 13.8
−Removed: The September 30, 2021 Consolidated Statement of Financial Position for SB/RH Holdings, LLC contains $ 8.0 million of income taxes payable to its parent company, calculated as if SB/RH Holdings, LLC were a separate taxpayer.
+Added: The $ 84.4 million increase for unrecognized tax positions relating to prior periods during the year ended September 30, 2022 includes $ 67.3 million related to the protective amended U.S.
+Added: tax return filed consistent with the June 2019 Regulations being invalid.
+Added: The September 30, 2022 Consolidated Statement of Financial Position for SB/RH Holdings, LLC contains $ 2.7 million of income taxes receivable from its parent company, calculated as if SB/RH Holdings, LLC were a separate taxpayer.
The Company files income tax returns in the U.S.
9 unchanged sentences
however, it is reasonably possible that during the next twelve months some portion of previously unrecognized tax benefits could be recognized.
−Removed: NOTE 17 - RELATED PARTIES
−Removed: Effective the close of the GBL divestiture on January 2, 2019, and GAC divestiture on January 28, 2019, the Company and Energizer entered into a series of TSAs and reverse TSAs that support various shared administrative functions including finance, sales and marketing, information technology, human resources, real estate and supply chain, customer service and procurement;
−Removed: to support both the divested business operations and the continuing operations of the Company, within the various regions in which they operate.
−Removed: Charges associated with TSAs and reverse TSAs are recognized as bundled service costs under a fixed fee structure by the respective service or function and geographic location and one-time pass-through charges, including warehousing, freight, among others, to and from Energizer that settle on a net basis between the two parties.
−Removed: Charges to Energizer for TSA services are recognized as a reduction of the respective operating costs incurred by the Company and recognized as a component of operating expense or cost of goods sold depending upon the functions being supported by the Company.
−Removed: Charges from Energizer for reverse TSA services are recognized as operating expenses or cost of goods sold depending upon the functions supported by Energizer.
−Removed: Effective January 2, 2020, Energizer closed its divestiture of the European based Varta® consumer battery business to Varta AG, which also transferred TSAs and reverse TSAs associated with the divested entities to be assumed by Varta AG.
−Removed: As a result, a portion of the TSA and reverse TSA charges with Energizer were transferred to Varta AG.
−Removed: The TSAs and reverse TSAs have an overall expected time period of 12 months following the close of the transaction with some variability in expiration dependent upon the completed transition of the respective service or function and its geographic location and provide up to 12 additional months for a total duration of up to 24 months.
−Removed: The Company had exited all outstanding TSAs with Energizer and Varta by January 2021.
−Removed: The following table summarizes the TSA income and expenses during the years ended September 30, 2021, 2020 and 2019:
−Removed: (in millions) 2021 2020 2019
−Removed: TSA income $ 0.9 $ 9.6 $ 19.1
−Removed: TSA expense 2.6 13.5 13.9
−Removed: Net TSA (loss) income $ ( 1.7 ) $ ( 3.9 ) $ 5.2
−Removed: Additionally, the Company, Energizer, and Varta AG receive cash and/or make payments on behalf of the respective counterparty’s operations as part of the shared operating activity, resulting in cash flow being commingled with the operating cash flow of the Company.
−Removed: The Company recognizes a net payable or receivable with Energizer and Varta AG for any outstanding TSA charges and net working capital attributable to the commingled operations and cash flow.
−Removed: As of September 30, 2021 and 2020, the Company had net payable of $ 2.9 million with Energizer included in Other Current Liabilities and net receivable of $ 5.4 million included in Other Receivables on the Company’s Statement of Financial Position, respectively.
−Removed: As of September 30, 2021 and 2020, the Company had net receivable of $ 1.7 million with Varta AG included in Other Receivables and net payable $ 1.0 million included in Other Current Liabilities on the Company’s Statement of Financial Position.
−Removed: The Company’s H&G segment continued to manufacture certain GAC related products at its facilities and sell the products to Energizer as a third-party supplier on an ongoing basis, at inventory cost plus contracted markup, as agreed upon in the supply agreement.
−Removed: The supply agreement had a contracted term of 24 months and expired in January 2021 with no renewal.
−Removed: Material and inventory on hand to support the supply agreement was recognized as inventory of the Company.
−Removed: During the years ended September 30, 2021, 2020 and 2019, the Company recognized $ 6.0 million, $ 18.9 million, and $ 12.5 million, respectively, of revenue attributable to the Energizer supply agreement as a component of H&G revenue after completion of the GAC divestiture.
−Removed: As of September 30, 2021 the Company had no outstanding receivables from Energizer associated with the H&G supply agreement.
−Removed: As of September 30, 2020, the Company had outstanding receivable of $ 4.4 million from Energizer in Trade Receivables, Net on the Company’s Statement of Financial Position associated with the H&G supply agreement.
−Removed: SPECTRUM BRANDS HOLDINGS, INC.
−Removed: SB/RH HOLDINGS, LLC
−Removed: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 17 – SHAREHOLDER’S EQUITY
−Removed: Share Repurchases
SBH has a share repurchase program that is executed through purchases made from time to time either in the open market or otherwise.
2 unchanged sentences
As part of the share repurchase program, SBH purchased treasury shares in open market purchases at market fair value in private purchases from employees or significant shareholders at fair value and through an accelerated share repurchase (“ASR”) agreement with a third-party financial institution.
−Removed: The following summarizes the activity of common stock repurchases under the program for the year ended September 30, 2021 and 2020:
+Added: The following summarizes the activity of common stock repurchases under the program for the years ended September 30, 2022, 2021 and 2020:
+Added: 2022 2021 2020
(in millions except per share data) Number of
3 unchanged sentences
Total Purchases 1.4 $ 97.34 $ 134.0 1.6 $ 81.43 $ 125.8 6.2 $ 58.57 $ 364.6
+Added: During the fourth quarter ended September 30, 2021, SBH entered into a $ 150.0 million rule 10b5-1 repurchase plan to facilitate daily market share repurchases through September 16, 2022, until the cap is reached or until the plan is terminated.
+Added: The Company completed share repurchases under its $ 150.0 million rule 10b5-1 repurchase plan during the year ended September 30, 2022.
+Added: On August 16, 2022, the Inflation Reduction Act of 2022 ("IRA") was enacted into law.
+Added: The IRA imposes a 1% excise tax on stock repurchases made after December 31, 2022.
+Added: SPECTRUM BRANDS HOLDINGS, INC.
+Added: SB/RH HOLDINGS, LLC
+Added: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Added: NOTE 17 – SHAREHOLDER’S EQUITY (continued)
On November 18, 2019, SBH entered into an ASR to repurchase $ 125.0 million of the Company’s common stock.
6 unchanged sentences
NOTE 18 – SHARE BASED COMPENSATION
−Removed: Equity based incentive and performance compensation awards provided to employees, directors, officers and consultants were issued pursuant to the Spectrum Brands Holdings, Inc.
−Removed: 2011 Omnibus Equity Awards Plan as approved and amended by the Spectrum Legacy stockholders, (the "Spectrum Equity Plan") and the Spectrum Brands Holdings, Inc.
−Removed: 2020 Omnibus Equity Plan, as approved by the Spectrum stockholders (the "New 2020 Equity Plan").
+Added: Equity based incentive and performance compensation awards provided to employees, directors, officers and consultants, including the restricted stock units and stock options further discussed below, were issued pursuant to the Spectrum Brands Holdings, Inc.
+Added: 2011 Omnibus Equity Awards Plan as approved and amended by the Spectrum Legacy stockholders, and the Spectrum Brands Holdings, Inc.
+Added: 2020 Omnibus Equity Plan, as approved by the Spectrum stockholders.
