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|
(Mark One)
|
|
|
x
|
|
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
For the fiscal year ended December 31, 2018
|
||
Or
|
||
o
|
|
TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
For the transition period from to
|
Delaware
(State or Other Jurisdiction of Incorporation or
Organization)
|
|
47-3574483
(IRS Employer Identification No.)
|
Title of Each Class:
|
|
Name of Each Exchange on Which Registered:
|
Common stock, $0.01 par value
|
|
New York Stock Exchange
|
Large accelerated filer
o
|
|
Accelerated filer
x
|
|
Non-accelerated filer
o
|
|
Smaller reporting company
o
|
|
Emerging growth company
x
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Part IV
.
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|||
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|
▪
|
Towing:
This product category includes devices and accessories installed on a tow-vehicle for the purpose of attaching a trailer, camper, etc. such as hitches, fifth wheels, gooseneck hitches, weight distribution systems, wiring harnesses, draw bars, ball mounts, crossbars, tow bars, security and other towing accessories;
|
▪
|
Trailering:
This product category includes control devices and components of the trailer itself such as brake controls, jacks, winches, couplers, interior and exterior vehicle lighting and brake replacement parts;
|
▪
|
Cargo Management:
This product category includes a wide variety of products used to facilitate the transportation of various forms of cargo, to secure that cargo or to organize items. Examples of these products are bike racks, roof cross bar systems, cargo carriers, luggage boxes, car interior protective products, rope, tie-downs, tarps, tarp straps, bungee cords, loading ramps and interior travel organizers; and
|
▪
|
Other:
This product category includes a diverse range of items in our portfolio that do not fit into any of the previous three main categories. Items in this category include tubular push bars, side steps, sports bars, skid plates, and oil pans.
|
▪
|
Channel Consolidation
: In the more mature market of the United States, there has been increasing consolidation in distribution networks with larger, more sophisticated aftermarket distributors and retailers gaining market share. In kind, these distributors generally require larger, more sophisticated suppliers with product expertise, category management and supply chain services and capabilities, as well as a global manufacturing and services footprint. We provide customers in this category the opportunity to rationalize their supply base of vendors in our product lines by virtue of our broad offering and product expertise; and
|
▪
|
Growth of Online Capabilities
: Reaching consumers directly through online capabilities, including e-commerce, is having an increasing impact on the global automotive aftermarket and retail channels. Establishment of a robust online presence is critical for suppliers regardless of whether or not they participate directly in e-commerce. We believe we are positioned well to take advantage of this continuing trend, given our established online presence. We support consumers by offering a wide range of information on our products and services, including installation videos, custom-fit guides and links to authorized dealers and both brick and mortar and e-commerce merchants.
|
▪
|
Global Platform/Supplier Consolidation
: Automotive OEs are adopting global vehicle platforms to decrease product development costs and increase manufacturing efficiency and profitability. As a result, automotive OEs are selecting
|
▪
|
Outsourcing of Design and Manufacturing of Vehicle Parts and Systems
: Automotive OEs continually strive to simplify their assembly processes, lower costs and reduce development times. As a result, they have increasingly relied on suppliers to perform many of the design, engineering, research and development and assembly functions traditionally performed by automotive OEs. Suppliers with extensive design and engineering capabilities are in the best position to benefit from this trend as they are able to offer value-added solutions with superior features and convenience. We believe certain automotive OEs have sought us out to assist with their engineering challenges to increase towing capacity and for the many solutions provided by our existing products; and
|
▪
|
Shorter Product Development Cycles
: Due to frequent shifts in government regulations and customer preferences, OEs are requiring suppliers to continue to provide new designs and product innovations. These trends are prevalent in mature markets as well as, emerging markets, which are advancing rapidly towards the regulatory standards and consumer preferences of the more mature markets. Suppliers with strong technologies, robust engineering and development capabilities are best positioned to meet OE demands for rapid innovation. Our broad product offerings, product expertise, and global engineering footprint enables us to rapidly deploy solutions meeting the changing customer needs.
|
▪
|
Diverse Product Portfolio of Market Leading Brands
. We believe we benefit from a diverse portfolio of high-quality and highly-engineered products sold under globally recognized and market leading brand names. By offering a wide range of products, we are able to provide a complete solution to satisfy our customers’ towing, trailering and cargo management needs, as well as serve diverse channels through effective brand management. Our brands are well-known in their respective product areas and channels. We believe that we are the leading supplier of towing products and among the leading suppliers of trailering products globally.
|
▪
|
Global Scale with Flexible Manufacturing Footprint and Supply Chain
. We were built through internal growth and a series of acquisitions to become the only truly global automotive accessories company with the products we offer. We have the ability to produce low-volume, customized, quick-turn products in our global manufacturing facilities, while our sourcing arrangements with third-party suppliers provides us with the flexibility to manufacture or source high-volume products as end-market demand fluctuates. Our flexible manufacturing capability, low-cost manufacturing facilities and established supply chain allow us to quickly and efficiently respond to changes in end-market demand.
|
▪
|
Long-Term Relationships with a Diverse Customer Base
. Our customers encompass a broad range of OEs, mass merchants, e-commerce websites, distributors, dealers, and independent installers, representing multiple channels to reaching the end consumer. Blue chip customers include Ford Motor Company, FCA, Volkswagen, BMW, Mercedes-Benz, AutoZone, Amazon, Toyota, Canadian Tire, LKQ, U-Haul, Home Depot and Etrailer, among others. Our customer relationships are well established, with many exceeding 20 years. These strong partnerships can provide stability to our revenue base through economic cycles. We believe Horizon’s diverse product portfolio, global scale and flexible manufacturing capabilities enable us to provide a unique value proposition to customers.
|
▪
|
Globally Competitive Cost Structure.
Since becoming an independent public company, we have focused on margin improvement activities, identifying and acting on projects to reduce our cost structure. With focused, identifiable projects under way or complete, we believe we should benefit from improved operating margins and cash flow that can then be deployed to high-value creation activities. The combination of our strong brand names, leading market position, flexible manufacturing and sourcing operations have historically resulted in significant cash flow generation.
|
▪
|
Experienced Management Team
. Our management team is led by our Chief Executive Officer, Carl Bizon, who has over 23 years of experience, most recently as the President of Horizon Americas. Prior to the Spin-off, he led TriMas’s international business, including both Europe-Africa and Asia-Pacific, as well as previously serving as Chief Executive Officer of Jayco Corporation. Brian Whittman, a Managing Director with Alvarez & Marsal North Americas, LLC, serves as our interim Chief Financial Officer since joining Horizon in October 2018. He brings more than 20 years of financial,
|
▪
|
Margin Expansion.
Our first priority is to drive the organization to a
10%
operating margin level. We believe the investments made in our facilities and equipment over the past few years, along with our efforts to realign our operations, should provide the foundation for additional margin expansion. We are developing an organization in which all team members are focused on constantly improving the efficiency of all operations through the adoption of lean and continuous improvement practices.
|
▪
|
Capital Structure.
Our second priority is to improve our capital structure. Our goal is to gradually reduce leverage over time. We aim to accomplish this goal through both margin improvement as well as paying down our fixed obligations, and should we decide to do so, we have a structure in place that allows us to prepay debt in addition to the amortization required under our term debt.
|
▪
|
Operational Stabilization.
Our third priority is to stabilize existing operations after significant management changes and changes in distribution footprint in the Americas and in manufacturing footprint in Europe-Africa during the year. We aim to have our distribution centers and manufacturing facilities operating efficiently and effectively to meet peak demand during our traditional summer selling season in 2019.
|
▪
|
Organic Growth.
Our fourth priority is to grow the business
3% to 5%
on an organic basis, annually. We have identified five broad areas of focused growth activities, involving geographic markets and sales channels, which we believe are particularly aligned with our competitive strengths.
|
▪
|
Balanced Original Equipment and Aftermarket growth
. The global market for accessories and vehicle personalization is increasing across channels. Automotive manufacturers are looking for suppliers to partner with to create genuine accessories to meet this need. Historically, this has been undertaken as a regional effort, but the growth of global automotive OE has increased the need for global suppliers. Our geographic footprint, existing customer relationships and the increase in global vehicle platforms align to present us with unique opportunities to grow with our automotive OE customers. The Company is positioned to balance and leverage the OE growth with growth in the aftermarket as we have significant brand recognition and strategic distributor and customer relationships.
|
▪
|
E-commerce
. We intend to leverage the breadth of our product portfolio and global manufacturing footprint to expand our presence in the high growth e-commerce channel. This strategy is applicable in our developed markets where a focus on content delivery and customer support drive growth. It is also a powerful tool as we look at developing new, less mature markets around the world, enabling a direct connection with the users of our product set.
|
▪
|
Low Cost Countries
. We believe our manufacturing presence in Mexico, Romania and Thailand, provide opportunities for growth, while supporting both new and existing global customers in a cost-effective manner.
|
▪
|
Chinese Market.
China is in the early stages of adoption for towing and trailering products. As this adoption rate increases, there is an opportunity for us to bring our experience in the safe use of these products into the market in a meaningful capacity. The rapidly growing middle class, in concert with a developing interest in an outdoor recreational lifestyle, is expected to result in incremental demand for our automotive aftermarket products and accessories. We intend to leverage our existing relationships with global automotive OEs and our global manufacturing and distribution network to expand our sales as the economy continues to develop and expand.
|
▪
|
Product Innovation.
Our presence in the OE channel and multiple geographic markets allows us to leverage development costs and product innovation tied to new vehicles across our entire global footprint.
|
▪
|
require us to dedicate a substantial portion of our cash from operations to the payment of debt service, reducing the availability of our cash flow to fund working capital, capital expenditures, acquisition and other general corporate purposes;
|
▪
|
increase our vulnerability to adverse economic or industry conditions;
|
▪
|
limit our ability to obtain additional financing in the future to enable us to react to changes in our business; or
|
▪
|
place us at a competitive disadvantage compared to businesses in our industry that have less debt.
|
▪
|
incur additional indebtedness and guarantee indebtedness;
|
▪
|
pay dividends or make other distributions or repurchase or redeem capital stock;
|
▪
|
prepay, redeem or repurchase certain debt;
|
▪
|
issue certain preferred stock or similar equity securities;
|
▪
|
make loans and investments;
|
▪
|
sell assets;
|
▪
|
incur liens;
|
▪
|
enter into transactions with affiliates;
|
▪
|
alter the businesses we conduct;
|
▪
|
enter into agreements restricting our subsidiaries’ ability to pay dividends; and
|
▪
|
consolidate, merge or sell all or substantially all of our assets.
|
▪
|
limited in how we conduct our business;
|
▪
|
unable to raise additional debt or equity financing to operate during general economic or business downturns; and
|
▪
|
unable to compete effectively or to take advantage of new business opportunities.
|
▪
|
changes in local government regulations and policies including, but not limited to, governmental embargoes, repatriation of earnings, expropriation of property, duty or tariff restrictions, investment limitations and tax policies;
|
▪
|
changes in local economic conditions;
|
▪
|
political and economic instability and disruptions, including labor unrest, civil strife, acts of war, guerrilla activities, insurrection and terrorism;
|
▪
|
legislation that regulates the use of chemicals;
|
▪
|
disadvantages of competing against companies from countries that are not subject to U.S. laws and regulations, including the Foreign Corrupt Practices Act (“FCPA”);
|
▪
|
compliance with international trade laws and regulations, including export control and economic sanctions, such as anti-dumping duties;
|
▪
|
difficulties in staffing and managing multi-national operations;
|
▪
|
limitations on our ability to enforce legal rights and remedies;
|
▪
|
tax inefficiencies in repatriating cash flow from non-U.S. subsidiaries that could affect our financial results and reduce our ability to service debt;
|
▪
|
reduced protection of intellectual property rights;
|
▪
|
increasingly complex laws and regulations concerning privacy and data security, including the European Union’s General Data Protection Regulation; and
|
▪
|
other risks arising out of foreign sovereignty over the areas where our operations are conducted.
|
▪
|
exemption from the auditor attestation requirements under Section 404 of the Sarbanes-Oxley Act of 2002;
|
▪
|
reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements;
|
▪
|
exemption from the requirements of holding non-binding stockholder votes on executive compensation arrangements; and
|
▪
|
exemption from any rules requiring mandatory audit firm rotation and auditor discussion and analysis and, unless the SEC otherwise determines, any future audit rules that may be adopted by the Public Company Accounting Oversight Board.
