Sale of Business

3 Months Ended

Mar. 31, 2021

Discontinued Operations and Disposal Groups [Abstract]

Sale of Business

Latin America Divestiture

On June 25, 2020, we closed on the sale of five subsidiaries comprising our manufacturing and sales operations in Latin America to buyers led by Instalación Profesional y Tecnologías del Centro S.A. de C.V., a Mexican company doing business as Accell in Brazil (Accell), through the execution of various definitive stock purchase agreements. The sale of these Latin America-based operations is part of our continued strategy to improve profitability and focus on growing our Networked Solutions and Outcomes businesses in Latin America and throughout the world. We retained the intellectual property rights to our products sold in Latin America. As part of the transaction, we entered into an intellectual property license agreement whereby Accell pays a royalty on certain products manufactured by Accell using licensed Company intellectual property. In addition, Accell serves as the exclusive distributor for our Device Solutions, Networked Solutions, and Outcomes product and service offerings in Latin America.

The total sales price of $35 million included payment of $21.1 million for working capital, which was to be paid in full by December 31, 2020, as evidenced by a promissory note. In January 2021, we agreed to extend the payment terms on the outstanding working capital balance of $18.4 million. Accell agreed to make monthly payments including interest through September 2022. During the quarter ended March 31, 2021, we received $3.5 million of payments on the working capital note, including $0.7 million in interest.

We recognized additional loss on sale of business for the quarter ended March 31, 2021 of $1.4 million driven primarily by $1.2 million in adjustment to the working capital note, resulting from a change to the currency denominations of the note.