Barnes & Noble Education, Inc.BNED
Barnes & Noble Education, Inc. Debt Disclosure
Debt
| As of | |||||||||||||||||
Maturity Date (a) | May 3, 2025 | April 27, 2024 | |||||||||||||||
| Credit Facility | June 9, 2028 | $ | 103,100 | $ | 164,947 | ||||||||||||
| Term Loan | April 7, 2025 | — | 32,653 | ||||||||||||||
Sub-total | 103,100 | 197,600 | |||||||||||||||
Less: Deferred financing costs, Term Loan (b) | — | (1,263) | |||||||||||||||
Total long-term debt | $ | 103,100 | $ | 196,337 | |||||||||||||
| Balance Sheet classification: | |||||||||||||||||
| Long-term borrowings | 103,100 | 196,337 | |||||||||||||||
Total long-term debt | $ | 103,100 | $ | 196,337 | |||||||||||||
(a) On June 10, 2024, we completed the Transactions, including amending and extending the maturity date of the Credit Facility and converting all outstanding principal and interest amounts owed under our Term Loan Credit Agreement into shares of our Common Stock.
(b) For additional information, see Deferred Financing Costs below.
Transaction
On June 10, 2024, we completed the Transactions, including the Rights Offering, the Private Investment, the Term Loan Debt Conversion, and the Credit Facility Refinancing, to substantially deleverage our Consolidated Balance Sheet. These Transactions raised additional capital for repayment of indebtedness and provide additional flexibility for working capital needs, which will also allow us to strategically invest in innovation and continue to execute our strategic initiatives, including but not limited to the growth of our First Day Complete program.
Upon closing of the Transactions on June 10, 2024:
•We received gross proceeds of $95,000 of new equity capital through a $50,000 new equity investment (the “Private Investment”) led by Immersion Corporation (“Immersion”) and a $45,000 fully backstopped equity rights offering (the “Rights Offering”). The Transactions infused approximately $85,500 of net cash proceeds after transaction costs. The transaction resulted in Immersion obtaining controlling financial interest.
•Our existing Term Loan credit agreement lenders, TopLids LendCo, LLC and Vital Fundco, LLC, converted approximately $34,000 of outstanding principal and any accrued and unpaid interest into our common stock.
•We refinanced our Credit Facility providing access to a $325,000 facility maturing in 2028. The refinanced Credit Facility will meaningfully enhance our financial flexibility and reduce our annual interest expense.
Credit Facility
The Company has informed its lenders of the ongoing investigation and related restatement process, and its inability to deliver its fiscal 2025 annual financial statements, as well as its first and second quarter fiscal 2026 financial statements, by the dates originally required under its asset-based revolving credit facility (the “Credit Facility”). The Company requested that the lenders extend these reporting deadlines and waive certain related representations and warranties that may be impacted by the investigation and the resulting restatement of the Company’s previously issued financial statements.
On August 8, 2025, the lenders and the administrative agent entered into a limited consent and waiver, providing a 75-day extension of the reporting deadlines to October 22, 2025, and waiving any potential breach of certain representations related to financial reporting impacted by the review. In connection with the waiver, the Company paid a fee of $325, equal to 0.10% of the aggregate revolving commitments, which was fully earned and payable on the effective date.
On October 21, 2025, the Company exercised its option to request the additional 45-day extension permitted under the waiver, and the lenders granted the request, extending the reporting deadline to December 6, 2025. In accordance with the agreement, the Company paid a second waiver fee of $325, also equal to 0.10% of the revolver commitments, fully earned and payable on the effective date of the extension.
On December 5,2025, the Company and its lenders entered into a Second Limited Consent and Waiver, further extending the delivery deadlines for the fiscal 2025 annual financial statements, and the first and second quarter fiscal 2026 financial statements to January 20, 2026. Under the Second Limited Consent and Waiver, the lenders agreed to (i) extend the reporting deadlines to the Permitted January Deadline of January 20, 2026, and (ii) waive potential breaches of representations under Section 5.15 of the Credit Agreement related solely to the ongoing financial reporting review during the extension period. In consideration of the extension, the Company paid an additional fee equal to 0.10% of each consenting lender’s revolving credit commitment, which was fully earned and payable on the effective date.
