WeightWatchers 2010 Annual Report Download - page 72

Dividends
We have issued a quarterl
y
cash dividend of $0.175 per share of our common stock ever
y
quarter be
g
innin
g
with the first quarter of fiscal 200
6
. Prior to these dividends, we had not declared or paid an
y
cash dividends on
o
ur common stoc
k
s
i
nce our acqu
i
s
i
t
i
on
by
Arta
li
n 1999
.
A
n
yd
ec
i
s
i
on to
d
ec
l
are an
d
pa
ydi
v
id
en
d
s
i
nt
h
e
f
uture w
ill b
ema
d
eatt
h
e
di
scret
i
on o
f
our Boar
d
o
f
D
i
rectors, a
f
ter ta
ki
n
gi
nto account our
fi
nanc
i
a
l
resu
l
ts, cap
i
ta
l
requ
i
rements an
d
ot
h
er
f
actors
i
tma
yd
ee
m
r
e
l
evant. Our Boar
d
o
f
D
i
rectors ma
yd
ec
id
eatan
y
t
i
me to
i
ncrease or
d
ecrease t
h
e amount o
fdi
v
id
en
d
sor
di
scont
i
nue t
h
epa
y
ment o
fdi
v
id
en
d
s
b
ase
d
on t
h
ese
f
actors. T
h
e WWI Cre
di
t Fac
ili
t
y
a
l
so conta
i
ns restr
i
ct
i
on
s
o
n our a
bili
t
y
to pa
ydi
v
id
en
d
s on our common stoc
k.
T
h
e WWI Cre
di
t Fac
ili
t
y
prov
id
es t
h
at we are perm
i
tte
d
to pa
ydi
v
id
en
d
san
d
extraor
di
nar
ydi
v
id
en
d
sso
l
on
g
as we are not
i
n
d
e
f
au
l
tun
d
er t
h
e WWI Cre
di
t Fac
ili
t
y
a
g
reements. However, pa
y
ment o
f
extraor
di
nar
y
dividends shall not exceed $150.0 million in an
y
fiscal
y
ear if net debt to EBITDA (as defined in the WWI Credi
t
Facilit
y
a
g
reement) is
g
reater than 3.75:1 and an investment
g
rade ratin
g
date (as defined in the WWI Credit
Fac
ili
t
y
a
g
reement)
h
as not occurre
d
.We
d
o not expect t
hi
s restr
i
ct
i
on to
i
mpa
i
r our a
bili
t
y
to pa
ydi
v
id
en
d
s,
b
ut
i
t cou
ld d
oso
.
Contractual Obligations
We are o
blig
ate
d
un
d
er non-cance
l
a
bl
e operat
i
n
gl
eases pr
i
mar
ily f
or o
ffi
ce an
d
rent
f
ac
ili
t
i
es. Conso
lid
ate
d
r
ent expense char
g
ed to operations under all our leases for fiscal 2010 was approximatel
y
$35.2 million.
T
h
e
f
o
ll
ow
i
n
g
ta
bl
e summar
i
zes our
f
uture contractua
l
o
blig
at
i
ons as o
f
t
h
een
d
o
ffi
sca
l
2010:
T
o
t
al
Payment Due by Per
i
od
L
ess t
h
a
n
1
Y
ear
1
-
3
Y
ea
r
s
3
-5
Y
ea
r
s
M
ore t
h
a
n
5
Y
ea
r
s
(
in millions
)
Long-Term Debt
(1)
Princi
p
a
l
......................................
$
1,365.1
$
197.5
$
210.9
$
728.1
$
228.
6
I
n
te
r
est
.......................................
10
9
.1 22.2
5
6.0 28.0 2.
9
Operating lease
s
....................................
66.
5
21.
9
24.
5
12.3 7.8
Other long-term obligations
(2)
......................... 4.2 0.6 1.3 1.2 1.1
Tota
l
.........................................
$
1
,
544.9
$
242.2
$
292.7
$
769.6
$
240.4
(1) Due to the fact that all of our debt is variable rate based, we have assumed for
p
ur
p
oses of this table that th
e
interest rate on all of our debt as of the end of fiscal 2010 remains constant for all
p
eriods
p
resented.
(2) “Other long-term obligations” primarily consist of deferred rent costs. The provision for income ta
x
contingencies included in other long-term liabilities on the consolidated balance sheet is not included in th
e
table above due to the fact that the Company is unable to estimate the timing of payment for this liability
.
We currently plan to meet our long-term debt obligations by using cash flows provided by operating
activities and opportunistically using other means to repay or refinance our obligations as we determin
e
appropriate. We believe that cash flows from operating activities, together with borrowings available under our
R
evolver, will be sufficient for the next 12 months to fund currently anticipated capital expenditure requirements,
debt service requirements and working capital requirements.
F
ranc
h
ise Ac
q
uisitions
The following are our key franchise acquisitions since fiscal 2007:
I
n June 2008, we acquired substantiall
y
all of the assets of two of our franchisees, Wei
g
ht Watchers o
f
S
y
racuse, Inc. and Dieters of the Southern Tier, Inc., for a combined purchase price of approximatel
y
$20.9 million
.
56