14. DEBT AND OTHER OBLIGATIONS

The company had standby letters of credit (“LOCs”) outstanding of $8.5 million and $8.4 million at October 10, 2026 and January 3, 2026, respectively, which reduce the availability of funds under the credit facility (as defined below). The outstanding LOCs are for the benefit of certain insurance companies and lessors. None of the outstanding LOCs are recorded as a liability on the Condensed Consolidated Balance Sheets.

Accounts Receivable Repurchase Facility, Credit Facility, and Term Loan Facility

Accounts Receivable Repurchase Facility. On April 14, 2023, the company entered into a $200.0 million accounts receivable repurchase facility (the "repurchase facility"). Under the repurchase facility, the company has the ability to request up to $50.0 million in additional facility capacity, for a total of up to $250.0 million, subject to approval of the funding parties and to the satisfaction of certain customary conditions of the facility. On April 14, 2026, the company entered into Amendment No. 3 to the Master Framework Agreement to amend the repurchase facility and extend the scheduled facility expiration date from April 14, 2027 to April 16, 2029. Under the repurchase facility, certain subsidiaries of the company sell or distribute, on an ongoing basis, substantially all of their trade receivables to the company. The company may at its option onward sell all of its qualifying receivables to the funding parties under the repurchase facility with an agreement to repurchase the receivables on a monthly basis for a repurchase price equal to the purchase price paid and an interest component based on Term SOFR (as defined in the Master Framework Agreement) plus a margin. There is an unused fee applicable on the daily unused portion of the repurchase facility. The repurchase facility contains certain customary representations and warranties, affirmative and negative covenants, and events of default. As of October 10, 2026 and January 3, 2026, the company was in compliance with all restrictive covenants under the repurchase facility.

Facility capacity under the repurchase facility is determined as the lesser of the total repurchase facility limit and a formula-derived amount based on qualifying trade receivables. Capacity under the repurchase facility is subject to the restrictions and limitations set forth in the Master Framework Agreement. The table below presents the highest and lowest outstanding balance under the repurchase facility during the forty weeks ended October 10, 2026:

Financing costs paid at inception of the repurchase facility and when amendments are executed are being amortized over the life of the repurchase facility. The company incurred $0.2 million in financing costs during the sixteen weeks ended April 25, 2026 related to the third amendment. The balance of unamortized financing costs was $0.4 million and $0.3 million on October 10, 2026 and January 3, 2026, respectively, and is recorded in other assets on the Condensed Consolidated Balance Sheets.

Credit Facility. On February 5, 2025, the company entered into a credit agreement, with the lenders party thereto and Wells Fargo Bank, National Association, as administrative agent, (as amended, restated, modified or supplemented from time to time, the “credit agreement” and the revolving credit facility thereunder, the “credit facility”). Under the credit agreement, our credit facility is a five-year, $500.0 million senior unsecured revolving loan facility with the following (among others) terms and conditions: (i) a maturity date of February 5, 2030; (ii) an applicable margin for revolving loans maintained as (1) base rate loans and swingline loans with a range of 0.00% to 0.75% (increased from 0.525% pursuant to the revolver amendment (as defined below)) and (2) SOFR loans with a range of 0.815% to 1.75% (increased from 1.525% pursuant to the revolver amendment), in each case, based on (x) the leverage ratio of the company and its subsidiaries and (y) the company’s corporate credit rating; (iii) an applicable facility fee with a range of 0.06% to 0.25% (increased from 0.225% pursuant to the revolver amendment), due quarterly on all commitments under the credit agreement, based on (x) the leverage ratio of the company and its subsidiaries and (y) the company’s corporate credit rating; and (iv) a maximum leverage ratio covenant set at 3.75 to 1.00, which permits the company, at its option, in connection with certain acquisitions and investments and subject to the terms and conditions provided in the credit agreement, to increase the maximum ratio permitted thereunder on one or more occasions to 4.00 to 1.00 for a period of four consecutive fiscal quarters, including and/or immediately following the fiscal quarter in which such acquisitions or investments were completed (the “covenant holiday”), provided that each additional covenant holiday will not be available to the company until it has achieved and maintained a leverage ratio no greater than 3.75 to 1.00 for at least two fiscal quarters. As discussed in more detail below, the company is in one such covenant holiday.

In addition, the credit facility contains a provision that permits the company to request up to $200.0 million in additional revolving commitments, for a total of up to $700.0 million, subject to the satisfaction of certain conditions. Proceeds from the credit facility may be used for working capital and general corporate purposes, including capital expenditures, acquisition financing, refinancing of indebtedness, dividends and share repurchases. The credit facility includes certain customary restrictions, which, among other things, require maintenance of financial covenants and limits encumbrance of assets and creation of indebtedness. Restrictive financial covenants include such ratios as a minimum interest coverage ratio and a maximum leverage ratio.

