9. Debt

The original issue discount and capitalized fees and expenses are amortized over the related term of the debt.

The Company recorded interest expense related to long-term debt of $9.0 million, $14.1 million, and $23.8 million, in Fiscal Years 2025, 2024 and 2023, respectively. During Fiscal Years 2025, 2024 and 2023, $1.1 million, $1.6 million and $2.8 million of debt discount and debt issuance costs related to long-term debt were amortized to interest expense, respectively.

Term Loan Credit Agreement

On December 12, 2025, the Company and Jill Acquisition LLC (the "Borrower") entered into a new Term Loan Credit Agreement (the “2025 Term Loan Credit Agreement”), with the lenders party thereto from time to time and CCP Agency, LLC, as administrative agent and as collateral agent. The 2025 Term Loan Credit Agreement provides for a senior secured term loan facility in an aggregate principal amount of $75.0 million with a maturity date of December 12, 2030 (the “2025 Term Loan Facility”).

The proceeds from the 2025 Term Loan Facility were used to pay off in full all outstanding principal balance under the Term Loan Credit Agreement dated as of April 5, 2023 (the “2023 Term Loan Credit Agreement”). All security interests and liens granted in connection with the 2023 Term Loan Credit Agreement were released.

A portion of the transaction was accounted for as a debt modification. As a result, approximately $1.0 million of deferred costs will continue to be deferred and amortized using the effective interest method through December 12, 2030, the maturity date of the Term Loan Credit Agreement. These fees are presented as a direct reduction from the carrying amount of long-term debt on the consolidated balance sheets. For repayment of the remaining portion of the 2023 Term Loan Credit Agreement the Company recorded a loss on debt refinancing of $3.1 million inclusive of the write-off of original issue discount, and deferred debt issuance costs and other fees, in the line item “Loss on debt refinancing” in its consolidated statements of operations and comprehensive income (loss) and in the consolidated statement of cash flows for the Fiscal Year Ended January 31, 2026.

Loans under the 2025 Term Loan Credit Agreement bear an upfront fee of 1.00% and interest at the Borrower’s election at (1) the Base Rate (as defined in the 2025 Term Loan Credit Agreement) plus 4.50% through August 1, 2026 and 4.25% thereafter or (2) Term SOFR (as defined in the Credit Agreement) plus 5.50% through August 1, 2026 and 5.25% thereafter, subject to a floor rate of 1.00%.

The Term Loan Facility is to be repaid in quarterly payments of $468,750 on the last Business Day of each Fiscal Quarter of the Borrower, commencing with the Fiscal Quarter ending May 2, 2026, until January 30, 2027 and of $187,500 commencing on the Fiscal Quarter ending May 1, 2027 and each Fiscal Quarter thereafter, with the remaining aggregate principal amount of Initial Term Loans then outstanding to be paid on maturity on December 12, 2030. Additionally, the Term Loan Facility is subject to mandatory repayment, subject to certain exceptions, including (i) 100% of the net proceeds of any issuance or incurrence of indebtedness other than debt permitted in the Term Loan Credit Agreement, (ii) 100% of the net cash proceeds of certain asset sales/insurance proceeds, subject to reinvestment rights and certain other exceptions, and (iii) an annual payment ranging from 25%-75%, based on the First Lien Net Leverage Ratio, of the annual Excess Cash Flow (“ECF”), less certain voluntary prepayments made during the year, as defined in the Term Loan Credit Agreement.

The Term Loan Facility may be voluntarily prepaid after the one-year anniversary without premium or penalty but on or prior to the one-year anniversary, subject to a premium of 1.0% of the aggregate principal amount being prepaid.

The obligations under the 2025 Term Loan Credit Agreement were guaranteed by the Company and J.Jill Gift Card Solutions, Inc., and were secured by substantially all of the real and personal property of the Borrower and the guarantors, subject to customary exceptions. The agreement included customary representations and warranties, affirmative and negative covenants, financial covenants, and events of default.

In conjunction with entering into the 2025 Term Loan Credit Agreement, the Company incurred $0.3 million of third-party fees which were expensed as incurred.

During Fiscal Year 2024, the Company made voluntary and required principal repayments totaling $94.2 million under the 2023 Term Loan Credit Agreement, including voluntary prepayments of $58.2 million on May 10, 2024 and $27.2 million on June 21, 2024. In connection with these voluntary prepayments, the Company paid a prepayment premium of $2.6 million and recognized a loss on extinguishment of debt of approximately $8.6 million, consisting primarily of accelerated amortization of deferred financing costs and the prepayment premium.

As of January 31, 2026, the outstanding principal balance under the 2025 Term Loan Credit Agreement was $75.0 million, and the Company was in compliance with all covenants.

Asset-Based Revolving Credit Agreement

On May 8, 2015, the Company entered into a five-year secured $40.0 million asset-based revolving credit facility agreement (the “ABL Facility”). The ABL Facility had an initial maturity of May 8, 2020. On June 12, 2019, this ABL Facility was amended to extend the termination date to May 8, 2023.

