SEC Filing | National Vision Holdings, Inc.

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_______________________________________________________________________

FORM 8-K

_______________________________________________________________________

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the securities Exchange Act of 1934

Date of Report (Date Earliest Event report):

March 6, 2019

_______________________________________________________________________

National Vision Holdings, Inc.

(Exact name of registrant as specified in its charter)

_______________________________________________________________________



Delaware (State or other jurisdiction of incorporation or organization)		46‑4841717 (I.R.S. Employer Identification No.)

2435 Commerce Ave, Building 2200 Duluth, Georgia (Address of principal executive offices)		30096 (Zip Code) Not Applicable (Former name, former address and former fiscal year, if changed since last report)

(770) 822‑3600 (Registrant’s telephone number, including area code)

_______________________________________________________________________

Check the appropriate box below if the Form 8−K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:


☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.42


☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)


☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)


☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 7.01 Regulation FD Disclosure.

As disclosed in the Annual Report on Form 10-K for the fiscal year ended December 29, 2018, filed with the Securities and Exchange Commission on February 27, 2019 (the “Form 10-K”), during the fourth quarter of 2018, National Vision Holdings, Inc. (the “Company”) identified and corrected immaterial errors related to lease accounting for all periods presented in the consolidated financial statements included in the Form 10-K. For further details, refer to Note 1. “Business and Significant Accounting Policies: Correction of Errors in Previously Issued Financial Statements” to our consolidated financial statements included in Part II. Item 8. of the Form 10-K.

In order to facilitate comparability of quarterly results, the Company is making available certain supplemental financial information (the “Supplemental Financial Information”) revising the statement of operations and reconciliations of non-GAAP measures for the first three quarters of 2017 and 2018 to correct the effect of these errors for the corresponding periods. The Supplemental Financial Information is furnished as Exhibit 99.1 hereto.

The information included in this Current Report on Form 8-K is being furnished under Item 7.01, “Regulation FD Disclosure” of Form 8-K. As such, the information herein shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, nor shall it be incorporated by reference into a filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

See the Exhibit Index immediately preceding the signature page hereto, which is incorporated herein by reference.

EXHIBIT INDEX



Exhibit No.	Description
99.1	Supplemental Financial Information

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed by the undersigned hereunto duly authorized.




		National Vision Holdings, Inc.

Date: March 6, 2019	By:	/s/ Jared Brandman
	Name:	Jared Brandman
	Title:	Senior Vice President, General Counsel and Secretary

Exhibit

National Vision Holdings, Inc. and Subsidiaries

Consolidated Statements of Operations

For the Fiscal Year Ended December 29, 2019 (Audited), the Three Months Ended December 29, 2018, September 29, 2018, June 30, 2018 and March 31, 2018 (Unaudited)



	Fiscal Year 2018			Fourth Quarter Ended December 29, 2018			Third Quarter Ended September 29, 2018									Second Quarter Ended June 30, 2018							First Quarter Ended March 31, 2018
	As reported			As reported ^(a)			As previously reported			Adjustments			As corrected			As previously reported		Adjustments			As corrected		As previously reported		Adjustments			As corrected
Revenue:
Net product sales	$	1,269,612		$	292,115		$	319,312		$	—		$	319,312		$	319,408	$	—		$	319,408	$	338,777	$	—		$	338,777
Net sales of services and plans	267,242			63,807			68,113			—			68,113			66,124		—			66,124		69,198		—			69,198
Total net revenue	1,536,854			355,922			387,425			—			387,425			385,532		—			385,532		407,975					407,975
Cost applicable to revenue
Products	511,406			121,846			130,951			—			130,951			127,731		—			127,731		130,878		—			130,878
Services and plans	202,165			51,624			51,637			—			51,637			49,328		—			49,328		49,576		—			49,576
Total cost applicable to revenue	713,571			173,470			182,588			—			182,588			177,059		—			177,059		180,454					180,454
Operating Expenses:
Selling, general and administrative	687,476			166,132			184,424			604			185,028			165,038		589			165,627		170,102		587			170,689
Depreciation and amortization	74,339			19,556			19,080			264			19,344			17,346		231			17,577		17,654		208			17,862
Asset impairment	17,630			15,493			2,137			—			2,137			—		—			—		—		—			—
Other expenses, net	1,487			658			411			—			411			296		—			296		122		—			122
Total operating expenses	780,932			201,839			206,052						206,920			182,680		820			183,500		187,878		795			188,673
Income (loss) from operations	42,351			(19,387		)	(1,215		)	(868		)	(2,083		)	25,793		(820		)	24,973		39,643		(795		)	38,848
Interest expense, net	37,283			9,139			9,407			—			9,407			9,424		—			9,424		9,313		—			9,313
Debt issuance costs	200			200			—			—			—			—		—			—		—		—			—
Earnings (loss) before income taxes	4,868			(28,726		)	(10,622		)	(868		)	(11,490		)	16,369		(820		)	15,549		30,330		(795		)	29,535
Income tax provision (benefit)	(18,785		)	(10,286		)	(16,438		)	(223		)	(16,661		)	3,292		(210		)	3,082		5,283		(203		)	5,080
Net income (loss):	$	23,653		$	(18,440	)	$	5,816		$	(645	)	$	5,171		$	13,077	$	(610	)	$	12,467	$	25,047	$	(592	)	$	24,455