During the limited extension period, the Company is required to (i) deliver weekly Approved Budget Updates and Variance Reports, (ii) make members of management available for bi-weekly update calls with the lenders, and (iii) maintain minimum excess availability of at least $30,000 under the Credit Facility. Failure to comply with these conditions constitutes an immediate event of default. The Company has informed its lenders that it is conducting a detailed review of certain financial reporting and accounting practices related to the calculation of EBITDA for fiscal years 2025 and 2024. As a result of this ongoing review, the Company was not able to deliver its fiscal 2025 annual financial statements or its fiscal first quarter 2026 financial statements by the deadlines originally required under the Credit Facility.
Pursuant to the A&R Credit Agreement, the lenders have committed to provide a four-year asset-backed revolving credit facility (the "Credit Facility") in an aggregate committed principal amount of up to $325,000. and extended the maturity date of the Credit Facility to June 9, 2028. During the 53 weeks ended May 3, 2025, we incurred debt issuance costs totaling $3,669 related to the Credit Facility under the A&R Credit Agreement.
Proceeds from the Credit Facility are and will be used for general corporate purposes, including seasonal working capital needs. The Company has interest-only obligations under the Credit Facility until the maturity date, at which time the total principal outstanding is due and payable.
Interest under the Credit Facility accrues, at the election of the Company, either (x) based on the Secured Overnight Financing Rate (“SOFR”), which is subject to a floor of 2.50% per annum, plus a spread of 3.50% per annum or (y) at an alternate base rate, which is subject to a floor of 3.50% per annum, plus a spread of 2.50% per annum; provided, that in the event the Company meets certain financial metrics for a consecutive six-month period beginning and ending after the one-year anniversary of the Closing Date, the foregoing spreads shall be reduced by 0.25% per annum.
The A&R Credit Agreement contains customary negative covenants that limit the Company’s ability to incur or assume additional indebtedness, grant or permit liens, make investments, make Restricted Payments (as defined in the A&R Credit Agreement) and other specified payments, merge with other entities, dispose of or acquire assets, or engage in transactions with affiliates, among other things. Additionally, the A&R Credit Agreement includes the following financial maintenance covenants:
•following the date that is six months following the Closing Date, the Company is required to maintain a minimum Availability (as defined in the A&R Credit Agreement) of (x) $25,000 for the first thirty (30) months after the Closing Date and (y) $30,000 after the date that is thirty (30) months after the Closing Date;
•commencing with the month ending on or about May 31, 2025, the Company is required to maintain a Consolidated Fixed Charge Coverage Ratio (as defined in the A&R Credit Agreement) of not less than 1.10 to 1.00, which will be tested monthly on the last day of each fiscal month for the trailing period; and
•commencing with the quarter ending on or about October 31, 2024, the Company is required to maintain a minimum Consolidated EBITDA (as defined in the A&R Credit Agreement), which will be tested quarterly on the last day of each fiscal quarter for (a) the trailing six-month period for the first test date, (b) the trailing nine-month period of the second test date and (c) for the trailing 12-month period thereafter.
The A&R Credit Agreement contains customary events of default, including for non-payment of obligations owing under the Credit Facility, material breaches of representations and warranties, failure to perform or observe covenants, default on other material indebtedness, customary ERISA events of default, bankruptcy and insolvency, material judgments, invalidity of liens on collateral, change of control or cessation of business. The A&R Credit Agreement also contains customary affirmative covenants and representations and warranties.
The Credit Facility is secured by substantially all of the inventory, accounts receivable and related assets of the borrowers under the Credit Facility. This is considered an all-assets lien (inclusive of proceeds from tax refunds payable to the Company and a pledge of equity from subsidiaries, exclusive of real estate).
