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Credit Agreements | 12 Months Ended
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Feb. 03, 2024
Debt Disclosure [Abstract] |
Credit Agreements | Note 4 — Credit Agreements On March 31, 2023, the Company entered into a Third Amended and Restated Credit Agreement (the “2023 Credit Agreement”) with Bank of America, N.A., as administrative agent and collateral agent, and lender. The 2023 Credit Agreement amended the previous Second Amended and Restated Credit Agreement (the “2019 Credit Agreement”) from a $75.0 million senior secured revolving credit facility to a $90.0 million senior secured revolving credit facility. The 2023 Credit Agreement contains substantially similar terms and conditions as the 2019 Credit Agreement including a swingline availability of $10.0 million, a $25.0 million incremental accordion feature and extended its maturity date to March 2028. The fee paid to the lenders on the unused portion of the 2023 Credit Agreement is 25 basis points when usage is greater than 50% of the facility amount; otherwise, the fee on the unused portion is 37.5 basis points per annum. Under the 2019 Credit Agreement, the fee on the unused portion was 25 basis points per annum. On January 25, 2024, the Company entered into a First Amendment to the Third Amended and Restated Credit Agreement that increased the advance rate and allowed the Company to enter into a new Term Loan Credit Agreement. Subsequent to January 25, 2024, advances under the 2023 Credit Agreement accrue interest at an annual rate equal to the Secured Overnight Financing Rate (“SOFR”) plus a margin of 275 basis points with no SOFR floor. Upon the demonstration that the Company’s fixed charge coverage ratio is greater than 1.0 to 1.0 on a trailing twelve-month basis, the interest rate permanently decreases on the 2023 Credit Agreement to SOFR plus a margin of 225 basis points. Prior to January 25, 2024, advances under the 2023 Credit Agreement accrued interest at an annual rate equal to SOFR plus a margin ranging from 200 to 250 basis points with no SOFR floor. Advances under the 2019 Credit Agreement accrued interest at an annual rate equal to SOFR, or the London Interbank Offered Rate (“LIBOR”) through December 16, 2022, plus a margin ranging from 125 to 175 basis points with no SOFR or LIBOR floor. The Company is subject to a Second Amended and Restated Security Agreement (“Security Agreement”) with its lenders. Pursuant to the Security Agreement, the Company pledged and granted to the administrative agent, for the benefit of itself and the secured parties specified therein, a lien on and security interest in all of the rights, title and interest in substantially all of the Company’s assets to secure the payment and performance of the obligations under the 2023 and 2019 Credit Agreements. On January 25, 2024, the Company entered into a Term Loan Credit Agreement with Gordon Brothers Group (the “Term Loan Lender”), via an affiliate entity, 1903P Loan Agent, LLC, as administrative agent and lender. The Term Loan Credit Agreement provides for a $12.0 million, “first-in, last-out” delayed-draw asset-based term loan (the “Term Loan”). The indebtedness under the Term Loan is subordinated in most respects to the 2023 Credit Agreement. The Company is required to draw at least $5.0 million (“Tranche A Loan”) on or before April 1, 2024. If the Company makes the initial draw of the Tranche A Loan on or before April 1, 2024, thereafter and through January 31, 2028, the Company will be permitted to make additional draws of the Term Loan of up to $7.0 million, in increments of $1.0 million (the “Tranche B Loan”). The Term Loan will mature in March 2028, coterminous with the 2023 Credit Agreement. From closing until the applicable adjustment date, the interest rate of the Term Loan will be one-month term SOFR, plus a margin of 9.50%. Following the applicable adjustment date, the interest rate will increase to one-month term SOFR, plus a margin of 11.50%. The adjustment date shall be on the first anniversary of the closing, unless the parties enter into a lease renegotiation services agreement with an affiliate of the Term Loan Lender within 90 days after closing, in which case the adjustment date will be on the second anniversary of the closing. Borrowings under the 2023 Credit Agreement and the Term Loan Credit Agreement are subject to certain conditions and contain customary events of default, including, without limitation, failure to make payments, a cross-default to certain other debt, breaches of covenants, breaches of representations and warranties, a change in control, certain monetary judgments and bankruptcy and ERISA events. Upon any such event of default, the principal amount of any unpaid loans and all other obligations under the 2023 Credit Agreement and the Term Loan Credit Agreement may be declared immediately due and payable. The maximum availability under the 2023 Credit Agreement and the Term Loan Credit Agreement is limited by a borrowing base formula, which consists of a percentage of eligible inventory and eligible credit card receivables, less reserves and an excess required availability covenant, which limits the borrowing base formula by the greater of 10% of the combined borrowing base formula or $8.0 million. As of February 3, 2024, the Company was in compliance with the covenants in the 2023 Credit Agreement and the Term Loan Credit Agreement. As of February 3, 2024 and January 28, 2023, there were $34.0 million and $15.0 million in outstanding borrowings under the 2023 or 2019 Credit Agreement, respectively. There were no borrowings under the Term Loan Credit Agreement and no letters of credit outstanding at either February 3, 2024 or January 28, 2023. As of February 3, 2024, the Company had approximately $18.1 million available for borrowing under the 2023 Credit Agreement and the Term Loan Credit Agreement, after the minimum required excess availability covenant.

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