Pursuit Attractions and Hospitality, Inc. (formerly known as Viad Corp)
Unaudited Pro Forma Condensed Consolidated Financial Statements
On December 31, 2024 (the “Closing Date”), Pursuit Attractions and Hospitality, Inc. (formerly known as Viad Corp) (the “Company”) completed the previously announced sale of its GES business. As previously disclosed in the Current Report on Form 8-K filed by the Company with the Securities and Exchange Commission (the “SEC”) on October 21, 2024, the Company entered into an Equity Purchase Agreement (the “Purchase Agreement”), dated October 20, 2024, with TL Voltron, LLC, a Delaware limited liability company (“Buyer”).
Subject to the terms and conditions of the Purchase Agreement, Buyer agreed to purchase, directly or indirectly through wholly-owned subsidiaries, as applicable, all of the outstanding equity interests held by the Company in its subsidiaries comprising the GES business (as defined in the Purchase Agreement) (such transaction, together with any other transactions contemplated by the Purchase Agreement, the “Transaction”). The aggregate purchase price for the Transaction was $535 million, consisting of a base purchase price of $510 million, subject to customary adjustments for cash, indebtedness, working capital and transaction expenses, each as set forth in the Purchase Agreement (as so adjusted, the “Purchase Price”), and a deferred purchase price of $25 million payable by Buyer to the Company one year after the Closing Date.
The sale of the GES business constitutes a significant disposition for purposes of Item 2.01 of Form 8-K. The Company has also determined that the sale of the GES business has met the criteria under Accounting Standards Codification 205-20, Presentation of Financial Statements – Discontinued Operations (“ASC 205-20”) to be classified as a discontinued operation, as the sale represents a strategic shift that will have a significant effect on the Company’s operations and financial results. Accordingly, the Company will account for the GES business as a discontinued operation beginning in its Annual Report on Form 10-K for the year ended December 31, 2024. The Company’s estimates for discontinued operations, as presented below in the unaudited pro forma condensed consolidated financial information, are preliminary and actual results could differ from these estimates.
The unaudited pro forma condensed consolidated financial statements presented below have been prepared in accordance with Article 11 of Regulation S-X and were derived from the Company’s historical consolidated financial statements. The unaudited pro forma condensed consolidated balance sheet as of September 30, 2024 reflects the Transaction as if it occurred on such date. The unaudited pro forma condensed consolidated statements of operations for the nine months ended September 30, 2024 and for each of the years ended December 31, 2023, 2022, and 2021 reflect the Transaction as if it occurred on January 1, 2023.
The unaudited pro forma condensed consolidated financial statements and the accompanying notes should be read in conjunction with:
•The Company’s Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on March 1, 2024; and
•The Company’s Quarterly Report on Form 10-Q for the nine months ended September 30, 2024, filed with the SEC on November 7, 2024.
The unaudited pro forma condensed consolidated balance sheet as of September 30, 2024 and the unaudited pro forma condensed consolidated statements of operations for the nine months ended September 30, 2024 and for the year ended December 31, 2023 reflect “Pro Forma Adjustments” that are incremental to those related to the sale of the GES business and discontinued operations presentation of the GES business, as discussed above. The Pro Forma Adjustments are described in the accompanying notes to the unaudited pro forma condensed consolidated financial statements.
The unaudited pro forma condensed consolidated financial information is provided for informational purposes only and does not purport to represent the Company’s actual financial condition or results of operations had the sale of the GES business occurred on the dates indicated, nor does it project the Company’s results of operations or financial condition for any future period or date. The Company has prepared the unaudited pro forma condensed consolidated financial information based on available information using certain assumptions that it believes are reasonable. As a result, the actual results reported by the Company in periods following the sale of the GES business may differ materially from this unaudited pro forma condensed consolidated financial information.