The following is a summary of the authorized and available shares per the respective plans:
4 unchanged sentences
2020 Omnibus Equity Plan 1.2 1.2
−Removed: Share based compensation expense is recognized as General and Administrative Expenses on the Consolidated Statements of Income.
+Added: Compensation costs for share-based payment arrangements are recognized as General and Administrative Expenses on the Consolidated Statements of Income.
The following is a summary of the share based compensation expense for the years ended September 30, 2022, 2021 and 2020:
3 unchanged sentences
Restricted Stock Units ("RSUs")
−Removed: The Company recognizes share based compensation expense from the issuance of its RSUs, primarily under its Long-Term Incentive Plan ("LTIP"), based on the fair value of the awards, as determined by the market price of the Company’s shares of common stock on the designated grant date and recognized on a straight-line basis over the requisite service period of the awards.
−Removed: Certain RSUs are time-based grants that provide for either 3-year cliff vesting or graded vesting depending upon the vesting conditions and forfeitures provided by the grant.
−Removed: Certain RSUs are performance-based awards that are dependent upon achieving specified financial metrics (adjusted EBITDA, return on adjusted equity, and adjusted free cash flow) over a designated period of time.
−Removed: Additionally, the Company regularly issues individual RSU awards under its equity plan to its Board members and individual employees for recognition, incentive, or retention purposes, when needed, which are primarily conditional upon time-based service conditions and included as a component of share-based compensation.
−Removed: During the year ended September 30, 2019, the Company also provided for bridge awards, that are special awards to certain employees, for transitioning to the LTIP from previous equity incentive compensation plans.
−Removed: Bridge awards have both performance conditions dependent upon achieving specified financial targets (adjusted EBITDA and adjusted free cash flow) in fiscal years ended September 30, 2019 and 2020, and time-based service conditions.
−Removed: All Bridge awards were fully vested during the year ended September 30, 2021 and paid in either RSUs or cash, or both, based upon an employee election when granted.
−Removed: Bridge awards elected to be payable in RSU were recognized as equity awards and included as a component of share-based compensation expense.
−Removed: Bridge awards elected to be payable in cash were not recognized as equity awards and excluded from share-based compensation expense.
+Added: The Company recognizes share based compensation expense from the issuance of RSUs, primarily under its Long-Term Incentive Plan ("LTIP").
+Added: RSUs granted under the LTIP include a combination of time-based grants and performance-based grants.
+Added: Compensation cost is based on the fair value of the awards, as determined by the market price of the Company’s shares of common stock on the designated grant date and recognized on a straight-line basis over the requisite service period of the awards.
+Added: Time-based RSUs provide for either a three year cliff vesting or graded vesting depending upon the vesting conditions provided by the grant and the performance-based RSUs are dependent upon achieving specified financial metrics (adjusted EBITDA, return on adjusted equity, and/or adjusted free cash flow) by the end of the three year vesting period.
+Added: The actual number of shares that will ultimately vest for the performance-based RSUs is dependent on the level of achievement of the specified performance conditions upon completion of the designated performance period.
+Added: The Company assessed the probability of achievement of the performance conditions and recognized expense for the awards based on the probable achievement of such metrics.
+Added: Additionally, the Company regularly issues individual RSU awards under its equity plan to its Board members and individual employees for recognition, incentive, or retention purposes, when needed, which are primarily conditional upon time-based service conditions, valued based on the fair value of the awards as determined by the market price of the Company's share of common stock on the designated grant price date and recognized as a component of share-based compensation on a straight-line basis over the requisite service period of the award.
+Added: RSUs are subject to forfeiture if employment terminates prior to vesting with forfeitures recognized as they occur.
+Added: RSUs have dividend equivalents credited to the recipient and are paid only to the extent the RSU vests and the related stock is issued.
+Added: RSUs are exercised upon completion of the vesting conditions.
+Added: Shares issued upon exercise of RSUs are sourced from treasury shares when available.
+Added: The Company regularly issues annual RSU grants under its LTIP during the first quarter of the fiscal year.
+Added: The following is a summary of the RSUs granted during the fiscal year ending September 30, 2022.
+Added: (in millions, except per share data)
+Added: Time-based grants
+Added: Vesting in less than 12 months 0.05 $ 94.18 $ 4.8 0.04 $ 93.37 $ 3.7
+Added: Vesting in more than 12 months 0.08 95.34 8.1 0.08 95.34 8.1
+Added: Total time-based grants 0.13 94.90 12.9 0.12 94.71 11.8
+Added: Performance-based grants 0.20 95.57 19.4 0.20 95.57 19.4
+Added: Total grants 0.33 $ 95.30 $ 32.3 0.32 $ 95.24 $ 31.2
SPECTRUM BRANDS HOLDINGS, INC.
2 unchanged sentences
NOTE 18 – SHARE BASED COMPENSATION (continued)
−Removed: Additionally, in prior years, the Company provided for a portion of its annual management incentive compensation plan ("MIP") to be paid in restricted stock units with immediate vesting, in lieu of cash payment.
−Removed: During the year ended September 30, 2020, the Company changed its MIP payout policy that previously provided for the issuance of stock for a designated pool of recipients to be fully funded through cash distribution with no stock issuance.
−Removed: As a result, there was no portion of annual MIP paid in common stock for the years ended September 30, 2021 and 2020.
−Removed: Share based compensation expense associated with the annual MIP was $ 15.2 million for the year ended September 30, 2019.
−Removed: The Company measures share based compensation expense of its Restricted Stock Units (“RSUs”) based on the fair value of the awards, as determined based on the market price of the Company’s shares of common stock on the grant date and recognized these costs on a straight-line basis over the requisite period of the awards.
−Removed: Certain RSUs are performance-based awards that are dependent upon achieving specified financial metrics over a designated period of time.
−Removed: As of September 30, 2021, the remaining unrecognized pre-tax compensation cost for SBH and SB/RH is $ 34.6 million.
−Removed: The following is a summary of the RSU activity for the years ended September 30, 2021, 2020 and 2019:
+Added: The following is a summary of RSU activity for the years ended September 30, 2022, 2021 and 2020:
(in millions, except per share data) Shares Weighted
3 unchanged sentences
Value at Grant
−Removed: At September 30, 2018 0.6 $ 107.71 $ 69.0 0.6 $ 108.75 $ 67.2
+Added: Outstanding and nonvested as of September 30, 2019 1.25 $ 53.58 $ 67.0 1.22 $ 53.22 $ 65.0
Granted 0.90 61.72 55.6 0.88 61.68 54.3
Forfeited ( 0.07 ) 60.79 ( 4.0 ) ( 0.06 ) 60.79 ( 3.9 )
−Removed: Vested ( 0.2 ) 83.47 ( 19.7 ) ( 0.2 ) 82.37 ( 18.5 )
−Removed: At September 30, 2019 1.2 53.58 67.0 1.2 53.22 65.0
+Added: Vested and exercised ( 0.68 ) 57.80 ( 39.3 ) ( 0.66 ) 57.29 ( 37.7 )
+Added: Outstanding and nonvested as of September 30, 2020 1.40 56.41 79.3 1.38 56.33 77.7
Granted 0.59 76.78 44.9 0.56 76.83 43.3
Forfeited ( 0.20 ) 65.52 ( 13.2 ) ( 0.20 ) 65.52 ( 13.2 )
−Removed: Vested ( 0.6 ) 57.80 ( 39.3 ) ( 0.6 ) 57.29 ( 37.7 )
−Removed: At September 30, 2020 1.4 56.41 79.3 1.4 56.33 77.7
+Added: Vested and exercised ( 0.33 ) 53.53 ( 17.8 ) ( 0.30 ) 52.82 ( 16.2 )
+Added: Outstanding and nonvested as of September 30, 2021 1.46 64.00 93.2 1.44 63.85 91.6
Granted 0.33 95.30 32.3 0.32 95.24 31.2
Forfeited ( 0.18 ) 78.90 ( 13.8 ) ( 0.18 ) 78.90 ( 13.8 )
−Removed: Vested ( 0.3 ) 53.53 ( 17.8 ) ( 0.3 ) 52.82 ( 16.2 )
−Removed: At September 30, 2021 1.5 $ 64.00 $ 93.2 1.5 $ 63.85 $ 91.6
−Removed: (in millions, except per share data)
−Removed: Time-based grants
−Removed: Vesting in less than 24 months 0.1 $ 77.25 $ 9.6 0.1 $ 77.65 $ 8.0
−Removed: Vesting in more than 24 months 0.1 74.57 7.8 0.1 74.57 7.8
−Removed: Total time-based grants 0.2 76.04 17.4 0.2 76.11 15.8
−Removed: Performance-based grants
−Removed: Vesting in less than 24 months 0.1 93.08 4.9 0.1 93.08 4.9
−Removed: Vesting in more than 24 months 0.3 74.54 22.6 0.3 74.54 22.6
−Removed: Total performance-based grants 0.4 $ 77.26 $ 27.5 0.4 $ 77.26 $ 27.5
−Removed: Total grants 0.6 $ 76.78 $ 44.9 0.6 $ 76.83 $ 43.3
−Removed: SPECTRUM BRANDS HOLDINGS, INC.