In connection with the Credit Facility, a 1.00% fee was payable in connection with the eighth amendment to the Original Credit Agreement (prior to its amendment and restatement), of which 50% was paid on September 2, 2024 and 50% is due and payable on June 10, 2025.
During the 53 weeks ended May 3, 2025, we borrowed $887,055 and repaid $948,920 under the Credit Facility, with $103,100 of outstanding borrowings under the Credit Facility as of May 3, 2025. During the 52 weeks ended April 27, 2024, we borrowed $563,023 and repaid $552,230 under the Credit Facility, with $164,947 of outstanding borrowings as of April 27, 2024. As of May 3, 2025 and April 27, 2024, we issued $575 and $3,575, respectively, in letters of credit under the Credit Facility.
During the 52 weeks ended April 27, 2024, we incurred debt issuance costs totaling $11,516 related to the July 2023 amendment the Original Credit Agreement. The debt issuance costs have been deferred and are presented as prepaid and other current assets and other noncurrent assets in the Consolidated Balance Sheets, and subsequently amortized ratably over the term of the A&R Credit Agreement.
As of May 3, 2025, and as of the issuance date of this Annual Report on Form 10-K , the Company remained in compliance with all covenants under the A&R Credit Agreement.
The following is a summary of the various Credit Agreement amendments.
April 2024 Credit Agreement Amendment
On April 16, 2024, we amended our existing Credit Agreement to, among other things, revise certain milestones related to the previously-disclosed liquidity and refinancing contingency plans to align such milestones with the Transactions contemplated by the Purchase Agreement, which milestones include (i) filing the Form S-1 no later than two (2) business days after the date of such amendment, (ii) obtaining receipt of support letters in support of the Transactions from persons owning not less than 20% of the outstanding voting stock of the Company by no later than May 3, 2024 (or such later date as agreed to in writing by the administrative agent in its sole discretion), (iii) obtaining receipt of the SEC approval with respect to such Form S-1 on or before May 24, 2024 (or such later date as agreed to in writing by the administrative agent in its sole discretion) and (iv) closing the Transactions contemplated by the Purchase Agreement on or before the date that is 25 days after the receipt of SEC approval with respect to the Form S-1. Under the Credit Agreement, the lenders originally committed to providing us with an asset-backed revolving credit facility in an aggregate principal amount of $400,000, which was reduced to $380,000 by the April 2024 amendment. During the 52 weeks ended April 27, 2024, we incurred debt issuance costs totaling $851 related to the April 2024 Credit Agreement amendment.
March 2024 Credit Agreement Amendment
On March 12, 2024, we amended our existing Credit Agreement to, among other things, (i) revise certain reporting requirements under the Credit Agreement and (ii) set certain milestones for liquidity and refinancing contingency plans, with respect to which we must execute a binding commitment no later than April 3, 2024 (as may be extended by the administrative agent to April 10, 2024). During the 52 weeks ended April 27, 2024, we incurred debt issuance costs totaling $1,929 related to the March 2024 Credit Agreement amendment.
December 2023 Credit Agreement Amendment
On December 12, 2023, we amended our existing Credit Agreement to, among other things: (i) amend the financial maintenance covenant to require Availability (as defined in the Credit Agreement) at all times to be greater than the greater of (x) 10% of the Aggregate Loan Cap (as defined in the Credit Agreement) and (y) (A) $32,500 or, subject to the satisfaction of certain conditions relating to the repayment of the Credit Agreement in full, (B) (a) $20,000 for the period of December 8, 2023 through January 12, 2024, (b) $25,000 for the period from January 26, 2024 through February 9, 2024, (c) $25,000 for the period of April 1, 2024 through April 30, 2024 and (d) $30,000 for the period of May 1, 2024 through May 31, 2024, and (ii) revise certain reporting requirements under the Credit Agreement. The amendment also revised the Specified Liquidity Transaction Fee introduced in the October 2023 Credit Agreement Amendment such that the $3,800 became due and was paid on January 31, 2024. During the 52 weeks ended April 27, 2024, we incurred debt issuance costs totaling $4,047 related to the December 2023 Credit Agreement amendment. The debt issuance costs have been deferred and are presented as prepaid and other current assets and other noncurrent assets in the Consolidated Balance Sheets, and subsequently amortized ratably over the term of the Credit Agreement.