Earnings per share:
Basic	$	0.31		$	(0.24	)	$	0.08		$	(0.01	)	$	0.07		$	0.17	$	—		$	0.17	$	0.34	$	(0.01	)	$	0.33
Diluted	$	0.30		$	(0.24	)	$	0.07		$	(0.01	)	$	0.06		$	0.17	$	(0.01	)	$	0.16	$	0.32	$	(0.01	)	$	0.31

Weighted average shares outstanding:
Basic	75,899			77,526			76,118			—			76,118			75,249		—			75,249		74,714		—			74,714
Diluted	79,041			77,526			79,710			—			79,710			77,858		—			77,858		77,837		—			77,837

(a) As reported in Exhibit 99.1 of Form 8-K filed on February 27, 2019

National Vision Holdings, Inc. and Subsidiaries

Consolidated Statements of Operations

For the Fiscal Year Ended December 30, 2017 (Audited), the Three Months Ended December 30, 2017, September 30, 2017, July 1, 2017 and April 1, 2017 (Unaudited)



	Fiscal Year 2017			Fourth Quarter Ended December30, 2017			Third Quarter Ended September 30, 2017								Second Quarter Ended July 1, 2017									First Quarter Ended April 1, 2017
	As reported			As reported ^(a)			As previously reported		Adjustments			As corrected			As previously reported			Adjustments			As corrected			As previously reported		Adjustments			As corrected
Revenue:
Net product sales	$	1,129,313		$	262,121		$	283,648	$	—		$	283,648		$	276,960		$	—		$	276,960		$	306,584	$	—		$	306,584
Net sales of services and plans	245,995			59,698			62,441		—			62,441			60,581			—			60,581			63,275		—			63,275
Total net revenue	1,375,308			321,819			346,089		—			346,089			337,541			—			337,541			369,859		—			369,859
Cost applicable to revenue
Products	456,078			106,979			115,752		—			115,752			112,314			—			112,314			121,033		—			121,033
Services and plans	180,888			45,413			46,606		—			46,606			44,094			—			44,094			44,775		—			44,775
Total cost applicable to revenue	636,966			152,392			162,358		—			162,358			156,408			—			156,408			165,808		—			165,808
Operating Expenses:
Selling, general and administrative	600,010			152,760			151,251		525			151,776			144,655			508			145,163			149,804		507			150,311
Depreciation and amortization	61,974			16,953			15,352		219			15,571			14,629			205			14,834			14,423		193			14,616
Asset impairment	4,117			3,117			—		—			—			1,000			—			1,000			—		—			—
Litigation settlement	7,000			—			—		—			—			7,000			—			7,000			—		—			—
Other expenses, net	950			203			568		—			568			77			—			77			102		—			102
Total operating expenses	674,051			173,033			167,171		744			167,915			167,361			713			168,074			164,329		700			165,029
Income (loss) from operations	64,291			(3,606		)	16,560		(744		)	15,816			13,772			(713		)	13,059			39,722		(700		)	39,022
Interest expense, net	55,536			14,571			14,851		—			14,851			14,622			—			14,622			11,492		—			11,492
Debt issuance costs	4,527			1,825			—		—			—			—			—			—			2,702		—			2,702
Earnings (loss) before income taxes	4,228			(20,002		)	1,709		(744		)	965			(850		)	(713		)	(1,563		)	25,528		(700		)	24,828
Income tax provision (benefit)	(38,910		)	(47,343		)	163		(287		)	(124		)	646			(276		)	370			8,458		(271		)	8,187
Net income (loss):	$	43,138		$	27,341		$	1,546	$	(457	)	$	1,089		$	(1,496	)	$	(437	)	$	(1,933	)	$	17,070	$	(429	)	$	16,641


