v3.25.1
LONG-TERM DEBT
 9 Months Ended
May 03, 2025
Debt Disclosure [Abstract]  
LONG-TERM DEBT
NOTE 8—LONG-TERM DEBT

The Company’s long-term debt consisted of the following:
(in millions)
Average Interest Rate at
May 3, 2025
Fiscal Maturity YearMay 3,
2025		August 3,
2024
Term Loan Facility (1)
9.07%2031$495 $499 
ABL Credit Facility (2)
5.75%2027992 1,113 
Senior Notes (3)
6.75%2029500 500 
Other secured loans—%2025— 1 
Debt issuance costs, net(16)(18)
Original issue discount on debt(9)(10)
Long-term debt, including current portion1,962 2,085 
Less: current portion of long-term debt(3)(4)
Long-term debt$1,959 $2,081 
(1) Face value before debt issuance costs of $6 million and $6 million, respectively, and an original issue discount on debt of $9 million and $10 million, respectively.
(2) Face value before debt issuance costs of $5 million and $7 million, respectively.
(3) Face value before debt issuance costs of $5 million and $5 million, respectively.
Term Loan Facility

The term loan agreement dated as of October 22, 2018 (as amended, the “Term Loan Agreement”) provides for a $500 million senior secured first lien term loan (the “Term Loan Facility”), which is scheduled to mature on May 1, 2031, with a springing maturity of 91 days prior to the maturity of the Senior Notes (defined below), in the event that at least $100 million in principal amount outstanding of such Senior Notes remains outstanding on such date.

The obligations under the Term Loan Facility are guaranteed by most of the Company’s wholly owned subsidiaries (collectively, the “Guarantors”), subject to customary exceptions and limitations. The Term Loan Facility is secured by (i) a first-priority lien on substantially all assets other than the ABL Assets (defined below) and (ii) a second-priority lien on substantially all of the ABL Assets, in each case, subject to customary exceptions and limitations, including an exception for owned real property (other than distribution centers) with net book values of less than or equal to $10 million. As of May 3, 2025 and August 3, 2024, there was $651 million and $686 million, respectively, of owned real property pledged as collateral that was included in Property and equipment, net and Prepaid expenses and other current assets in the Condensed Consolidated Balance Sheets.

As of May 3, 2025, the borrowings under the Term Loan Facility bear interest at rates that, at the Term Borrowers’ option, can be either: (i) a base rate plus a margin of 3.75% or (ii) a SOFR rate plus a margin of 4.75%, provided that the SOFR rate shall never be less than 0.0%.

Subsequent to the third quarter of fiscal 2025, on May 5, 2025, the Company made a voluntary prepayment of $100 million on the Term Loan Facility funded with incremental borrowings under the ABL Credit Facility. This prepayment will count towards any requirement to prepay the Term Loan Facility from Excess Cash Flow (as defined in the Term Loan Agreement) generated during fiscal 2025, which would be due in fiscal 2026. In connection with this prepayment, the Company expects to incur a loss on debt extinguishment of $4 million in the fourth quarter of fiscal 2025 related to unamortized debt issuance costs, unamortized original issue discount and the required 1% prepayment premium, which will be recorded within Interest expense, net.

ABL Credit Facility

The revolving credit agreement dated as of June 3, 2022 (as amended, the “ABL Loan Agreement”) provides for a secured asset-based revolving credit facility (the “ABL Credit Facility”) with an aggregate principal amount available of up to $2,730 million, including Revolver Loans (as defined in the ABL Loan Agreement) of up to $2,600 million and a First In, Last Out (“FILO”) tranche of incremental ABL loans of $130 million (the “ABL FILO Loan”). The ABL Credit Facility is scheduled to mature on June 3, 2027.
Revolver Loans and ABL FILO Loans under the ABL Credit Facility bear interest at rates that, at the Company’s option, can be either at a base rate or Term SOFR plus an applicable margin. The applicable margins and letter of credit fees under the ABL Credit Facility are variable and are dependent upon the prior fiscal quarter’s daily average Availability (as defined in the ABL Loan Agreement), and were as follows:
Range of Facility Rates and Fees (per annum)May 3, 2025
Applicable margin for revolver base rate loans
0.00% - 0.25%
0.00 %
Applicable margin for revolver SOFR and BA loans(1)
1.00% - 1.25%
1.00 %
Applicable margin for FILO base rate loans
1.50%
1.50 %
Applicable margin for FILO SOFR loans
2.50%
2.50 %
Unutilized commitment fees
0.20%
0.20 %
Letter of credit fees
1.125% - 1.375%
1.125 %
(1) The Company utilizes SOFR-based loans and UNFI Canada utilizes bankers’ acceptance rate-based loans.

The ABL Credit Facility is guaranteed by the Guarantors, subject to customary exceptions and limitations. The ABL Credit Facility is secured by (i) a first-priority lien on certain accounts receivable, inventory and certain other assets (collectively, the “ABL Assets”) and (ii) a second-priority lien on all other assets that do not constitute ABL Assets, in each case, subject to customary exceptions and limitations.

Availability under the ABL Credit Facility is subject to a borrowing base consisting of specified percentages of the value of eligible accounts receivable, credit card receivables, inventory, pharmacy receivables and pharmacy prescription files, after adjusting for customary reserves, but at no time shall exceed the aggregate commitments plus the outstanding ABL FILO Loans under the ABL Credit Facility (currently $2,730 million).

As of May 3, 2025, the borrowing base was $2,618 million, reflecting the advance rates described above and $100 million of reserves, which is below the $2,730 million limit of availability. This resulted in total availability of $2,618 million for loans and letters of credit under the ABL Credit Facility. The Company’s unused credit under the ABL Credit Facility was as follows:
(in millions)May 3, 2025
Total availability for ABL loans and letters of credit$2,618 
ABL loans outstanding992 
Letters of credit outstanding184 
Unused credit$1,442 

Senior Notes

On October 22, 2020, the Company issued $500 million of unsecured 6.750% senior notes due October 15, 2028 (the “Senior Notes”). The Senior Notes are guaranteed by each of the Company’s subsidiaries that are borrowers under or that guarantee the ABL Credit Facility or the Term Loan Facility.