October 2023 Credit Agreement Amendment
On October 10, 2023, we amended our existing Credit Agreement to revise certain reporting requirements to the administrative agent and lenders under the Credit Agreement. The amendment introduced a Specified Liquidity Transaction Fee of $3,800 that would become due and payable at the earlier to occur of (i) January 31, 2024, to the extent a Specified Liquidity Transaction (as defined in the Credit Agreement) has not been consummated prior to such date (or such later date that is up to thirty days thereafter to the extent agreed to in writing by the Administrative Agent in its sole discretion) or (ii) an Event of Default under the Credit Agreement. During the 52 weeks ended April 27, 2024, we incurred debt issuance costs totaling $1,428 related to the October 2023 Credit Agreement amendment. The debt issuance costs have been deferred and are presented as prepaid and other current assets and other noncurrent assets in the Consolidated Balance Sheets, and subsequently amortized ratably over the term of the Credit Agreement.
July 2023 Credit Agreement Amendment
On July 28, 2023, we amended our existing Credit Agreement to (i) extend the maturity date of the Credit Agreement to December 28, 2024, (ii) reduce advance rates with respect to the borrowing base by 1000 basis points on September 2, 2024 (in lieu of the reductions previously contemplated for September 2023), (iii) subject to the conditions set forth in such amendment, add a CARES Act tax refund claim to the borrowing base, from April 1, 2024 through July 31, 2024, (iv) amend the financial maintenance covenant to require Availability (as defined in the Credit Agreement) at all times greater than the greater of (x) 10% of the Aggregate Loan Cap (as defined in the Credit Agreement) and (y) (A) $32,500 minus, subject to the conditions set forth in such amendment, (B) (a) $7,500 for the period of April 1, 2024 through and including April 30, 2024, (b) $2,500 for the period of May 1, 2024 through and including May 31, 2024 and (c) $0 at all other times, (v) add a minimum Consolidated EBITDA (as defined in the Credit Agreement) financial maintenance covenant, and (vi) amend certain negative and affirmative
covenants and add certain additional covenants, all as more particularly set forth in such amendment. The amendment also requires that we appoint a Chief Restructuring Officer and that, by August 11, 2023, we (i) appoint two independent members to the board of directors of the Company from prospective candidates that have been previously disclosed to the Administrative Agent and the Lenders and (ii) appoint a committee of the board of directors of the Company to consist of three board members (two of whom will be the new independent directors). The committee’s responsibilities will include, among other things, to explore, consider, solicit expressions of interest or proposals for, respond to any communications, inquiries or proposals regarding, and advise as to all strategic alternatives to effect a “Specified Liquidity Transaction” (as defined in the Credit Agreement). There can be no guarantee or assurances that any such transaction or transactions be consummated. We must pay (i) a fee of 0.50% of the outstanding principal amount of the commitments under the Credit Agreement March 2023 amendment (as defined in the Credit Agreement) on the closing date (in lieu of the deferred fee previously contemplated in connection with the March 2023 amendment (as defined in the Credit Agreement)) and (ii) a fee of 1.00% of the outstanding principal amount of the commitments under the Credit Agreement as of the closing date on the earlier to occur of September 2, 2024 and an Event of Default (as defined in the Credit Agreement).
