Divestitures

Advent Financial Services, LLC (Financial Intermediary Segment)

On August 18, 2014, Advent sold certain intellectual property, software, and customer data to Santa Barbara Tax Products Group, LLC, for cash consideration of $1.0 million paid at closing. The transaction resulted in a gain of approximately $0.8 million, which is included in net income from discontinued operations on the condensed consolidated statement of operations.

Also on August 18, 2014, the Company announced that it was conducting an orderly winding-down of Advent’s remaining business and operations. As the run-off operations were substantially complete as of September 30, 2014, and as the Company will not have any significant continuing involvement in Advent, the operations of Advent have been classified as discontinued operations for all periods presented.

StreetLinks, LLC (Appraisal Management Segment)

On April 16, 2014, the Company and non-controlling members of StreetLinks (the "Sellers") entered into a purchase and sale agreement with Assurant, pursuant to which Assurant purchased 100% of the outstanding membership units of StreetLinks in exchange for $60.0 million paid in cash at closing and up to $12.0 million in post-closing consideration contingent upon the total revenue of StreetLinks in fiscal years 2015 and 2016. The sale closed on April 16, 2014. The Company received approximately $53.9 million in cash proceeds at closing, of which $1.0 million was used to make certain earned bonus payments to three StreetLinks executives. Subsequent to closing, the Company received an additional $0.8 million relating to adjustments for working capital.

The post-closing consideration provides for payment if (a) the total revenue of StreetLinks is $184 million or more for calendar year 2015, Assurant shall pay to the Sellers an aggregate of $12.0 million; but if not, then (b) if the total revenue of StreetLinks is greater than $167.5 million for the calendar year 2016, Assurant shall pay to Sellers up to an aggregate of $12.0 million, based on a linear scale where full payment of the $12.0 million would occur at total revenue of $184 million. The post-closing consideration will be reduced for certain earned bonus payments to three StreetLinks executives of $2.0 million if the maximum post-closing consideration is earned and otherwise prorated based on the same linear scale.

The transaction resulted in a gain of approximately $48.2 million, which is included in the net income from discontinued operations line on the condensed consolidated statement of operations. Also included in net income from discontinued operations are approximately $1.8 million of transaction-related expenses, such as legal and consulting fees.

In connection with the sale, the Company and Assurant also entered into a transition services agreement, pursuant to which the Company will provide ongoing information technology, human resources management and accounting services to StreetLinks for a period of up to eighteen months. The cash flows related to these services are not significant to StreetLinks. The Company will have no significant continuing involvement with StreetLinks beyond the transition services. Professional service fees earned by the ongoing entity under the transition services agreement are included in service fee income on the condensed consolidated statement of operations.

The Company has also executed a Non-Competition, Non-Solicitation and Non-Disclosure Agreement with StreetLinks providing that Novation will be prohibited from competing in the real estate appraisal management or valuation services business for a period of four years.

Mango Moving LLC (Logistics Segment)

Because of continued capital demands and difficulties generating positive cash flows or earnings, effective February 27, 2013, the Company committed to a plan to abandon the operations of Mango, which comprised the Company's entire Logistics segment. The run-off operations of Mango ceased during the first quarter of 2013, and the Company will not have any significant continuing involvement in Mango.

Results of Discontinued Operations

For the nine and three months ended September 30, 2014, net income from discontinued operations consists of the net operating income and losses of the disposed entities and any necessary eliminations through the date of sale or disposal, the gain on the sale of StreetLinks and any transaction-related expenses, income tax expense, and the gain on the sale of Advent intellectual property. For the nine and three months ended September 30, 2013, net income (loss) from discontinued operations consists solely of the net operating income and losses of the disposed entities and any necessary eliminations.

The results of the Company's discontinued operations are summarized below:



	For the Nine Months Ended September 30,				For the Three Months Ended September 30,
	2014		2013		2014			2013
Service fee income	$	37,840	$	125,332	$	493		$	32,555

Income (loss) from discontinued operations before income taxes	$	50,057	$	11,379	$	(390	)	$	1,915
Income tax expense	8,643		—		816			—
Income (loss) from discontinued operations, net of income taxes	$	41,414	$	11,379	$	(1,206	)	$	1,915

The assets and liabilities of discontinued operations as of September 30, 2014 relate entirely to Advent. As of September 30, 2014, the current liabilities of discontinued operations were comprised primarily of accruals for rebate and incentive programs, unclaimed funds, and electronic return originator (ERO) fees held for various violations of Advent's compliance program. The Company anticipates that the majority of the accruals for rebates and incentives will be settled within the next twelve months, while unclaimed funds will be escheated to the applicable state in accordance with unclaimed property laws. Obligations relating to ERO fees that have been held will be resolved when claims are received or when the statute of limitations for the related contractual obligation expires.

Noncurrent liabilities of discontinued operations consist entirely of ERO fees held for various violations of Advent's compliance program. The classification of ERO fees held as current versus noncurrent is dependent on the nature of the compliance violation and the tax year during which the violation occurred.

The major classes of assets and liabilities of discontinued operations as of September 30, 2014 and December 31, 2013 are detailed below.



	September 30, 2014		December 31, 2013
Assets
Current Assets
Cash and cash equivalents	$	608	$	3,499
Service fee receivable, net	—		4,850
Other current assets	292		2,720
Total current assets	900		11,069
Non-Current Assets
Property and equipment, net of accumulated depreciation	—		1,329
Goodwill	—		3,170
Other assets	—		1,449
Total non-current assets	—		5,948
Total assets	$	900	$	17,017

Liabilities
Current Liabilities
Accounts payable and accrued expenses	$	1,837	$	7,468
Other current liabilities	—		844
Total current liabilities (A)	1,837		8,312
Non-Current Liabilities
Other liabilities	1,721		1,364
Total non-current liabilities	1,721		1,364
Total liabilities (A)	$	3,558	$	9,676


(A)	Excludes amounts due to Novation of approximately $0.7 million and $6.4 million as of September 30, 2014 and December 31, 2013, respectively. These amounts are eliminated upon consolidation and, therefore, are not included in the consolidated balance sheets for any periods presented.