1-800-FLOWERS.COM(FLWS) - 2025 Q3 - Quarterly Results

Second Amendment to Credit Agreement This section outlines the Second Amendment to the Credit Agreement, detailing its purpose, specific modifications, conditions for effectiveness, and reaffirmation of obligations Introduction and Background This section introduces the Second Amendment to the Credit Agreement, identifying the parties involved and its purpose to amend existing agreements - The document is the Second Amendment, dated May 6, 2025, among 1-800-Flowers.com, Inc., its subsidiary borrowers and guarantors, the lenders, and JPMorgan Chase Bank, N.A. as Administrative Agent[2] - The amendment modifies the Third Amended and Restated Credit Agreement dated June 27, 2023, and the Security Agreement dated September 30, 2014[4] Article 1: Amendments to the Credit Agreement and the Security Agreement This article specifies direct modifications to the Credit Agreement and Security Agreement, detailing amendments through text changes, schedule replacement, and new annex addition - The Credit Agreement is amended as set forth in Annex I[7] - Schedule 1.01(a) to the Credit Agreement is replaced in its entirety with the schedule attached as Annex II[8] - The Security Agreement is amended as set forth in Annex III, and a new Annex 5 is added[9][10] Article 2: Representations and Warranties The Borrowers provide key representations and warranties, confirming the amendment's authorization, accuracy of representations, and absence of any continuing Default - The Borrowers affirm that the amendment is duly authorized and constitutes a legal, valid, and binding obligation[12] - All representations and warranties in the amended credit agreement are confirmed to be true and correct in all material respects as of the Second Amendment Effective Date[13] - The Borrowers warrant that no Default has occurred and is continuing immediately after the amendment takes effect[14] Article 3: Conditions Precedent This article outlines conditions for the amendment's effectiveness, including executed counterparts, officer's certificate, fee payment, and KYC/AML compliance - The amendment becomes effective upon the Administrative Agent receiving executed counterparts from each Loan Party and the Required Lenders[16] - An officer's certificate must be provided, certifying the accuracy of the representations and warranties in Article 2[17] - All required fees and expenses must be paid, and all documentation for USA PATRIOT Act and other anti-money laundering rules must be received[18][19] Article 4: General Provisions This article contains general legal provisions, clarifying original agreements remain in force, reaffirming obligations and liens, and specifying New York law - Except as expressly provided, the Credit Agreement, Security Agreement, and other Loan Documents remain unmodified and in full force[21] - Each Loan Party reaffirms that its obligations, liabilities, and the liens and security interests under the Loan Documents remain in full force and effect on a continuous basis[23] - The amendment shall be construed in accordance with and governed by the law of the State of New York[25] Signature Pages This section contains signatures from 1-800-FLOWERS.COM, INC., its subsidiaries, the administrative agent, and key lenders, making the Second Amendment legally binding - The amendment is executed by James Langrock, Senior Vice President, Treasurer and Chief Financial Officer of 1-800-FLOWERS.COM, INC., and in various capacities for its subsidiaries[29][30][31] - JPMorgan Chase Bank, N.A. signs as Administrative Agent, a Lender, and an Issuing Lender[33] - Other key lenders signing the amendment include Wells Fargo Bank, Bank of America, TD Bank, and M&T Bank[34][35][36][37] Third Amended and Restated Credit Agreement This section details the Third Amended and Restated Credit Agreement, covering definitions, credit facility mechanics, guarantee structure, representations, conditions, covenants, events of default, and administrative agent roles Article I: Definitions This article defines capitalized terms, introducing new suspension and restriction periods that modify financial covenants and pricing, and reduces the Revolving Credit Commitment Applicable Rate Spreads and Fees | Period | ABR Spread | Term Benchmark Spread/Acceptance Fee | Commitment Fee Rate | | :--- | :--- | :--- | :--- | | Suspension/Covenant Restriction Period | 2.50% | 3.50% | 0.50% | | Other Periods (Leverage > 3.50:1.00) | 1.50% | 2.50% | 0.35% | - The "Revolving Credit Commitment" is reduced from $225 million to $205 million, effective on the Second Amendment Effective Date[257] - Introduces the "First Suspension Period" from the Second Amendment Effective Date to December 26, 2026, and the "Second Suspension Period" from December 27, 2026, to March 28, 2027, during which certain covenants are modified[158][273] - Defines a "Covenant Restriction Period" commencing March 29, 2027, which continues certain modified covenant terms after the suspension periods end[118] Article II: The Credits This article details credit facility mechanics, covering borrowing, repayment, and prepayments, with the Second Amendment altering term loan schedules, seasonal reductions, and introducing mandatory prepayments based on excess cash Term Loan Repayment Schedule | Installment Dates | Original Principal Amount | Amended Principal Amount | | :--- | :--- | :--- | | September 26, 2025 | $5 million | $3 million | | December 26, 2025 | $5 million | $6 million | | March 24, 2028 | $5 million | $6 million | | Term Loan Maturity Date | $125 million | $97 million | - The seasonal reduction period for Revolving Credit Commitments is amended to run from January 1 through July 1 of each fiscal year, instead of through August 1[333] - A new mandatory prepayment clause requires the Company to prepay Revolving Credit Loans by the amount that its unrestricted cash and cash equivalents exceed $25 million, tested monthly during any Suspension or Covenant Restriction Period[391] - The company is prohibited from requesting an increase to the Revolving Credit Commitment or requesting Incremental Term Loans during any Suspension Period or Covenant Restriction Period[371][376] Article III: Guarantee This article establishes the credit facility's guarantee structure, with the parent company guaranteeing subsidiary obligations and subsidiaries jointly guaranteeing parent and other borrower obligations, all being absolute and unconditional - The Company guarantees the obligations of all Subsidiary Borrowers and Subsidiary Guarantors[470] - Each Subsidiary Guarantor