Earnings per share:
Basic	$	0.72		$	0.39		$	0.03	$	(0.01	)	$	0.02		$	(0.03	)	$	—		$	(0.03	)	$	0.30	$	—		$	0.30
Diluted	$	0.70		$	0.37		$	0.03	$	(0.01	)	$	0.02		$	(0.03	)	$	—		$	(0.03	)	$	0.29	$	—		$	0.29

Weighted average shares outstanding:
Basic	59,895			70,454			56,414		—			56,414			56,414			—			56,414			56,261		—			56,261
Diluted	62,035			73,256			58,459		—			58,459			56,414			—			56,414			57,934		—			57,934

(a) As reported in Exhibit 99.1 of Form 8-K filed on February 27, 2019

The following tables reconcile our net income to EBITDA, Adjusted EBITDA, and Adjusted Net Income for the periods presented (Unaudited):



	Fiscal Year 2018			Fourth Quarter Ended December 29, 2018			Third Quarter Ended September 29, 2018									Second Quarter Ended June 30, 2018							First Quarter Ended March 31, 2018
	As reported			As reported ^(a)			As previously reported			Adjustments			As corrected			As previously reported		Adjustments			As corrected		As previously reported		Adjustments			As corrected
Net income (loss)	$	23,653		$	(18,440	)	$	5,816		$	(645	)	$	5,171		$	13,077	$	(610	)	$	12,467	$	25,047	$	(592	)	$	24,455
Interest expense	37,283			9,139			9,407			—			9,407			9,424		—			9,424		9,313		—			9,313
Income tax provision (benefit)	(18,785		)	(10,286		)	(16,438		)	(223		)	(16,661		)	3,292		(210		)	3,082		5,283		(203		)	5,080
Depreciation and amortization	74,339			19,556			19,080			264			19,344			17,346		231			17,577		17,654		208			17,862
EBITDA	116,490			(31		)	17,865			(604		)	17,261			43,139		(589		)	42,550		57,297		(587		)	56,710

Stock compensation expense ^(b)	20,939			7,190			10,629			—			10,629			1,524		—			1,524		1,596		—			1,596
Debt issuance costs ^(c)	200			200			—			—			—			—		—			—		—		—			—
Asset impairment ^(d)	17,630			15,493			2,137			—			2,137			—		—			—		—		—			—
New store pre-opening expense ^(e)	2,229			487			512			—			512			756		—			756		474		—			474
Non-cash rent ^(f)	2,801			867			420			241			661			508		237			745		300		228			528
Secondary offering expenses ^(g)	2,451			609			702			—			702			177		—			177		1,191		(228		)	963
Long-term incentive plan ^(h)	7,040			2,429			4,611			—			4,611			—		—			—		—		—			—
Other ⁽ⁱ⁾	4,585			1,473			1,927			—			1,927			726		—			726		231		228			459
Adjusted EBITDA	$	174,365		$	28,717		$	38,803		$	(363	)	$	38,440		$	46,830	$	(352	)	$	46,478	$	61,089	$	(359	)	$	60,730



	Fiscal Year 2018			Fourth Quarter Ended December 29, 2018			Third Quarter Ended September 29, 2018									Second Quarter Ended June 30, 2018									First Quarter Ended March 31, 2018
	As reported			As reported ^(a)			As previously reported			Adjustments			As corrected			As previously reported			Adjustments			As corrected			As previously reported			Adjustments			As corrected
Net income (loss)	$	23,653		$	(18,440	)	$	5,816		$	(645	)	$	5,171		$	13,077		$	(610	)	$	12,467		$	25,047		$	(592	)	$	24,455
Stock compensation expense ^(b)	20,939			7,190			10,629			—			10,629			1,524			—			1,524			1,596			—			1,596
Debt issuance costs ^(c)	200			200			—			—			—			—			—			—			—			—			—
Asset impairment ^(d)	17,630			15,493			2,137			—			2,137			—			—			—			—			—			—
New store pre-opening expense^(e)	2,229			487			512			—			512			756			—			756			474			—			474
Non-cash rent ^(f)	2,801			867			420			241			661			508			237			745			300			228			528
Secondary offering expenses ^(g)	2,451			609			702			—			702			177			—			177			1,191			(228		)	963
Long-term incentive plan ^(h)	7,040			2,429			4,611			—			4,611			—			—			—			—			—			—
Other ⁽ⁱ⁾	4,585			1,473			1,927			—			1,927			726			—			726			231			228			459
Amortization of acquisition intangibles and deferred financing costs ^(j)	9,253			2,412			2,279			—			2,279			2,281			—			2,281			2,281			—			2,281
Tax benefit of stock option exercises ^(k)	(25,544		)	(7,578		)	(13,900		)	—			(13,900		)	(1,371		)	—			(1,371		)	(2,695		)	—			(2,695		)
Tax effect of total adjustments ^(l)	(13,309		)	(4,102		)	(5,943		)	(62		)	(6,005		)	(1,528		)	(61		)	(1,589		)	(1,555		)	(58		)	(1,613		)
Adjusted Net Income	$	51,928		$	1,040		$	9,190		$	(466	)	$	8,724		$	16,150		$	(434	)	$	15,716		$	26,870		$	(422	)	$	26,448