−Removed: SB/RH HOLDINGS, LLC
−Removed: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
−Removed: NOTE 19 – SHARE BASED COMPENSATION (continued)
+Added: Vested and exercised ( 0.60 ) 55.09 ( 33.4 ) ( 0.60 ) 54.34 ( 31.8 )
+Added: Outstanding and nonvested as of September 30, 2022 1.01 $ 77.22 $ 78.3 0.98 $ 77.03 $ 77.2
+Added: As of September 30, 2022, the remaining unrecognized pre-tax compensation cost associated with outstanding RSUs is $ 39.6 million for both SBH and SB/RH that would expected to be recognized over a weighted average period of 1.5 years, contingent upon realization of performance goals for performance based grants.
+Added: If performance goals are not met, compensation cost may be not recognized, and previously recognized compensation cost would be reversed.
Stock Options
−Removed: All stock options awards are fully vested and exercisable, with no new awards being granted during the years ended September 30, 2021, 2020 and 2019, and no remaining unrecognized pre-tax compensation as of September 30, 2021.
+Added: All stock options awards are fully vested and exercisable.
+Added: The Company does not regularly grant new stock option awards and there were no awards granted during the years ended September 30, 2022, 2021 and 2020.
+Added: Shares issued upon exercise of stock option awards are sourced from treasury shares when available.
The following is a summary of outstanding stock option awards during the years ended September 30, 2022, 2021, and 2020:
4 unchanged sentences
Vested and exercisable at September 30, 2019 $ 0.23 $ 73.51 $ 4.79
−Removed: Forfeited ( 0.01 ) 67.83 4.94
−Removed: Vested and exercisable at September 30, 2019 0.23 73.51 4.79
Exercised ( 0.01 ) 52.83 3.55
2 unchanged sentences
Vested and exercisable at September 30, 2021 0.16 82.36 5.32
+Added: Vested and exercisable at September 30, 2022 $ 0.16 $ 82.36 $ 5.32
+Added: No options were exercised during the year ended September 30, 2022.
The intrinsic value of share options exercised during the years ended September 30, 2021 and 2020 was $ 2.5 million and $ 0.1 million, respectively.
Cash received from the options exercises during the years ended September 30, 2021 and 2020 was $ 3.4 million and $ 0.3 million, respectively.
+Added: As of September 30, 2022, the aggregate intrinsic value of outstanding and exercisable options was zero with the remaining contractual term of 2.3 years.
SPECTRUM BRANDS HOLDINGS INC.
5 unchanged sentences
Balance at September 30, 2019 $ ( 215.9 ) $ 4.9 $ ( 62.6 ) $ ( 273.6 )
−Removed: Other comprehensive (loss) income before reclassification ( 30.8 ) 12.6 ( 27.6 ) ( 45.8 )
−Removed: Net reclassification for (gain) loss to income from continuing operations — ( 10.4 ) 2.1 ( 8.3 )
−Removed: Net reclassification for (gain) loss to income from discontinued operations — ( 0.2 ) 0.1 ( 0.1 )
−Removed: Other comprehensive (loss) income before tax ( 30.8 ) 2.0 ( 25.4 ) ( 54.2 )
−Removed: Deferred tax effect ( 4.7 ) ( 5.4 ) 4.1 ( 6.0 )
−Removed: Other comprehensive loss, net of tax ( 35.5 ) ( 3.4 ) ( 21.3 ) ( 60.2 )
−Removed: Sale and deconsolidation of GBL and GAC discontinued operations (Note 3) 11.6 0.9 9.4 21.9
−Removed: other comprehensive loss from continuing operations attributable to non-controlling interest ( 0.2 ) — — ( 0.2 )
−Removed: other comprehensive loss from discontinued operations attributable to non-controlling interest ( 0.3 ) — — ( 0.3 )
−Removed: Other comprehensive loss attributable to controlling interest ( 23.4 ) ( 2.5 ) ( 11.9 ) ( 37.8 )
−Removed: Balance as of September 30, 2019 ( 215.9 ) 4.9 ( 62.6 ) ( 273.6 )
Other comprehensive loss before reclassification ( 18.5 ) ( 6.2 ) ( 5.2 ) ( 29.9 )
4 unchanged sentences
Other comprehensive (loss) income, net of tax ( 18.4 ) 0.5 ( 1.2 ) ( 19.1 )
−Removed: Adoption of ASU 2018-02 (Note 2) — ( 1.8 ) 2.1 0.3
+Added: Adoption of ASU 2018-02 — ( 1.8 ) 2.1 0.3
Sale and deconsolidation of Coevorden operations (Note 3) 8.1 — — 8.1
12 unchanged sentences
Balance as of September 30, 2021 ( 194.8 ) 6.4 ( 46.9 ) ( 235.3 )
+Added: Other comprehensive (loss) income before reclassification ( 72.0 ) 30.7 18.3 ( 23.0 )
+Added: Net reclassification for (gain) loss to income from continuing operations — ( 20.2 ) 3.6 ( 16.6 )
+Added: Net reclassification for gain to income from discontinued operations — ( 2.4 ) ( 0.1 ) ( 2.5 )
+Added: Other comprehensive (loss) income before tax ( 72.0 ) 8.1 21.8 ( 42.1 )
+Added: Deferred tax effect ( 20.0 ) 2.3 ( 8.9 ) ( 26.6 )
+Added: Other comprehensive (loss) income, net of tax ( 92.0 ) 10.4 12.9 ( 68.7 )
+Added: other comprehensive loss from continuing operations attributable to non-controlling interest ( 0.4 ) — — ( 0.4 )
+Added: other comprehensive loss from discontinued operations attributable to non-controlling interest ( 0.5 ) — — ( 0.5 )
+Added: Other comprehensive (loss) income attributable to controlling interest ( 91.1 ) 10.4 12.9 ( 67.8 )
+Added: Balance as of September 30, 2022 $ ( 285.9 ) $ 16.8 $ ( 34.0 ) $ ( 303.1 )
+Added: The following table presents reclassifications of the gain (loss) on the Consolidated Statements of Income from AOCI for the periods indicated:
+Added: (in millions) 2022 2021 2020
+Added: Defined Benefit Pension Derivative Instruments Total Defined Benefit Pension Derivative Instruments Total Defined Benefit Pension Derivative Instruments Total
+Added: Net Sales $ — $ 0.1 $ 0.1 $ — $ 0.1 $ 0.1 $ — $ ( 0.1 ) $ ( 0.1 )
+Added: Cost of goods sold — 20.1 20.1 — ( 9.3 ) ( 9.3 ) — 4.7 4.7
+Added: Other non-operating expense (income), net ( 3.6 ) — ( 3.6 ) ( 4.8 ) — ( 4.8 ) ( 4.6 ) — ( 4.6 )
+Added: Income from discontinued operations, net of tax 0.1 2.4 2.5 0.1 ( 0.1 ) — 0.3 0.4 0.7
See Note 14 - Derivatives for further detail on the Company’s hedging activity.