Pursuit Attractions and Hospitality, Inc. (formerly known as Viad Corp)
Pro Forma Condensed Consolidated Balance Sheet
(Unaudited)
As of September 30, 2024
(In thousands, except per share amounts)
| | | | | | | | | | | | | | |
| | | | Transaction Accounting Adjustments | | | |
| Company Historical | | Disposition Adjustments (Note 2a) | | Additional Transaction Accounting Adjustments | | Debt Adjustments | | Pro Forma |
Assets | | | | | | | | | | | | | | |
Current assets | | | | | | | | | | | | | | |
Cash and cash equivalents | $ | 64,552 | | $ | (27,262) | | $ | 92,292 | 2(b) | $ | - | | $ | 129,582 |
Accounts receivable, net | | 168,635 | | | (147,163) | | | - | | | - | | | 21,472 |
Inventories | | 11,246 | | | (349) | | | - | | | - | | | 10,897 |
Current contract costs | | 28,909 | | | (28,909) | | | - | | | - | | | - |
Prepaid insurance | | 6,303 | | | (62) | | | - | | | - | | | 6,241 |
Other current assets | | 29,944 | | | (11,281) | | | 25,000 | 2(c) | | - | | | 43,663 |
Total current assets | | 309,589 | | | (215,026) | | | 117,292 | | | - | | | 211,855 |
Property and equipment, net | | 588,864 | | | (41,309) | | | - | | | - | | | 547,555 |
Other investments and assets | | 20,352 | | | (6,762) | | | - | | | - | | | 13,590 |
Operating lease right-of-use assets | | 100,404 | | | (67,776) | | | - | | | - | | | 32,628 |
Deferred income taxes | | 2,304 | | | (2,198) | | | - | | | - | | | 106 |
Goodwill | | 121,905 | | | - | | | - | | | - | | | 121,905 |
Other intangible assets, net | | 52,410 | | | (280) | | | - | | | - | | | 52,130 |
Total Assets | $ | 1,195,828 | | $ | (333,351) | | $ | 117,292 | | $ | - | | $ | 979,769 |
Liabilities, Mezzanine Equity, and Stockholders' Equity | | | | | | | | | | | | | | |
Current liabilities | | | | | | | | | | | | | | |
Accounts payable | $ | 120,355 | | $ | (100,671) | | $ | - | | $ | - | | $ | 19,684 |
Contract liabilities | | 67,721 | | | (57,720) | | | - | | | - | | | 10,001 |
Accrued compensation | | 40,249 | | | (30,920) | | | - | | | - | | | 9,329 |
Operating lease obligations | | 17,807 | | | (15,230) | | | - | | | - | | | 2,577 |
Other current liabilities | | 53,213 | | | (29,861) | | | (1,649) | 2(d) | | - | | | 21,703 |
Current portion of debt and finance obligations | | 8,314 | | | (1,674) | | | (4,000) | 2(e) | | - | | | 2,640 |
Total current liabilities | | 307,659 | | | (236,076) | | | (5,649) | | | - | | | 65,934 |
Long-term debt and finance obligations | | 381,887 | | | (2,254) | | | (308,048) | 2(f) | | 1,927 | 2(h) | | 73,512 |
Pension and postretirement benefits | | 15,859 | | | (559) | | | - | | | - | | | 15,300 |
Long-term operating lease obligations | | 96,502 | | | (59,602) | | | - | | | - | | | 36,900 |
Other deferred items and liabilities | | 67,265 | | | (19,517) | | | - | | | - | | | 47,748 |
Total liabilities | | 869,172 | | | (318,008) | | | (313,697) | | | 1,927 | | | 239,394 |
Commitments and contingencies | | | | | | | | | | | | | | |
Convertible Series A preferred stock | | 132,591 | | | - | | | - | | | - | | | 132,591 |
Redeemable noncontrolling interest | | 4,382 | | | - | | | - | | | - | | | 4,382 |
Stockholders’ equity | | | | | | | | | | | | | | |
Common stock | | 37,402 | | | - | | | - | | | - | | | 37,402 |
Additional capital | | 572,219 | | | - | | | - | | | - | | | 572,219 |
Accumulated earnings (deficit) | | (280,017) | | | (15,343) | | | 430,989 | 2(g) | | (1,927) | 2(h) | | 133,702 |
Accumulated other comprehensive loss | | (46,551) | | | - | | | - | | | - | | | (46,551) |
Common stock in treasury, at cost, 3,745,837 shares | | (186,288) | | | - | | | - | | | - | | | (186,288) |
Total Company stockholders' equity | | 96,765 | | | (15,343) | | | 430,989 | | | (1,927) | | | 510,484 |
Non-redeemable noncontrolling interest | | 92,918 | | | - | | | - | | | - | | | 92,918 |
Total stockholders’ equity | | 189,683 | | | (15,343) | | | 430,989 | | | (1,927) | | | 603,402 |
Total Liabilities, Mezzanine Equity, and Stockholders' Equity | $ | 1,195,828 | | $ | (333,351) | | $ | 117,292 | | $ | - | | $ | 979,769 |
See notes to unaudited pro forma condensed consolidated financial statements.