On April 6, 2026, the company entered into the First Amendment to the credit agreement (the “revolver amendment”) to, among other things, (i) extend the covenant holiday currently in effect to the period from the closing date of the revolver amendment through and including the company’s fiscal quarter ending October 9, 2027, (ii) add an additional tier to the pricing grid thereof that applies if the company’s corporate credit ratings fall to Ba2 or below from Moody’s and BB or below from S&P, consistent with the term loan credit agreement (as defined below), and (iii) made certain other changes to align with the term loan credit agreement. In September 2026, our corporate credit rating was lowered by Moody's (from Baa3 to Ba1), S&P (from BBB- to BB+), and Fitch (from BBB- to BB+), changing our corporate credit rating from investment grade to non-investment grade. Additionally, as required per the credit facility and term loan facility upon a downgrade below both Baa3 from Moody's and BBB- from S&P, the company provided guarantees by certain subsidiaries of the company to the lenders.

The company believes that, given its current cash position, its cash flow from operating and other activities and its available credit capacity, it can meet its presently foreseeable financial requirements. As of October 10, 2026 and January 3, 2026, the company was in compliance with all restrictive covenants under the credit facility.

Financing costs paid at inception of the credit facility and at the time amendments are executed are being amortized over the life of the credit facility. The company incurred additional financing costs of $0.3 million during the first quarter of Fiscal 2026 related to the first amendment. The balance of unamortized financing costs was $1.6 million and $1.6 million on October 10, 2026 and January 3, 2026, respectively, and is recorded in other assets on the Condensed Consolidated Balance Sheets.

Amounts outstanding under the credit facility can vary daily. Changes in the gross borrowings and repayments can be caused by cash flow activity from operations, capital expenditures, acquisitions, dividends, share repurchases, and tax payments, as well as

derivative transactions, which are part of the company’s overall risk management strategy as discussed in Note 10, Derivative Financial Instruments, of this Form 10-Q. The table below presents the borrowings and repayments under the credit facility during the forty weeks ended October 10, 2026:

Borrowings under the credit facility are subject to the restrictions and limitations set forth in the credit facility agreement.

Term Loan Facility. On April 6, 2026, the company entered into a $400.0 million senior unsecured delayed draw term loan credit facility (the “term loan facility”) pursuant to a Term Loan Credit Agreement (the “term loan credit agreement”), dated as of April 6, 2026, with certain financial institutions party thereto as lenders and Wells Fargo Bank, National Association, as administrative agent. The term loan credit agreement requires that the company use the net proceeds of the term loan facility to, together with cash on hand, finance the repayment in full of the 2026 notes and to pay the fees, costs and expenses incurred in connection therewith and with the execution of the term loan facility and the revolver amendment. On September 30, 2026, the company completed a single drawdown of $390.0 million under the term loan facility to fund the repayment in full of the 2026 notes on October 1, 2026. The term loan facility matures on the third anniversary of the funding date thereof.

Borrowings under the term loan facility bear interest, at the option of the company, based on SOFR or the “base rate”, in each case, plus an applicable margin determined by reference to a pricing grid based on the company’s leverage ratio and corporate credit rating, with a range of 0.875% to 2.000% in the case of SOFR-based loans and a range of 0.000% to 1.000% in the case of base rate loans. In addition, the term loan facility bears an additional ticking fee on the full amount of the unused commitments, also determined by reference to the pricing grid, and ranging from 0.060% to 0.250%, based upon the company’s then applicable leverage ratio and corporate credit rating.

The term loan credit agreement contains representations, covenants and events of default that are customary for financing transactions of this nature, which are substantially the same as the credit agreement (including, without limitation, with respect to financial covenants).

The company believes that, given its current cash position, its cash flow from operating and other activities and its available credit capacity, it can meet its presently foreseeable financial requirements. As of October 10, 2026, the company was in compliance with all restrictive covenants under the term loan facility.

The company incurred financing costs at inception of the term loan of $1.5 million and these costs are being amortized to interest expense over the life of the borrowing.

As of October 10, 2026, the company was in compliance with all restrictive covenants of the accounts receivable repurchase facility, credit facility, and term loan facility. Global and U.S. economies remain volatile, with continued inflation, competition in the fresh packaged bread category, and shifts in consumer preferences. As a prudent measure to enable continued covenant compliance for the fiscal period ending April 24, 2027 and future periods, the company is seeking an amendment or waiver of certain restrictive covenants under its credit facility and term loan facility, namely the maximum leverage ratio and interest coverage ratio (the "Amendment"). Discussions with the company’s lenders are underway and constructive, and the company believes it is well positioned to obtain the Amendment prior to the filing of the Annual Report on Form 10-K for the year ending January 2, 2027. The company has also identified contingency plans designed to improve its financial condition and increase cash available for debt reduction. If the Amendment is not obtained, these plans are intended to enable the company to comply with these covenants for at least one year from the issuance of these interim financial statements. A failure to comply with these covenants would result in an event of default under the credit facility and term loan facility and, in turn, under the accounts receivable repurchase facility. Any such default could have a material adverse effect on the company’s liquidity, financial condition, and results of operations.