5 unchanged sentences
The Company is a defendant in various litigation matters generally arising out of the ordinary course of business.
−Removed: Based on information currently available, the Company does not believe that any of the matters or proceedings presently pending will have a material adverse effect on its results of operations, financial condition, liquidity or cash flows.
+Added: Based on information currently available, the Company does not believe that any additional matters or proceedings presently pending will have a material adverse effect on its results of operations, financial condition, liquidity or cash flows.
Shareholder Litigation.
8 unchanged sentences
The court subsequently appointed separate counsel to represent the HRG shareholder class.
−Removed: In August 2021, the Company reached an agreement in principle, subject to final documentation and approval of the Court, to settle the claims of the Spectrum Legacy class, the cost of which will be defrayed by third-party insurance.
−Removed: In October 2021, the Company reached an agreement in principle, subject to final documentation and approval of the Court, to settle the claims of the HRG class, the cost of which will be defrayed by third-party insurance.
+Added: In August 2021, the Company reached an agreement in principle to settle the claims of the Spectrum Legacy class, the cost of which has been defrayed by third-party insurance.
+Added: In October 2021, the Company reached an agreement in principle to settle the claims of the HRG class, the cost of which also has been defrayed by third-party insurance.
+Added: In March 2022, the court granted approval to both settlements.
Environmental.
−Removed: The Company has provided for an estimated cost of $ 11.3 million and $ 11.6 million, as of September 30, 2021 and 2020, respectively, associated with environmental remediation activities primarily with some of its former manufacturing sites, included in Other Long-Term Liabilities on the Consolidated Statement of Financial Position.
+Added: The Company has realized commitments attributable to environmental remediation activities primarily associated with former manufacturing sites of the Company's HPC segment.
+Added: In coordination with local and federal regulatory agencies, we have conducted testing on certain sites which have resulted in the identification of contamination that has been attributed to historic activities at the properties, resulting in the realization of incremental costs to be assumed by the Company towards the remediation of these properties and the recognition of an environmental remediation liability.
+Added: We have not conducted invasive testing at all sites and locations and have identified an environmental remediation liability to the extent such remediation requirements have been identified and are considered estimable.
+Added: As of September 30, 2022, there was an environmental remediation liability of $ 8.8 million with $ 4.7 million included in Other Current Liabilities and $ 4.1 million included in Other Long-Term Liabilities on the Consolidated Statements of Financial Position.
+Added: As of September 30, 2021, there was an environmental remediation liability of $ 11.3 million included in Other Long-Term Liabilities on the Consolidated Statement of Financial Position.
+Added: The Company’s environmental remediation liabilities are measured at the expected value of future cash outflows discounted to their present value using a discount rate of 5 %.
+Added: Based on current estimates, the expected payments for environmental remediation for the next five years and thereafter at September 30, 2022 are as follows:
+Added: (in millions)
+Added: Total payments 10.3
+Added: Amount representing interest ( 1.5 )
+Added: Total environmental obligation $ 8.8
The Company believes that any additional liability in excess of the amounts provided that may result from resolution of these matters, will not have a material adverse effect on the consolidated financial condition, results of operations or cash flows of the Company.
8 unchanged sentences
The Company recognized $ 0.4 million of warranty accruals as of September 30, 2022 and 2021, included in Other Current Liabilities on the Consolidated Statement of Financial Statement.
−Removed: During the year ended September 30, 2021, the Company recognized legal reserves at our H&G division of approximately $ 3.2 million attributable to significant and unusual non-recurring claims with no previous history or precedent, included in Other Current Liabilities on the Consolidated Statement of Financial Position.
+Added: SPECTRUM BRANDS HOLDINGS INC.
+Added: SB/RH HOLDINGS, LLC
+Added: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Added: NOTE 20 - COMMITMENTS AND CONTINGENCIES
+Added: Product Safety Recall.
+Added: During the fourth quarter of the year ended September 30, 2022, the HPC segment initiated two voluntary product recalls in collaboration with the U.S.
+Added: Consumer Product Safety Commission (" CPSC"), suspending sales of the affected products and issuing a stop sale with its customers.
+Added: The Company has assessed the incremental costs attributable to the recall, including the anticipated returns from customers for existing retail inventory, write-off of inventory on hand, and other costs to facilitate the recall such as notification, shipping and handling, rework and destruction of affected products, as needed, and evaluated the probability of redemption.
+Added: As a result, the Company recognized $ 7.5 million in Other Current Liabilities on the Consolidated Statement of Financial Position associated with the costs for the recalls as of September 30, 2022.
+Added: Additionally, the Company has indemnification provisions that are contractually provided by third-parties for the affected products and as a result the Company has also recognized $ 4.7 million in Other Receivables on the Consolidated Statement of Financial Position related to recovery from such indemnification provisions.
+Added: For the year ended September 30, 2022, the Company realized incremental charges of $ 5.5 million, net of indemnifications, of which $ 0.5 million was recognized as a reduction in Net Sales for anticipated returns and $ 4.9 million and $ 0.1 million as Cost of Goods Sold and General and Administrative Expenses on the Consolidated Statements of Operations for associated costs.
+Added: As of September 30, 2022, and 2021, the Company recognized legal reserves at our H&G division of approximately $ 2.0 million and $ 3.2 million, respectively, attributable to significant and unusual non-recurring claims with no previous history or precedent, included in Other Current Liabilities on the Consolidated Statement of Financial Position.
NOTE 21 - SEGMENT INFORMATION
1 unchanged sentence
The Company manages its continuing operations in three vertically integrated, product-focused reporting segments:
−Removed: (i) GPC, which consists of the Company’s worldwide pet care business;
−Removed: (ii) H&G, which consists of the Company’s home and garden and insect control business and (iii) HPC, which consists of the Company’s worldwide small kitchen and personal care appliances businesses.
+Added: (i) GPC, which consists of the Company’s global pet care business;
+Added: (ii) H&G, which consists of the Company’s home and garden, insect control and cleaning products business and (iii) HPC, which consists of the Company’s global small kitchen and personal care appliances businesses.
Global strategic initiatives and financial objectives for each reportable segment are determined at the corporate level.
10 unchanged sentences
Adjusted EBITDA further excludes:
−Removed: • Stock based and other incentive compensation costs that consist of costs associated with long-term compensation arrangements and other equity based compensation based upon achievement of long-term performance metrics under the Company's Long-Term Incentive Plan ("LTIP");
−Removed: and generally consist of non-cash, stock-based compensation.
−Removed: During the years ended September 30, 2021, 2020, and 2019, other incentive compensation also includes incentive bridge awards issued due to changes in the Company’s LTIP that allowed for cash based payment upon employee election but does not qualify for share-based compensation.
−Removed: All bridge awards fully vested in November 2020.
+Added: • Stock based compensation costs consist of costs associated with long-term compensation arrangements that generally consist of non-cash stock based compensation.
+Added: During the years ended September 30, 2021 and 2020, compensation costs included incentive bridge awards previously issued due to changes in the Company's LTIP that allowed for cash based payment upon employee election but do not quality for share based compensation, which were fully vested in November 2020.