|
Horizon Americas
|
|
Horizon Asia‑Pacific
|
|
Horizon Europe‑Africa
|
|
United States:
Indiana:
South Bend
Michigan:
Plymouth
Texas:
McAllen
Kansas:
Edgerton
International:
Brazil:
Itaquaquecetuba, São Paulo
Canada:
Mississauga, Ontario
Mexico:
Reynosa
|
|
International:
Australia:
Keysborough, Victoria
New Zealand:
Manukau City
Thailand:
Chon Buri
|
|
International:
Germany:
Hartha
Rheda-Wiedenbrück
France:
Luneray
Romania:
Braşov
South Africa:
Pretoria
Springs
United Kingdom:
Deeside
|
|
Period
|
|
Total Number of Shares Purchased
|
|
Average Price Paid per Share
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
|
|
Maximum Number of Shares that May Yet be Purchased Under the Plans or Programs
(a)
|
|||||
October 1 - 31, 2018
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
813,494
|
|
November 1 - 30, 2018
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
813,494
|
|
December 1 - 31, 2018
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
813,494
|
|
Total
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
|
|
|
Year ended December 31,
|
||||||||||||||||||
|
|
2018
(a)
|
|
2017
(a)
|
|
2016
(a)
|
|
2015
|
|
2014
|
||||||||||
|
|
(dollars in thousands, except per share data)
|
||||||||||||||||||
Statement of Income Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net sales
|
|
$
|
849,950
|
|
|
$
|
892,980
|
|
|
$
|
649,200
|
|
|
$
|
575,510
|
|
|
$
|
611,780
|
|
Gross profit
|
|
143,880
|
|
|
207,600
|
|
|
160,350
|
|
|
143,040
|
|
|
148,090
|
|
|||||
Operating profit (loss)
|
|
(170,390
|
)
|
|
34,760
|
|
|
6,300
|
|
|
19,570
|
|
|
24,460
|
|
|||||
Net income (loss)
|
|
(204,900
|
)
|
|
(4,770
|
)
|
|
(12,660
|
)
|
|
8,300
|
|
|
15,350
|
|
|||||
Net loss attributable to noncontrolling interest
|
|
(940
|
)
|
|
(1,220
|
)
|
|
(300
|
)
|
|
—
|
|
|
—
|
|
|||||
Net income (loss) attributable to Horizon Global
|
|
(203,960
|
)
|
|
(3,550
|
)
|
|
(12,360
|
)
|
|
8,300
|
|
|
15,350
|
|
|||||
Net income (loss) per share attributable to Horizon Global:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
$
|
(8.14
|
)
|
|
$
|
(0.14
|
)
|
|
$
|
(0.66
|
)
|
|
$
|
0.46
|
|
|
$
|
0.85
|
|
Diluted
|
|
$
|
(8.14
|
)
|
|
$
|
(0.14
|
)
|
|
$
|
(0.66
|
)
|
|
$
|
0.46
|
|
|
$
|
0.85
|
|
Weighted average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
25,053,013
|
|
|
24,781,349
|
|
|
18,775,500
|
|
|
18,064,491
|
|
|
18,062,027
|
|
|||||
Diluted
|
|
25,053,013
|
|
|
24,781,349
|
|
|
18,775,500
|
|
|
18,160,852
|
|
|
18,113,416
|
|
|
|
December 31,
|
||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
|
|
(dollars in thousands)
|
||||||||||||||||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total assets
|
|
$
|
521,350
|
|
|
$
|
661,030
|
|
|
$
|
613,370
|
|
|
$
|
331,580
|
|
|
$
|
339,500
|
|
Short-term borrowings and current maturities, long-term debt
|
|
13,860
|
|
|
16,710
|
|
|
22,900
|
|
|
10,130
|
|
|
460
|
|
|||||
Long-term debt
|
|
350,650
|
|
|
258,880
|
|
|
327,040
|
|
|
178,610
|
|
|
300
|
|
|
|
Year ended December 31,
|
|||||||||||||||||||
|
|
2018
|
|
As a Percentage of Net Sales
|
|
2017
|
|
As a Percentage of Net Sales
|
|
2016
|
|
As a Percentage of Net Sales
|
|||||||||
|
|
(dollars in thousands)
|
|||||||||||||||||||
Net Sales
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Horizon Americas
|
|
$
|
390,690
|
|
|
46.0
|
%
|
|
$
|
439,700
|
|
|
49.2
|
%
|
|
$
|
443,240
|
|
|
68.3
|
%
|
Horizon Europe‑Africa
|
|
323,260
|
|
|
38.0
|
%
|
|
325,970
|
|
|
36.5
|
%
|
|
104,080
|
|
|
16.0
|
%
|
|||
Horizon Asia‑Pacific
|
|
136,000
|
|
|
16.0
|
%
|
|
127,310
|
|
|
14.3
|
%
|
|
101,880
|
|
|
15.7
|
%
|
|||
Total
|
|
$
|
849,950
|
|
|
100.0
|
%
|
|
$
|
892,980
|
|
|
100.0
|
%
|
|
$
|
649,200
|
|
|
100.0
|
%
|
Gross Profit
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Horizon Americas
|
|
$
|
79,910
|
|
|
20.5
|
%
|
|
$
|
127,990
|
|
|
29.1
|
%
|
|
$
|
131,320
|
|
|
29.6
|
%
|
Horizon Europe‑Africa
|
|
29,550
|
|
|
9.1
|
%
|
|
46,760
|
|
|
14.3
|
%
|
|
6,560
|
|
|
6.3
|
%
|
|||
Horizon Asia‑Pacific
|
|
34,420
|
|
|
25.3
|
%
|
|
32,850
|
|
|
25.8
|
%
|
|
22,470
|
|
|
22.1
|
%
|
|||
Total
|
|
$
|
143,880
|
|
|
16.9
|
%
|
|
$
|
207,600
|
|
|
23.2
|
%
|
|
$
|
160,350
|
|
|
24.7
|
%
|
Selling, General and Administrative Expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Horizon Americas
|
|
$
|
86,380
|
|
|
22.1
|
%
|
|
$
|
83,680
|
|
|
19.0
|
%
|
|
$
|
86,470
|
|
|
19.5
|
%
|
Horizon Europe‑Africa
|
|
49,540
|
|
|
15.3
|
%
|
|
47,750
|
|
|
14.6
|
%
|
|
17,180
|
|
|
16.5
|
%
|
|||
Horizon Asia‑Pacific
|
|
14,230
|
|
|
10.5
|
%
|
|
13,940
|
|
|
10.9
|
%
|
|
11,210
|
|
|
11.0
|
%
|
|||
Corporate
|
|
35,210
|
|
|
N/A
|
|
|
26,250
|
|
|
N/A
|
|
|
30,290
|
|
|
N/A
|
|
|||
Total
|
|
$
|
185,360
|
|
|
21.8
|
%
|
|
$
|
171,620
|
|
|
19.2
|
%
|
|
$
|
145,150
|
|
|
22.4
|
%
|
Net Loss on Disposition of Property and Equipment
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Horizon Americas
|
|
$
|
340
|
|
|
0.1
|
%
|
|
$
|
(240
|
)
|
|
(0.1
|
)%
|
|
$
|
(230
|
)
|
|
(0.1
|
)%
|
Horizon Europe‑Africa
|
|
1,870
|
|
|
0.6
|
%
|
|
(800
|
)
|
|
(0.2
|
)%
|
|
(280
|
)
|
|
(0.3
|
)%
|
|||
Horizon Asia‑Pacific
|
|
(70
|
)
|
|
(0.1
|
)%
|
|
(170
|
)
|
|
(0.1
|
)%
|
|
(30
|
)
|
|
—
|
%
|
|||
Corporate
|
|
—
|
|
|
N/A
|
|
|
(10
|
)
|
|
N/A
|
|
|
—
|
|
|
N/A
|
|
|||
Total
|
|
$
|
2,140
|
|
|
0.3
|
%
|
|
$
|
(1,220
|
)
|
|
(0.1
|
)%
|
|
$
|
(540
|
)
|
|
(0.1
|
)%
|
Operating Profit (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Horizon Americas
|
|
$
|
(6,850
|
)
|
|
(1.8
|
)%
|
|
$
|
44,060
|
|
|
10.0
|
%
|
|
$
|
38,680
|
|
|
8.7
|
%
|
Horizon Europe‑Africa
|
|
(148,630
|
)
|
|
(46.0
|
)%
|
|
(1,790
|
)
|
|
(0.5
|
)%
|
|
(13,320
|
)
|
|
(12.8
|
)%
|
|||
Horizon Asia‑Pacific
|
|
20,250
|
|
|
14.9
|
%
|
|
18,740
|
|
|
14.7
|
%
|
|
11,230
|
|
|
11.0
|
%
|
|||
Corporate
|
|
(35,160
|
)
|
|
N/A
|
|
|
(26,250
|
)
|
|
N/A
|
|
|
(30,290
|
)
|
|
N/A
|
|
|||
Total
|
|
$
|
(170,390
|
)
|
|
(20.0
|
)%
|
|
$
|
34,760
|
|
|
3.9
|
%
|
|
$
|
6,300
|
|
|
1.0
|
%
|
Capital Expenditures
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Horizon Americas
|
|
$
|
6,760
|
|
|
1.7
|
%
|
|
$
|
10,150
|
|
|
2.3
|
%
|
|
$
|
5,550
|
|
|
1.3
|
%
|
Horizon Europe‑Africa
|
|
4,500
|
|
|
1.4
|
%
|
|
13,190
|
|
|
4.0
|
%
|
|
4,670
|
|
|
4.5
|
%
|
|||
Horizon Asia‑Pacific
|
|
2,610
|
|
|
1.9
|
%
|
|
2,440
|
|
|
1.9
|
%
|
|
3,310
|
|
|
3.2
|
%
|
|||
Corporate
|
|
—
|
|
|
N/A
|
|
|
1,510
|
|
|
N/A
|
|
|
1,010
|
|
|
N/A
|
|
|||
Total
|
|
$
|
13,870
|
|
|
1.6
|
%
|
|
$
|
27,290
|
|
|
3.1
|
%
|
|
$
|
14,540
|
|
|
2.2
|
%
|
Depreciation and Amortization
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Horizon Americas
|
|
$
|
8,160
|
|
|
2.1
|
%
|
|
$
|
10,660
|
|
|
2.4
|
%
|
|
$
|
10,750
|
|
|
2.4
|
%
|
Horizon Europe‑Africa
|
|
12,090
|
|
|
3.7
|
%
|
|
10,110
|
|
|
3.1
|
%
|
|
3,290
|
|
|
3.2
|
%
|
|||
Horizon Asia‑Pacific
|
|
4,800
|
|
|
3.5
|
%
|
|
4,310
|
|
|
3.4
|
%
|
|
4,090
|
|
|
4.0
|
%
|
|||
Corporate
|
|
330
|
|
|
N/A
|
|
|
260
|
|
|
N/A
|
|
|
90
|
|
|
N/A
|
|
|||
Total
|
|
$
|
25,380
|
|
|
3.0
|
%
|
|
$
|
25,340
|
|
|
2.8
|
%
|
|
$
|
18,220
|
|
|
2.8
|
%
|
|
|
Payments Due by Periods
|
||||||||||||||||||
|
|
Total
|
|
Less than
One Year
|
|
1 - 3 Years
|
|
3 - 5 Years
|
|
More than
5 Years
|
||||||||||
|
|
(dollars in thousands)
|
||||||||||||||||||
ABL Facility
|
|
$
|
61,570
|
|
|
$
|
—
|
|
|
$
|
61,570
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Term B Loan
|
|
190,520
|
|
|
10,410
|
|
|
180,110
|
|
|
—
|
|
|
—
|
|
|||||
Convertible Notes
|
|
125,000
|
|
|
—
|
|
|
—
|
|
|
125,000
|
|
|
—
|
|
|||||
Bank facilities
|
|
16,020
|
|
|
2,260
|
|
|
3,430
|
|
|
—
|
|
|
10,330
|
|
|||||
Operating and capital lease obligations
|
|
71,980
|
|
|
17,000
|
|
|
29,160
|
|
|
12,730
|
|
|
13,090
|
|
|||||
Interest obligations
|
|
46,480
|
|
|
17,690
|
|
|
26,770
|
|
|
2,020
|
|
|
—
|
|
|||||
Deferred purchase price
|
|
3,430
|
|
|
3,400
|
|
|
30
|
|
|
—
|
|
|
—
|
|
|||||
Total contractual obligations
|
|
$
|
515,000
|
|
|
$
|
50,760
|
|
|
$
|
301,070
|
|
|
$
|
139,750
|
|
|
$
|
23,420
|
|
▪
|
An emerging growth company is exempt from any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and financial statements, commonly known as an “auditor discussion and analysis.”
|
▪
|
An emerging growth company is not required to hold a nonbinding advisory stockholder vote on executive compensation or any golden parachute payments not previously approved by stockholders.
|
▪
|
An emerging growth company is not required to comply with the requirement of auditor attestation of management’s assessment of internal control over financial reporting, which is required for other public reporting companies by Section 404 of the Sarbanes-Oxley Act.
|
▪
|
An emerging growth company is eligible for reduced disclosure obligations regarding executive compensation in its periodic and annual reports, including without limitation exemption from the requirement to provide a compensation discussion and analysis describing compensation practices and procedures.
|
▪
|
A company that is an emerging growth company is eligible for reduced financial statement disclosure in registration statements, which must include two years of audited financial statements rather than the three years of audited financial statements that are required for other public reporting companies.