(a)	As reported in Exhibit 99.1 of Form 8-K filed on February 27, 2019


(b)	Non-cash charges related to stock-based compensation programs, which vary from period to period depending on the timing of awards and performance vesting conditions.


(c)	For fiscal year 2018, fees associated with the issuance of new term loans during the fourth quarter of fiscal year 2018.


(d)	Non-cash charges related to impairment of long-lived assets, primarily goodwill in our Military and Fred Meyer brands during fiscal year 2018

(e)

Pre-opening expenses, which include marketing and advertising, labor and occupancy expenses incurred prior to opening a new store, are generally higher than comparable expenses incurred once such store is open and generating revenue. We believe that such higher pre-opening expenses are specific in nature, are not indicative of ongoing core operating performance. We adjust for these costs to facilitate comparisons of store operating performance from period to period.


(f)	Consists of the non-cash portion of rent expense, which reflects the extent to which our straight-line rent expense recognized under GAAP exceeds or is less than our cash rent payments.


(g)	Expenses related to our secondary public offerings during fiscal year 2018.

(h)

Expenses pursuant to a long-term incentive plan for non-executive employees who were not participants in the management equity plan for fiscal year 2018. This plan was effective in 2014 following the acquisition of the Company by KKR Sponsor. During the third quarter of fiscal year 2018, $4.6 million cash payout was triggered as a result of the second secondary offering of common stock by KKR Sponsor and other selling shareholders. The remaining $2.4 million relates to the third secondary offering and is accrued but not paid as of fiscal year end 2018.

(i)

Other adjustments include amounts that management believes are not representative of our operating performance (amounts in brackets represent reductions in Adjusted EBITDA and Adjusted Net Income) including our share of losses on equity method investments of $0.3 million, $0.4 million, $0.4 million, $0.2 million for the three months ended December 29, 2018, September 29, 2018, June 30, 2018 and March 31, 2018, respectively; the amortization impact of the KKR Acquisition-related adjustments (e.g., fair value of leasehold interests) of $0.1 million, $0.2 million, $52,000 million and $17 thousand for the three months ended December 29, 2018, September 29, 2018, June 30, 2018 and March 31, 2018, respectively; differences between the timing of expense versus cash payments related to contributions to charitable organizations of $(0.2) million, for the three months ended December 29, 2018, and $(0.3) million for each of the three months ended September 29, 2018, June 30, 2018 and March 31, 2018, respectively; costs of severance and relocation of $0.1 million, $0.3 million $0.3 million, and $0.2 million for the three months ended December 29, 2018, September 29, 2018, June 30, 2018 and March 31, 2018, respectively; excess payroll taxes related to stock option exercises of $0.6 million and $0.9 million for the three months ended December 29, 2018 and September 29, 2018, respectively; and other expenses and adjustments totaling $0.6 million, $0.4 million, $0.2 million and $0.3 million for the three months ended December 29, 2018, September 29, 2018, June 30, 2018 and March 31, 2018, respectively.

(j)

Amortization of the increase in carrying values of definite-lived intangible assets resulting from the application of purchase accounting to the KKR Acquisition of $1.9 million for each of the fiscal quarters of 2018; and 2) Amortization of debt discounts associated with the March 2014 term loan borrowings in connection with the KKR Acquisition and, to a lesser extent, amortization of debt discounts associated with the May 2015 and February 2017 incremental First Lien - Term Loan B and the November 2017 First Lien - Term Loan B refinancing, aggregating to $0.5 million for the three months ended December 29, 2018, and $0.4 million for each of the three months ended September 29, 2018, June 30, 2018 and March 31, 2018.


