we seek to improve our overall profitability by implementing cost reduction programs associated with our manufacturing , selling and general and administrative expenses . in november 2013 , the company initiated a cost reduction plan designed to deliver meaningful cost savings and optimal equipment utilization . this plan will result in several plant rationalizations . the costs associated with this plan will primarily consist of one-time costs associated with facility consolidation , including severance and termination benefits for employees of approximately $ 6 million , other costs associated with exiting facilities of approximately $ 30 million and non-cash asset impairment charges of approximately $ 11 million . in addition , as part of this cost reduction plan the company estimates it will incur capital expenditures of approximately $ 13 million . overall these facility restructuring programs are projected to generate approximately $ 27 million of annual operating savings when fully implemented . these amounts are preliminary estimates based on the information currently available to management . the plan is expected to be fully implemented by the end of fiscal 2014. recent developments initial public offering in october 2012 , the company completed an initial public offering and sold 29,411,764 shares of common stock at a public offering price of $ 16.00 per share . in conjunction with the initial public offering the company executed a 12.25 for one stock split of the company 's common stock . the effect of the stock split on outstanding shares and earnings per share has been retroactively applied to all periods presented . transaction fees totaling $ 33 million were included in paid-in capital on the consolidated balance sheets . proceeds , net of transaction fees , of $ 438 million and cash from operations were used to repurchase $ 455 million of 11 % senior subordinated notes due september 2016. as part of the repurchase the company paid premiums of $ 13 million and wrote-off $ 3 million of deferred financing fees . 17 tax receivable agreement in connection with the initial public offering , the company entered into an income tax receivable agreement ( `` tra `` ) that provides for the payment to pre-initial public offering stockholders , option holders and holders of our stock appreciation rights , 85 % of the amount of cash savings , if any , in u.s. federal , foreign , state and local income tax that are actually realized ( or are deemed to be realized in the case of a change of control ) as a result of the utilization of our and our subsidiaries ' net operating losses attributable to periods prior to the initial public offering . the company expects to pay between $ 313 million and $ 360 million in cash related to this agreement . this range is based on the company 's assumptions using various items , including valuation analysis and current tax law . the company recorded an obligation of $ 313 million which was recognized as a reduction of paid-in capital on the consolidated balance sheets . changes in the estimated tra obligation will be recorded as other expense ( income ) in the consolidated statement of operations . payments under the tra are not conditioned upon the parties ' continued ownership of the company . the balance at the end of fiscal 2013 was $ 308 million . during fiscal 2013 , the company made $ 5 million of payments related to the tra with an additional $ 32 million being paid in the first fiscal quarter of 2014. incremental term loan in february 2013 , the company entered into an incremental assumption agreement to increase the commitments under berry plastics corporation 's existing term loan credit agreement by $ 1.4 billion . berry plastics corporation borrowed loans in an aggregate principal amount equal to the full amount of the commitments on such date . the incremental term loans bear interest at libor plus 2.50 % per annum with a libor floor of 1.00 % , matures in february 2020 and are subject to customary amortization . the proceeds from the incremental term loan , in addition to borrowings under the revolving credit facility , were used to ( a ) satisfy and discharge all of berry plastics corporation 's outstanding ( i ) second priority senior secured floating rate notes due 2014 , ( ii ) first priority senior secured floating rate notes due 2015 , ( iii ) 101⁄4 % senior subordinated notes due 2016 and ( iv ) 81⁄4 % first priority senior secured notes due 2015 , which , in each case , were called for redemption in february 2013 and the related indentures and ( b ) pay related fees and expenses . the company recognized a $ 48 million loss on extinguishment of debt related to this debt refinancing . interest rate swap in february 2013 , the company entered into an interest rate swap transaction to protect $ 1 billion of outstanding variable rate term loan debt from future interest rate volatility . the agreement swapped the greater of a three-month variable libor contract or 1.00 % for a fixed three-year rate of 2.355 % , with an effective date in may 2016 