|
|
|
December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
Assets
|
|
|
|
|
||||
Current assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
27,650
|
|
|
$
|
29,570
|
|
Receivables, net of allowance for doubtful accounts of approximately $5.1 million and $3.1 million at December 31, 2018 and December 31, 2017, respectively
|
|
108,340
|
|
|
91,770
|
|
||
Inventories, net
|
|
173,690
|
|
|
171,500
|
|
||
Prepaid expenses and other current assets
|
|
9,690
|
|
|
10,950
|
|
||
Total current assets
|
|
319,370
|
|
|
303,790
|
|
||
Property and equipment, net
|
|
102,280
|
|
|
113,020
|
|
||
Goodwill
|
|
12,660
|
|
|
138,190
|
|
||
Other intangibles, net
|
|
78,050
|
|
|
90,230
|
|
||
Deferred income taxes
|
|
2,690
|
|
|
4,290
|
|
||
Other assets
|
|
6,300
|
|
|
11,510
|
|
||
Total assets
|
|
$
|
521,350
|
|
|
$
|
661,030
|
|
Liabilities and Shareholders' Equity
|
|
|
|
|
||||
Current liabilities:
|
|
|
|
|
||||
Short-term borrowings and current maturities, long-term debt
|
|
$
|
13,860
|
|
|
$
|
16,710
|
|
Accounts payable
|
|
123,130
|
|
|
138,730
|
|
||
Accrued liabilities
|
|
65,820
|
|
|
53,070
|
|
||
Total current liabilities
|
|
202,810
|
|
|
208,510
|
|
||
Long-term debt
|
|
350,650
|
|
|
258,880
|
|
||
Deferred income taxes
|
|
14,150
|
|
|
14,870
|
|
||
Other long-term liabilities
|
|
19,960
|
|
|
38,370
|
|
||
Total liabilities
|
|
587,570
|
|
|
520,630
|
|
||
Commitments and contingencies (See Notes 13 and 14)
|
|
|
|
|
|
|
||
Shareholders' equity (deficit):
|
|
|
|
|
||||
Preferred stock $0.01 par: Authorized 100,000,000 shares;
Issued and outstanding: None |
|
—
|
|
|
—
|
|
||
Common stock, $0.01 par: Authorized 400,000,000 shares;
25,866,747 shares issued and 25,180,241 outstanding at December 31, 2018, and 25,625,571 shares issued and 24,939,065 outstanding at December 31, 2017 |
|
250
|
|
|
250
|
|
||
Paid-in capital
|
|
160,990
|
|
|
159,830
|
|
||
Treasury stock, at cost: 686,506 shares at December 31, 2018 and December 31, 2017
|
|
(10,000
|
)
|
|
(10,000
|
)
|
||
Accumulated deficit
|
|
(222,720
|
)
|
|
(18,760
|
)
|
||
Accumulated other comprehensive income
|
|
7,760
|
|
|
10,570
|
|
||
Total Horizon Global shareholders' equity (deficit)
|
|
(63,720
|
)
|
|
141,890
|
|
||
Noncontrolling interest
|
|
(2,500
|
)
|
|
(1,490
|
)
|
||
Total shareholders' equity (deficit)
|
|
(66,220
|
)
|
|
140,400
|
|
||
Total liabilities and shareholders' equity
|
|
$
|
521,350
|
|
|
$
|
661,030
|
|
|
|
Year ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Net sales
|
|
$
|
849,950
|
|
|
$
|
892,980
|
|
|
$
|
649,200
|
|
Cost of sales
|
|
(706,070
|
)
|
|
(685,380
|
)
|
|
(488,850
|
)
|
|||
Gross profit
|
|
143,880
|
|
|
207,600
|
|
|
160,350
|
|
|||
Selling, general and administrative expenses
|
|
(185,360
|
)
|
|
(171,620
|
)
|
|
(145,150
|
)
|
|||
Net loss on dispositions of property and equipment
|
|
(2,140
|
)
|
|
(1,220
|
)
|
|
(540
|
)
|
|||
Impairment of goodwill and intangible assets
|
|
(126,770
|
)
|
|
—
|
|
|
(8,360
|
)
|
|||
Operating profit (loss)
|
|
(170,390
|
)
|
|
34,760
|
|
|
6,300
|
|
|||
Other expense, net:
|
|
|
|
|
|
|
||||||
Interest expense
|
|
(27,740
|
)
|
|
(22,410
|
)
|
|
(20,080
|
)
|
|||
Loss on extinguishment of debt
|
|
—
|
|
|
(4,640
|
)
|
|
—
|
|
|||
Other expense, net
|
|
(13,130
|
)
|
|
(2,730
|
)
|
|
(2,610
|
)
|
|||
Other expense, net
|
|
(40,870
|
)
|
|
(29,780
|
)
|
|
(22,690
|
)
|
|||
Income (loss) before income tax
|
|
(211,260
|
)
|
|
4,980
|
|
|
(16,390
|
)
|
|||
Income tax benefit (expense)
|
|
6,360
|
|
|
(9,750
|
)
|
|
3,730
|
|
|||
Net loss
|
|
(204,900
|
)
|
|
(4,770
|
)
|
|
(12,660
|
)
|
|||
Less: Net loss attributable to noncontrolling interest
|
|
(940
|
)
|
|
(1,220
|
)
|
|
(300
|
)
|
|||
Net loss attributable to Horizon Global
|
|
$
|
(203,960
|
)
|
|
$
|
(3,550
|
)
|
|
$
|
(12,360
|
)
|
Net loss per share attributable to Horizon Global:
|
|
|
|
|
|
|
||||||
Basic
|
|
$
|
(8.14
|
)
|
|
$
|
(0.14
|
)
|
|
$
|
(0.66
|
)
|
Diluted
|
|
$
|
(8.14
|
)
|
|
$
|
(0.14
|
)
|
|
$
|
(0.66
|
)
|
Weighted average common shares outstanding:
|
|
|
|
|
|
|
||||||
Basic
|
|
25,053,013
|
|
|
24,781,349
|
|
|
18,775,500
|
|
|||
Diluted
|
|
25,053,013
|
|
|
24,781,349
|
|
|
18,775,500
|
|
|
|
Year ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Net loss
|
|
$
|
(204,900
|
)
|
|
$
|
(4,770
|
)
|
|
$
|
(12,660
|
)
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
||||||
Foreign currency translation and other
|
|
(5,150
|
)
|
|
17,840
|
|
|
(10,590
|
)
|
|||
Derivative instruments
|
|
2,270
|
|
|
540
|
|
|
(220
|
)
|
|||
Total other comprehensive income (loss), net of tax
|
|
(2,880
|
)
|
|
18,380
|
|
|
(10,810
|
)
|
|||
Total comprehensive income (loss)
|
|
(207,780
|
)
|
|
13,610
|
|
|
(23,470
|
)
|
|||
Less: Comprehensive loss attributable to noncontrolling interest
|
|
(1,010
|
)
|
|
(1,190
|
)
|
|
(300
|
)
|
|||
Comprehensive income (loss) attributable to Horizon Global
|
|
$
|
(206,770
|
)
|
|
$
|
14,800
|
|
|
$
|
(23,170
|
)
|
|
|
Year ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Cash Flows from Operating Activities:
|
|
|
|
|
|
|
||||||
Net loss
|
|
$
|
(204,900
|
)
|
|
$
|
(4,770
|
)
|
|
$
|
(12,660
|
)
|
Adjustments to reconcile net loss to net cash provided by operating activities, net of acquisition impact:
|
|
|
|
|
|
|
||||||
Net loss on dispositions of property and equipment
|
|
2,140
|
|
|
1,220
|
|
|
540
|
|
|||
Impairment of goodwill and intangible assets
|
|
126,770
|
|
|
—
|
|
|
8,360
|
|
|||
Depreciation
|
|
16,440
|
|
|
14,930
|
|
|
10,260
|
|
|||
Amortization of intangible assets
|
|
8,940
|
|
|
10,410
|
|
|
7,960
|
|
|||
Amortization of original issuance discount and debt issuance costs
|
|
8,330
|
|
|
6,940
|
|
|
2,090
|
|
|||
Deferred income taxes
|
|
1,360
|
|
|
(100
|
)
|
|
(8,430
|
)
|
|||
Non-cash compensation expense
|
|
1,550
|
|
|
3,630
|
|
|
3,860
|
|
|||
Loss on extinguishment of debt
|
|
—
|
|
|
4,640
|
|
|
—
|
|
|||
Amortization of purchase accounting inventory step-up
|
|
—
|
|
|
420
|
|
|
6,680
|
|
|||
(Increase) decrease in receivables
|
|
(21,890
|
)
|
|
(9,540
|
)
|
|
4,740
|
|
|||
(Increase) decrease in inventories
|
|
(7,530
|
)
|
|
(17,710
|
)
|
|
10,650
|
|
|||
(Increase) decrease in prepaid expenses and other assets
|
|
6,940
|
|
|
1,410
|
|
|
(6,300
|
)
|
|||
Increase (decrease) in accounts payable and accrued liabilities
|
|
(6,770
|
)
|
|
3,540
|
|
|
6,300
|
|
|||
Other, net
|
|
(1,880
|
)
|
|
(860
|
)
|
|
1,360
|
|
|||
Net cash (used for) provided by operating activities
|
|
(70,500
|
)
|
|
14,160
|
|
|
35,410
|
|
|||
Cash Flows from Investing Activities:
|
|
|
|
|
|
|
||||||
Capital expenditures
|
|
(13,870
|
)
|
|
(27,290
|
)
|
|
(14,540
|
)
|
|||
Acquisition of businesses, net of cash acquired
|
|
—
|
|
|
(19,800
|
)
|
|
(94,370
|
)
|
|||
Net proceeds from disposition of product line, property and equipment
|
|
200
|
|
|
6,350
|
|
|
470
|
|
|||
Net cash used for investing activities
|
|
(13,670
|
)
|
|
(40,740
|
)
|
|
(108,440
|
)
|
|||
Cash Flows from Financing Activities:
|
|
|
|
|
|
|
||||||
Proceeds from borrowing on credit facilities
|
|
23,380
|
|
|
52,310
|
|
|
41,820
|
|
|||
Repayments of borrowings on credit facilities
|
|
(28,520
|
)
|
|
(50,910
|
)
|
|
(40,200
|
)
|
|||
Proceeds from Term B Loan, net of issuance costs
|
|
45,430
|
|
|
—
|
|
|
148,180
|
|
|||
Repayments of borrowings on Term B Loan, including transaction fees
|
|
(9,090
|
)
|
|
(189,760
|
)
|
|
(10,000
|
)
|
|||
Proceeds from ABL Facility, net of issuance costs
|
|
87,930
|
|
|
139,100
|
|
|
118,430
|
|
|||
Repayments of borrowings on ABL Facility
|
|
(36,380
|
)
|
|
(129,100
|
)
|
|
(118,430
|
)
|
|||
Repayments of Westfalia Group debt
|
|
—
|
|
|
—
|
|
|
(39,000
|
)
|
|||
Repurchase of common stock
|
|
—
|
|
|
(10,000
|
)
|
|
—
|
|
|||
Proceeds from sale of common stock in connection with the Company's equity offering, net of issuance costs
|
|
—
|
|
|
79,920
|
|
|
—
|
|
|||
Proceeds from issuance of Convertible Notes, net of issuance costs
|
|
—
|
|
|
121,130
|
|
|
—
|
|
|||
Proceeds from issuance of Warrants, net of issuance costs
|
|
—
|
|
|
20,930
|
|
|
—
|
|
|||
Payments on Convertible Note Hedges, inclusive of issuance costs
|
|
—
|
|
|
(29,680
|
)
|
|
—
|
|
|||
Other, net
|
|
(390
|
)
|
|
(240
|
)
|
|
(300
|
)
|
|||
Net cash provided by financing activities
|
|
82,360
|
|
|
3,700
|
|
|
100,500
|
|
|||
Effect of exchange rate changes on cash
|
|
(110
|
)
|
|
2,210
|
|
|
(750
|
)
|
|||
Cash and Cash Equivalents:
|
|
|
|
|
|
|
||||||
Increase (decrease) for the year
|
|
(1,920
|
)
|
|
(20,670
|
)
|
|
26,720
|
|
|||
At beginning of year
|
|
29,570
|
|
|
50,240
|
|
|
23,520
|
|
|||
At end of year
|
|
$
|
27,650
|
|
|
$
|
29,570
|
|
|
$
|
50,240
|
|
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
|
||||||
Cash paid for interest
|
|
$
|
18,630
|
|
|
$
|
14,270
|
|
|
$
|
17,330
|
|
Cash paid for taxes
|
|
$
|
5,780
|
|
|
$
|
7,740
|
|
|
$
|
4,760
|
|
Non-cash investing/financing activities:
|
|
|
|
|
|
|
||||||
Non-cash equity issuance for acquisition of businesses
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
49,960
|
|
|
|
Common Stock
|
|
Paid-in Capital
|
|
Treasury Stock
|
|
Accumulated Deficit
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Total Horizon Global Shareholders' Equity
|
|
Noncontrolling Interest
|
|
Total Shareholders' Equity
|
||||||||||||||||
Balances at January 1, 2016
|
|
$
|
180
|
|
|
$
|
1,260
|
|
|
$
|
—
|
|
|
$
|
(1,910
|
)
|
|
$
|
2,470
|
|
|
$
|
2,000
|
|
|
$
|
—
|
|
|
$
|
2,000
|
|
Net loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(12,360
|
)
|
|
—
|
|
|
(12,360
|
)
|
|
(300
|
)
|
|
(12,660
|
)
|
||||||||
Other comprehensive loss, net of tax
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,810
|
)
|
|
(10,810
|
)
|
|
—
|
|
|
(10,810
|
)
|
||||||||
Issuance of common stock
|
|
30
|
|
|
49,930
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
49,960
|
|
|
—
|
|
|
49,960
|
|
||||||||
Shares surrendered upon vesting of employees' share based payment awards to cover tax obligations
|
|
—
|
|
|
(330
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(330
|
)
|
|
—
|
|
|
(330
|
)
|
||||||||
Exercise of stock options
|
|
—
|
|
|
40
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
40
|
|
|
—
|
|
|
40
|
|
||||||||
Non-cash compensation expense
|
|
—
|
|
|
3,860
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,860
|
|
|
—
|
|
|
3,860
|
|
||||||||
Impact of adoption of new accounting guidance related to stock-based compensation
|
|
—
|
|
|
40
|
|
|
—
|
|
|
(40
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Balances at December 31, 2016
|
|
$
|
210
|
|
|
$
|
54,800
|
|
|
$
|
—
|
|
|
$
|
(14,310
|
)
|
|
$
|
(8,340
|
)
|
|
$
|
32,360
|
|
|
$
|
(300
|
)
|
|
$
|
32,060
|
|
Net loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,550
|
)
|
|
—
|
|
|
(3,550
|
)
|
|
(1,220
|
)
|
|
(4,770
|
)
|
||||||||
Other comprehensive income, net of tax
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18,350
|
|
|
18,350
|
|
|
30
|
|
|
18,380
|
|
||||||||
Issuance of common stock
|
|
40
|
|
|
79,880
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
79,920
|
|
|
—
|
|
|
79,920
|
|
||||||||
Repurchase of common stock
|
|
—
|
|
|
—
|
|
|
(10,000
|
)
|
|
—
|
|
|
—
|
|
|
(10,000
|
)
|
|
—
|
|
|
(10,000
|
)
|
||||||||
Shares surrendered upon vesting of employees' share based payment awards to cover tax obligations
|
|
—
|
|
|
(260
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(260
|
)
|
|
—
|
|
|
(260
|
)
|
||||||||
Exercise of stock options
|
|
—
|
|
|
50
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
50
|
|
|
—
|
|
|
50
|
|
||||||||
Non-cash compensation expense
|
|
—
|
|
|
3,630
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,630
|
|
|
—
|
|
|
3,630
|
|
||||||||
Issuance of Warrants, net of issuance costs
|
|
—
|
|
|
20,930
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20,930
|
|
|
—
|
|
|
20,930
|
|
||||||||
Initial equity component of the 2.75% Convertible Senior Notes due 2022, net of issuance costs and tax
|
|
—
|
|
|
20,010
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20,010
|
|
|
—
|
|
|
20,010
|
|
||||||||
Convertible Note Hedges, net of issuance costs and tax
|
|
—
|
|
|
(19,550
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(19,550
|
)
|
|
—
|
|
|
(19,550
|
)
|
||||||||
Balances at December 31, 2017, as reported
|
|
$
|
250
|
|
|
$
|
159,490
|
|
|
$
|
(10,000
|
)
|
|
$
|
(17,860
|
)
|
|
$
|
10,010
|
|
|
$
|
141,890
|
|
|
$
|
(1,490
|
)
|
|
$
|
140,400
|
|
Impact of ASU 2018-02
|
|
—
|
|
|
340
|
|
|
—
|
|
|
(900
|
)
|
|
560
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Balances at December 31, 2017, as restated
|
|
$
|
250
|
|
|
$
|
159,830
|
|
|
$
|
(10,000
|
)
|
|
$
|
(18,760
|
)
|
|
$
|
10,570
|
|
|
$
|
141,890
|
|
|
$
|
(1,490
|
)
|
|
$
|
140,400
|
|
Net loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(203,960
|
)
|
|
—
|
|
|
(203,960
|
)
|
|
(940
|
)
|
|
(204,900
|
)
|
||||||||
Other comprehensive loss, net of tax
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,810
|
)
|
|
(2,810
|
)
|
|
(70
|
)
|
|
(2,880
|
)
|
||||||||
Shares surrendered upon vesting of employees' share based payment awards to cover tax obligations
|
|
—
|
|
|
(390
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(390
|
)
|
|
—
|
|
|
(390
|
)
|
||||||||
Non-cash compensation expense
|
|
—
|
|
|
1,550
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,550
|
|
|
—
|
|
|
1,550
|
|
||||||||
Balances at December 31, 2018
|
|
$
|
250
|
|
|
$
|
160,990
|
|
|
$
|
(10,000
|
)
|
|
$
|
(222,720
|
)
|
|
$
|
7,760
|
|
|
$
|
(63,720
|
)
|
|
$
|
(2,500
|
)
|
|
$
|
(66,220
|
)
|
Fixed Asset Category
|
Estimated Useful Life
|
Building and Land/building improvements
|
10 - 40 years
|
Machinery and Equipment
|
3 - 15 years
|
▪
|
Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date;
|
▪
|
Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly; and
|
▪
|
Level 3 inputs are unobservable inputs for the asset or liability.
