Subsequent Events |
12 Months Ended |
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Dec. 31, 2019 | |
| Subsequent Events [Abstract] | |
| Subsequent Events |
Subsequent Events
On November 11, 2019, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) by and among the Company, Advisor Group, and Harvest Merger Sub, Inc., a Florida corporation and a wholly owned subsidiary of Advisor Group (“Merger Sub”). Under the Merger Agreement, on February 14, 2020, Merger Sub merged with and into the Company (the “Merger”), with the Company continuing as the surviving corporation in the Merger and a wholly owned subsidiary of Advisor Group. As a result of the Merger, a change of control of the Company occurred, and the Company is now a wholly owned subsidiary of Advisor Group, which is owned by private investment funds sponsored by Reverence Capital Partners LLC.
The Merger caused each share of the Company’s Common Stock to be cancelled and converted into the right to receive $3.50 in cash (the “Merger Consideration”).
Each outstanding option award to purchase the Company’s Common Stock (a “Company Option”) was accelerated. Each holder of a Company Option received cash equal to the product of (i) the number of shares subject to the Company Option and (ii) the excess of the Merger Consideration over the exercise price per share of the Company Option.
All outstanding restricted stock awards of the Company (a “Company Restricted Share”) were accelerated with each holder receiving cash equal to the product of (i) the number of common shares underlying such Company restricted stock awards held and (ii) the Merger Consideration.
In February 2020, the December 2018 Notes were purchased by Advisor Group, our affiliate, and became a intercompany balance.
As required by the terms of the Company's Series A Preferred Stock, on February 14, 2020, the Company provided notice to the holders of its Series A Preferred Stock of their right to convert each share of Series A Preferred Stock owned by them into $25.0389 per share in cash. The conversion right arose from the Merger and the resulting change of control of the Company. 12,816,614 shares of Series A Preferred Stock were converted and 4,584,668 shares of Series A Preferred Stock remained outstanding as of March 10, 2020.
On February 13, 2020, AG Issuer, LLC (“AG Escrow Issuer”) issued $500,000 in aggregate principal amount of 6.25% Senior Secured Notes due 2028 (the “2028 Senior Secured Notes”). The 2028 Senior Secured Notes were issued under an indenture, dated February 13, 2020 (the “Initial Indenture”), by and between AG Escrow Issuer and Wilmington Trust, National Association, as trustee (the “Trustee”) and as notes collateral agent (the “Notes Collateral Agent”).
AG Escrow Issuer was merged with and into Advisor Group on February 14, 2020. In connection therewith, the Company and Securities America Financial Corporation (together, the “Ladenburg Guarantors”) entered into a supplemental indenture, dated February 14, 2020 (the “2028 Senior Secured Notes Supplemental Indenture,” and together with the Initial Indenture, the “2028 Senior Secured Notes Indenture”), pursuant to which the Ladenburg Guarantors have agreed to guarantee all of Advisor Group’s obligations under the 2028 Senior Secured Notes Indenture and the 2028 Senior Secured Notes.
On February 14, 2020, the Ladenburg Guarantors entered into a supplemental indenture (the “2027 Senior Notes Supplemental Indenture”), pursuant to which the Ladenburg Guarantors agreed to guarantee all of Advisor Group’s obligations under the indenture, dated as of August 1, 2019, among Advisor Group, the guarantor parties thereto from time to time, and the Trustee (as supplemented, the “2027 Senior Notes Indenture”), and Advisor Group’s 10.75% senior unsecured notes due 2027 (the “2027 Senior Notes”), which, as of February 14, 2020, had an outstanding aggregate principal amount of approximately $350,000. On February 20, 2020, the Ladenburg Guarantors entered into a third supplemental indenture, pursuant to which the Ladenburg Guarantors agreed to guarantee an additional $63,000 in 2027 Senior Notes issued by Advisor Group.
On February 14, 2020, the Ladenburg Guarantors, as guarantors, entered into a joinder agreement to Advisor Group’s credit agreement with, inter alios, the several lending institutions from time to time party thereto and UBS AG, Stamford Branch, as administrative agent, governing the senior secured credit facilities (the “Senior Secured Credit Facilities”). On February 14, 2020, the Senior Secured Credit Facilities consisted of (i) a seven-year $1.5 billion senior secured Term Loan B facility (the “Term Loan Facility”) and (ii) a $325 million senior secured revolving credit facility (the “Revolving Credit Facility”).
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