and expiration in may 2019. in june 2013 , the company elected to settle this derivative instrument and received $ 16 million as a result of this settlement . the offset is included in accumulated other comprehensive loss and deferred income taxes and will be amortized to interest expense from may 2016 through may 2019 , the original term of the swap agreement . secondary public offerings in april 2013 , we completed a secondary public offering in which certain funds affiliated with apollo and graham sold 18,975,000 shares of common stock at $ 17.00 per share , which included 2,475,000 shares purchased by the underwriters upon the exercise in full of their option to purchase additional shares . story_separator_special_tag the company was in compliance with all covenants at the end of fiscal 2013. our fixed charge coverage ratio , as defined in the revolving credit facility , is calculated based on a numerator consisting of adjusted ebitda less pro forma adjustments , income taxes paid in cash and capital expenditures , and a denominator consisting of scheduled principal payments in respect of indebtedness for borrowed money , interest expense and certain distributions . we are obligated to sustain a minimum fixed charge coverage ratio of 1.0 to 1.0 under the revolving credit facility at any time when the aggregate unused capacity under the revolving credit facility is less than 10 % of the lesser of the revolving credit facility commitments and the borrowing base ( and for 10 business days following the date upon which availability exceeds such threshold ) or during the continuation of an event of default . at the end of fiscal 2013 , the company had unused borrowing capacity of $ 531 million under the revolving credit facility and thus was not subject to the minimum fixed charge coverage ratio covenant . our fixed charge coverage ratio was 2.2 to 1.0 at the end of fiscal 2013. despite not having financial maintenance covenants , our debt agreements contain certain negative covenants . the failure to comply with these negative covenants could restrict our ability to incur additional indebtedness , effect acquisitions , enter into certain significant business combinations , make distributions or redeem indebtedness . the term loan facility contains a negative covenant first lien secured leverage ratio covenant of 4.0 to 1.0 on a pro forma basis for a proposed transaction , such as an acquisition or incurrence of additional first lien debt . our first lien secured leverage ratio was 3.2 to 1.0 at the end of fiscal 2013. a key financial metric utilized in the calculation of the first lien leverage ratio is adjusted ebitda as defined in the company 's senior secured credit facilities . the following table reconciles ( i ) our adjusted ebitda to net income under gaap and ( ii ) our adjusted free cash flow to cash flow from operating activities under gaap . replace_table_token_8_th adjusted ebitda and adjusted free cash flow , as presented in this document , are supplemental financial measures that are not required by , or presented in accordance with , generally accepted accounting principles in the united states ( “ gaap ” ) . adjusted ebitda and adjusted free cash flow are not gaap financial measures and should not be considered as an alternative to operating or net income or cash flows from operating activities , in each case determined in accordance with gaap . we define “ adjusted ebitda ” as net income ( loss ) before depreciation and amortization , income tax expense ( benefit ) , interest expense ( net ) and certain restructuring and business optimization charges and as adjusted for unrealized cost reductions and acquired businesses , including unrealized synergies , which are more particularly defined in our credit documents and the indentures governing our notes . adjusted ebitda is used by our lenders for debt covenant compliance purposes and by our management as one of several measures to evaluate management performance . while the 23 determination of appropriate adjustments in the calculation of adjusted ebitda is subject to interpretation under the terms of the credit facility , management believes the adjustments described above are in accordance with the covenants in the credit facility . adjusted ebitda eliminates certain charges that we believe do not reflect operations and underlying operational performance . although we use adjusted ebitda as a financial measure to assess the performance of our business , the use of adjusted ebitda has important limitations , including that ( 1 ) adjusted ebitda does not represent funds available for dividends , reinvestment or other discretionary uses , or account for one-time expenses and charges ; ( 2 ) adjusted ebitda does not reflect cash outlays for capital expenditures or contractual commitments ; ( 3 ) adjusted ebitda does not reflect changes in , or cash requirements for , working capital ; ( 4 ) adjusted ebitda does not reflect the interest expense or the cash requirements necessary to service interest or principal payments on indebtedness ; ( 5 ) adjusted ebitda does not reflect income tax expense or the cash necessary to pay income taxes ; ( 6 ) adjusted ebitda excludes depreciation and amortization and , although depreciation and amortization are non-cash charges , the assets being depreciated and amortized will often have to be replaced in the future , and adjusted ebitda does not reflect cash requirements for such replacements ; and ( 7 ) adjusted ebitda does not reflect the impact of earnings or charges resulting from matters we consider not to be indicative of our ongoing operations . we define “ adjusted free cash flow ” as cash flow from operating activities less additions to property , plant and equipment . we use adjusted free cash flow as a measure of liquidity because it assists us in assessing our company 's ability to fund its growth through its generation of cash . we believe adjusted free cash flow is useful to an investor in evaluating our liquidity because adjusted free cash flow and similar measures are widely used by investors , securities analysts and other interested parties in our industry to measure a company 's liquidity without regard to revenue and expense recognition , which can vary depending upon accounting methods . although we use adjusted free cash flow as a liquidity measure to assess our ability to generate cash , the use of adjusted free cash flow has important limitations , including that : ( 1 ) adjusted free cash flow does not reflect the cash requirements necessary to service principal payments on our indebtedness ; and ( 2 ) adjusted free cash flow removes the impact of accrual basis

debt extinguishment . debt extinguishment was $ 64 million during fiscal 2013 as a result of loss on extinguishment of debt attributed to $ 37 million of call premium and penalties , $ 19 million of deferred financing fees and $ 8 million of debt discount related to the debt extinguishment that resulted from our incremental term loan capital restructuring and the use of the proceeds from our initial public offering . other income , net . other income was $ 7 million in fiscal 2013 and fiscal 2012 , respectively . these gains are attributed to the fair value adjustment for our interest rate swaps . 20 interest expense , net . interest expense decreased from $ 328 million in fiscal 2012 to $ 244 million in fiscal 2013 primarily as the result of the interest savings that resulted from our incremental term loan capital restructure and initial public offering , which proceeds were used to payoff indebtedness . income tax expense . fiscal 2013 , we recorded an income tax expense of $ 28 million or an effective tax rate of 33 % compared to an income tax expense of $ 2 million or an effective tax rate of 50 % in fiscal 2012. the effective tax rate is impacted by the relative impact of discrete items and certain international entities for which a full valuation allowance is recognized . discussion of results of operations for fiscal 2012 compared to fiscal 2011 net sales . net sales increased from $ 4,561 million in fiscal 2011 to $ 4,766 million in fiscal 2012. this increase is primarily attributed to net sales from acquired businesses of 10 % partially offset by a volume decline of 6 % . the following discussion in this section provides a comparison of net sales by business segment .


 Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.
     ```debt extinguishment . debt extinguishment was $ 64 million during fiscal 2013 as a result of loss on extinguishment of debt attributed to $ 37 million of call premium and penalties , $ 19 million of deferred financing fees and $ 8 million of debt discount related to the debt extinguishment that resulted from our incremental term loan capital restructuring and the use of the proceeds from our initial public offering . other income , net . other income was $ 7 million in fiscal 2013 and fiscal 2012 , respectively . these gains are attributed to the fair value adjustment for our interest rate swaps . 20 interest expense , net . interest expense decreased from $ 328 million in fiscal 2012 to $ 244 million in fiscal 2013 primarily as the result of the interest savings that resulted from our incremental term loan capital restructure and initial public offering , which proceeds were used to payoff indebtedness . income tax expense . fiscal 2013 , we recorded an income tax expense of $ 28 million or an effective tax rate of 33 % compared to an income tax expense of $ 2 million or an effective tax rate of 50 % in fiscal 2012. the effective tax rate is impacted by the relative impact of discrete items and certain international entities for which a full valuation allowance is recognized . discussion of results of operations for fiscal 2012 compared to fiscal 2011 net sales . net sales increased from $ 4,561 million in fiscal 2011 to $ 4,766 million in fiscal 2012. this increase is primarily attributed to net sales from acquired businesses of 10 % partially offset by a volume decline of 6 % . the following discussion in this section provides a comparison of net sales by business segment .