Pursuit Attractions and Hospitality, Inc. (formerly known as Viad Corp)
Pro Forma Condensed Consolidated Statements of Operations
(Unaudited)
For the Nine Months Ended September 30, 2024
(In thousands, except per share amounts)
| | | | | | | | | | | | | | | |
| | | | Transaction Accounting Adjustments | | | | |
| Company Historical | | Disposition Adjustments (Note 3a) | | Additional Transaction Accounting Adjustments | | Debt Adjustments | | Pro Forma | |
Revenue: | | | | | | | | | | | | | | | |
Services | $ | 912,126 | | $ | (674,105) | | $ | - | | $ | - | | $ | 238,021 | |
Products | | 195,613 | | | (112,946) | | | - | | | - | | | 82,667 | |
Total revenue | | 1,107,739 | | | (787,051) | | | - | | | - | | | 320,688 | |
Costs and expenses: | | | | | | | | | | | | | | | |
Costs of services | | 798,666 | | | (612,705) | | | - | | | - | | | 185,961 | |
Costs of products | | 171,529 | | | (99,095) | | | - | | | - | | | 72,434 | |
Corporate activities | | 17,612 | | | - | | | - | | | - | | | 17,612 | |
Interest expense, net | | 35,858 | | | (25,548) | | | - | | | (4,822) | 3(c) | | 5,488 | |
Other expense, net | | 1,287 | | | (414) | | | (2,084) | 3(b) | | - | | | (1,211) | |
Restructuring charges | | (326) | | | 326 | | | - | | | - | | | - | |
Impairment charges | | 6,110 | | | - | | | - | | | - | | | 6,110 | |
Total costs and expenses | | 1,030,736 | | | (737,436) | | | (2,084) | | | (4,822) | | | 286,394 | |
Income (loss) from continuing operations before income taxes | | 77,003 | | | (49,615) | | | 2,084 | | | 4,822 | | | 34,294 | |
Income tax expense (benefit) | | 17,247 | | | (5,624) | | | - | | | - | | | 11,623 | |
Income (loss) from continuing operations | | 59,756 | | | (43,991) | | | 2,084 | | | 4,822 | | | 22,671 | |
Income from discontinued operations | | 743 | | | - | | | - | | | - | | | 743 | |
Net income (loss) | | 60,499 | | | (43,991) | | | 2,084 | | | 4,822 | | | 23,414 | |
Net income attributable to non-redeemable noncontrolling interest | | (8,062) | | | - | | | - | | | - | | | (8,062) | |
Net loss attributable to redeemable noncontrolling interest | | 372 | | | - | | | - | | | - | | | 372 | |
Net income (loss) attributable to Company | $ | 52,809 | | $ | (43,991) | | $ | 2,084 | | $ | 4,822 | | $ | 15,724 | |
Less: Allocation to participating securities | | (11,282) | | | | | | | | | | | | (2,372) | |
Convertible preferred stock dividends paid in cash | | (5,850) | | | | | | | | | | | | (5,850) | |
Convertible preferred stock dividends paid in kind | | - | | | | | | | | | | | | - | |
Adjustment to the redemption value of redeemable noncontrolling interest | | - | | | | | | | | | | | | - | |
Net income allocated to Company common stockholders (basic) | $ | 35,677 | | | | | | | | | | | $ | 7,502 | |
Add: Allocation to participating securities | | 165 | | | | | | | | | | | | 34 | |
Net income allocated to Company common stockholders (diluted) | $ | 35,842 | | | | | | | | | | | $ | 7,536 | |
| | | | | | | | | | | | | | | |
Company’s net income per share: | | | | | | | | | | | | | | | |
Basic per share | $ | 1.69 | | | | | | | | | | | $ | 0.36 | 3(d) |
Diluted per share | $ | 1.67 | | | | | | | | | | | $ | 0.35 | 3(d) |
| | | | | | | | | | | | | | | |
Number of shares used in per share computation: | | | | | | | | | | | | | | | |
Basic | | 21,107 | | | | | | | | | | | | 21,107 | 3(d) |
Diluted | | 21,517 | | | | | | | | | | | | 21,517 | 3(d) |
See notes to unaudited pro forma condensed consolidated financial statements.