|
|
|
Horizon Americas
|
|
Horizon
Europe-Africa |
|
Horizon
Asia-Pacific |
|
Total
|
||||||||
|
|
(dollars in thousands)
|
||||||||||||||
Net Sales
|
|
|
|
|
|
|
|
|
||||||||
Automotive OEM
|
|
$
|
80,300
|
|
|
$
|
174,040
|
|
|
$
|
23,810
|
|
|
$
|
278,150
|
|
Automotive OES
|
|
5,610
|
|
|
50,890
|
|
|
60,620
|
|
|
117,120
|
|
||||
Aftermarket
|
|
114,450
|
|
|
77,190
|
|
|
25,070
|
|
|
216,710
|
|
||||
Retail
|
|
115,920
|
|
|
—
|
|
|
11,460
|
|
|
127,380
|
|
||||
Industrial
|
|
38,810
|
|
|
—
|
|
|
15,040
|
|
|
53,850
|
|
||||
E-commerce
|
|
34,220
|
|
|
4,570
|
|
|
—
|
|
|
38,790
|
|
||||
Other
|
|
1,380
|
|
|
16,570
|
|
|
—
|
|
|
17,950
|
|
||||
Total
|
|
$
|
390,690
|
|
|
$
|
323,260
|
|
|
$
|
136,000
|
|
|
$
|
849,950
|
|
|
|
Acquisition Date
|
||
|
|
(dollars in thousands)
|
||
Consideration
|
|
|
||
Cash paid
|
|
$
|
19,570
|
|
Recognized amounts of identifiable assets acquired and liabilities assumed
|
|
|
||
Receivables
|
|
2,100
|
|
|
Inventories
|
|
2,340
|
|
|
Other intangibles
|
|
7,690
|
|
|
Prepaid expenses and other current assets
|
|
110
|
|
|
Property and equipment
|
|
2,250
|
|
|
Accounts payable and accrued liabilities
|
|
(1,680
|
)
|
|
Deferred income taxes
|
|
(2,150
|
)
|
|
Total identifiable net assets
|
|
10,660
|
|
|
Goodwill
|
|
8,910
|
|
|
|
|
$
|
19,570
|
|
|
|
Horizon Americas
|
|
Horizon Europe‑Africa
|
|
Horizon Asia‑Pacific
|
|
Total
|
||||||||
|
(dollars in thousands)
|
|||||||||||||||
Balances at December 31, 2016
|
|
$
|
5,370
|
|
|
$
|
114,820
|
|
|
$
|
—
|
|
|
$
|
120,190
|
|
Goodwill from acquisitions
(a)
|
|
—
|
|
|
—
|
|
|
6,990
|
|
|
6,990
|
|
||||
Foreign currency translation
|
|
(90
|
)
|
|
11,340
|
|
|
(240
|
)
|
|
11,010
|
|
||||
Balances at December 31, 2017
|
|
5,280
|
|
|
126,160
|
|
|
6,750
|
|
|
138,190
|
|
||||
Impairment
|
|
—
|
|
|
(124,660
|
)
|
|
—
|
|
|
(124,660
|
)
|
||||
Foreign currency translation and other
|
|
(780
|
)
|
|
(1,500
|
)
|
|
1,410
|
|
|
(870
|
)
|
||||
Balances at December 31, 2018
|
|
$
|
4,500
|
|
|
$
|
—
|
|
|
$
|
8,160
|
|
|
$
|
12,660
|
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||||||||
Intangible Category by Useful Life
|
|
Gross Carrying
Amount
|
|
Accumulated
Amortization
|
|
Gross Carrying
Amount
|
|
Accumulated
Amortization
|
||||||||
|
|
(dollars in thousands)
|
||||||||||||||
Finite-lived intangible assets:
|
|
|
|
|
|
|
|
|
||||||||
Customer relationships, 5 - 20 years
|
|
$
|
177,910
|
|
|
$
|
(127,740
|
)
|
|
$
|
180,850
|
|
|
$
|
(121,750
|
)
|
Technology and other, 3 - 15 years
|
|
21,000
|
|
|
(15,910
|
)
|
|
19,950
|
|
|
(15,260
|
)
|
||||
Trademark/Trade names, 1 - 8 years
|
|
730
|
|
|
(250
|
)
|
|
730
|
|
|
(190
|
)
|
||||
Total finite-lived intangible assets
|
|
199,640
|
|
|
(143,900
|
)
|
|
201,530
|
|
|
(137,200
|
)
|
||||
Trademark/Trade names, indefinite-lived
|
|
22,310
|
|
|
—
|
|
|
25,900
|
|
|
—
|
|
||||
Total other intangible assets
|
|
$
|
221,950
|
|
|
$
|
(143,900
|
)
|
|
$
|
227,430
|
|
|
$
|
(137,200
|
)
|
|
|
Year ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(dollars in thousands)
|
||||||||||
Technology and other, included in cost of sales
|
|
$
|
1,840
|
|
|
$
|
710
|
|
|
$
|
170
|
|
Customer relationships & Trademark/Trade names, included in selling, general and administrative expenses
|
|
7,100
|
|
|
9,700
|
|
|
7,790
|
|
|||
Total amortization expense
|
|
$
|
8,940
|
|
|
$
|
10,410
|
|
|
$
|
7,960
|
|
Year ended December 31,
|
|
Estimated Amortization Expense
|
||
|
|
(dollars in thousands)
|
||
2019
|
|
$
|
8,150
|
|
2020
|
|
7,890
|
|
|
2021
|
|
6,160
|
|
|
2022
|
|
5,540
|
|
|
2023
|
|
4,970
|
|
|
|
December 31,
2018 |
|
December 31,
2017 |
||||
|
|
(dollars in thousands)
|
||||||
Finished goods
|
|
$
|
112,620
|
|
|
$
|
113,740
|
|
Work in process
|
|
21,470
|
|
|
17,960
|
|
||
Raw materials
|
|
55,640
|
|
|
53,950
|
|
||
Total inventories
|
|
$
|
189,730
|
|
|
$
|
185,650
|
|
Reserves
|
|
(16,040
|
)
|
|
(14,150
|
)
|
||
Inventories, net
|
|
$
|
173,690
|
|
|
$
|
171,500
|
|
|
|
December 31,
2018 |
|
December 31,
2017 |
||||
|
|
(dollars in thousands)
|
||||||
Land and land improvements
|
|
$
|
460
|
|
|
$
|
480
|
|
Buildings
|
|
21,440
|
|
|
23,370
|
|
||
Machinery and equipment
|
|
161,750
|
|
|
162,830
|
|
||
|
|
183,650
|
|
|
186,680
|
|
||
Less: Accumulated depreciation
|
|
81,370
|
|
|
73,660
|
|
||
Property and equipment, net
|
|
$
|
102,280
|
|
|
$
|
113,020
|
|
|
|
Year ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(dollars in thousands)
|
||||||||||
Depreciation expense, included in cost of sales
|
|
$
|
15,110
|
|
|
$
|
13,730
|
|
|
$
|
8,800
|
|
Depreciation expense, included in selling, general and administrative expense
|
|
1,330
|
|
|
1,200
|
|
|
1,460
|
|
|||
Total depreciation expense
|
|
$
|
16,440
|
|
|
$
|
14,930
|
|
|
$
|
10,260
|
|
|
|
December 31,
2018 |
|
December 31,
2017 |
||||
|
|
(dollars in thousands)
|
||||||
Customer claims
|
|
14,160
|
|
|
2,170
|
|
||
Accrued compensation
|
|
10,230
|
|
|
10,360
|
|
||
Customer incentives
|
|
10,100
|
|
|
8,800
|
|
||
Restructuring
|
|
7,530
|
|
|
3,940
|
|
||
Accrued professional services
|
|
4,770
|
|
|
4,140
|
|
||
Deferred purchase price
|
|
3,400
|
|
|
1,930
|
|
||
Short-term tax liabilities
|
|
1,930
|
|
|
7,700
|
|
||
Cross currency swap
|
|
1,610
|
|
|
—
|
|
||
Other
|
|
12,090
|
|
|
14,030
|
|
||
Total accrued liabilities
|
|
$
|
65,820
|
|
|
$
|
53,070
|
|
|
|
December 31,
2018 |
|
December 31,
2017 |
||||
|
|
(dollars in thousands)
|
||||||
Long-term tax liabilities
|
|
$
|
6,270
|
|
|
$
|
13,750
|
|
Restructuring
|
|
2,580
|
|
|
3,100
|
|
||
Deferred purchase price
|
|
30
|
|
|
3,350
|
|
||
Cross currency swap
|
|
—
|
|
|
7,830
|
|
||
Other
|
|
11,080
|
|
|
10,340
|
|
||
Total other long-term liabilities
|
|
$
|
19,960
|
|
|
$
|
38,370
|
|
|
|
December 31,
2018 |
|
December 31,
2017 |
||||
|
|
(dollars in thousands)
|
||||||
ABL Facility
|
|
$
|
61,570
|
|
|
$
|
10,000
|
|
Term B Loan
|
|
190,520
|
|
|
149,620
|
|
||
Convertible Notes
|
|
125,000
|
|
|
125,000
|
|
||
Bank facilities, capital leases and other long-term debt
|
|
18,990
|
|
|
25,780
|
|
||
|
|
396,080
|
|
|
310,400
|
|
||
Less:
|
|
|
|
|
||||
Unamortized debt issuance costs and original issuance discount on Term B Loan
|
|
7,380
|
|
|
4,940
|
|
||
Unamortized debt issuance costs and discount on the Convertible Notes
|
|
24,190
|
|
|
29,870
|
|
||
Current maturities, long-term debt
|
|
13,860
|
|
|
16,710
|
|
||
Long-term debt
|
|
$
|
350,650
|
|
|
$
|
258,880
|
|
|
|
Year ended December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
|
|
(dollars in thousands)
|
||||||
Contractual interest coupon on convertible debt
|
|
$
|
3,490
|
|
|
$
|
3,190
|
|
Amortization of debt issuance costs
|
|
$
|
530
|
|
|
$
|
490
|
|
Amortization of "equity discount" related to debt
|
|
$
|
5,150
|
|
|
$
|
4,380
|
|
Years ending December 31,
|
|
Future maturities of long-term debt
|
||
|
|
(dollars in thousands)
|
||
2019
|
|
$
|
13,860
|
|
2020
|
|
76,890
|
|
|
2021
|
|
170,000
|
|
|
2022
|
|
125,000
|
|
|
2023
|
|
—
|
|
|
Thereafter
|
|
10,330
|
|
|
Total
|
|
$
|
396,080
|
|
|
|
|
|
Asset / (Liability) Derivatives
|
||||||
|
|
Balance Sheet Caption
|
|
December 31, 2018
|
|
December 31, 2017
|
||||
|
|
|
|
(dollars in thousands)
|
||||||
Derivatives designated as hedging instruments
|
|
|
|
|
|
|
||||
Foreign currency forward contracts
|
|
Prepaid expenses and other current assets
|
|
$
|
1,910
|
|
|
$
|
—
|
|
Foreign currency forward contracts
|
|
Accrued liabilities
|
|
—
|
|
|
(670
|
)
|
||
Cross currency swap
|
|
Accrued Liabilities
|
|
(2,480
|
)
|
|
—
|
|
||
Cross currency swap
|
|
Other long-term liabilities
|
|
—
|
|
|
(7,830
|
)
|
||
Total derivatives designated as hedging instruments
|
|
|
|
(570
|
)
|
|
(8,500
|
)
|
||
Derivatives not designated as hedging instruments
|
|
|
|
|
|
|
||||
Foreign currency forward contracts
|
|
Prepaid expenses and other current assets
|
|
290
|
|
|
110
|
|
||
Foreign currency forward contracts
|
|
