WeightWatchers 2012 Annual Report Download - page 98

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WEIGHT WATCHERS INTERNATIONAL, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
Credit Facility changed as a result of the Company amending and restating the WWI Credit Facility to, among
other things, extend the maturity of certain of the Company’s term loan facilities and the revolving credit facility
and to obtain new commitments for the borrowing of an additional $1,449,397 of term loans to finance the
purchases of shares of the Company’s common stock in the Tender Offer and from Artal Holdings pursuant to
the Purchase Agreement (each as defined below in Note 7).
Immediately prior to the amendment of the WWI Credit Facility, the term loan facilities consisted of a
tranche A-1 loan (“Term A-1 Loan”), a tranche B loan (“Term B Loan”), a tranche C loan (“Term C Loan”), and
a tranche D loan (“Term D Loan”), and a revolving credit facility (“Revolver A-1”). The aggregate principal
amount then outstanding under (i) the Term A-1 Loan was $128,648, (ii) the Term B Loan was $237,500, (iii) the
Term C Loan was $420,394 and (iv) the Term D Loan was $238,247. Immediately prior to the amendment of the
WWI Credit Facility, the Revolver A-1 had no loans outstanding under it, $1,027 of issued but undrawn letters of
credit and $331,620 in available unused commitments thereunder.
Following the amendment of the WWI Credit Facility on March 15, 2012, (i) $33,083 in aggregate principal
amount of the Term A-1 Loan and $301,777 in aggregate principal amount of the Term C Loan were converted
into, and $849,397 in aggregate principal amount of commitments to borrow new term loans were provided
under, a new tranche E loan (“Term E Loan”), (ii) $107,025 in aggregate principal amount of the Term B Loan
and $119,123 in aggregate principal amount of the Term D Loan were converted into, and $600,000 in aggregate
principal amount of commitments to borrow new term loans were provided under, a new tranche F loan (“Term F
Loan”), and (iii) $261,971 in aggregate principal amount of commitments under the Revolver A-1 were
converted into a new revolving credit facility (“Revolver A-2”). The loans outstanding under each term loan
facility existing prior to the amendment of the WWI Credit Facility and the loans and commitments outstanding
under the Revolver A-1, in each case that were not converted into the Term E Loan, the Term F Loan or the
Revolver A-2, as applicable, continued to remain outstanding under the WWI Credit Facility as the Term A-1
Loan, the Term B Loan, the Term C Loan, the Term D Loan or the Revolver A-1, as applicable. In connection
with this amendment, the Company incurred fees of $26,248 during the first quarter of fiscal 2012. On March 27,
2012, the Company borrowed an aggregate of $726,000 under the Term E Loan and the Term F Loan to finance
the purchase of shares in the Tender Offer and to pay a portion of the related fees and expenses. On April 9,
2012, the Company borrowed an aggregate of approximately $723,397 under the Term E Loan to finance the
purchase of shares from Artal Holdings. At December 29, 2012, the Company had $2,406,364 outstanding under
the WWI Credit Facility, a combination of term loans and amounts outstanding under the Revolver A-1 and the
Revolver A-2. In addition, at December 29, 2012, the Revolver A-1 had $244 in issued but undrawn letters of
credit outstanding thereunder and $64,058 in available unused commitments thereunder and the Revolver A-2
had $908 in issued but undrawn letters of credit outstanding thereunder and $237,437 in available unused
commitments thereunder.
At December 29, 2012 and December 31, 2011, the Company’s debt consisted entirely of variable-rate
instruments. Interest rate swaps were entered into to hedge a portion of the cash flow exposure associated with
the Company’s variable- rate borrowings. The average interest rate on the Company’s debt, exclusive of the
impact of swaps, was approximately 2.99% and 2.40% per annum at December 29, 2012 and December 31,
2011, respectively.
The WWI Credit Facility provides that term loans and the loans outstanding under the Revolver A-1 and the
Revolver A-2 bear interest at a rate per annum equal to either, at the Company’s option, the LIBO Rate (Reserve
Adjusted) (as defined in the WWI Credit Facility agreement) plus an applicable margin or the Alternate Base
Rate (as defined in the WWI Credit Facility agreement) plus an applicable margin, which applicable margins will
vary depending on the Company’s Net Debt to EBITDA Ratio (as defined in the WWI Credit Facility agreement)
F-16