Pursuit Attractions and Hospitality, Inc. (formerly known as Viad Corp)
Pro Forma Condensed Consolidated Statements of Operations
(Unaudited)
For the Year Ended December 31, 2023
(In thousands, except per share amounts)
| | | | | | | | | | | | | | | |
| | | | Transaction Accounting Adjustments | | | | |
| Company Historical | | Disposition Adjustments (Note 3a) | | Additional Transaction Accounting Adjustments | | Debt Adjustments | | Pro Forma | |
Revenue: | | | | | | | | | | | | | | | |
Services | $ | 1,006,226 | | $ | (747,560) | | $ | - | | $ | - | | $ | 258,666 | |
Products | | 232,454 | | | (140,833) | | | - | | | - | | | 91,621 | |
Total revenue | | 1,238,680 | | | (888,393) | | | - | | | - | | | 350,287 | |
Costs and expenses: | | | | | | | | | | | | | | | |
Costs of services | | 919,966 | | | (702,960) | | | - | | | - | | | 217,006 | |
Costs of products | | 210,212 | | | (125,754) | | | - | | | - | | | 84,458 | |
Corporate activities | | 14,040 | | | - | | | - | | | - | | | 14,040 | |
Gain on sale of ON Services | | 204 | | | (204) | | | - | | | - | | | - | |
Interest expense, net | | 47,978 | | | (42,016) | | | - | | | (1,655) | 3(c) | | 4,307 | |
Other expense, net | | 2,033 | | | (689) | | | (3,056) | 3(b) | | - | | | (1,712) | |
Restructuring charges | | 1,174 | | | (975) | | | - | | | - | | | 199 | |
Total costs and expenses | | 1,195,607 | | | (872,598) | | | (3,056) | | | (1,655) | | | 318,298 | |
Income (loss) from continuing operations before income taxes | | 43,073 | | | (15,795) | | | 3,056 | | | 1,655 | | | 31,989 | |
Income tax expense (benefit) | | 18,799 | | | (5,871) | | | - | | | - | | | 12,928 | |
Income (loss) from continuing operations | | 24,274 | | | (9,924) | | | 3,056 | | | 1,655 | | | 19,061 | |
Loss from discontinued operations | | (822) | | | - | | | - | | | - | | | (822) | |
Net income (loss) | | 23,452 | | | (9,924) | | | 3,056 | | | 1,655 | | | 18,239 | |
Net income attributable to non-redeemable noncontrolling interest | | (7,836) | | | - | | | - | | | - | | | (7,836) | |
Net loss attributable to redeemable noncontrolling interest | | 401 | | | - | | | - | | | - | | | 401 | |
Net income (loss) attributable to Company | $ | 16,017 | | $ | (9,924) | | $ | 3,056 | | $ | 1,655 | | $ | 10,804 | |
Less: Allocation to participating securities | | (1,993) | | | | | | | | | | | | (728) | |
Convertible preferred stock dividends paid in cash | | (7,801) | | | | | | | | | | | | (7,801) | |
Convertible preferred stock dividends paid in kind | | - | | | | | | | | | | | | - | |
Adjustment to the redemption value of redeemable noncontrolling interest | | - | | | | | | | | | | | | - | |
Net income allocated to Company common stockholders (basic) | $ | 6,223 | | | | | | | | | | | $ | 2,275 | |
Add: Allocation to participating securities | | 18 | | | | | | | | | | | | 6 | |
Net income allocated to Company common stockholders (diluted) | $ | 6,241 | | | | | | | | | | | $ | 2,281 | |
| | | | | | | | | | | | | | | |
Company’s net income per share: | | | | | | | | | | | | | | | |
Basic per share | $ | 0.30 | | | | | | | | | | | $ | 0.11 | 3(d) |
Diluted per share | $ | 0.30 | | | | | | | | | | | $ | 0.11 | 3(d) |
| | | | | | | | | | | | | | | |
Number of shares used in per share computation: | | | | | | | | | | | | | | | |
Basic | | 20,855 | | | | | | | | | | | | 20,855 | 3(d) |
Diluted | | 21,097 | | | | | | | | | | | | 21,097 | 3(d) |
See notes to unaudited pro forma condensed consolidated financial statements.