May 2023 Credit Agreement Amendment
On May 24, 2023, we amended our existing Credit Agreement to (i) increase the applicable margin with respect to the interest rate under the Credit Agreement to 3.75% per annum, in the case of interest accruing based on SOFR, and 2.75%, in the case of interest accruing based on an alternative base rate, in each case, without regard to a pricing grid, (ii) defer the reduction of advance rates used to calculate our borrowing capacity by an amount equal to 500 basis points previously required on May 31, 2023 to September 1, 2023, (iii) require cash flow reporting and variance testing commencing June 3, 2023 and (iv) defer partial prepayment of the term loan from the DSS segment sale proceeds to September 1, 2023. We did not incur debt issuance costs related to the May 2023 Credit Agreement amendment.
Term Loan
On June 10, 2024, our existing Term Loan Credit Agreement (the "Term Loan") dated June 7, 2022, lenders converted approximately $34,000 of outstanding principal and accrued and unpaid interest into our Common Stock, resulting in financing noncash flow activity totaling $86,755. We recognized a loss on extinguishment of debt of $55,233 in the Consolidated Statement of Operations in connection with the Term Loan debt conversion which represents the difference between the Common Stock fair value issued upon conversion and the net carrying value of the Term Loan, plus unamortized deferred financing costs related to the Term Loan. As a result of the Term Loan Debt Conversion, the Term Loan and its related agreements were terminated. See Note 6. Equity and Earnings (Loss) Per Share.
On June 7, 2022, we entered into a Term Loan Credit Agreement with TopLids LendCo, LLC and Vital Fundco, LLC (the “Term Loan” or “Term Loan Credit Agreement”). The Term Loan provided for term loans in an amount equal to $30,000 and matured on April 7, 2025. The proceeds of the Term Loans were being used to finance working capital, and to pay fees and expenses related to the Term Loan.
The Term Loan provided for term loans in an amount equal to $30,000 and, the loans thereunder, matured on April 7, 2025. The proceeds of the Term Loan were being used to finance working capital, and to pay fees and expenses. During the 53 weeks ended May 3, 2025, we incurred $0 for interest in kind and repaid $0 under the Term Loan, with $0 of outstanding borrowings as of May 3, 2025. During the 52 weeks ended April 27, 2024, we incurred $2,652 for interest in kind and repaid $0, with $32,652 of outstanding borrowings as of April 27, 2024.
The Term Loan accrued interest at a rate equal to 11.25%, payable quarterly. All interest on the Term Loan prior to July 29, 2023 was paid in cash. Subsequent to July 29, 2023, all interest incurred on the Term Loan was incurred in kind as permitted under the July 2023 Term Loan Amendment and is part of the outstanding debt balance. The Term Loans did not amortize prior to maturity.
The Term Loan did not contain a financial covenant, but otherwise contains representations and warranties, covenants and events of default that are substantially the same as those in the A&R Credit Agreement, including restrictions on the ability of the Company and its subsidiaries to incur additional debt, incur or permit liens on assets, make investments and acquisitions, consolidate or merge with any other company, engage in asset sales and make dividends and distributions. The Term Loan was secured by second-priority liens on all assets securing the obligations under the A&R Credit Agreement, which are all of the assets of the Company and the Guarantors, subject to customary exclusions and limitations set forth in the Term Loan and the other loan documents executed in connection therewith.
The A&R Credit Agreement permits us to incur the Term Loan and also provides that, upon repayment of the Term Loan (and, if applicable, any replacement credit facility thereof), we may incur second lien secured debt in an aggregate principal amount not to exceed $75,000.
The following is a summary of the various Term Loan Credit Agreement amendments.
March 2023 Term Loan Credit Agreement Amendment
On March 8, 2023, we amended the Term Loan Credit Agreement to (i) extend the maturity date of the Term Loan Credit Agreement by six months to December 7, 2024, (ii) permit the application of certain proceeds to the repayment of the loans under Credit Agreement and (iii) amend certain negative covenants and add certain additional covenants to conform to the Credit Agreement. In addition, the amendment required the achievement of a Specified Event (as described above) by no later than May 31, 2023 (as such date may be extended under the Credit Agreement, but no later than August 31, 2023 without consent from lenders under the Term Loan Credit Agreement).