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 Suspicious Activity Report : we seek to improve our overall profitability by implementing cost reduction programs associated with our manufacturing , selling and general and administrative expenses . in november 2013 , the company initiated a cost reduction plan designed to deliver meaningful cost savings and optimal equipment utilization . this plan will result in several plant rationalizations . the costs associated with this plan will primarily consist of one-time costs associated with facility consolidation , including severance and termination benefits for employees of approximately $ 6 million , other costs associated with exiting facilities of approximately $ 30 million and non-cash asset impairment charges of approximately $ 11 million . in addition , as part of this cost reduction plan the company estimates it will incur capital expenditures of approximately $ 13 million . overall these facility restructuring programs are projected to generate approximately $ 27 million of annual operating savings when fully implemented . these amounts are preliminary estimates based on the information currently available to management . the plan is expected to be fully implemented by the end of fiscal 2014. recent developments initial public offering in october 2012 , the company completed an initial public offering and sold 29,411,764 shares of common stock at a public offering price of $ 16.00 per share . in conjunction with the initial public offering the company executed a 12.25 for one stock split of the company 's common stock . the effect of the stock split on outstanding shares and earnings per share has been retroactively applied to all periods presented . transaction fees totaling $ 33 million were included in paid-in capital on the consolidated balance sheets . proceeds , net of transaction fees , of $ 438 million and cash from operations were used to repurchase $ 455 million of 11 % senior subordinated notes due september 2016. as part of the repurchase the company paid premiums of $ 13 million and wrote-off $ 3 million of deferred financing fees . 17 tax receivable agreement in connection with the initial public offering , the company entered into an income tax receivable agreement ( `` tra `` ) that provides for the payment to pre-initial public offering stockholders , option holders and holders of our stock appreciation rights , 85 % of the amount of cash savings , if any , in u.s. federal , foreign , state and local income tax that are actually realized ( or are deemed to be realized in the case of a change of control ) as a result of the utilization of our and our subsidiaries ' net operating losses attributable to periods prior to the initial public offering . the company expects to pay between $ 313 million and $ 360 million in cash related to this agreement . this range is based on the company 's assumptions using various items , including valuation analysis and current tax law . the company recorded an obligation of $ 313 million which was recognized as a reduction of paid-in capital on the consolidated balance sheets . changes in the estimated tra obligation will be recorded as other expense ( income ) in the consolidated statement of operations . payments under the tra are not conditioned upon the parties ' continued ownership of the company . the balance at the end of fiscal 2013 was $ 308 million . during fiscal 2013 , the company made $ 5 million of payments related to the tra with an additional $ 32 million being paid in the first fiscal quarter of 2014. incremental term loan in february 2013 , the company entered into an incremental assumption agreement to increase the commitments under berry plastics corporation 's existing term loan credit agreement by $ 1.4 billion . berry plastics corporation borrowed loans in an aggregate principal amount equal to the full amount of the commitments on such date . the incremental term loans bear interest at libor plus 2.50 % per annum with a libor floor of 1.00 % , matures in february 2020 and are subject to customary amortization . the proceeds from the incremental term loan , in addition to borrowings under the revolving credit facility , were used to ( a ) satisfy and discharge all of berry plastics corporation 's outstanding ( i ) second priority senior secured floating rate notes due 2014 , ( ii ) first priority senior secured floating rate notes due 2015 , ( iii ) 101⁄4 % senior subordinated notes due 2016 and ( iv ) 81⁄4 % first priority senior secured notes due 2015 , which , in each case , were called for redemption in february 2013 and the related indentures and ( b ) pay related fees and expenses . the company recognized a $ 48 million loss on extinguishment of debt related to this debt refinancing . interest rate swap in february 2013 , the company entered into an interest rate swap transaction to protect $ 1 billion of outstanding variable rate term loan debt from future interest rate volatility . the agreement swapped the greater of a three-month variable libor contract or 1.00 % for a fixed three-year rate of 2.355 % , with an effective date in may 2016 and expiration in may 2019. in june 2013 , the company elected to settle this derivative instrument and received $ 16 million as a result of this settlement . the offset is included in accumulated other comprehensive loss and deferred income taxes and will be amortized to interest expense from may 2016 through may 2019 , the original term of the swap agreement . secondary public offerings in april 2013 , we completed a secondary public offering in which certain funds affiliated with apollo and graham sold 18,975,000 shares of common stock at $ 17.00 per share , which included 2,475,000 shares purchased by the underwriters upon the exercise in full of their option to purchase additional shares . story_separator_special_tag the company was in compliance with