See Note 18 - Share Based Compensation for further details;
+Added: • Incremental amounts attributable to strategic transactions and business development initiatives including, but not limited to, the acquisition or divestitures of a business, costs to effect and facilitate a transaction, including such cost to integrate or separate the respective business.
+Added: These amounts are excluded from our performance metrics as they are reflective of incremental investment by the Company towards business development activities, incremental costs attributable to such transactions and are not considered recurring or reflective of the continuing ongoing operations of the consolidated group or segments;
+Added: • Incremental amounts realized towards restructuring and optimization projects including, but not limited to, costs towards the development and implementation of strategies to optimize operations and improve efficiency, reduce costs, increase revenues, increase or maintain our current profit margins, including recognition of one-time exit or disposal costs.
+Added: These amounts are excluded from our ongoing performance metrics as they are reflective of incremental investment by the Company towards significant initiatives controlled by management, incremental costs directly attributable to such initiatives, indirect impact or disruption to operating performance during implementation, and are not considered recurring or reflective of the continuing ongoing operations of the consolidated group or segments;
+Added: • Unallocated shared costs associated with discontinued operations from certain shared and center-led administrative functions supporting the Company's business units excluded from income from discontinued operations as they are not a direct cost of the discontinued business but a result of indirect allocations, including but not limited to, information technology, human resources, finance and accounting, supply chain, and commercial operations.
+Added: Amounts attributable to unallocated shared costs would be mitigated through subsequent strategic or restructuring initiatives, TSAs, elimination of extraneous costs, or re-allocations or absorption of existing continuing operations following the completed sale of the discontinued operations.
+Added: See Note 3 - Divestitures for further details;
+Added: • Non-cash purchase accounting adjustments recognized in earnings from continuing operations subsequent to an acquisition, including, but not limited to, the costs attributable to the step-up in inventory value and the incremental value in operating lease assets with below market rent, among others;
+Added: • Non-cash gain from the remeasurement of the contingent consideration liability recognized during the year ended September 30, 2022, associated with the Tristar Business acquisition.
+Added: See Note 4 - Acquisitions for further details;
+Added: • Non-cash asset impairments or write-offs realized and recognized in earnings from continuing operations;
SPECTRUM BRANDS HOLDINGS INC.
2 unchanged sentences
NOTE 21 - SEGMENT INFORMATION (continued)
−Removed: • Restructuring and related charges, which consist of project costs associated with the restructuring initiatives across the Company's segments.
−Removed: See Note 5 - Restructuring and Related Charges for further details;
−Removed: • Transaction related charges that consist of (1) transaction costs from acquisitions or subsequent project costs directly associated with integration of an acquired business with the consolidated group;
−Removed: and (2) transaction costs from divestitures and subsequent project costs to facilitate separation of shared operations, including development of transferred shared service operations, platforms and personnel transferred and exiting of transition service arrangements (TSAs) and reverse TSAs.
−Removed: See Note 2 – Significant Accounting Policies and Practices for further details;
−Removed: • Unallocated shared costs associated with discontinued operations from certain shared and center-led administrative functions supporting the Company's business units excluded from income from discontinued operations as they are not a direct cost of the discontinued business but a result of indirect allocations, including but not limited to, information technology, human resources, finance and accounting, supply chain, and commercial operations.
−Removed: Amounts attributable to unallocated shared costs would be mitigated through subsequent strategic or restructuring initiatives, TSAs, elimination of extraneous costs or re-allocation or absorption by existing continuing operations following the completed sale of the discontinued operations.
−Removed: See Note 3 - Divestitures for further details;
−Removed: • Gains and losses attributable to the Company’s investment in Energizer common stock.
+Added: • Gains attributable to the Company’s investment in Energizer common stock.
During the year ended September 30, 2021, the Company sold its remaining shares in Energizer common stock.
See Note 7 – Fair Value of Financial Instruments for further details;
−Removed: • Non-cash asset impairments or write-offs realized and recognized in earnings from continuing operations;
−Removed: • Non-cash purchase accounting inventory adjustments recognized in earnings from continuing operations after an acquisition;
−Removed: • Incremental reserves for non-recurring litigation or environmental remediation activity including (1) proposed settlement on outstanding litigation matters at our H&G division attributable to significant and unusual nonrecurring claims with no previous history or precedent recognized during the year ended September 30, 2021, (2) environmental remediation reserves realized during the year ended September 30, 2019 on legacy properties and former manufacturing sites assumed by the organization which had previously been exited by the Company, and (3) legal settlement costs associated with retained litigation from the Company's divested GAC operations realized during the year ended September 30, 2019.
+Added: • Incremental reserves for non-recurring litigation or environmental remediation activity including the proposed settlement on outstanding litigation matters at our H&G division attributable to significant and unusual nonrecurring claims with no previous history or precedent recognized during the years ended September 30, 2022 and 2021.
+Added: See Note 20 – Commitments and Contingencies for further detail;
+Added: • Early settlement on certain foreign currency cash flow hedges in our EMEA region prior to their stated maturity due to changes in the Company's legal entity organizational structure and forecasted purchasing strategy of HPC finished goods inventory within the region, resulting in the recognition of realized gains during the third quarter ended July 3, 2022, plus the proforma effect of assumed losses following the early settlement date for subsequent settlement periods through the original stated maturities.
+Added: See Note 14- Derivatives for further details;
+Added: • Incremental costs recognized by the HPC segment attributable to the realization of product recalls initiated by the Company during the year ended September 30, 2022.
See Note 20 - Commitments and Contingencies for further details;
−Removed: • Incremental costs realized under a three-year tolling agreement entered into with the buyer in consideration with the divestiture of the Coevorden Operations on March 29, 2020, for the continued production of dog and cat food products purchased to support GPC commercial operations and distribution in Europe.
−Removed: See Note 3 - Divestitures for further details;
• Gain on extinguishment of the Salus CLO debt due to the discharge of the obligation during the year ended September 30, 2020;
−Removed: See Note 12 - Debt for further details;
−Removed: • Foreign currency gains and losses attributable to multicurrency loans for the years ended September 30, 2020 and 2019, that were entered into with foreign subsidiaries in exchange for the receipt of divestiture proceeds by the parent company and the distribution of the respective foreign subsidiaries’ net assets as part of the GBL and GAC divestitures;
−Removed: • Other adjustments primarily consisting of costs attributable to (1) incremental fines and penalties realized for delayed shipments following the transition of a third-party logistics service provider in GPC during the year ended September 30, 2021;
−Removed: (2) costs associated with Salus operations during the years ended September 30, 2021, 2020 and 2019 as they are not considered a component of continuing commercial products company;
−Removed: (3) expenses and cost recovery for flood damage at the Company's facilities in Middleton, Wisconsin recognized during the years ended September 30, 2020 and 2019;
−Removed: (4) incremental costs for separation of a key executives during the years ended September 30, 2020 and 2019;
−Removed: (5) costs associated with a safety recall in GPC during the year ended September 30, 2019;
−Removed: (6) operating margin on H&G sales to GAC discontinued operations during the year ended September 30, 2019;
−Removed: and (7) certain fines and penalties for delayed shipments following the completion of a GPC distribution center consolidation in EMEA during the year ended September 30, 2019.
+Added: • Other adjustments primarily attributable to (1) costs associated with Salus as they are not considered a components of the continuing commercial products company (2) other key executive severance related costs;
+Added: (3) asset write-off for exit of certain GPC brands within China during year ended September 30, 2022, and (4) write-off of cost based investment previously held by the GPC segment during the year ended September 30, 2022.
+Added: (5) expenses and cost recovery for flood damage at the Company's facilities in Middleton, Wisconsin recognized during the years ended September 30, 2020 (6) foreign currency gains and losses attributable to multicurrency loans for the year ended September 30, 2020, that were entered into with foreign subsidiaries in exchange for the receipt of divestiture proceeds by the parent company and the distribution of the respective foreign subsidiaries’ net assets as part of the GBL and GAC divestitures.