Pursuit Attractions and Hospitality, Inc. (formerly known as Viad Corp)
Pro Forma Condensed Consolidated Statements of Operations
(Unaudited)
For the Year Ended December 31, 2022
(In thousands, except per share amounts)
| | | | | | | | | |
| Company Historical | | Disposition Adjustments (Note 3a) | | Pro Forma | |
Revenue: | | | | | | | | | |
Services | $ | 912,040 | | $ | (693,481) | | $ | 218,559 | |
Products | | 215,271 | | | (134,502) | | | 80,769 | |
Total revenue | | 1,127,311 | | | (827,983) | | | 299,328 | |
Costs and expenses: | | | | | | | | | |
Costs of services | | 857,760 | | | (654,650) | | | 203,110 | |
Costs of products | | 200,540 | | | (123,676) | | | 76,864 | |
Corporate activities | | 13,418 | | | - | | | 13,418 | |
Gain on sale of ON Services | | (19,637) | | | 19,637 | | | - | |
Interest expense, net | | 34,891 | | | (30,826) | | | 4,065 | |
Other expense, net | | 2,077 | | | (788) | | | 1,289 | |
Restructuring charges | | 3,059 | | | (2,975) | | | 84 | |
Impairment charges | | 583 | | | (583) | | | - | |
Total costs and expenses | | 1,092,691 | | | (793,861) | | | 298,830 | |
Income (loss) from continuing operations before income taxes | | 34,620 | | | (34,122) | | | 498 | |
Income tax expense (benefit) | | 9,973 | | | (4,259) | | | 5,714 | |
Income (loss) from continuing operations | | 24,647 | | | (29,863) | | | (5,216) | |
Income from discontinued operations | | 148 | | | - | | | 148 | |
Net income (loss) | | 24,795 | | | (29,863) | | | (5,068) | |
Net income attributable to non-redeemable noncontrolling interest | | (2,323) | | | - | | | (2,323) | |
Net loss attributable to redeemable noncontrolling interest | | 748 | | | - | | | 748 | |
Net income (loss) attributable to Company | $ | 23,220 | | $ | (29,863) | | $ | (6,643) | |
Less: Allocation to participating securities | | (3,600) | | | | | | - | |
Convertible preferred stock dividends paid in cash | | (7,801) | | | | | | (7,801) | |
Convertible preferred stock dividends paid in kind | | - | | | | | | - | |
Adjustment to the redemption value of redeemable noncontrolling interest | | (763) | | | | | | (763) | |
Net income (loss) allocated to Company common stockholders (basic) | $ | 11,056 | | | | | $ | (15,207) | |
Add: Allocation to participating securities | | 30 | | | | | | - | |
Net income (loss) allocated to Company common stockholders (diluted) | $ | 11,086 | | | | | $ | (15,207) | |
| | | | | | | | | |
Company’s net income (loss) per share: | | | | | | | | | |
Basic per share | $ | 0.54 | | | | | $ | (0.74) | 3(d) |
Diluted per share | $ | 0.53 | | | | | $ | (0.74) | 3(d) |
| | | | | | | | | |
Number of shares used in per share computation: | | | | | | | | | |
Basic | | 20,589 | | | | | | 20,589 | 3(d) |
Diluted | | 20,812 | | | | | | 20,589 | 3(d) |
See notes to unaudited pro forma condensed consolidated financial statements.
