01—Abstract
Summary
Summary of the 8-K filed June 30, 2025. Cited figures are marked; the original filing is the authoritative source.
Ross Stores, Inc. (ROST) has announced the entry into a new senior unsecured revolving Credit Agreement, referred to as the 2025 Credit Facility, effective June 27, 2025.
This new facility provides up to $1.3 billiona in borrowing capacity, with an option to increase it by an additional $700 million, subject to lender agreement. The facility replaces the Company's previous credit agreement and extends its maturity to June 2030, with options for further one-year extensions. This action signals continued financial flexibility and access to capital for Ross Stores.
The terms of the 2025 Credit Facility are largely consistent with the prior agreement, maintaining the same borrowing capacity. Interest rates are based on Term SOFR or an alternate benchmark, plus a margin that varies with the Company's credit rating, ranging from 0.675%b to 1.25% for Term SOFR loans. A commitment fee on unused portions is also applicable.
The agreement includes customary covenants, such as a debt-to-EBITDAR ratio limit of 3.50 to 1.00, and restrictions on subsidiary indebtedness, asset sales, and liens. This refinancing ensures Ross Stores maintains robust liquidity and financial support for its ongoing operations and strategic initiatives.
02—Key points
Key Highlights
- Ross Stores, Inc. entered into a new $1.3 billion senior unsecured revolving Credit Agreement (2025 Credit Facility) effective June 27, 2025.
- The new facility replaces the previous $1.3 billion credit facility entered into in February 2022.
- The 2025 Credit Facility has a maturity date of June 2030, with options to extend for up to two additional one-year periods.
- The Company has the option to increase the credit facility size by an additional $700 million, subject to lender consent.
- Borrowing costs are tied to Term SOFR (or an alternative rate) plus a margin, varying based on the Company's long-term debt credit rating.
- Key financial covenants include a maximum Consolidated Adjusted Debt to Consolidated EBITDAR ratio of 3.50 to 1.00.
- No borrowings were outstanding under the previous facility at the time of termination and the new facility's effectiveness.
03—Questions
Frequently Asked Questions
What is the primary purpose of this 8-K filing?
The primary purpose of this 8-K filing is to inform investors about Ross Stores, Inc. entering into a new senior unsecured revolving Credit Agreement (the 2025 Credit Facility) and the subsequent termination of its previous credit facility.
What is the borrowing capacity of the new credit facility and what is its term?
The new 2025 Credit Facility provides the Company with up to $1.3 billion in borrowing availability. It matures in June 2030, with the option for the Company to extend it for up to two additional one-year periods.
Does the new credit facility provide any additional financial flexibility beyond the existing capacity?
Yes, the new facility includes an option for Ross Stores to increase its borrowing capacity by an additional $700 million, subject to the agreement of the committing lenders. This offers potential for expanded liquidity if needed.
Are there any significant changes in the terms or covenants compared to the previous credit facility?
The filing states that the 2025 Credit Facility provides 'substantially unchanged commercial terms and borrowing capacity limits' compared to the Prior Credit Facility. It includes customary covenants, such as a debt-to-EBITDAR ratio, restrictions on indebtedness, asset sales, and liens, which are typical for such agreements.
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