all covenants at the end of fiscal 2013. our fixed charge coverage ratio , as defined in the revolving credit facility , is calculated based on a numerator consisting of adjusted ebitda less pro forma adjustments , income taxes paid in cash and capital expenditures , and a denominator consisting of scheduled principal payments in respect of indebtedness for borrowed money , interest expense and certain distributions . we are obligated to sustain a minimum fixed charge coverage ratio of 1.0 to 1.0 under the revolving credit facility at any time when the aggregate unused capacity under the revolving credit facility is less than 10 % of the lesser of the revolving credit facility commitments and the borrowing base ( and for 10 business days following the date upon which availability exceeds such threshold ) or during the continuation of an event of default . at the end of fiscal 2013 , the company had unused borrowing capacity of $ 531 million under the revolving credit facility and thus was not subject to the minimum fixed charge coverage ratio covenant . our fixed charge coverage ratio was 2.2 to 1.0 at the end of fiscal 2013. despite not having financial maintenance covenants , our debt agreements contain certain negative covenants . the failure to comply with these negative covenants could restrict our ability to incur additional indebtedness , effect acquisitions , enter into certain significant business combinations , make distributions or redeem indebtedness . the term loan facility contains a negative covenant first lien secured leverage ratio covenant of 4.0 to 1.0 on a pro forma basis for a proposed transaction , such as an acquisition or incurrence of additional first lien debt . our first lien secured leverage ratio was 3.2 to 1.0 at the end of fiscal 2013. a key financial metric utilized in the calculation of the first lien leverage ratio is adjusted ebitda as defined in the company 's senior secured credit facilities . the following table reconciles ( i ) our adjusted ebitda to net income under gaap and ( ii ) our adjusted free cash flow to cash flow from operating activities under gaap . replace_table_token_8_th adjusted ebitda and adjusted free cash flow , as presented in this document , are supplemental financial measures that are not required by , or presented in accordance with , generally accepted accounting principles in the united states ( “ gaap ” ) . adjusted ebitda and adjusted free cash flow are not gaap financial measures and should not be considered as an alternative to operating or net income or cash flows from operating activities , in each case determined in accordance with gaap . we define “ adjusted ebitda ” as net income ( loss ) before depreciation and amortization , income tax expense ( benefit ) , interest expense ( net ) and certain restructuring and business optimization charges and as adjusted for unrealized cost reductions and acquired businesses , including unrealized synergies , which are more particularly defined in our credit documents and the indentures governing our notes . adjusted ebitda is used by our lenders for debt covenant compliance purposes and by our management as one of several measures to evaluate management performance . while the 23 determination of appropriate adjustments in the calculation of adjusted ebitda is subject to interpretation under the terms of the credit facility , management believes the adjustments described above are in accordance with the covenants in the credit facility . adjusted ebitda eliminates certain charges that we believe do not reflect operations and underlying operational performance . although we use adjusted ebitda as a financial measure to assess the performance of our business , the use of adjusted ebitda has important limitations , including that ( 1 ) adjusted ebitda does not represent funds available for dividends , reinvestment or other discretionary uses , or account for one-time expenses and charges ; ( 2 ) adjusted ebitda does not reflect cash outlays for capital expenditures or contractual commitments ; ( 3 ) adjusted ebitda does not reflect changes in , or cash requirements for , working capital ; ( 4 ) adjusted ebitda does not reflect the interest expense or the cash requirements necessary to service interest or principal payments on indebtedness ; ( 5 ) adjusted ebitda does not reflect income tax expense or the cash necessary to pay income taxes ; ( 6 ) adjusted ebitda excludes depreciation and amortization and , although depreciation and amortization are non-cash charges , the assets being depreciated and amortized will often have to be replaced in the future , and adjusted ebitda does not reflect cash requirements for such replacements ; and ( 7 ) adjusted ebitda does not reflect the impact of earnings or charges resulting from matters we consider not to be indicative of our ongoing operations . we define “ adjusted free cash flow ” as cash flow from operating activities less additions to property , plant and equipment . we use adjusted free cash flow as a measure of liquidity because it assists us in assessing our company 's ability to fund its growth through its generation of cash . we believe adjusted free cash flow is useful to an investor in evaluating our liquidity because adjusted free cash flow and similar measures are widely used by investors , securities analysts and other interested parties in our industry to measure a company 's liquidity without regard to revenue and expense recognition , which can vary depending upon accounting methods . although we use adjusted free cash flow as a liquidity measure to assess our ability to generate cash , the use of adjusted free cash flow has important limitations , including that : ( 1 ) adjusted free cash flow does not reflect the cash requirements necessary to service principal payments on our indebtedness ; and ( 2 ) adjusted free cash flow removes the impact of accrual basis