Pursuit Attractions and Hospitality, Inc. (formerly known as Viad Corp)
Pro Forma Condensed Consolidated Statements of Operations
(Unaudited)
For the Year Ended December 31, 2021
(In thousands, except per share amounts)
| | | | | | | | | |
| Company Historical | | Disposition Adjustments (Note 3a) | | Pro Forma | |
Revenue: | | | | | | | | | |
Services | $ | 401,142 | | $ | (268,221) | | $ | 132,921 | |
Products | | 106,198 | | | (52,074) | | | 54,124 | |
Total revenue | | 507,340 | | | (320,295) | | | 187,045 | |
Costs and expenses: | | | | | | | | | |
Costs of services | | 440,383 | | | (305,523) | | | 134,860 | |
Costs of products | | 113,889 | | | (62,268) | | | 51,621 | |
Corporate activities | | 11,689 | | | - | | | 11,689 | |
Interest expense, net | | 28,324 | | | (13,877) | | | 14,447 | |
Other expense, net | | 2,070 | | | (806) | | | 1,264 | |
Restructuring charges | | 6,066 | | | (5,936) | | | 130 | |
Total costs and expenses | | 602,421 | | | (388,410) | | | 214,011 | |
Income (loss) from continuing operations before income taxes | | (95,081) | | | 68,115 | | | (26,966) | |
Income tax expense (benefit) | | (1,788) | | | 427 | | | (1,361) | |
Income (loss) from continuing operations | | (93,293) | | | 67,688 | | | (25,605) | |
Income from discontinued operations | | 558 | | | - | | | 558 | |
Net income (loss) | | (92,735) | | | 67,688 | | | (25,047) | |
Net income attributable to non-redeemable noncontrolling interest | | (1,686) | | | - | | | (1,686) | |
Net loss attributable to redeemable noncontrolling interest | | 1,766 | | | - | | | 1,766 | |
Net income (loss) attributable to Company | $ | (92,655) | | $ | 67,688 | | $ | (24,967) | |
Less: Allocation to participating securities | | - | | | | | | - | |
Convertible preferred stock dividends paid in cash | | (3,900) | | | | | | (3,900) | |
Convertible preferred stock dividends paid in kind | | (3,821) | | | | | | (3,821) | |
Adjustment to the redemption value of redeemable noncontrolling interest | | (1,797) | | | | | | (1,797) | |
Net loss allocated to Company common stockholders (basic) | $ | (102,173) | | | | | $ | (34,485) | |
Add: Allocation to participating securities | | - | | | | | | - | |
Net loss allocated to Company common stockholders (diluted) | $ | (102,173) | | | | | $ | (34,485) | |
| | | | | | | | | |
Company’s net loss per share: | | | | | | | | | |
Basic per share | $ | (5.01) | | | | | $ | (1.69) | 3(d) |
Diluted per share | $ | (5.01) | | | | | $ | (1.69) | 3(d) |
| | | | | | | | | |
Number of shares used in per share computation: | | | | | | | | | |
Basic | | 20,411 | | | | | | 20,411 | 3(d) |
Diluted | | 20,411 | | | | | | 20,411 | 3(d) |
See notes to unaudited pro forma condensed consolidated financial statements.
Pursuit Attractions and Hospitality, Inc. (formerly known as Viad Corp)
Notes to the Unaudited Pro Forma Condensed Consolidated Financial Statements
1.Basis of Pro Forma Presentation
The unaudited pro forma condensed consolidated financial statements have been prepared in accordance with Article 11 of Regulation S-X, Pro Forma Financial Information.
In accordance with ASC 205-20, discontinued operations represent the elimination of assets, liabilities, shareholders’ equity, and results of operations attributable to the GES business, which were included in the Company’s historical consolidated financial statements (“Company Historical”). Adjustments do not include general corporate overhead costs previously allocated to the GES business, which will continue to be recognized on an ongoing basis. Such allocations include labor and non-labor expense related to the Company’s corporate support functions that previously provided support to the GES business including finance, accounting, tax, treasury, information technology, human resources, and legal. Adjustments include direct operating expenses incurred that are identifiable as costs of the GES business and will not continue to be recognized on an ongoing basis.