jointly and severally guarantees the obligations of the Company and other Borrowers[471] - The guarantee obligations are unconditional and are not affected by waivers, amendments, or the release of any other security[472] Article IV: Representations and Warranties This article contains Loan Parties' representations and warranties to lenders, covering legal and financial status, due organization, authority, financial condition, compliance with laws, and solvency, which must be true at signing and for each credit event - The Loan Parties represent they are duly organized, have the power to conduct business, and the credit agreement is a valid and binding obligation[488][489] - The Company confirms its financial statements are accurate and there has been no Material Adverse Effect since July 3, 2022[491][492] - The Company represents it has implemented policies to ensure compliance with Anti-Corruption Laws and Sanctions, and that no Loan Party or its key personnel is a Sanctioned Person[509] Article V: Conditions This article outlines conditions precedent for the credit agreement's effectiveness and subsequent credit events, requiring executed documents, legal opinions, and officer's certificates, with representations and warranties remaining true, and adding a borrowing limit if cash exceeds $25 million during Suspension Periods - The effectiveness of the agreement is conditioned on the Administrative Agent receiving executed counterparts, legal opinions, corporate documents, and officer's certificates[514][515][516][517] - Each credit event (e.g., a new loan) requires that representations and warranties be true and correct and that no Default has occurred[526] - A new condition is added for borrowings during a Suspension or Covenant Restriction Period: unrestricted cash and equivalents must not exceed $25 million after giving effect to the transaction[527] Article VI: Affirmative Covenants This article specifies affirmative covenants, including requirements for financial statements, material event notifications, property maintenance, tax payments, and insurance, with the Second Amendment introducing additional reporting and cash management restrictions during suspension periods - During the First Suspension Period, the Company must deliver monthly certificates demonstrating compliance with the new Liquidity covenant and provide a 13-week cash flow forecast[531] - During any Suspension or Covenant Restriction Period, the Company must maintain its principal U.S. depositary banking with the Lenders[558] - During Suspension or Covenant Restriction Periods, cash held by non-Loan Party subsidiaries is capped at $1 million, and cash held in accounts outside the U.S. is also capped at $1 million[558] - During Suspension or Covenant Restriction Periods, the Company must establish and maintain Control Agreements over its main deposit and securities accounts within 60 days of the Second Amendment Effective Date[555] Article VII: Negative Covenants This article outlines prohibited actions, including limitations on debt, liens, mergers, asset sales, investments, and restricted payments, with the Second Amendment introducing more restrictive sub-limits and prohibitions during suspension periods, and suspending certain financial covenants with a new Liquidity covenant - The Consolidated Leverage Ratio and Consolidated Fixed Charge Coverage Ratio covenants are suspended during the First Suspension Period[578][580] - A new Liquidity covenant is introduced, applicable only during the First Suspension Period, requiring the Company to maintain minimum liquidity levels as of the last day of each fiscal month[581] - During Suspension and Covenant Restriction Periods, the ability to incur debt, dispose of assets, make investments, and make restricted payments is significantly more limited through lower dollar-value baskets and the prohibition of certain activities previously permitted based on leverage tests[561][567][571][572][573] Article VIII: Events of Default This article defines "Events of Default," including non-payment, covenant breaches, cross-defaults on material debt, bankruptcy, and judgments exceeding $15 million, upon which the Administrative Agent can terminate commitments and accelerate loan repayment - Events of Default include non-payment of principal, interest, or fees; violation of covenants; incorrect representations; and cross-defaults on other Material Indebtedness (exceeding $15 million)[587] - Bankruptcy or insolvency proceedings, whether voluntary or involuntary (if undismissed for 60 days), constitute an immediate Event of Default[588] - A Change in Control of the company is also defined as an Event of Default[588] - Upon an Event of Default, lenders may terminate commitments and declare all loans immediately due and payable[589] Article IX: The Administrative Agent This article appoints JPMorgan Chase Bank, N.A. as Administrative Agent, outlining its role, rights, and responsibilities, clarifying its reliance on information, protection from liability, and provisions for erroneous payments - Each Lender and Issuing Lender irrevocably appoints JPMorgan Chase Bank, N.A. as its Administrative Agent[591] - The Administrative Agent's duties are expressly set forth in the loan documents, and it is not subject to any fiduciary duties It is not liable for actions taken with the consent of the Required Lenders or in the absence of its own gross negligence or willful misconduct[593] - The article includes a mechanism for the Administrative Agent to recover any payments erroneously transmitted to a Lender[603] Article X: Miscellaneous This article contains standard miscellaneous legal clauses, including procedures for notices, waivers and amendments, cost reimbursement, lender indemnification, loan assignment rules, New York governing law, consent to jurisdiction, and a mutual waiver of jury trial - Amendments to the agreement generally require the written consent of the Company and the Required Lenders, with certain critical changes (e.g., increasing commitments, reducing principal/interest) requiring consent of each affected Lender[612] - The Company is required to pay all reasonable out-of-pocket expenses of the Administrative Agent and indemnify the Agent and Lenders against losses and claims arising from the credit facility[616][617] - The agreement is governed by the law of the State of New York, and all parties submit to the exclusive jurisdiction of courts in the Southern District of New York[640][641] - All parties to the agreement waive their right to a trial by jury in any legal proceeding related to the agreement[645]