SPECTRUM BRANDS HOLDINGS INC.
2 unchanged sentences
NOTE 21 - SEGMENT INFORMATION (continued)
−Removed: Segment Adjusted EBITDA in relation to the Company’s reportable segments for SBH and SB/RH for the years ended September 30, 2021, 2020, and 2019, is as follows:
+Added: Segment Adjusted EBITDA in relation to the Company’s reportable segments for SBH for the years ended September 30, 2022, 2021, and 2020, is as follows:
SBH (in millions) 2022 2021 2020
−Removed: 2021 2020 2019
HPC $ 69.6 $ 102.6 $ 92.2
4 unchanged sentences
Interest expense 99.4 116.5 93.7
−Removed: Depreciation and amortization 117.0 114.7 147.3
−Removed: Share and incentive based compensation 29.4 36.1 47.6
−Removed: Restructuring and related charges 40.3 71.6 61.0
−Removed: Transaction related charges 56.3 23.1 20.9
+Added: Depreciation 49.0 51.9 59.3
+Added: Amortization 50.3 65.1 55.3
+Added: Share based compensation 10.2 29.4 36.1
+Added: Tristar acquisition and integration 24.3 0.1 —
+Added: Rejuvenate acquisition and integration 6.8 10.8 —
+Added: Armitage acquisition and integration 1.4 10.9 —
+Added: Omega production integration 4.6 1.3 —
+Added: HHI divestiture 6.3 9.6 —
+Added: HPC separation initiatives 19.1 14.2 —
+Added: Coevorden operations divestiture 8.8 11.6 5.5
+Added: Fiscal 2022 restructuring 9.8 — —
+Added: Global ERP transformation 13.1 4.3 —
+Added: GPC distribution center transition 35.8 15.2 —
+Added: Global productivity improvement program 5.1 21.2 71.1
+Added: Russia closing initiative 1.9 — —
+Added: HPC brand portfolio transitions 1.3 — —
+Added: Other project costs 12.1 7.4 18.1
Unallocated shared costs 27.6 26.9 17.4
−Removed: (Gain) loss on Energizer investment ( 6.9 ) 16.8 12.1
−Removed: Inventory acquisition step-up 7.3 — —
+Added: Non-cash purchase accounting adjustments 8.3 7.3 —
+Added: Gain from remeasurement of contingent consideration liability ( 28.5 ) — —
Loss on sale of Coevorden operations — — 26.8
−Removed: Write-off from impairment of goodwill — — 116.0
Write-off from impairment of intangible assets — — 24.2
−Removed: Legal and environmental remediation reserves 6.0 — 10.0
−Removed: Foreign currency loss on multicurrency divestiture loans — 3.8 36.2
+Added: (Gain) loss on Energizer investment — ( 6.9 ) 16.8
+Added: Legal and environmental 1.5 6.0 —
Salus CLO debt extinguishment — — ( 76.2 )
−Removed: Coevorden tolling related charges 6.2 — —
−Removed: Other 3.9 ( 3.0 ) 6.9
+Added: Early settlement of foreign currency cash flow hedges ( 5.1 ) — —
+Added: HPC product recall 5.5 — —
+Added: Salus and other 4.8 0.1 0.9
Loss from operations before income taxes $ ( 90.3 ) $ ( 11.1 ) $ ( 25.1 )
+Added: SPECTRUM BRANDS HOLDINGS INC.
+Added: SB/RH HOLDINGS, LLC
+Added: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Added: NOTE 21 - SEGMENT INFORMATION (continued)
+Added: Segment Adjusted EBITDA in relation to the Company’s reportable segments for SB/RH for the years ended September 30, 2022, 2021, and 2020, is as follows:
SB/RH (in millions) 2022 2021 2020
−Removed: 2021 2020 2019
HPC $ 69.6 $ 102.6 $ 92.2
4 unchanged sentences
Interest expense 99.8 116.8 93.2
−Removed: Depreciation and amortization 117.0 114.7 147.3
+Added: Depreciation 49.0 51.9 59.3
+Added: Amortization 50.3 $ 65.1 55.3
Share and incentive based compensation 9.1 27.7 34.8
−Removed: Restructuring and related charges 40.3 71.6 61.0
−Removed: Transaction related charges 56.3 23.1 20.9
+Added: Tristar acquisition and integration 24.3 0.1 —
+Added: Rejuvenate acquisition and integration 6.8 10.8 —
+Added: Armitage acquisition and integration 1.4 10.9 —
+Added: Omega production integration 4.6 1.3 —
+Added: HHI divestiture 6.3 9.6 —
+Added: HPC separation initiatives 19.1 14.2 —
+Added: Coevorden operations divestiture 8.8 11.6 5.5
+Added: Fiscal 2022 restructuring 9.8 — —
+Added: Global ERP transformation 13.1 4.3 —
+Added: GPC distribution center transition 35.8 15.2 —
+Added: Global productivity improvement program 5.1 21.2 71.1
+Added: Russia closing initiative 1.9 — —
+Added: HPC brand portfolio transitions 1.3 — —
+Added: Other project costs 12.1 7.4 18.1
Unallocated shared costs 27.6 26.9 17.4
−Removed: (Gain) loss on Energizer investment ( 6.9 ) 16.8 12.1
−Removed: Inventory acquisition step-up 7.3 — —
+Added: Non-cash purchase adjustment 8.3 7.3 —
+Added: Gain from remeasurement of contingent consideration liability ( 28.5 ) — —
Loss on sale of Coevorden operations — — 26.8
−Removed: Write-off from impairment of goodwill — — 116.0
Write-off from impairment of intangible assets — — 24.2
−Removed: Legal and environmental remediation reserves 6.0 — 10.0
−Removed: Foreign currency loss on multicurrency divestiture loans — 3.8 36.2
−Removed: Coevorden tolling related charges 6.2 — —
+Added: (Gain) loss on Energizer investment — ( 6.9 ) 16.8
+Added: Legal and environmental 1.5 6.0 —
+Added: Gain on early settlement of cash flow hedges ( 5.1 ) — —
+Added: HPC Product Recall 5.5 — —
Other 4.5 0.1 0.2
Loss from operations before income taxes $ ( 87.9 ) $ ( 7.7 ) $ ( 93.9 )
−Removed: SPECTRUM BRANDS HOLDINGS INC.
−Removed: SB/RH HOLDINGS, LLC
−Removed: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
−Removed: NOTE 22 - SEGMENT INFORMATION (continued)
Other financial information relating to the segments of SBH and SB/RH are as follows for the years ended September 30, 2022, 2021 and 2020 and as of September 30, 2022 and 2021:
15 unchanged sentences
Total capital expenditures $ 64.0 $ 43.6 $ 44.1
+Added: SPECTRUM BRANDS HOLDINGS INC.
+Added: SB/RH HOLDINGS, LLC
+Added: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
+Added: NOTE 21 - SEGMENT INFORMATION (continued)
Segment total assets (in millions)
21 unchanged sentences
Total long-lived assets $ 346.3 $ 316.7
−Removed: SPECTRUM BRANDS HOLDINGS INC.
−Removed: SB/RH HOLDINGS, LLC
−Removed: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 22 - EARNINGS PER SHARE – SBH
7 unchanged sentences
2022 2021 2020
−Removed: Net income (loss) from continuing operations attributable to controlling interest $ 15.1 $ ( 52.7 ) $ ( 303.0 )
+Added: Net (loss) income from continuing operations attributable to controlling interest $ ( 77.2 ) $ 15.1 $ ( 52.7 )
Income from discontinued operations attributable to controlling interest 148.8 174.5 150.5
11 unchanged sentences
Weighted average number of anti-dilutive shares excluded from denominator 0.2 — 0.2
−Removed: SPECTRUM BRANDS HOLDINGS INC.
