WeightWatchers 2015 Annual Report Download - page 67

second quarter of fiscal 2013 in connection with this refinancing. In the second quarter of fiscal 2013, we wrote-
off fees associated with this refinancing which resulted in our recording a charge of $21.7 million in early
extinguishment of debt.
On September 26, 2014, we entered into an agreement with certain lenders amending the Credit Agreement
that, among other things, eliminated the Financial Covenant (as defined in the Credit Agreement) with respect to
the Revolving Facility. In connection with this amendment, we wrote-off deferred financing fees of
approximately $1.6 million in the third quarter of fiscal 2014. Concurrently with and in order to effect this
amendment, we reduced the amount of the Revolving Facility from $250.0 million to $50.0 million.
Under the terms of the Credit Agreement, depending on our Consolidated Leverage Ratio (as defined in the
Credit Agreement), we are obligated to offer to prepay the Term Facilities in an aggregate amount determined by
our excess cash flow (as defined in the Credit Agreement). On March 13, 2015, we commenced an offer to
prepay at a discount to par up to $75.0 million in aggregate principal amount of term loans outstanding under the
Tranche B-1 Term Facility. On March 20, 2015, we accepted offers with a discount equal to or greater than
9.00% in respect of such term loans. On March 25, 2015, we paid an aggregate amount of cash proceeds totaling
$57.4 million plus an amount sufficient to pay accrued and unpaid interest on the amount prepaid to prepay $63.1
million in aggregate principal amount of such term loans under the Tranche B-1 Term Facility. This expenditure
reduced, on a dollar for dollar basis, our $59.7 million obligation to make a mandatory excess cash flow
prepayment offer to the term loan lenders under the terms of the Credit Agreement. In addition, we made a
voluntary prepayment at par on March 25, 2015 of $2.5 million in respect of such term loans under the Tranche
B-1 Term Facility to reduce the remaining excess cash flow prepayment obligation for fiscal 2015. As a result of
this prepayment, we wrote-off fees of $0.3 million, incurred fees of $0.6 million and recorded a gain on early
extinguishment of debt of $4.7 million, inclusive of these fees, in the first quarter of fiscal 2015.
On June 17, 2015, we commenced another offer to prepay at a discount to par up to $229.0 million in
aggregate principal amount of term loans outstanding under the Tranche B-1 Term Facility. On June 22, 2015,
we accepted offers with a discount equal to or greater than 9.00% in respect of such term loans. On June 26,
2015, we paid an aggregate amount of cash proceeds totaling $77.2 million plus an amount sufficient to pay
accrued and unpaid interest on the amount prepaid to prepay $84.9 million in aggregate principal amount of such
term loans under the Tranche B-1 Term Facility. As a result of this prepayment, we wrote-off fees of $0.3
million, incurred fees of $0.6 million and recorded a gain on early extinguishment of debt of $6.7 million,
inclusive of these fees, in the second quarter of fiscal 2015.
On July 14, 2015, we drew down the $48.0 million available on our Revolving Facility in order to enhance
our cash position and to provide additional financial flexibility. The revolver borrowing has been classified as a
short-term liability in consideration of the fact that the terms of the Revolving Facility require an assessment as
to whether there have been any material adverse changes with respect to the Company in connection with our
monthly interest elections. Although the revolver borrowing has been classified as a short-term liability, absent
any change in fact and circumstance, we have the ability to extend and not repay the Revolving Facility until its
due date of April 2, 2018.
At January 2, 2016, under the WWI Credit Facility, we had $2,186.6 million outstanding consisting entirely
of term loans, and borrowings of $48.0 million outstanding under the Revolving Facility. In addition, at
January 2, 2016, the Revolving Facility had $1.8 million in issued but undrawn letters of credit outstanding
thereunder and $0.2 million in available unused commitments thereunder. The proceeds from borrowings under
the Revolving Facility (including swing line loans and letters of credit) are available to be used for working
capital and general corporate purposes.
At the end of fiscal 2015, fiscal 2014 and fiscal 2013, our debt consisted entirely of variable-rate
instruments. Interest rate swaps were entered into to hedge a portion of the cash flow exposure associated with
our variable-rate borrowings. The weighted average interest rate on our debt, exclusive of the impact of swaps,
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