During the 52 weeks ended April 29, 2023, we incurred debt issuance costs totaling $431 related to the March 2023 Term Loan Credit Agreement amendment. We paid a fee of $50 on the amendment closing date to the lenders under the Term Loan Credit Agreement. The debt issuance costs have been deferred and are presented as a reduction to long-term borrowings in the Consolidated Balance Sheets, and subsequently amortized ratably over the term of the Term Loan Facility.
July 2023 Term Loan Credit Agreement Amendment
On July 28, 2023, we amended our Term Loan to (i) extend the maturity date of the Term Loan Credit Agreement to April 7, 2025, (ii) allow for interest to be paid in kind until September 2, 2024, (iii) amend the 1.50% anniversary fee to recur on June 7 of each year that the Term Loan Credit Agreement remains outstanding, with 2024 fee deferred to the earlier of September 2, 2024 and the Termination Date (as defined in the Term Credit Loan Agreement) and (iv) amend certain negative covenants and affirmative and add certain additional covenants. We must pay a fee of $50 to the lenders under the Term Loan Credit Agreement on the earlier of September 2, 2024 and the Termination Date (as defined in the Term Loan Credit Agreement).
The debt issuance costs have been deferred and are presented as a reduction to long-term borrowings in the Consolidated Balance Sheets, and subsequently amortized ratably over the term of the Term Loan.
Deferred Financing Costs
The debt issuance costs have been deferred and are presented as noted below in the Consolidated Balance Sheets and are subsequently amortized ratably over the term of respective debt.
| Dollars in thousands | As of | ||||||||||||||||
Balance Sheet Location | Maturity Date/ Amortization Term (a) | May 3, 2025 | April 27, 2024 | ||||||||||||||
Credit Facility - Prepaid and Other Current Assets | June 9, 2028 | $ | — | $ | — | ||||||||||||
Credit Facility - Other noncurrent assets | 11,597 | 12,897 | |||||||||||||||
Credit Facility - sub-total | 11,597 | 12,897 | |||||||||||||||
Term Loan - Contra Debt | — | 1,263 | |||||||||||||||
Total deferred financing costs | $ | 11,597 | $ | 14,160 | |||||||||||||
(a) On June 10, 2024, we completed the Transactions, including amending and extending the maturity date of the Credit Facility and converting all outstanding principal and interest amounts owed under our Term Loan Credit Agreement into shares of our Common Stock. For additional information, see Note 9. Debt.
Interest
The following table presents interest expense and cash interest paid:
| 53 weeks ended | 52 weeks ended | |||||||||||||
| May 3, 2025 | April 27, 2024 | |||||||||||||
| Interest Incurred | ||||||||||||||
| Credit Facility | $ | 16,279 | $ | 24,409 | ||||||||||
| Term Loan | 1,167 | 3,984 | ||||||||||||
| Total Interest Incurred | $ | 17,446 | $ | 28,393 | ||||||||||
| Amortization of Deferred Financing Costs | ||||||||||||||
| Credit Facility | $ | 5,014 | $ | 11,910 | ||||||||||
| Term Loan | 150 | 1,240 | ||||||||||||
| Total Amortization of Deferred Financing Costs | $ | 5,164 | $ | 13,150 | ||||||||||
| Interest Income, net of expense | $ | (350) | $ | (1,178) | ||||||||||
| Total Interest Expense | $ | 22,260 | $ | 40,365 | ||||||||||
Cash Interest Paid | $ | 17,912 | $ | 24,943 | ||||||||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Dec 23, 2025 | Showing above |
| 2024 | Jul 1, 2024 | |
| 2023 | Jul 31, 2023 | |
| 2022 | Jun 29, 2022 | |
| 2021 | Jun 30, 2021 | |
About Debt Disclosures
Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.
Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.