Accrued liabilities
|
|
—
|
|
|
(90
|
)
|
||
Cross currency swap
|
|
Other assets
|
|
—
|
|
|
90
|
|
||
Cross currency swap
|
|
Accrued liabilities
|
|
(90
|
)
|
|
—
|
|
||
Total derivatives de-designated as hedging instruments
|
|
|
|
200
|
|
|
110
|
|
||
Total derivatives
|
|
|
|
$
|
(370
|
)
|
|
$
|
(8,390
|
)
|
|
|
Frequency
|
|
Asset / (Liability)
|
|
Quoted Prices in Active Markets for Identical Assets
(Level 1) |
|
Significant Other Observable Inputs
(Level 2) |
|
Significant Unobservable Inputs
(Level 3) |
||||||||
|
|
|
|
(dollars in thousands)
|
||||||||||||||
December 31, 2018
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency forward contracts
|
|
Recurring
|
|
$
|
2,200
|
|
|
$
|
—
|
|
|
$
|
2,200
|
|
|
$
|
—
|
|
Cross currency swaps
|
|
Recurring
|
|
$
|
(2,570
|
)
|
|
$
|
—
|
|
|
$
|
(2,570
|
)
|
|
$
|
—
|
|
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency forward contracts
|
|
Recurring
|
|
$
|
(650
|
)
|
|
$
|
—
|
|
|
$
|
(650
|
)
|
|
$
|
—
|
|
Cross currency swap
|
|
Recurring
|
|
$
|
(7,740
|
)
|
|
$
|
—
|
|
|
$
|
(7,740
|
)
|
|
$
|
—
|
|
|
|
Employee Costs
|
|
Facility Closure and Other Costs
|
|
Total
|
||||||
|
|
(dollars in thousands)
|
||||||||||
Balances at December 31, 2017
|
|
1,850
|
|
|
5,190
|
|
|
7,040
|
|
|||
Restructuring charges
|
|
10,440
|
|
|
2,680
|
|
|
13,120
|
|
|||
Payments and other
(1)
|
|
(7,300
|
)
|
|
(2,750
|
)
|
|
(10,050
|
)
|
|||
Balances at December 31, 2018
|
|
$
|
4,990
|
|
|
$
|
5,120
|
|
|
$
|
10,110
|
|
December 31,
|
|
Minimum payments
|
||
|
|
(dollars in thousands)
|
||
2019
|
|
$
|
15,820
|
|
2020
|
|
14,790
|
|
|
2021
|
|
12,590
|
|
|
2022
|
|
7,900
|
|
|
2023
|
|
4,830
|
|
|
Thereafter
|
|
13,090
|
|
|
Total
|
|
$
|
69,020
|
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(dollars in thousands, except for per share amounts)
|
||||||||||
Numerator:
|
|
|
|
|
|
|
||||||
Net loss attributable to Horizon Global
|
|
$
|
(203,960
|
)
|
|
$
|
(3,550
|
)
|
|
$
|
(12,360
|
)
|
Denominator:
|
|
|
|
|
|
|
||||||
Weighted average shares outstanding, basic
|
|
25,053,013
|
|
|
24,781,349
|
|
|
18,775,500
|
|
|||
Dilutive effect of stock-based awards
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Weighted average shares outstanding, diluted
|
|
25,053,013
|
|
|
24,781,349
|
|
|
18,775,500
|
|
|||
|
|
|
|
|
|
|
||||||
Basic loss per share attributable to Horizon Global
|
|
$
|
(8.14
|
)
|
|
$
|
(0.14
|
)
|
|
$
|
(0.66
|
)
|
Diluted loss per share attributable to Horizon Global
|
|
$
|
(8.14
|
)
|
|
$
|
(0.14
|
)
|
|
$
|
(0.66
|
)
|
|
|
Year Ended December 31,
|
|||||||
|
|
2018
|
|
2017
|
|
2016
|
|||
Number of options
|
|
240,647
|
|
|
343,782
|
|
|
331,485
|
|
Exercise price of options
|
|
$9.20 - $11.29
|
|
|
$9.20 - $11.29
|
|
|
$9.20 - $11.29
|
|
Restricted stock units
|
|
646,336
|
|
|
584,335
|
|
|
526,751
|
|
Convertible Notes
|
|
5,005,000
|
|
|
4,566,205
|
|
|
—
|
|
Warrants
|
|
5,005,000
|
|
|
4,566,205
|
|
|
—
|
|
|
|
Number of Stock Options
|
|
Weighted Average Exercise Price
|
|
Average Remaining Contractual Life (Years)
|
|
Aggregate Intrinsic Value
|
||||||
Outstanding at December 31, 2017
|
|
338,349
|
|
|
$
|
10.38
|
|
|
—
|
|
|
—
|
|
|
Granted
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Exercised
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Canceled, forfeited
|
|
(245,382
|
)
|
|
10.37
|
|
|
—
|
|
|
—
|
|
||
Expired
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Outstanding at December 31, 2018
|
|
92,967
|
|
|
$
|
10.40
|
|
|
4.6
|
|
|
$
|
—
|
|
|
|
Number of Restricted Shares
|
|
Weighted Average Grant Date Fair Value
|
|||
Outstanding at December 31, 2017
|
|
582,611
|
|
|
$
|
13.51
|
|
Granted
|
|
477,963
|
|
|
7.43
|
|
|
Vested
|
|
(331,456
|
)
|
|
11.67
|
|
|
Canceled, forfeited
|
|
(309,190
|
)
|
|
11.12
|
|
|
Outstanding at December 31, 2018
|
|
419,928
|
|
|
$
|
9.75
|
|
|
|
Derivative Instruments
|
|
Foreign Currency Translation and Other
|
|
Total
|
||||||
|
(dollars in thousands)
|
|||||||||||
Balances at January 1, 2016
|
|
$
|
(710
|
)
|
|
$
|
3,180
|
|
|
$
|
2,470
|
|
Net unrealized losses arising during the period
(a)
|
|
3,170
|
|
|
(10,590
|
)
|
|
(7,420
|
)
|
|||
Less: Net realized losses reclassified to net income
(b)
|
|
3,390
|
|
|
—
|
|
|
3,390
|
|
|||
Net current-period change
|
|
(220
|
)
|
|
(10,590
|
)
|
|
(10,810
|
)
|
|||
Balances at December 31, 2016
|
|
(930
|
)
|
|
(7,410
|
)
|
|
(8,340
|
)
|
|||
Net unrealized gains (losses) arising during the period
(a)
|
|
(8,810
|
)
|
|
17,810
|
|
|
9,000
|
|
|||
Less: Net realized gains reclassified to net income
(b)
|
|
(9,350
|
)
|
|
—
|
|
|
(9,350
|
)
|
|||
Net current-period change
|
|
540
|
|
|
17,810
|
|
|
18,350
|
|
|||
Balances at December 31, 2017
|
|
(390
|
)
|
|
10,400
|
|
|
10,010
|
|
|||
Impact of ASU 2018-02
|
|
80
|
|
|
480
|
|
|
560
|
|
|||
Balances at December 31, 2017, as restated
|
|
(310
|
)
|
|
10,880
|
|
|
10,570
|
|
|||
Net unrealized gains (losses) arising during the period
(a)
|
|
7,440
|
|
|
(5,080
|
)
|
|
2,360
|
|
|||
Less: Net realized losses reclassified to net income
(b)
|
|
5,170
|
|
|
—
|
|
|
5,170
|
|
|||
Net current-period change
|
|
2,270
|
|
|
(5,080
|
)
|
|
(2,810
|
)
|
|||
Balances at December 31, 2018
|
|
$
|
1,960
|
|
|
$
|
5,800
|
|
|
$
|
7,760
|
|
|
|
Year ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(dollars in thousands)
|
||||||||||
Net Sales
|
|
|
|
|
|
|
||||||
Horizon Americas
|
|
$
|
390,690
|
|
|
$
|
439,700
|
|
|
$
|
443,240
|
|
Horizon Europe‑Africa
|
|
323,260
|
|
|
325,970
|
|
|
104,080
|
|
|||
Horizon Asia‑Pacific
|
|
136,000
|
|
|
127,310
|
|
|
101,880
|
|
|||
Total
|
|
$
|
849,950
|
|
|
$
|
892,980
|
|
|
$
|
649,200
|
|
Operating Profit (Loss)
|
|
|
|
|
|
|
||||||
Horizon Americas
|
|
$
|
(6,850
|
)
|
|
$
|
44,060
|
|
|
$
|
38,680
|
|
Horizon Europe‑Africa
|
|
(148,630
|
)
|
|
(1,790
|
)
|
|
(13,320
|
)
|
|||
Horizon Asia‑Pacific
|
|
20,250
|
|
|
18,740
|
|
|
11,230
|
|
|||
Corporate
|
|
(35,160
|
)
|
|
(26,250
|
)
|
|
(30,290
|
)
|
|||
Total
|
|
$
|
(170,390
|
)
|
|
$
|
34,760
|
|
|
$
|
6,300
|
|
Capital Expenditures
|
|
|
|
|
|
|
||||||
Horizon Americas
|
|
$
|
6,760
|
|
|
$
|
10,150
|
|
|
$
|
5,550
|
|
Horizon Europe‑Africa
|
|
4,500
|
|
|
13,190
|
|
|
4,670
|
|
|||
Horizon Asia‑Pacific
|
|
2,610
|
|
|
2,440
|
|
|
3,310
|
|
|||
Corporate
|
|
—
|
|
|
1,510
|
|
|
1,010
|
|
|||
Total
|
|
$
|
13,870
|
|
|
$
|
27,290
|
|
|
$
|
14,540
|
|
Depreciation and Amortization
|
|
|
|
|
|
|
||||||
Horizon Americas
|
|
$
|
8,160
|
|
|
$
|
10,660
|
|
|
$
|
10,750
|
|
Horizon Europe‑Africa
|
|
12,090
|
|
|
10,110
|
|
|
3,290
|
|
|||
Horizon Asia‑Pacific
|
|
4,800
|
|
|
4,310
|
|
|
4,090
|
|
|||
Corporate
|
|
330
|
|
|
260
|
|
|
90
|
|
|||
Total
|
|
$
|
25,380
|
|
|
$
|
25,340
|
|
|
$
|
18,220
|
|
|
|
December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
|
|
(dollars in thousands)
|
||||||
Total Assets
|
|
|
|
|
||||
Horizon Americas
|
|
$
|
219,680
|
|
|
$
|
209,210
|
|
Horizon Europe - Africa
|
|
173,980
|
|
|
341,750
|
|
||
Horizon Asia‑Pacific
|
|
119,590
|
|
|
88,210
|
|
||
Corporate
|
|
8,100
|
|
|
21,860
|
|
||
Total
|
|
$
|
521,350
|
|
|
$
|
661,030
|
|
|
|
Year ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(dollars in thousands)
|
||||||||||
Net Sales
|
|
|
|
|
|
|
||||||
Total U.S.
|
|
$
|
380,480
|
|
|
$
|
423,090
|
|
|
$
|
428,770
|
|
Non-U.S.
|
|
|
|
|
|
|
||||||
Australia
|
|
69,440
|
|
|
69,760
|
|
|
60,020
|
|
|||
Germany
|
|
186,430
|
|
|
194,120
|
|
|
52,350
|
|
|||
Other Europe
|
|
117,960
|
|
|
114,940
|
|
|
39,520
|
|
|||
Asia
|
|
67,420
|
|
|
58,140
|
|
|
41,940
|
|
|||
Africa
|
|
19,880
|
|
|
16,320
|
|
|
12,130
|
|
|||
Other Americas
|
|
8,340
|
|
|
16,610
|
|
|
14,470
|
|
|||
Total non-U.S.
|
|
469,470
|
|
|
469,890
|
|
|
220,430
|
|
|||
Total
|
|
$
|
849,950
|
|
|
$
|
892,980
|
|
|
$
|
649,200
|
|
|
|
December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
|
|
(dollars in thousands)
|
||||||
Property and equipment, net
|
|
|
|
|
||||
Total U.S.
