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Spectrum Brands and Salton Inc.
Terminate Sale Agreement

Rayovac parent says global pet supply business to remain in company's portfolio

Spectrum Brands, Inc. Press Release

FlashlightNews.org - 7/14/2008


(Click photo to enlarge)
Rayovac Hybrid Battery Charger

Rayovac Hybrid Battery Charger with 2 AA Batteries

ATLANTA, Ga. - Spectrum Brands, Inc. (NYSE: SPC) (the Company) announced today that it and Salton Inc. and Salton's wholly owned subsidiary, Applica Pet Products LLC, have mutually agreed to terminate the definitive agreement for the sale of the Company's global pet supply business.

"Despite our desire and diligent efforts to complete this transaction upon the negotiated terms, we have been unable to obtain the consent of our senior lenders necessary to close on a basis that would be in the best interests of our shareholders and the Company," said Kent Hussey, CEO of Spectrum Brands. "We will therefore continue to operate the global pet supply business and work to capture the strong market potential we see there. Additionally, our Board and management team remain committed to finding and executing appropriate alternatives for reducing the indebtedness of the Company."

Hussey continued, "With $72.7 million of cash on our Balance Sheet at quarter-end, June 29, 2008, and both sales and adjusted EBITDA growth expected for the full year fiscal 2008 versus full year fiscal 2007 results, we continue to believe that we have sufficient liquidity to run our businesses." In addition, based on current forecasts, the Company projects its fiscal 2009 free cash flow from operations, which would be available to reduce outstanding indebtedness, to range between $40 to $50 million. This projection includes an estimate of Cash Flows from Operating Activities for fiscal 2009 of $75 to $85 million less capital expenditures of $35 million.

Termination of the definitive agreement is conditioned upon the company paying to Salton Inc. $3 million as a reimbursement of expenses within 2 business days. Additionally, the standstill provisions of the confidentiality and standstill agreement entered into on February 26, 2008 with Harbinger Capital Partners Master Fund I, Ltd. were terminated.

About Spectrum Brands, Inc.

Spectrum Brands is a global consumer products company and a leading supplier of consumer batteries, lawn and garden care products, specialty pet supplies, shaving and grooming products, household insect control products, personal care products and portable lighting. Helping to meet the needs of consumers worldwide, included in its portfolio of widely trusted brands are Rayovac®, Varta®, Remington®, Tetra®, Marineland®, Nature's Miracle®, Dingo®, 8-In-1®, Spectracide®, Schultz®, Cutter®, Repel®, and HotShot®. Spectrum Brands' products are sold by the world's top 25 retailers and are available in more than one million stores in more than 120 countries around the world. Headquartered in Atlanta, Georgia, Spectrum Brands generated fiscal year 2007 net sales of $2.6 billion. The Company's stock trades on the New York Stock Exchange under the symbol SPC.

For more information, visit www.spectrumbrands.com/.

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