Sprouts Farmers Market Inc. filed SEC Form 8-K: Entry into a Material Definitive Agreement, Termination of a Material Definitive Agreement, Creation of a Direct Financial Obligation, Regulation FD Disclosure, Financial Statements and Exhibits
$SFM
Food Chains
Consumer Staples
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d)
of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) July 25, 2025
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation or organization) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||||||
(Address of principal executive offices and zip code)
(480 ) 814-8016
(Registrant’s telephone number, including area code)
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Item 1.01. Entry into a Material Definitive Agreement.
On July 25, 2025, Sprouts Farmers Market, Inc. (“Holdings”) and its subsidiary, Sprouts Farmers Markets Holdings, LLC (“Borrower” and, together with Holdings, the “Company”) entered into a credit agreement (the “Credit Agreement”) with the lenders named therein, JPMorgan Chase Bank, N.A., as administrative agent, an issuing bank and swingline lender, J.P. Morgan Securities LLC, as sustainability structuring agent, Truist Bank and PNC Bank, National Association, as syndication agent, and Bank of America, N.A., BMO Bank, N.A. and US Bank National Association, as documentation agents. The Credit Agreement provides for a senior secured revolving credit facility (the “Revolving Credit Facility”) with an initial aggregate commitment of $600 million, which may be increased from time to time pursuant to the terms set forth in the Credit Agreement. In connection with the closing of the Credit Agreement, the Company terminated its existing $700 million senior secured credit facility. The proceeds of loans under the Revolving Credit Facility will be used for general corporate purposes. The Company had no loans outstanding under the Credit Agreement as of July 25, 2025.
The Credit Agreement is scheduled to mature, and the commitments thereunder will terminate, on July 25, 2030, subject to extensions as set forth in the Credit Agreement.
Loans under the Credit Agreement will initially bear interest, at the Borrower’s option, either at the Term SOFR (with a floor of 0.00%) plus 1.00% per annum or alternate base rate (with a floor of 0.00%) plus 0.00% per annum. The interest rate margins are subject to upward adjustments pursuant to a pricing grid based on the Company’s total net leverage ratio as set forth in the Credit Agreement and to upward or downward adjustments of up to 0.05% based upon the achievement of certain sustainability-linked metric thresholds, as set forth in the Credit Agreement.
The Borrower may prepay loans and permanently reduce commitments under the Credit Agreement at any time in agreed-upon minimum principal amounts, without premium or penalty (except Term SOFR breakage costs, if applicable).
Subject to certain customary exceptions, obligations under the Credit Agreement are guaranteed by the Company and substantially all of the Borrower’s current and future wholly owned material domestic subsidiaries, subject to customary exceptions, and are secured by a first–priority security interest in substantially all of the assets of the Company and its subsidiary guarantors, including, without limitation, a pledge by Holdings of its equity interest in the Borrower, subject to customary exceptions.
The Credit Agreement contains customary representations, affirmative covenants and negative covenants which representations and affirmative and negative covenants are subject to customary and other agreed-upon exceptions. In addition, the Credit Agreement requires that the Borrower and its restricted subsidiaries maintain a maximum total net leverage ratio not to exceed 3.75 to 1.00, as may be adjusted as set forth in the Credit Agreement, and a minimum interest coverage ratio not to be less than 3.00 to 1.00. Each of these covenants is tested on the last day of each fiscal quarter, commencing with the fiscal quarter ending September 28, 2025.
The Credit Agreement also contains customary events of default. If an event of default occurs, the administrative agent and lenders are entitled to take various actions, including the acceleration of amounts due under the Credit Agreement, termination of commitments thereunder and certain other customary actions permitted to be taken upon an event of default by a secured creditor.
A copy of the Credit Agreement is filed as Exhibit 10.1 to this report and is incorporated herein by reference. The foregoing description of the Credit Agreement does not purport to be complete and is qualified in its entirety by reference to the complete text of the Credit Agreement.
Item 1.02. Termination of a Material Definitive Agreement.
The information set forth in Item 1.01 of this Form 8-K is hereby incorporated into this Item 1.02.
Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The information set forth in Item 1.01 of this Form 8-K is hereby incorporated into this Item 2.03.
Item 7.01. Regulation FD Disclosure.
The registrant is furnishing this Item 7.01 in connection with the disclosure of information, in the form of the textual information from a press release dated July 25, 2025. This information may be amended or updated at any time and from time to time through another Current Report on Form 8-K, a later company filing or other means. A copy of the press release is furnished herewith as Exhibit 99.1 and is incorporated into this Item 7.01 by reference.
The information furnished in this Item 7.01, including Exhibit 99.1, is being furnished and shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall it be deemed to be incorporated by reference into any registration statement or other document filed pursuant to the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.
The registrant does not have, and expressly disclaims, any obligation to release publicly any updates or any changes in our expectations or any change in events, conditions, or circumstances on which any forward-looking statement in the attached press release is based.
The text of this Current Report on Form 8-K and the attached press release are available on the registrant’s investor relations website located at investors.sprouts.com, although the registrant reserves the right to discontinue that availability at any time.
Item 9.01. Financial Statements and Exhibits.
(d)Exhibits
Exhibit Number | Description | |||||||
| 10.1 | ||||||||
| 99.1 | ||||||||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | |||||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| SPROUTS FARMERS MARKET, INC. | ||||||||
| Date: July 25, 2025 | By: | /s/ Brandon F. Lombardi | ||||||
| Name: | Brandon F. Lombardi | |||||||
| Title: | Chief Legal Officer and Corporate Secretary | |||||||