|
|
$
|
26,560
|
|
|
$
|
5,770
|
|
Non-U.S.
|
|
|
|
|
||||
Australia
|
|
8,480
|
|
|
10,730
|
|
||
Germany
|
|
43,010
|
|
|
48,400
|
|
||
United Kingdom
|
|
620
|
|
|
22,920
|
|
||
Other Europe
|
|
8,820
|
|
|
9,830
|
|
||
Asia
|
|
7,370
|
|
|
7,720
|
|
||
Africa
|
|
5,320
|
|
|
5,260
|
|
||
Other Americas
|
|
2,100
|
|
|
2,390
|
|
||
Total non-U.S.
|
|
75,720
|
|
|
107,250
|
|
||
Total
|
|
$
|
102,280
|
|
|
$
|
113,020
|
|
|
|
Year ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(dollars in thousands)
|
||||||||||
Domestic
|
|
$
|
(43,200
|
)
|
|
$
|
(3,880
|
)
|
|
$
|
(14,630
|
)
|
Foreign
|
|
(168,060
|
)
|
|
8,860
|
|
|
(1,760
|
)
|
|||
Income (loss) before income tax
|
|
$
|
(211,260
|
)
|
|
$
|
4,980
|
|
|
$
|
(16,390
|
)
|
|
|
Year ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(dollars in thousands)
|
||||||||||
Current income tax benefit (expense):
|
|
|
|
|
|
|
||||||
Federal
|
|
$
|
10,070
|
|
|
$
|
(7,680
|
)
|
|
$
|
(1,170
|
)
|
State and local
|
|
(190
|
)
|
|
(240
|
)
|
|
(970
|
)
|
|||
Foreign
|
|
(7,880
|
)
|
|
(2,190
|
)
|
|
(2,560
|
)
|
|||
Total current income tax expense
|
|
2,000
|
|
|
(10,110
|
)
|
|
(4,700
|
)
|
|||
Deferred income tax benefit (expense):
|
|
|
|
|
|
|
||||||
Federal
|
|
(1,870
|
)
|
|
(3,000
|
)
|
|
3,800
|
|
|||
State and local
|
|
160
|
|
|
(390
|
)
|
|
450
|
|
|||
Foreign
|
|
6,070
|
|
|
3,750
|
|
|
4,180
|
|
|||
Total deferred income tax benefit
|
|
4,360
|
|
|
360
|
|
|
8,430
|
|
|||
Income tax benefit (expense)
|
|
$
|
6,360
|
|
|
$
|
(9,750
|
)
|
|
$
|
3,730
|
|
|
|
December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
|
|
(dollars in thousands)
|
||||||
Deferred tax assets:
|
|
|
|
|
||||
Receivables, net
|
|
$
|
980
|
|
|
$
|
460
|
|
Inventories
|
|
3,610
|
|
|
3,280
|
|
||
Accrued liabilities and other long-term liabilities
|
|
10,410
|
|
|
10,600
|
|
||
Tax loss and credit carryforwards
|
|
26,720
|
|
|
12,930
|
|
||
Gross deferred tax asset
|
|
41,720
|
|
|
27,270
|
|
||
Valuation allowances
|
|
(26,650
|
)
|
|
(10,560
|
)
|
||
Net deferred tax asset
|
|
15,070
|
|
|
16,710
|
|
||
Deferred tax liabilities:
|
|
|
|
|
||||
Property and equipment, net
|
|
(5,470
|
)
|
|
(4,300
|
)
|
||
Intangibles, net
|
|
(18,670
|
)
|
|
(19,710
|
)
|
||
Other
|
|
(2,390
|
)
|
|
(3,280
|
)
|
||
Gross deferred tax liability
|
|
(26,530
|
)
|
|
(27,290
|
)
|
||
Net deferred tax liability
|
|
$
|
(11,460
|
)
|
|
$
|
(10,580
|
)
|
|
|
Year ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(dollars in thousands)
|
||||||||||
U.S. federal statutory rate
|
|
21
|
%
|
|
35
|
%
|
|
35
|
%
|
|||
Tax at U.S. federal statutory rate
|
|
$
|
44,360
|
|
|
$
|
(1,740
|
)
|
|
$
|
5,730
|
|
State and local taxes, net of federal tax benefit
|
|
1,500
|
|
|
(340
|
)
|
|
(340
|
)
|
|||
Differences in statutory foreign tax rates
|
|
13,180
|
|
|
3,680
|
|
|
1,230
|
|
|||
Uncertain tax positions
|
|
2,680
|
|
|
3,950
|
|
|
1,260
|
|
|||
Tax holiday
(1)
|
|
—
|
|
|
950
|
|
|
460
|
|
|||
Withholding taxes
|
|
(990
|
)
|
|
(300
|
)
|
|
(300
|
)
|
|||
Tax credits
|
|
3,980
|
|
|
590
|
|
|
(70
|
)
|
|||
Net change in valuation allowance
|
|
(19,210
|
)
|
|
(3,020
|
)
|
|
(1,600
|
)
|
|||
Transaction costs
|
|
—
|
|
|
(1,610
|
)
|
|
(2,670
|
)
|
|||
Tax reform/SAB 118 true-up
|
|
(2,280
|
)
|
|
(11,850
|
)
|
|
—
|
|
|||
Goodwill
|
|
(36,580
|
)
|
|
—
|
|
|
—
|
|
|||
Other, net
|
|
(280
|
)
|
|
(60
|
)
|
|
30
|
|
|||
Income tax benefit (expense)
|
|
$
|
6,360
|
|
|
$
|
(9,750
|
)
|
|
$
|
3,730
|
|
|
|
Uncertain Tax Positions
|
||
|
|
(dollars in thousands)
|
||
Balance at December 31, 2016
|
|
$
|
8,850
|
|
Tax positions related to current year:
|
|
|
||
Additions
|
|
—
|
|
|
Reductions
|
|
—
|
|
|
Tax positions related to prior years:
|
|
|
||
Additions
|
|
50
|
|
|
Reductions
|
|
(30
|
)
|
|
Lapses in the statutes of limitations
|
|
(2,110
|
)
|
|
Cumulative Translation Adjustment
|
|
550
|
|
|
Balance at December 31, 2017
|
|
$
|
7,310
|
|
Tax positions related to current year:
|
|
|
||
Additions
|
|
—
|
|
|
Reductions
|
|
—
|
|
|
Tax positions related to prior years:
|
|
|
|
|
Additions
|
|
270
|
|
|
Reductions
|
|
—
|
|
|
Settlements
|
|
—
|
|
|
Lapses in the statutes of limitations
|
|
(1,580
|
)
|
|
Cumulative Translation Adjustment
|
|
(340
|
)
|
|
Balance at December 31, 2018
|
|
$
|
5,660
|
|
|
|
Year ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(dollars in thousands)
|
||||||||||
Brink acquisition ticking fee
|
|
$
|
5,130
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Brazil acquisition indemnification asset
|
|
4,300
|
|
|
1,520
|
|
|
1,500
|
|
|||
Customer pay discounts
|
|
1,600
|
|
|
1,540
|
|
|
1,210
|
|
|||
Foreign currency (gain) / loss
|
|
960
|
|
|
800
|
|
|
(480
|
)
|
|||
Accretion arising from lease recovery
|
|
240
|
|
|
270
|
|
|
320
|
|
|||
Gain on sale of Broom & Brush
|
|
—
|
|
|
(1,300
|
)
|
|
—
|
|
|||
Currency option premium purchase
|
|
—
|
|
|
—
|
|
|
840
|
|
|||
Other
|
|
900
|
|
|
(100
|
)
|
|
(780
|
)
|
|||
Total other expense, net
|
|
$
|
13,130
|
|
|
$
|
2,730
|
|
|
$
|
2,610
|
|
|
|
Three months ended
|
||||||||||||||
|
|
March 31, 2018
|
|
June 30, 2018
|
|
September 30, 2018
|
|
December 31, 2018
|
||||||||
|
|
(unaudited, dollars in thousands, except for per share data)
|
||||||||||||||
Net sales
|
|
$
|
216,810
|
|
|
$
|
233,340
|
|
|
$
|
227,840
|
|
|
$
|
171,960
|
|
Gross profit
|
|
$
|
38,450
|
|
|
$
|
47,570
|
|
|
$
|
43,620
|
|
|
$
|
14,240
|
|
Net loss
|
|
$
|
(57,760
|
)
|
|
$
|
(67,160
|
)
|
|
$
|
(33,000
|
)
|
|
$
|
(46,980
|
)
|
Net loss attributable to Horizon Global
|
|
$
|
(57,510
|
)
|
|
$
|
(66,930
|
)
|
|
$
|
(32,760
|
)
|
|
$
|
(46,760
|
)
|
Net loss per share attributable to Horizon Global:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
$
|
(2.30
|
)
|
|
$
|
(2.68
|
)
|
|
$
|
(1.31
|
)
|
|
$
|
(1.86
|
)
|
Diluted
|
|
$
|
(2.30
|
)
|
|
$
|
(2.68
|
)
|
|
$
|
(1.31
|
)
|
|
$
|
(1.86
|
)
|
|
|
Three months ended
|
||||||||||||||
|
|
March 31, 2017
|
|
June 30, 2017
|
|
September 30, 2017
|
|
December 31, 2017
|
||||||||
|
|
(unaudited, dollars in thousands, except for per share data)
|
||||||||||||||
Net sales
|
|
$
|
203,280
|
|
|
$
|
253,590
|
|
|
$
|
240,120
|
|
|
$
|
195,990
|
|
Gross profit
|
|
$
|
45,390
|
|
|
$
|
67,670
|
|
|
$
|
58,420
|
|
|
$
|
36,120
|
|
Net income (loss)
|
|
$
|
(10,160
|
)
|
|
$
|
19,970
|
|
|
$
|
6,560
|
|
|
$
|
(21,140
|
)
|
Net income (loss) attributable to Horizon Global
|
|
$
|
(9,860
|
)
|
|
$
|
20,260
|
|
|
$
|
6,890
|
|
|
$
|
(20,840
|
)
|
Net income (loss) per share attributable to Horizon Global:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
$
|
(0.41
|
)
|
|
$
|
0.80
|
|
|
$
|
0.28
|
|
|
$
|
(0.84
|
)
|
Diluted
|
|
$
|
(0.41
|
)
|
|
$
|
0.79
|
|
|
$
|
0.27
|
|
|
$
|
(0.84
|
)
|
2.1(c)*
|
|
2.2(i)*
|
|
2.3(h)*
|
|
3.1(n)
|
|
3.2(b)
|
|
4.1(j)
|
|
4.2(j)
|
|
10.1(c)
|
|
10.2(c)
|
|
10.3(c)
|
|
10.4(f)
|
|
10.5(f)
|
|
10.6(i)
|
|
10.7(l)
|
|
10.8(n)
|
|
10.9(c)
|
|
10.10(i)
|
|
10.11(l)
|
10.12(k)*
|
|
10.13(m)
|
|
10.14(n)
|
|
10.15(d)**
|
|
10.16(e)**
|
|
10.17(a)
|
|
10.18(e)**
|
|
10.19(e)**
|
|
10.20(e)**
|
|
10.21(e)**
|
|
10.22(e)**
|
|
10.23(e)**
|
|
10.24(e)**
|
|
10.25(g)**
|
|
10.26(g)**
|
|
10.27(g)**
|
|
10.28(g)**
|
|
10.29(g)**
|
|
10.30**
|
|
10.31(m)**
|
|
10.32(m)**
|
|
10.33(m)**
|
|
10.34(m)**
|
|
10.35(m)**
|
|
10.36(n)**
|
|
10.37(i)
|
10.38(j)
|
|
10.39(j)
|
|
10.40(j)
|
|
10.41(j)
|
|
10.42(j)
|
|
10.43(j)
|
|
10.44(j)
|
|
10.45(j)
|
|
10.46(j)
|
|
10.47(j)
|
|
10.48(j)
|
|
10.49(j)
|
|
10.50(n)
|
|
10.51
|
|
10.52*
|
|
21.1
|
|
23.1
|
|
31.1
|
|
31.2
|
|
32.1
|
|
32.2
|
|
101.INS
|
XBRL Instance Document.
|
101.SCH
|
XBRL Taxonomy Extension Schema Document.
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase Document.