(k)	Tax benefit associated with accounting guidance adopted at the beginning of fiscal year 2017 (Accounting Standards Update 2016-09, Compensation - Stock Compensation), requiring excess tax benefits to be recorded in earnings as discrete items in the reporting period in which they occur.


(l)	Represents the income tax effect of the total adjustments, at our combined statutory federal and state income tax rates.

The following tables reconcile our net income to EBITDA, Adjusted EBITDA, and Adjusted Net Income for the periods presented (Unaudited):



	Fiscal Year 2017			Fourth Quarter Ended December 30, 2017			Third Quarter Ended September 30, 2017								Second Quarter Ended July 1, 2017									First Quarter Ended April 1, 2017
	As reported			As reported ^(a)			As previously reported		Adjustments			As corrected			As previously reported			Adjustments			As corrected			As previously reported		Adjustments			As corrected
Net income (loss)	$	43,138		$	27,341		$	1,546	$	(457	)	$	1,089		$	(1,496	)	$	(437	)	$	(1,933	)	$	17,070	$	(429	)	$	16,641
Interest expense	55,536			14,571			14,851		—			14,851			14,622			—			14,622			11,492		—			11,492
Income tax provision (benefit)	(38,910		)	(47,343		)	163		(287		)	(124		)	646			(276		)	370			8,458		(271		)	8,187
Depreciation and amortization	61,974			16,953			15,352		219			15,571			14,629			205			14,834			14,423		193			14,616
EBITDA	121,738			11,522			31,912		(525		)	31,387			28,401			(508		)	27,893			51,443		(507		)	50,936

Stock compensation expense ^(a)	5,152			2,012			1,151		—			1,151			885			—			885			1,104		—			1,104
Debt issuance costs ^(b)	4,527			1,825			—		—			—			—			—			—			2,702		—			2,702
Asset impairment ^(c)	4,117			3,117			—		—			—			1,000			—			1,000			—		—			—
Non-cash inventory write-offs ^(d)	2,271			—			—		—			—			256			—			256			2,015		—			2,015
Management fees ^(e)	5,263			4,418			271		—			271			290			—			290			284		—			284
New store pre-opening expense ^(f)	2,531			635			618		—			618			660			—			660			618		—			618
Non-cash rent ^(g)	1,919			289			381		205			586			296			199			495			358		191			549
Litigation settlement ^(h)	7,000			—			—		—			—			7,000			—			7,000			—		—			—
Other ⁽ⁱ⁾	3,924			883			1,828		—			1,828			831			—			831			382		—			382
Adjusted EBITDA	$	158,442		$	24,701		$	36,161	$	(320	)	$	35,841		$	39,619		$	(309	)	$	39,310		$	58,906	$	(316	)	$	58,590



	Fiscal Year 2017			Fourth Quarter Ended December 30, 2017			Third Quarter Ended September 30, 2017									Second Quarter Ended July 1, 2017									First Quarter Ended April 1, 2017
	As reported			As reported ^(a)			As previously reported			Adjustments			As corrected			As previously reported			Adjustments			As corrected			As previously reported			Adjustments			As corrected
Net income (loss)	$	43,138		$	27,341		$	1,546		$	(457	)	$	1,089		$	(1,496	)	$	(437	)	$	(1,933	)	$	17,070		$	(429	)	$	16,641
Stock compensation expense ^(b)	5,152			2,012			1,151			—			1,151			885			—			885			1,104			—			1,104
Debt issuance costs ^(c)	4,527			1,825			—			—			—			—			—			—			2,702			—			2,702
Asset impairment ^(d)	4,117			3,117			—			—			—			1,000			—			1,000			—			—			—
Non-cash inventory write-offs ^(e)	2,271			—			—			—			—			256			—			256			2,015			—			2,015
Management fees ^(f)	5,263			4,418			271			—			271			290			—			290			284			—			284
New store pre-opening expenses ^(g)	2,531			635			618			—			618			660			—			660			618			—			618
Non-cash rent ^(h)	1,919			289			381			205			586			296			199			495			358			191			549
Litigation settlement ⁽ⁱ⁾	7,000			—			—			—			—			7,000			—			7,000			—			—			—
Other ^(j)	3,924			883			1,828			—			1,828			831			—			831			382			—			382
Amortization of acquisition intangibles and deferred financing costs ^(k)	14,481			5,853			2,884			—			2,884			2,885			—			2,885			2,859			—			2,859
Tax legislation adjustment ^(l)	(42,089		)	(42,089		)	—			—			—			—			—			—			—			—			—
Tax effect of total adjustments ^(m)	(20,475		)	(7,613		)	(2,853		)	(82		)	(2,935		)	(5,641		)	(80		)	(5,721		)	(4,129		)	(77		)	(4,206		)
Adjusted Net Income (loss)	$	31,759		$	(3,329	)	$	5,826		$	(334	)	$	5,492		$	6,966		$	(318	)	$	6,648		$	23,263		$	(315	)	$	22,948


