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RELATED PARTY TRANSACTIONS
6 Months Ended
Jun. 30, 2016
Related Party Transactions [Abstract]  
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS
As discussed in Note 3, Discontinued Operations, the Company has entered into a transition services agreement to provide certain services to New Avon, as well as an agreement for research and development and subleases for office space. In addition, New Avon is performing certain services for the Company under a similar transition services agreement. The Company recorded a net $11.0 and $14.9 reduction of selling, general and administrative expenses associated with these agreements during the three and six months ended June 30, 2016, respectively.
The Company also supplies product to New Avon as part of these transition services. The Company recorded revenues of $9.8 and $13.5 and gross profit of $.4 and $.9 associated with this supply arrangement during the three and six months ended June 30, 2016, respectively. In addition, New Avon also supplies product to the Company as part of these transition services. The Company purchased $2.4 and $3.6 from New Avon associated with this supply arrangement during the three and six months ended June 30, 2016, respectively.
The Company also entered into agreements with an affiliate of Cerberus, which provide for the secondment of Cerberus affiliate personnel to the Company's project management team responsible for assisting with the execution of the transformation plan (the "Transformation Plan") announced in January 2016. The Company recorded $1.0 and $1.0 in selling, general and administrative expenses associated with these agreements during the three and six months ended June 30, 2016, respectively. See Note 12, Restructuring Initiatives for additional information related to the Transformation Plan.
The Company also issued standby letters of credit to the lessors of certain equipment, a lease for which was transferred to New Avon in connection with the separation of the Company's North America business. As of June 30, 2016 the Company has accrued $2.1 for the estimated value of such standby letters of credit. The recognition of the liability was included in the estimated loss on sale of the North America business in loss from discontinued operations, net of tax.
See Note 7, Series C Convertible Preferred Stock, for discussion of preferred shares issued to Cerberus Investor.