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
(a)
|
|
Incorporated by reference to the Exhibits filed with our Registration Statement on Form S-1 filed on March 31, 2015 (Reg. No. 333-203138).
|
(b)
|
|
Incorporated by reference to the Exhibits filed with our Current Report on Form 8-K filed on February 20, 2019 (Reg. No. 001-37427).
|
(c)
|
|
Incorporated by reference to the Exhibits filed with our Current Report on Form 8-K filed on July 6, 2015 (File No. 001-37427).
|
(d)
|
|
Incorporated by reference to the Exhibits filed with our Quarterly Report on Form 10-Q filed on August 11, 2015 (File No. 001-37427).
|
(e)
|
|
Incorporated by reference to the Exhibits filed with our Quarterly Report on Form 10-Q filed on November 10, 2015 (File No. 001-37427).
|
(f)
|
|
Incorporated by reference to the Exhibits filed with our Current Report on Form 8-K filed on December 23, 2015 (File No. 001-37427).
|
(g)
|
|
Incorporated by reference to the Exhibits filed with our Quarterly Report on Form 10-Q filed on May 3, 2016 (File No. 001-37427).
|
(h)
|
|
Incorporated by reference to Exhibits filed with our Annual Report on Form 10-K filed on March 1, 2018 (File No. 001-37427).
|
(i)
|
|
Incorporated by reference to the Exhibits filed with our Current Report on Form 8-K filed on October 11, 2016 (File No. 001-37427).
|
(j)
|
|
Incorporated by reference to the Exhibits filed with our Current Report on Form 8-K filed on February 1, 2017 (File No. 001-37427).
|
(k)
|
|
Incorporated by reference to the Exhibits filed with our Current Report on Form 8-K filed on April 6, 2017 (File No. 001-37427).
|
(l)
|
|
Incorporated by reference to the Exhibits filed with our Annual Report on Form 10-K filed on March 10, 2017 (File No. 001-37427).
|
(m)
|
|
Incorporated by reference to the Exhibits filed with our Quarterly Report on Form 10-Q filed on May 3, 2018 (File No. 001-37427).
|
(n)
|
|
Incorporated by reference to the Exhibits filed with our Quarterly Report on Form 10-Q filed on August 7, 2018 (File No. 001-37427).
|
|
|
|
HORIZON GLOBAL CORPORATION
(Registrant)
|
||
|
|
|
|
|
|
|
|
|
BY:
|
|
/s/ CARL S. BIZON
|
DATE:
|
March 18, 2019
|
|
|
|
Name: Carl S. Bizon
Title:
President and Chief Executive Officer
|
Name
|
|
Title
|
|
Date
|
|
|
|
|
|
/s/ CARL S. BIZON
|
|
President and Chief Executive Officer and Director
|
|
March 18, 2019
|
Carl S. Bizon
|
|
(Principal Executive Officer)
|
|
|
|
|
|
|
|
/s/ BRIAN WHITTMAN
|
|
Vice President, Finance
|
|
March 18, 2019
|
Brian Whittman
|
|
(Principal Financial and Accounting Officer)
|
|
|
|
|
|
|
|
/s/ DENISE ILITCH
|
|
Chair of the Board of Directors
|
|
March 18, 2019
|
Denise Ilitch
|
|
|
|
|
|
|
|
|
|
/s/ RICHARD L. DEVORE
|
|
Director
|
|
March 18, 2019
|
Richard L. DeVore
|
|
|
|
|
|
|
|
|
|
/s/ SCOTT G. KUNSELMAN
|
|
Director
|
|
March 18, 2019
|
Scott G. Kunselman
|
|
|
|
|
|
|
|
|
|
/s/ DAVID A. ROBERTS
|
|
Director
|
|
March 18, 2019
|
David A. Roberts
|
|
|
|
|
|
|
|
|
|
/s/ RICHARD D. SIEBERT
|
|
Director
|
|
March 18, 2019
|
Richard D. Siebert
|
|
|
|
|
|
|
|
|
|
/s/ MAXIMILIANE C. STRAUB
|
|
Director
|
|
March 18, 2019
|
Maximiliane C. Straub
|
|
|
|
|
|
|
|
|
ADDITIONS
|
|
|
|
|
||||||||||||
DESCRIPTION
|
|
BALANCE
AT
BEGINNING
OF PERIOD
|
|
CHARGED
TO
COSTS AND
EXPENSES
|
|
CHARGED
(CREDITED)
TO OTHER
ACCOUNTS
(1)
|
|
DEDUCTIONS
(2)
|
|
BALANCE
AT END
OF PERIOD
|
||||||||||
Allowance for doubtful accounts deducted from accounts receivable in the balance sheet
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Year ended December 31, 2018
|
|
$
|
3,100
|
|
|
$
|
920
|
|
|
$
|
1,200
|
|
|
$
|
80
|
|
|
$
|
5,140
|
|
Year ended December 31, 2017
|
|
$
|
3,810
|
|
|
$
|
640
|
|
|
$
|
(1,340
|
)
|
|
$
|
10
|
|
|
$
|
3,100
|
|
Year ended December 31, 2016
|
|
$
|
2,960
|
|
|
$
|
910
|
|
|
$
|
50
|
|
|
$
|
110
|
|
|
$
|
3,810
|
|
1.
|
Purpose
.
The purpose of this Plan
is to attract and retain non-employee Directors, officers and other key employees
of the Company and its Subsidiaries and to provide to such persons incentives and rewards for performance or service.
|
2.
|
Definitions
.
As used in this Plan:
|
(i)
|
Profits
(e.g., gross profit, EBITDA, operating income, EBIT, EBT, net income, net sales, cost of sales, earnings per share, residual or economic earnings, inventory turnover, operating profit, economic profit - these profitability metrics could be measured before certain specified special items and/or subject to GAAP definition);
|
(ii)
|
Cash Flow
(e.g., free cash flow, free cash flow with or without specific capital expenditure target or range, including or excluding divestments and/or acquisitions, net cash provided by operating activities, net increase (or decrease) in cash and cash equivalents, total cash flow, cash flow in excess of cost of capital or residual cash flow or cash flow return on investment);
|
(iii)
|
Returns
(e.g., profits or cash flow returns on: assets, invested capital, net capital employed, and equity);
|
(iv)
|
Working Capital
(e.g., working capital divided by sales, days’ sales outstanding, days’ sales inventory, and days’ sales in payables);
|
(v)
|
Profit Margins
(e.g., profits divided by revenues, gross margins and material margins divided by revenues);
|
(vi)
|
Liquidity Measures
(e.g., debt-to-capital, debt-to-EBITDA, total debt ratio);
|
(vii)
|
Sales Growth, Gross Margin Growth, Cost Initiative and Stock Price Metrics
(e.g., revenues, revenue growth, revenue growth outside the United States, gross margin and gross margin growth, material margin and material margin growth, stock price appreciation, market capitalization, total return to shareholders, sales and administrative costs divided by sales, and sales and administrative costs divided by profits); and
|
(viii)
|
Strategic Initiative Key Deliverable Metrics
consisting of one or more of the following: product development, strategic partnering, research and development, vitality index, market penetration, market share, geographic business expansion goals, cost targets, selling, general and administrative expenses, customer satisfaction, employee satisfaction, management of employment practices and employee benefits, supervision of litigation and information technology, productivity, economic value added (or another measure of profitability that considers the cost of capital employed), product quality, sales of new products, and goals relating to acquisitions or divestitures of subsidiaries, affiliates and joint ventures.
|
3.
|
Shares Available Under the Plan
.
|
(i)
|
Subject to adjustment as provided in
Section 11
of this Plan and the share counting rules set forth in
Section 3(b)
of this Plan, the number of Common Shares available under the Plan for awards of (A) Option Rights or Appreciation Rights, (B) Restricted Shares, (C) Restricted Stock Units, (D) Performance Shares or Performance Units, (E) awards contemplated by
Section 9
of this Plan, or (F) dividend equivalents paid with respect to awards made under this Plan
shall be, in the aggregate, 4,350,000 Common Shares (2,000,000 of which were approved in 2015 and 2,350,000 of which are anticipated to be approved by Shareholders in 2018). Such shares may be shares of original issuance or treasury shares or a combination of the foregoing.
|
(ii)
|
The aggregate number of Common Shares available under
Section 3(a)(i)
of this Plan will be reduced by one Common Share for every one Common Share subject to an award granted under this Plan.
|
(i)
|
If any award granted under this Plan is cancelled or forfeited, expires or is settled for cash (in whole or in part), or is unearned (in whole or in part), the Common Shares subject to such award will, to the extent of such cancellation, forfeiture, expiration, cash settlement, or unearned amount, again be available under
Section 3(a)(i)
.
|
(ii)
|
Notwithstanding anything to the contrary contained herein: (A) Common Shares withheld by the Company in payment of the Option Price of an Option Right will not be added back to the aggregate number of Common Shares available under
Section 3(a)(i)
above; (B) Common Shares tendered or otherwise used in payment of the Option Price of an Option Right will not be added to the aggregate number of Common Shares available under
Section 3(a)(i)
above; (C) Common Shares withheld by the Company or tendered or otherwise used to satisfy a tax withholding obligation will be added (or added back, as applicable) to the aggregate number of Common Shares available under
Section 3(a)(i)
above; (D) Common Shares withheld by the Company or tendered or otherwise used to satisfy a tax withholding obligation with respect to an Award other than an Option Right or Appreciated Right will be added (or added back, as applicable) to the aggregate number of Common Shares available under
Section 3(a)(i)
above (provided, however, that such recycling of Common Shares for tax withholding purposes will be limited to 10 years from the date of stockholder approval of the Plan if such recycling involves Common Shares that have actually been issued by the Company); (E) Common Shares subject to an Appreciation Right that are not actually issued in connection with its Common Shares settlement on exercise
|
(i)
|
No Participant will be granted Option Rights and/or Appreciation Rights, in the aggregate, for more than 250,000 Common Shares during any calendar year.
|
(ii)
|
No Participant will be granted Qualified Performance-Based Awards of Restricted Shares, Restricted Stock Units, Performance Shares and/or other awards under
Section 9
of this Plan, in the aggregate, for more than 500,000 Common Shares during any calendar year.
|
(iii)
|
In no event will any Participant in any calendar year receive Qualified Performance-Based Awards of Performance Units and/or other awards payable in cash under
Section 9
of this Plan having an aggregate maximum value as of their respective Dates of Grant in excess of $2,500,000.
|
(iv)
|
In no event will any Participant in any calendar year receive Qualified Performance-Based Awards that are Cash Incentive Awards having an aggregate maximum value in excess of $5,000,000.
|
(v)
|
In no event will any non-employee Director in any calendar year be granted compensation for such service having an aggregate maximum value (measured at the Date of Grant as applicable, and calculating the value of any awards based on the grant date fair value for financial reporting purposes) in excess of $500,000.
|
(vi)
|
Notwithstanding anything in this Plan to the contrary (except for the discretionary acceleration provisions of the Plan), up to 5% of the maximum number of Common Shares available for awards under this Plan as provided for in
Section 3(a)
of this Plan, as may be adjusted under
Section 11
of this Plan, may be used for awards granted under
Section 4
through
Section 9
of this Plan that do not at grant comply with the applicable one-year minimum vesting or performance period requirements set forth in such sections of this Plan.
|
4.
|
Option Rights
.
The Committee may, from time to time and upon such terms and conditions as it may determine, authorize the granting to Participants of Option Rights. Each such grant may utilize any or all of the authorizations, and will be subject to all of the requirements, contained in the following provisions:
|
5.
|
Appreciation Rights
.
|
(i)
|
Each grant may specify that the amount payable on exercise of an Appreciation Right will be paid by the Company in cash, Common Shares or any combination thereof.
|
(ii)
|
Any grant may specify that the amount payable on exercise of an Appreciation Right may not exceed a maximum specified by the Committee at the Date of Grant.
|
(iii)
|
Any grant may specify waiting periods before exercise and permissible exercise dates or periods.
|
(iv)
|
Each grant may specify the period or periods of continuous service by the Participant with the Company or any Subsidiary that is necessary before the Appreciation Rights or installments thereof will become exercisable;
provided
, that, except as otherwise described in this subsection, no portion of any grant of Appreciation Rights may become exercisable sooner than after one year or a one-year performance period. Notwithstanding the minimum vesting provisions of this Plan, Appreciation Rights may provide for the earlier exercise of such Appreciation Rights, including in the event of the retirement, death or disability of a Participant, or in the event of a Change in Control.
|
(v)
|
Any grant of Appreciation Rights may specify Management Objectives that must be achieved as a condition of the exercise of such Appreciation Rights.
|
(vi)
|
Each grant of Appreciation Rights will be evidenced by an Evidence of Award, which Evidence of Award will describe such Appreciation Rights, identify the related Option Rights (if applicable), and contain such other terms and provisions, consistent with this Plan, as the Committee may approve.
|
(i)
|
Each grant will specify in respect of each Free-Standing Appreciation Right a Base Price, which (except with respect to awards under
Section 22
of this Plan) may not be less than the Market Value per Share on the Date of Grant;
|
(ii)
|
Successive grants may be made to the same Participant regardless of whether any Free-Standing Appreciation Rights previously granted to the Participant remain unexercised; and
|
(iii)
|
No Free-Standing Appreciation Right granted under this Plan may be exercised more than 10 years from the Date of Grant.
|
6.
|
Restricted Shares
.
The Committee may, from time to time and upon such terms and conditions as it may determine, authorize the grant or sale of Restricted Shares to Participants. Each such grant or sale may utilize any or all of the authorizations, and will be subject to all of the requirements, contained in the following provisions:
|
7.
|
Restricted Stock Units
.
The Committee may, from time to time and upon such terms and conditions as it may determine, authorize the granting or sale of Restricted Stock Units to Participants. Each such grant or sale may utilize any or all of the authorizations, and will be subject to all of the requirements, contained in the following provisions:
|
8.
|
Cash Incentive Awards, Performance Shares and Performance Units
.
The Committee may, from time to time and upon such terms and conditions as it may determine, authorize the granting of Cash Incentive Awards, Performance Shares and Performance Units. Each such grant may utilize any or all of the authorizations, and will be subject to all of the requirements, contained in the following provisions:
|
9.
|
Other Awards
.
|
10.
|
Administration of this Plan
.
|
11.
|
Adjustments
.