(a)	As reported in Exhibit 99.1 of Form 8-K filed on February 27, 2019


(b)	Non-cash charges related to stock-based compensation programs, which vary from period to period depending on the timing of awards and performance vesting conditions.


(c)	For fiscal year 2017, includes $2.7 million of fees associated with the borrowing of $175.0 million in additional principal under our first lien credit agreement during the first quarter of 2017 and $1.8 million of fees associated with the refinancing of our first lien credit agreement during the fourth quarter of 2017.


(d)	Non-cash charges related to impairment of cost basis investment during the second quarter of 2017 and write-off of capitalized software and property and equipment during the fourth quarter of 2017.


(e)	Reflects write-offs of inventory relating to the expiration of a specific type of contact lens that could not be sold and required disposal.


(f)	Reflects management fees paid to KKR Sponsor and Berkshire in accordance with our monitoring agreement with them. The monitoring agreement was terminated automatically in accordance with its terms upon the consummation of the IPO in October 2017.

(g)


(h)	Consists of the non-cash portion of rent expense, which reflects the extent to which our straight-line rent expense recognized under GAAP exceeds or is less than our cash rent payments.


(i)	Expenses associated with settlement of litigation.

(j)

Other adjustments include amounts that management believes are not representative of our operating performance (amounts in brackets represent reductions in Adjusted EBITDA and Adjusted Net Income) including our share of losses on equity method investments of $0.3 million, $0.4 million, $0.2 million and $0.1 million for the three months ended December 30, 2017, September 30, 2017, July 1, 2017 and April 1, 2017, respectively; the amortization impact of the KKR Acquisition-related adjustments (e.g., fair value of leasehold interests) of $(0.1) for each of the three months ended December 30, 2017, September 30, 2017, July 1, 2017 and April 1, 2017; expenses related to preparation for being an SEC registrant that were not directly attributable to our IPO and therefore not charged to equity of $0.6 million and $0.7 million and $0.5 million for the three months ended September 30, 2017, July 1, 2017 and April 1, 2017, respectively; differences between the timing of expense versus cash payments related to contributions to charitable organizations of $(0.3) million for each of the three months ended December 30, 2017, September 30, 2017, July 1, 2017 and April 1, 2017; costs of severance and relocation of $0.4 million, $0.7 million and $0.3 million for the three months ended December 30, 2017, September 30, 2017 and July 1, 2017, respectively; and other expenses and adjustments totaling $0.5 million, $0.4 million and $0.1 million for the three months ended December 30, 2017, September 30, 2017, and April 1, 2017, respectively.

(k)

Amortization of the increase in carrying values of definite-lived intangible assets resulting from the application of purchase accounting to the KKR Acquisition of $1.9 million for each of the quarters of 2017; and 2) Amortization of debt discounts associated with the March 2014 term loan borrowings in connection with the KKR Acquisition and, to a lesser extent, amortization of debt discounts associated with the May 2015 and February 2017 incremental First Lien - Term Loan B and the November 2017 First Lien - Term Loan B refinancing, aggregating to $4.0 million for the quarter ended December 30, 2017, and $1.0 million for each of the three months ended September 30, 2017, July 1, 2017 and April 1, 2017. The additional amortization of debt discount in fourth quarter of 2017 includes a $3.3 million write-off of debt discounts associated with the repayment of the entire $125.0 million second lien term loan balance.


(l)	The adjustment represents re-measuring and reassessing the net realizability of our deferred tax assets and liabilities during fiscal year 2017. See Note 6. “Income Taxes” in Part II. Item 8. of this Form 10-K for additional information regarding the Tax Legislation.


(m)	Represents the income tax effect of the total adjustments, at our combined statutory federal and state income tax rates.