On April 15, 2022, the Company entered into an amendment to the ABL Facility, whereby (i) the maturity date of the ABL Facility was extended from May 8, 2023 to May 8, 2024, and (ii) changed the benchmark interest rate applicable to the loans under the ABL Facility from LIBOR to the forward-looking secured overnight financing rate (“Term SOFR”).

On May 10, 2023, the Company entered into Amendment No. 6 to the ABL Credit Agreement, which extended the maturity date of the ABL Credit Agreement from May 8, 2024 to May 10, 2028 (or 180 days prior to the maturity date of the Company’s Term Loan Credit Agreement if the maturity date of such Term Loan Facility has not been extended to a date that is at least 180 days after the maturity date of the ABL Credit Agreement). The other terms and conditions of the ABL Facility remain substantially unchanged. The benchmark interest rate applicable to the loans under the ABL Facility is the forward-looking secured overnight financing rate.

On December 1, 2023, the Company entered into Amendment No. 7 (the “ABL Amendment”) to the ABL Credit Agreement, which made a technical revision for administrative purposes that removed the requirement for a Borrower’s non-negotiable bill of lading, non-negotiable sea waybill or other similar shipping document (each a “Non-Negotiable Document”) to state on its face that the inventory that is subject to such Non-Negotiable Document is subject to the lien of the administrative agent.

The ABL Facility consists of revolving loans and swing line loans. Borrowings classified as revolving loans under the ABL Facility may be maintained as either Term SOFR or Base Rate loans, each of which has a variable interest rate plus an applicable margin. Borrowings classified as swing line loans under the ABL Facility are Base Rate loans. Term SOFR loans under the ABL Facility accrue interest at a rate equal to Term SOFR plus a spread ranging from 1.50% to 1.75%, depending on borrowing amounts. Base Rate loans under the ABL Facility accrue interest at a rate equal to (i) the greatest of (a) the financial institution’s prime rate, (b) the overnight Federal Funds Effective Rate plus 0.50%, (c) Adjusted Term SOFR (as adjusted by any Floor) plus 1.00% (ii) a spread ranging from 0.50% to 0.75%, depending on borrowing amounts.

Interest on each Term SOFR loan is payable on the last day of each interest period and no more than quarterly, and interest on each Base Rate loan is payable in arrears on the last business day of April, July, October and January. For both Term SOFR and Base Rate loans, interest is payable periodically upon repayment, conversion or maturity, with interest periods ranging between 30 to 180 days at the election of the Company, or 12 months with the consent of all lenders.

The ABL Facility also requires the quarterly payment, in arrears, of a commitment fee. The commitment fee is payable in an amount equal to 0.25% of the Unutilized Revolving Loan commitment.

The Company had no short-term borrowings under the Company’s ABL Facility as of January 31, 2026 and February 1, 2025. During the fiscal years ended January 31, 2026 and February 1, 2025, no amount was drawn or outstanding under the ABL Facility. Based on the terms of the agreement and the increase for the letters of credit, the Company’s available borrowing capacity under the ABL Facility as of January 31, 2026 and February 1, 2025 was $35.7 million and $35.7 million, respectively.

The Company incurred an immaterial amount of interest expense and amortization of deferred fees related to the ABL facility for Fiscal Years 2025, 2024 and 2023, respectively.

Borrowings under the ABL Facility are secured by a first lien on accounts receivable and inventory. In connection with the ABL Facility, the Company is subject to various financial reporting (including with respect to liquidity), financial and other covenants. Affirmative covenants include providing timely quarterly and annual financial statements and prompt notification of the occurrence of any event of default or any other event, change or circumstance that has had, or could reasonably be expected to have, a material adverse effect as defined in the ABL Facility. In addition, there are negative covenants, including certain restrictions on the Company’s ability to incur additional indebtedness, create liens, enter into transactions with affiliates, transfer assets, pay dividends, consolidate or merge with other entities, make advances, investments and loans or modify its organizational documents. The ABL Facility also includes certain financial maintenance covenants, including a requirement to maintain a fixed charge coverage ratio greater than or equal to 1.00:1.00 if availability under the ABL Facility is less than specified levels. As of January 31, 2026 and February 1, 2025, the Company was in compliance with all financial covenants in effect.

If an event of default occurs under the ABL Facility, the Company’s obligations may be accelerated. In addition, a 2.00% interest surcharge will be imposed on overdue amounts.

Letters of Credit

As of January 31, 2026 and February 1, 2025, there were outstanding letters of credit of $4.3 million and $4.3 million, respectively, which reduced the availability under the ABL Facility. As of January 31, 2026, the maximum commitment for letters of credit was $15.0 million. Letters of credit accrue interest at a rate equal to the applicable margin with respect to revolving loans maintained as Term SOFR loans under the ABL facility. The Company primarily used letters of credit to secure payment of workers’ compensation claims and customs bonds. Letters of credit are generally obtained for a one-year term and automatically renew annually and would only be drawn upon if the Company fails to comply with its contractual obligations.

Payments of Long-term Debt Obligations Due by Period