BJs RESTAURANTS INC Debt Disclosure

8. Long-Term Debt

Line of Credit

On April 30, 2020, we entered into an Amended Credit Facility (“Credit Facility”) with Bank of America, N.A. (“BofA”) and JPMorgan Chase Bank, N.A., to amend and restate our existing unsecured revolving line of credit (the “Line of Credit”) in response to disruptions arising from the COVID-19 pandemic and to modify certain financial covenants through the first quarter of fiscal 2021. On June 15, 2020, we further modified our Credit Facility to reduce our Line of Credit by $15.0 million, extend the maturity date by one year, change certain interest rates and reset select covenant levels. On January 15, 2021, we once again amended our Credit Facility to further reduce our Line of Credit by $20.0 million, change certain interest rates and reset selected covenant levels. See Note 15 for further information.

As of December 29, 2020, our Credit Facility matures on November 18, 2022, and provides us with revolving loan commitments totaling $235 million (reduced to $215 million effective January 15, 2021), of which $50 million may be used for the issuance of letters of credit. Availability under the Credit Facility is reduced by outstanding letters of credit, which are used to support our self-insurance programs. As of December 29, 2020, there were borrowings of $116.8 million and letters of credit totaling approximately $21.1 million outstanding under the Credit Facility. Available borrowings under the Credit Facility were $97.1 million as of December 29, 2020.

Borrowings under the Line of Credit bear interest at an annual rate equal to either (a) LIBOR plus a percentage not to exceed 3.00% (with a floor on LIBOR of 1.00%), or (b) a percentage not to exceed 2.00% above a Base Rate equal to the highest of (i) the Federal Funds Rate plus 1/2 of 1.00%, (ii) BofA’s Prime Rate, or (iii) one-month LIBOR plus 1.00%, in either case depending on the level of lease and debt obligations of the Company as compared to EBITDA and lease expenses. The weighted average interest rate during fiscal 2020 was approximately 3.7%.

The Credit Facility is secured by the Company’s assets and contains provisions requiring us to maintain compliance with certain covenants, including a fixed charge coverage ratio and a lease adjusted leverage ratio. As of December, 29, 2020, we were in violation of these two covenants; however, this was cured in conjunction with our amendment on January 15, 2021, whereby the testing of the fixed charge coverage ratio and lease adjusted leverage ratio have been suspended until the third quarter of fiscal 2021. They will be tested based upon our earnings during the third quarter of fiscal 2021. Under a new financial covenant, there will be a one-time test of our earnings based upon results as of the end of the second fiscal quarter of

2021. Additionally, the financial covenant pertaining to liquidity will continue to be tested monthly through December 2021, and we will be required to meet a monthly fixed amount. Lastly, we are also subject to certain limits on capital expenditures for fiscal 2021 and 2022, with relief from the spending limits being granted if we satisfy certain financial covenant levels.

Pursuant to the Line of Credit, we are required to pay certain customary fees and expenses associated with maintenance and use of the Line of Credit, including letter of credit issuance fees, unused commitment fees and interest on the Line of Credit, which are payable monthly. Interest expense and commitment fees under the Credit Facility were approximately $7.1 million, $4.6 million and $4.8 million, for fiscal 2020, 2019 and 2018, respectively. We also capitalized approximately $0.1 and $0.3 million of interest expense related to new restaurant construction during fiscal 2020 and 2019, respectively. Additionally, for fiscal 2020, we capitalized approximately $0.8 million of fees related to the amended and modified credit agreement, which will be amortized over the remaining term of the Credit Facility.