FLOWERS FOODS INC 8-K

What Happened

• On April 6, 2026, Flowers Foods, Inc. (FLO) entered into a $400.0 million senior unsecured delayed-draw term loan credit facility and concurrently amended its revolving credit facility. The company will use the term loan proceeds, together with cash on hand, to repay in full its $400 million aggregate principal amount of 3.500% senior notes due October 2026. Wells Fargo Bank, N.A. serves as administrative agent for the term loan and the revolver amendment.

Key Details

• Amount and purpose: $400.0 million delayed-draw term loan to refinance the $400M 3.500% senior notes due Oct 2026; draw period through Oct 1, 2026.
• Maturity and pricing: initial maturity three years from funding; interest at SOFR or base rate plus a margin based on a pricing grid (SOFR margin 0.875%–2.000%; base-rate margin 0.00%–1.000%).
• Fees: additional ticking fee on unused commitments (pricing-grid range 0.060%–0.250%).
• Financial covenants: maximum Leverage Ratio of 3.75:1.00 (can be increased to 4.00:1.00 for up to four quarters after an acquisition — a “Covenant Holiday”); minimum Interest Coverage Ratio of 4.50:1.00. A Covenant Holiday is in effect through the fiscal quarter ending Oct 9, 2027.
• Guarantees: subsidiaries are not required to guarantee the term loan unless the company’s debt rating falls below specified levels or certain ratings conditions aren’t met.
• Revolver amendment: extends the existing Covenant Holiday through the fiscal quarter ending Oct 9, 2027 and aligns pricing and other terms with the new term loan (adds a lower-rating pricing tier consistent with the term loan).

Why It Matters

• This transaction replaces near-term bond maturities with a three-year bank facility, giving Flowers Foods time and flexibility to manage cash and capital structure without immediately refinancing in the public bond market. The financial covenants (leverage and interest coverage) and the extended Covenant Holiday set measurable limits and breathing room that investors can monitor. Changes to pricing tied to credit ratings mean future borrowing costs could rise if ratings weaken.