Home Shopping Network 2015 Annual Report Download - page 34

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32
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
At December 31, 2015 and 2014, HSNi’s outstanding long-term debt was $640.0 million and $228.1 million,
respectively, all of which pays interest at a variable rate, generally tied to LIBOR. The increase in HSNi's outstanding variable-
rate debt was due to its refinancing that occurred in January 2015. Changes in interest rates on our variable rate debt could
affect our earnings. We are managing our future interest rate exposure through an interest rate swap with a notional amount of
$187.5 million and a fixed rate of 0.8525% that took effect January 2014 and expires in April 2017. A hypothetical 100 basis
point increase in interest rates on the portion of our variable rate debt that was outstanding as of December 31, 2015 and that
was not effectively hedged by the fixed-rate interest rate swap would increase our annual interest expense by approximately
$4.5 million in 2016.