−Removed: SB/RH HOLDINGS, LLC
−Removed: NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
−Removed: NOTE 24 - QUARTERLY RESULTS (UNAUDITED)
−Removed: Spectrum Brands Holdings, Inc.
−Removed: Quarter Ended
−Removed: SBH 2021 (in millions, except per share) September 30, 2021 July 4, 2021 April 4, 2021 January 3, 2021
−Removed: Revenue $ 757.8 $ 743.8 $ 760.3 $ 736.2
−Removed: Gross profit 258.2 262.6 261.0 252.8
−Removed: Net income (loss) from continuing operations attributable to controlling interest 6.0 ( 1.8 ) ( 3.7 ) 14.7
−Removed: Net income from discontinued operations attributable to controlling interest 44.2 32.5 40.4 57.4
−Removed: Net income attributable to controlling interest $ 50.2 $ 30.7 $ 36.7 $ 72.1
−Removed: Basic earnings per share from continuing operations $ 0.14 $ ( 0.04 ) $ ( 0.09 ) $ 0.34
−Removed: Basic earnings per share from discontinued operations 1.04 0.76 0.95 1.34
−Removed: Basic earnings per share $ 1.18 $ 0.72 $ 0.86 $ 1.68
−Removed: Diluted earnings per share from continuing operations $ 0.14 $ ( 0.04 ) $ ( 0.09 ) $ 0.34
−Removed: Diluted earnings per share from discontinued operations 1.02 0.76 0.95 1.34
−Removed: Diluted earnings per share $ 1.16 $ 0.72 $ 0.86 $ 1.68
−Removed: Quarter Ended
−Removed: SBH 2020 (in millions, except per share) September 30, 2020 June 28, 2020 March 29, 2020 December 29, 2019
−Removed: Revenue $ 736.9 $ 702.7 $ 608.7 $ 573.8
−Removed: Gross profit 254.2 252.4 200.2 171.4
−Removed: Net (loss) income from continuing operations attributable to controlling interest ( 9.6 ) 126.1 ( 107.6 ) ( 61.6 )
−Removed: Net income from discontinued operations attributable to controlling interest 55.0 19.0 50.7 25.8
−Removed: Net income (loss) attributable to controlling interest $ 45.4 $ 145.1 $ ( 56.9 ) $ ( 35.8 )
−Removed: Basic earnings per share from continuing operations $ ( 0.22 ) $ 2.93 $ ( 2.39 ) $ ( 1.29 )
−Removed: Basic earnings per share from discontinued operations 1.27 0.44 1.13 0.54
−Removed: Basic earnings per share $ 1.05 $ 3.37 $ ( 1.26 ) $ ( 0.75 )
−Removed: Diluted earnings per share from continuing operations $ ( 0.22 ) $ 2.92 $ ( 2.39 ) $ ( 1.29 )
−Removed: Diluted earnings per share from discontinued operations 1.27 0.44 1.13 0.54
−Removed: Diluted earnings per share $ 1.05 $ 3.36 $ ( 1.26 ) $ ( 0.75 )
−Removed: SB/RH Holdings, LLC
−Removed: Quarter Ended
−Removed: SB/RH 2021 (in millions) September 30, 2021 July 4, 2021 April 4, 2021 January 3, 2021
−Removed: Revenue $ 757.8 $ 743.8 $ 760.3 $ 736.2
−Removed: Gross profit 258.2 262.6 261.0 252.8
−Removed: Net loss attributable to controlling interest from continuing operations 6.2 ( 0.9 ) ( 3.2 ) 15.1
−Removed: Net income attributable to controlling interest from discontinued operations 44.0 32.6 40.4 57.4
−Removed: Net income attributable to controlling interest $ 50.2 $ 31.7 $ 37.2 $ 72.5
−Removed: Quarter Ended
−Removed: SB/RH 2020 (in millions) September 30, 2020 June 28, 2020 March 29, 2020 December 29, 2019
−Removed: Revenue $ 736.9 $ 702.7 $ 608.7 $ 573.8
−Removed: Gross profit 254.2 252.4 200.2 171.4
−Removed: Net (loss) income attributable to controlling interest from continuing operations ( 13.5 ) 70.1 ( 106.0 ) ( 59.3 )
−Removed: Net income attributable to controlling interest from discontinued operations 55.9 18.7 51.6 24.4
−Removed: Net income (loss) income attributable to controlling interest $ 42.4 $ 88.8 $ ( 54.4 ) $ ( 34.9 )
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
8 unchanged sentences
Executive Vice President, Chief Financial Officer
−Removed: (Principal Financial Officer)
−Removed: /s/ Daniel L.
−Removed: Vice President, Corporate Controller and Chief Accounting Officer
−Removed: (Principal Accounting Officer)
+Added: (Principal Financial Officer and Principal Accounting Officer)
/s/ Leslie L.
14 unchanged sentences
Executive Vice President, Chief Financial Officer
−Removed: (Principal Financial Officer)
−Removed: /s/ Daniel L.
−Removed: Vice President, Corporate Controller and Chief Accounting Officer
−Removed: (Principal Accounting Officer)
+Added: (Principal Financial Officer and Principal Accounting Officer)
/s/ Leslie L.
27 unchanged sentences
Exhibit 2.5 Asset and Stock Purchase Agreement, dated as of September 8, 2021, by and between Spectrum Brands, Inc.
−Removed: and ASSA ABLOY AB (Schedules have been omitted pursuant to Item 601(b)(2) of Regulation S-K.
+Added: and ASSA ABLOY AB (inc orporated herein by reference to Exhibit 2.1 to the Current Report on Form 8-K filed with the SEC by Spectrum Brands Holdings, Inc.
+Added: on September 8, 2021 (File No.
+Added: 001-4219) (Schedules have been omitted pursuant to Item 601(b)(2) of Regulation S-K.
The Company agrees to furnish supplementally to the SEC a copy of any omitted schedule upon request ) .
+Added: Exhibit 2.6 Amendment No.
+Added: 1 to Asset and Stock Purchase Agreement dated as of July 14, 2022, by and between Spectrum Brands, Inc.
+Added: and ASSA ABLOY AB (incorporated herein by reference to Exhibit 2.1 to the Current Report on Form 8-K filed with the SEC by Spectrum Brands Holdings, Inc.
+Added: on July 14, 2022 (File No.
+Added: 001-4219) (Schedules have been omitted pursuant to Item 601(b)(2) of Regulation S-K.
+Added: The Company agrees to furnish supplementally to the SEC a copy of any omitted schedule upon request ) .
Exhibit 3.1 Amended and Restated Certificate of Incorporation of Spectrum Brands Holdings, Inc.
−Removed: HRG Group, Inc.)
+Added: HRG Group, Inc.) (incorporated herein by reference to Exhibit 3.1 to the Current Report on Form 8-K filed with the SEC by Spectrum Bran ds Holdings, Inc.
+Added: ( f.k.a HRG Group, Inc.) on July 13, 2018 (File No.
+Added: Exhibit 3.2 C ertificate of Amendment to the Amended and Restated Certificate of Incorporate of the Registrant, filed with the Secre tary of State of the State of Delaware on August 3, 2021 (incorporated here in by reference to Exhibit 3.1 to the Current Report on Form 8-K filed with the SEC by Spectrum Brands Holdings, Inc.
+Added: on August 3, 2021 (File No.
Exhibit 3.3 Third Restated By-Laws of Spectrum Brands Holdings, Inc.
20 unchanged sentences
HRG Group, Inc.) on September 24, 2019 (File No.