In connection with the Transaction, the Company terminated its existing $500 million credit agreement (the “2021 Credit Agreement”), which provided for a $400 million term loan (the “Term Loan B”) and $100 million revolving credit facility (the “Revolver”). Under the terms of the 2021 Credit Agreement, the Company was required to repay amounts outstanding under Term Loan B upon close of the Transaction. Accordingly, direct expenses of the GES business reflects historical interest expense incurred for amounts outstanding under Term Loan B. The Company elected to allocate interest expense associated with the Revolver to the GES business based on the relative net assets of the GES business compared to the historical Company net assets.
No pro forma tax adjustments are reflected in the unaudited pro forma condensed consolidated financial statements as the tax impact is considered immaterial. This assessment is based on the presence of operating losses and other deferred tax assets to offset any significant taxable income arising from the pro forma adjustments reflected in the unaudited pro forma condensed consolidated financial statements.
2.Pro Forma Adjustments – Balance Sheet
(a)Represents the elimination of the assets and liabilities of the GES business that were sold under the terms of the Transaction.
(b)Represents the estimated net cash proceeds at the closing of the Transaction:
| | | |
| $ | 510,000 | Base purchase price |
| | (80,691) | Less: indebtedness assumed by Buyer |
| | 2,811 | Plus: working capital adjustment |
| | (21,828) | Less: transaction expenses paid at the Closing Date |
| | (318,000) | Less: repayment of amounts outstanding under the Term Loan B |
| $ | 92,292 | Estimated net cash proceeds |
| | | |
(c)Represents the estimated deferred purchase price payable by Buyer to the Company one year after Closing Date.
(d)Represents the net impact to other current liabilities:
| | | |
| $ | 278 | Additional transaction expenses incurred after September 30, 2024 |
| | (1,927) | Less: previously accrued transaction expenses paid at the Closing Date |
| $ | (1,649) | Net impact to other current liabilities |
| | | |
(e)Represents the repayment of current portion of amounts outstanding under Term Loan B.
(f)Represents the net pro forma impact to long-term debt and finance obligations:
| | | |
| $ | 5,952 | Write off of unamortized debt issuance costs associated with Term Loan B |
| | (314,000) | Repayment of the long-term portion of amounts outstanding under Term Loan B |
| | (308,048) | Net impact to long-term debt and finance obligations |
| | | |
(g)Represents the net pro forma impact to accumulated earnings (deficit):
| | | |
| $ | 510,000 | Base purchase price |
| | 25,000 | Deferred purchase price payable by Buyer to the Company one year after the Closing Date discussed above in note 2(c) |
| | 535,000 | Total consideration |
| | (20,179) | Less: transaction expenses incurred post September 30, 2024 |
| | (77,880) | Less: indebtedness assumed by Buyer, offset by the working capital adjustment |
| | (5,952) | Less: write off of unamortized debt issuance costs associated with Term Loan B |
| $ | 430,989 | Net pro forma impact to accumulated earnings (deficit) |
| | | |
(h)Represents the write off of unamortized debt issuance costs associated with the Revolver; Revolver was undrawn as of September 30, 2024.
3.Pro Forma Adjustments – Statements of Operations
(a)Represents the elimination of revenues and expenses associated with the GES business.
(b)In connection with the Transaction, the Company and Buyer entered into a Transition Services Agreement (“TSA”) primarily to support the Company’s information technology infrastructure, which had historically been provided by the GES business along with other immaterial corporate functions that the Company had historically provided to the GES business. The terms of the services included in the TSA vary in length, with the longest being 12 months related to the information technology infrastructure support, and includes the option to extend for up to two additional 3-month periods. This adjustment recognizes the expense related to the TSA for the periods presented.
(c)Represents the reduction of historical interest expense associated with the Revolver that had not been allocated to the GES business.
(d)Represents the impact on earnings per share related to pro forma adjustments. For the years ended December 31, 2022 and 2021 the unaudited pro forma condensed consolidated statements of operations results in a loss, therefore there is no impact to dilutive earnings per share.