The Committee shall make or provide for such adjustments in the numbers of Common Shares covered by outstanding Option Rights, Appreciation Rights, Restricted Shares, Restricted Stock Units, Performance Shares and Performance Units granted hereunder and, if applicable, in the number of Common Shares covered by other awards granted pursuant to
Section 9
hereof, in the Option Price and Base Price provided in outstanding Option Rights and Appreciation Rights, in the kind of shares covered thereby, in Cash Incentive Awards, and in other award terms, as the Committee, in its sole discretion, exercised in good faith, shall determine is equitably required to prevent dilution or enlargement of the rights of Participants or Optionees that otherwise would result from (a) any stock dividend, stock split, combination of shares, recapitalization or other change in the capital structure of the Company, (b) any merger, consolidation, spin-off, split-off, spin-out, split-up, reorganization, partial or complete liquidation or other distribution of assets, issuance of rights or warrants to purchase securities, or (c) any other corporate transaction or event having an effect similar to any of the foregoing. Moreover, in the event of any such transaction or event or in the event of a Change in Control, the Committee shall provide in substitution for any or all outstanding awards under this Plan such alternative consideration (including cash), if any, as it, in good faith, shall determine to be equitable in the circumstances and shall require in connection therewith the surrender of all awards so replaced in a manner that complies with Section 409A of the Code. In addition, for each Option Right or Appreciation Right with an Option Price or Base Price greater than the consideration offered in connection with any such transaction or event or Change in Control, the Committee may in its discretion elect to cancel such Option Right or Appreciation Right without any payment to the person holding such Option Right or Appreciation Right. The Committee shall also make or provide for such adjustments in the numbers of shares specified in
Section 3
of this Plan as the Committee in its sole discretion, exercised in good faith, shall determine is appropriate to reflect any transaction or event described in this
Section 11
;
provided
,
however
, that any such adjustment to the number specified in
Section 3(c)
will be made only if and to the extent that such adjustment would not cause any Option Right intended to qualify as an Incentive Stock Option to fail to so qualify.
|
12.
|
Change in Control
. For purposes of this Plan, except as may be otherwise prescribed by the Committee in an Evidence of Award made under this Plan, a “Change in Control” will be deemed to have occurred upon the occurrence (after the Effective Date) of any of the following events:
|
13.
|
Detrimental Activity and Recapture Provisions
. Any Evidence of Award may provide for the cancellation or forfeiture of an award or the forfeiture and repayment to the Company of any gain related to an award, or other provisions intended to have a similar effect, upon such terms and conditions as may be determined by the Committee from time to time, if a Participant, either (a) during employment or other service with the Company or a Subsidiary or (b) within a specified period after termination of such employment or service, shall engage in any detrimental activity. In addition, notwithstanding anything in this Plan to the contrary, any Evidence of Award may also provide for the cancellation or forfeiture of an award or the forfeiture and repayment to the Company of any gain related to an award, or other provisions intended to have a similar effect, upon such terms and conditions as may be required by the Committee or under Section 10D of the Exchange Act and any applicable rules or regulations promulgated by the Securities and Exchange Commission or any national securities exchange or national securities association on which the Common Shares may be traded.
|
14.
|
Non U.S. Participants
.
In order to facilitate the making of any grant or combination of grants under this Plan, the Committee may provide for such special terms for awards to Participants who are foreign nationals or who are employed by the Company or any Subsidiary outside of the United States of America or who provide services to the Company under an agreement with a foreign nation or agency, as the Committee may consider necessary or appropriate to accommodate differences in local law, tax policy or custom. Moreover, the Committee may approve such supplements to or amendments, restatements or alternative versions of this Plan (including, without limitation, sub-plans) as it may consider necessary or appropriate for such purposes, without thereby affecting the terms of this Plan as in effect for any other purpose, and the Secretary or other appropriate officer of the Company may certify any such document as having been approved and adopted in the same manner as this Plan. No such special terms, supplements, amendments or restatements, however, will include any provisions that are inconsistent with the terms of this Plan
|
15.
|
Transferability
.
|
16.
|
Withholding Taxes
.
To the extent that the Company is required to withhold federal, state, local or foreign taxes in connection with any payment made or benefit realized by a Participant or other person under this Plan, and the amounts available to the Company for such withholding are insufficient, it will be a condition to the receipt of such payment or the realization of such benefit that the Participant or such other person make arrangements satisfactory to the Company for payment of the balance of such taxes required to be withheld, which arrangements (in the discretion of the Committee) may include relinquishment of a portion of such benefit. If a Participant’s benefit is to be received in the form of Common Shares, and such Participant fails to make arrangements for the payment of tax, then, unless otherwise determined by the Committee, the Company will withhold Common Shares having a value equal to the amount required to be withheld. Notwithstanding the foregoing, when a Participant is required to pay the Company an amount required to be withheld under applicable income and employment tax laws, the Participant may elect, unless otherwise determined by the Committee, to satisfy the obligation, in whole or in part, by having withheld, from the shares required to be delivered to the Participant, Common Shares having a value equal to the amount required to be withheld or by delivering to the Company other Common Shares held by such Participant. The shares used for tax withholding will be valued at an amount equal to the market value of such Common Shares on the date the benefit is to be included in Participant’s income. In no event will the market value of the Common Shares to be withheld and delivered pursuant to this Section to satisfy applicable withholding taxes in connection with the benefit exceed the minimum amount of taxes required to be withheld. Participants will also make such arrangements as the Company may require for the payment of any withholding tax obligation that may arise in connection with the disposition of Common Shares acquired upon the exercise of Option Rights.
|
17.
|
Compliance with Section 409A of the Code
.
|
18.
|
Amendments
.
|
19.
|
Governing Law
.
This Plan and all grants and awards and actions taken hereunder will be governed by and construed in accordance with the internal substantive laws of the State of Delaware.
|
20.
|
Effective Date/Termination
.
The Company established the Horizon Global Corporation 2015 Equity and Incentive Compensation Plan in 2015 (the “2015 Plan”). The Company amended and restated in its entirety the 2015 Plan as of March 8, 2016, in the form of the Horizon Global Corporation Amended and Restated 2015 Equity and Incentive Compensation Plan (the “Amended and Restated 2015 Plan”), which was approved by Shareholders on May 17, 2016. The Company hereby again amends and restates in its entirety, as of the Effective Date, the Amended and Restated 2015 Plan in the form of this document (the “Second Amended and Restated 2015 Plan”). For clarification purposes, the terms and conditions of the Second Amended and Restated 2015 Plan, to the extent they differ from the terms and conditions of either the 2015 Plan or the Amended and Restated 2015 Plan, shall not apply to or otherwise impact previously granted or outstanding awards under the 2015 Plan or the Amended and Restated 2015 Plan, as applicable. This Second Amended and Restated 2015 Plan will be effective as of the Effective Date. No grant will be made under this Plan on or after the tenth anniversary of the Effective Date, but all grants made prior to such date will continue in effect thereafter subject to the terms thereof and of this Plan (or predecessor versions, as applicable).
|
21.
|
Miscellaneous Provisions
.
|
22.
|
Stock-Based Awards in Substitution for Option Rights
or Awards Granted by Other Company
.
Notwithstanding anything in this Plan to the contrary:
|
•
|
During the Consulting Period, you agree to provide Consulting Services to the Company up to 8 hours
per week as may be reasonably agreed between the Company’s principal executive officer (or his designee) and you. However, your obligations during the Consulting Period as set forth in this Paragraph 3 shall not require you to report to work at the Company, nor to work any definite hours, and all scheduling shall take into account your personal and family plans so as not to interfere unreasonably with those plans.
|
•
|
During the Consulting Period, you will at all times be and remain an independent contractor and will not be covered as an employee under any benefit plans of the Company. You shall be free to exercise your own judgment as to the manner and method of providing the Consulting Services to the Company, subject to applicable laws and requirements reasonably imposed by the Company.
|
1.
|
WAIVER AND RELEASE
|
2.
|
SCOPE OF RELEASE
|
3.
|
REVIEW OF RELEASE
|
4.
|
ENTIRE AGREEMENT
|
1.
|
Severance benefits under the Severance Policy
†
, which severance benefits (subject to any applicable withholding) consist of the following (as further described in, and qualified by reference to, the Severance Policy):
|
◦
|
Payment of an amount equal in value to the product of (a) one, multiplied by (b) the sum of (i) $310,000 (your annual base salary rate (as in effect on the Separation Date)) plus (ii) $201,500
(the value of your target short-term incentive award for the 2018 calendar year). This amount will be payable in equal installments in accordance with the Company’s payroll practices as in effect from time to time commencing on the day the Release becomes effective and ending on the last payroll date of or on behalf of the Company in the last month of the 12-month period following the Separation Date, provided that the first such payment shall include all amounts that would have been paid to you in accordance with the Company’s payroll practices if such payments had begun on the Separation Date;
|
◦
|
Payment of (a) all accrued but unpaid base salary through the Separation Date and (b) earned but unused vacation through the Separation Date. These amounts will be payable by the next payroll date following the Separation Date;
|
◦
|
Payment of your short-term incentive award for the 2018 calendar year, based on actual performance results for the full 2018 calendar year and prorated through the Separation Date, payable in accordance with the terms of the Company’s short-term incentive program;
|
◦
|
If you timely elect to continue group health care coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985 (“
COBRA
”), and subject to the Company’s COBRA policies, the Company or its appropriate affiliate will reimburse you for the employer’s portion of premiums for continued group health coverage under COBRA until the earliest of (a) the termination of your COBRA period, (b) 12 months after the Separation Date, or (c) the date you become eligible to receive any medical benefits under any plan or program of any other employer. You will be responsible for payment of the COBRA premium and will be reimbursed by the Company or its appropriate affiliate for the portion of the premium that the Company or its appropriate affiliate would have paid for group health coverage if you had continued to be an employee of the Company or its appropriate affiliate. In the event that your COBRA period expires before the date that is 12 months after the Separation Date, the Company or its appropriate affiliate will pay you a monthly amount equal to the monthly contribution that the Company or its appropriate affiliate would have paid for your coverage under the applicable group health plan of the Company or its appropriate affiliate if you had continued as an employee of the Company or its appropriate affiliate until the earlier of (x) 12 months after the Separation Date or (y) the date on which you become eligible to receive any medical benefits under any plan or program of any other employer; and
|
◦
|
Executive-level outplacement services until the earlier of (a) 12 months following the Separation Date or (b) the date on which you become employed by a subsequent employer.
|
◦
|
Treatment of outstanding Equity Plan awards as follows, subject in all cases to the applicable terms and provisions of the Equity Plan, the related award agreements and the Severance Policy:
|
▪
|
Each of your unvested awards that are outstanding under the Equity Plan, other than equity awards and cash incentive awards that are subject to vesting upon the attainment of performance goals, shall vest in an amount equal to (a) the product of (i) the total number of shares subject to such award and (ii) a fraction, the numerator of which is equal to the number of whole calendar months that have elapsed from the grant date of the applicable award to the Separation Date and the denominator of which is equal to the full number of calendar months in the vesting period of such award, less (b) the number of shares that had already become vested as of the Separation Date in respect of such award. As a result, the following portions of the following awards granted to you under the Equity Plan will vest as of the Separation Date:
|
•
|
March 1, 2016 Restricted Stock Units Grant
:
3,238
RSUs
|
•
|
March 1, 2017 Restricted Stock Units Grant
:
954
RSUs
|
•
|
March 1, 2018 Restricted Stock Units Grant
:
2,117
RSUs
|
•
|
March 1, 2016 Nonqualified Stock Option Grant
:
4,152
Option Rights
|
▪
|
Notwithstanding the foregoing, each equity award and cash incentive award granted under the Equity Plan that is subject to vesting upon the attainment of performance goals shall become payable in an amount equal to (a) the product of (i) the total number of shares or amount of cash, as applicable, that is earned with respect to such award at the end of the applicable performance period based on actual performance in accordance with the terms of the governing arrangements under which such performance-based award was granted and, (ii) a fraction, the numerator of which is equal to the number of whole calendar months that have elapsed from the grant date of the applicable award to the Separation Date and the denominator of which is the full number of calendar months in the vesting period of such award, less (b) the number of shares or amount of cash that had already become vested as of the Separation Date in respect of such award. Awards that vest as described in this paragraph will be settled at the time when such awards are settled under the applicable terms of the Equity Plan for individuals who remain employed through the end of the applicable performance period.
|
Grant Date
|
Original Target Cash Incentive Award
|
Pro-Rated Target Cash Incentive Award
|
March 1, 2017
|
$93,000
|
$81,375
|
March 1, 2018
|
$93,000
|
$34,875
|
2.
|
Accrued vested benefits under any other benefit plans, programs or arrangements of the Company or its appropriate affiliate (including any vested benefits under the Company’s qualified and nonqualified retirement plans), subject to the terms of such plans, programs or arrangements.
|
3.
|
With respect to each equity award referenced above, all applicable withholding requirements with respect thereto shall be satisfied by retention by the Company of a portion of the shares otherwise deliverable to you thereunder, with the shares so retained credited against such withholding requirement at the market value of such shares on the date of such delivery, provided that in no event will the market value of the shares to be so withheld exceed the minimum amount of taxes required to be withheld.
|
Tier I Participants
|
Tier II Participants
|
Chief Executive Officer
|
Chief Financial Officer*
General Counsel*
Chief Human Resources Officer
Chief Information Officer
Business Unit Presidents
|
Participation Tier
|
Non-COC Multiplier
|
Non-COC Period
|
COC Multiplier
|
COC Period
|
I
|
1.5
|
18 months
|
2
|
24 months
|
II
|
1
|
12 months
|
1.5
|
18 months
|
Participation Tier
|
Non-COC Multiplier
|
Non-COC Period
|
COC Multiplier
|
COC Period
|
*
|
1
|
12 months
|
2
|
24 months
|
1.
|
I have reviewed this annual report on Form 10-K of Horizon Global Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
/s/ CARL S. BIZON
|
|
Carl S. Bizon
Chief Executive Officer
|
|
1.
|
I have reviewed this annual report on Form 10-K of Horizon Global Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
/s/ BRIAN WHITTMAN
|
|
Brian Whittman
Principal Financial and Accounting Officer
|
|
1.
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ CARL S. BIZON
|
|
Carl S. Bizon
Chief Executive Officer
|
|
1.
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
/s/ BRIAN WHITTMAN
|
|
Brian Whittman
Principal Financial and Accounting Officer
|