+Added: Exhibit 4.5 Indenture governing Spectrum Brands, Inc.’s 5.50% Senior Notes due 2030, dated as of June 30, 2020, among Spectrum Brands, Inc., the guarantors named therein and US Bank National Association, as trustee (filed by incorporation by reference to Exhibit 4.1 to the Current Report on Form 8-K filed with the SEC by Spectrum Brands Holdings, Inc.
+Added: HRG Group, Inc.) on June 30, 2020 (File No.
+Added: Exhibit 4.6 Indenture governing the 3.875% Senior Notes due 2031, dated as of March 3, 2021, among Spectrum Brands, Inc., the guarantors party thereto and US Bank National Association, as trustee (incorporated herein by reference to Exhibit 4.1 to the Current Report on Form 8-K filed with the SEC by Spectrum Brands Holdings, Inc.
+Added: on March 3, 2021 (File No.
Exhibit 4.7 Rights Agreement, dated as of February 24, 2018, between Spectrum Brands Holdings, Inc.
6 unchanged sentences
HRG Group, Inc.) on January 28, 2020 (File No.
−Removed: Exhibit 4.7 Indenture governing the 3.875% Senior Notes due 2031, dated as of March 3, 2021, among Spectrum Brands, Inc., the guarantors party thereto and US Bank National Association, as trustee (incorporated herein by reference to Exhibit 4.1 to the Current Report on Form 8-K filed with the SEC by Spectrum Brands Holdings, Inc.
−Removed: on March 3, 2021 (File No.
Exhibit 10.1 Amended and Restated Credit Agreement, dated as of June 30, 2020 among the Company, SB/RH Holdings, the guarantors party thereto, the lenders party thereto from time to time, and Royal Bank of Canada, as the administrative agent (incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K filed with the SEC by Spectrum Brands Holdings, Inc.
1 unchanged sentence
Exhibit 10.2 First Amendment to Amended and Restated Credit Agreement, dated as of March 3, 2021 (to the Amended and Restated Credit Agreement dated as of June 30, 2020), by and among the Company, SB/RH Holdings, Royal Bank of Canada, as the administrative agent and the lenders party thereto (incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K filed with the SEC by Spectrum Brands ).
+Added: Exhibit 10.3 Second Amendment to Amended and Restated Credit Agreement, dated as of December 10, 2021 (to the Amended and Restated Credit Agreement dated as of June 30, 2020) by and among the Company, SB/RH Holdings, the guarantors party thereto, the lenders party thereto from time to time, and Royal Bank of Canada, as the administrative agent.
+Added: (incorporated herein by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q filed with the SEC by Spectrum Brands on February 4, 2022 (File No.
+Added: Exhibit 10.4 Third Amendment to Amended and Restated Credit Agreement, dated as of February 3, 2022 (to the Amended and Restated Credit Agreement dated as of June 30, 2020), by and among the Company, SB/RH Holdings, Royal Bank of Canada, as the administrative agent, the guarantors party thereto and the lenders party thereto (incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K filed with the SEC by Spectrum Brands on February 18, 2022 (File No.
+Added: Exhibit 10.5 Fourth Amendment to Amended and Restated Credit Agreement, dated as of November 17, 2022 (to the Amended and Restated Credit Agreement dated as of June 30, 2020), by and among the Company, SB/RH Holdings, Royal Bank of Canada, as the administrative agent, the guarantors party thereto and the lenders party thereto (incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K filed with the SEC by Spectrum Brands on November 18, 2022 (File No.
Exhibit 10.6 Security Agreement, dated as of June 23, 2015, by and among Spectrum Brands, Inc., SB/RH Holdings, LLC, the subsidiary guarantors party thereto from time to time and Deutsche Bank AG New York Branch, as collateral agent (incorporated herein by reference to Exhibit 10.2 to the Current Report on Form 8-K filed with the SEC by Spectrum Brands Legacy, Inc.
2 unchanged sentences
Spectrum Brands Holdings, Inc.) on June 23, 2015 (File No.
−Removed: Exhibit 10.5+ Spectrum Brands Holdings, Inc.
−Removed: 2011 Omnibus Equity Award Plan, as amended on January 28, 2014 (incorporated herein by reference to Exhibit 99.1 to the Current Report on Form 8-K filed with the SEC by Spectrum Brands Legacy, Inc.
−Removed: Spectrum Brands Holdings, Inc.) on February 3, 2014 (File No.
Exhibit 10.8+ Amended & Restated Spectrum Brands Holdings, Inc.
13 unchanged sentences
333- 242343).
−Removed: Exhibit 10.10+ Employment Agreement dated January 20, 2016 by and among Spectrum Brands, Inc.
−Removed: Maura (incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K filed with the SEC by Spectrum Brands Legacy, Inc.
−Removed: Spectrum Brands Holdings, Inc.) on January 21, 2016 (File No.
−Removed: Exhibit 10.11+ Amended and Restated Employment Agreement dated as of September 26, 2017 by and between Spectrum Brands, Inc., Spectrum Brands Legacy, Inc.
−Removed: Spectrum Brands Holdings, Inc.) and David M.
−Removed: Maura (filed by incorporated by reference to Exhibit 10.1 to a Current Report on Form 8-K filed with the SEC by Spectrum Brands Legacy, Inc.
−Removed: Spectrum Brands Holdings, Inc.) on September 29, 2017 (File No.
−Removed: Exhibit 10.12+ Release Agreement, dated as of July 13, 2018, by and between Ehsan Zargar and Spectrum Brands Holdings, Inc.
−Removed: HRG Group, Inc.) (incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K filed with the SEC by Spectrum Brands Holdings, Inc.
−Removed: HRG Group, Inc.) on July 13, 2018 (File No.
+Added: Exhibit 10.12+ Amended and Restated Employment Agreement dated April 25, 2018, by and between Spectrum Brands, Inc., Spectrum Brands Holdings, Inc.
+Added: Maura (filed by incorporation by reference to Exhibit 10.1 to a Current Report on Form 8-K filed with the SEC by Spectrum Brands Legacy, Inc.
+Added: Spectrum Brands Holdings, Inc.) on May 1, 2018 (File No.
Exhibit 10.13+ Employment Agreement, dated as of September 13, 2018, by and among Ehsan Zargar, Spectrum Brands Holdings, Inc.
2 unchanged sentences
HRG Group, Inc.) on November 23, 2018 (File NO.
−Removed: Exhibit 10.14+ Severance Agreement, dated February 1, 2016, by and among Randal Lewis and Spectrum Brands, Inc.
−Removed: (incorporated herein by reference to Exhibit 10.42 to the Annual Report on Form 10-K filed with the SEC by Spectrum Brands Holdings, Inc.
−Removed: HRG Group, Inc.) on November 23, 2018 (File NO.
Exhibit 10.14+ Form of Agreement with David Maura and Ehsan Zargar Regarding Certain Provisions of Such Executive’s Respective Prior Separation Agreements with HRG Group, Inc.
9 unchanged sentences
HRG Group, Inc.) on September 9, 2019 (File No.
+Added: Exhibit 10.16+* Separation Agreement, dated as of August 30, 2022, by and between Spectrum Brands Holdings, Inc.
+Added: and Randal D.
Exhibit 10.17+ Letter Agreement, dated as of September 9, 2019, by and between Spectrum Brands Holdings, Inc.
6 unchanged sentences
HRG Group, Inc.) on September 9, 2019 (File No.
+Added: Exhibit 10.18+* Separation Agreement, dated as of August 30, 2022, by and between Spectrum Brands Holdings, Inc.
+Added: and Rebeckah Long.
Exhibit 10.20+ Form of Restricted Stock Unit Award Agreement effective as of December 22, 2020 (incorporated herein by reference to Exhibit 10.4 to the Quarterly Report on Form 10-Q filed with the SEC by Spectrum Brands Holdings, Inc.
34 unchanged sentences
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.