8-KMaterial AgreementsFinancial EventsExhibits & Filings

Burlington Stores, Inc. 8-K Report, Material Agreement (Jun 25, 2021)

Filed June 25, 2021For Securities:BURL

Summary

Burlington Stores, Inc. (BURL), through its subsidiary Burlington Coat Factory Warehouse Corporation, has executed Amendment No. 9 to its Term Loan Credit Agreement. The primary impact of this amendment for investors is the extension of the term loan maturity date by nearly four years, from November 17, 2024, to June 24, 2028. This move provides the company with extended financial flexibility and stability, particularly as it navigates its ongoing business operations and strategic initiatives. Furthermore, the amendment involves replacing the outstanding $961 million principal amount of term B-5 loans with an equivalent amount of new term B-6 loans. While the maturity date is extended, there is a slight increase in the interest rate margins for both prime rate and LIBOR loans. This adjustment, from 0.75% to 1.00% for prime and 1.75% to 2.00% for LIBOR (with a 0.00% LIBOR floor), reflects prevailing market conditions and the extended repayment period. Overall, this refinancing activity signals a proactive approach by management to manage the company's debt structure and support its long-term growth objectives.

Key Highlights

  • 1Extended Term Loan Maturity: The maturity date of the company's term loan facility has been extended from November 17, 2024, to June 24, 2028.
  • 2Debt Refinancing: The outstanding $961 million principal amount of term B-5 loans has been replaced with a like aggregate principal amount of new term B-6 loans.
  • 3Slight Increase in Interest Rates: Interest rate margins for prime rate loans increased from 0.75% to 1.00%, and for LIBOR loans from 1.75% to 2.00%, with a 0.00% LIBOR floor.
  • 4Enhanced Financial Flexibility: The extended maturity provides Burlington Stores with greater financial runway and operational flexibility.
  • 5Material Definitive Agreement: This amendment constitutes a material definitive agreement related to the company's debt.
  • 6Key Financial Parties Involved: JPMorgan Chase Bank, N.A. acted as administrative agent, with BofA Securities, Inc., Goldman Sachs Bank USA, and Wells Fargo Securities, LLC serving as joint lead arrangers and joint bookrunners.

Frequently Asked Questions

The most significant impact is the extension of the maturity date for the company's term loan facility from November 2024 to June 2028. This provides Burlington Stores with an additional nearly four years to repay these borrowings.

Yes, there was a slight increase in the interest rate margins. For prime rate loans, the margin increased from 0.75% to 1.00%. For LIBOR loans, the margin increased from 1.75% to 2.00%. There is a 0.00% LIBOR floor, meaning the LIBOR rate will not go below zero for interest calculation purposes.

The amendment involved replacing the outstanding $961 million principal amount of term B-5 loans with an equivalent amount of new term B-6 loans.

The company entered into this amendment to extend its debt maturity, thereby enhancing its financial flexibility and providing more time to manage its capital structure and support its long-term business strategy.