SUBSEQUENT EVENTS

9 Months Ended

Apr. 28, 2012

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS

9.             SUBSEQUENT EVENTS

On May 24, 2012, the Company refinanced its existing $400 million revolving credit facility by entering into an amended and restated $500 million revolving credit facility (the “Amended and Restated Credit Facility”) by and among the Company, United Natural Foods West, Inc., United Natural Trading Co. (collectively, the “U.S. Borrowers”), and UNFI Canada (together with the U.S. Borrowers, the “Borrowers”), the lenders thereto, and Bank of America, N.A. as administrative agent.  The Amended and Restated Credit Facility consists of a senior secured revolving loan facility of up to $500.0 million, of which $450.0 million is available to the U.S. Borrowers and $50.0 million is available to UNFI Canada.  Subject to lenders providing an increase in funding, the Borrowers may increase the amount of the Amended and Restated Credit Facility by up to $100.0 million (in not less than $10.0 million increments) without consent of the lenders not lending the increase in funding.  The Amended and Restated Credit Facility provides for a $40.0 million sublimit of availability for letters of credit and a $35.0 million sublimit of availability for short-term borrowings on a swingline basis, with in each case further sublimits applicable to UNFI Canada.  Availability under the Amended and Restated Credit Facility is subject to a borrowing base, which is based on 90% of eligible accounts receivable plus 85% of the net orderly liquidation value of eligible inventory, subject to customary reserves.

In connection with the refinancing, the Borrowers incurred approximately $217.7 million in borrowings to repay in full all existing indebtedness of approximately $43.6 million under the Company’s term loan agreement maturing in July 2012 and approximately $174.1 million to refinance existing indebtedness under the $400 million revolving credit facility.  In connection with the payoff of the Company’s term loan, the corresponding interest rate swap on that loan was also settled for a payment of $0.3 million.

Interest accrues on borrowings of U.S. Borrowers at rates that, at the Company’s option, can be either a base rate (the highest of Bank of America N.A.’s prime rate, the average of overnight federal funds rate plus 0.50%, and one-month LIBOR plus 1.00%), plus an applicable margin, or a LIBOR-based rate plus an applicable margin.  Interest accrues on borrowings of UNFI Canada at rates that, at the Company’s option, can be either a prime rate (the highest of the 30-day Reuters Canadian Deposit Offering Rate for bankers’ acceptances plus 0.50%, the prime rate of Bank of America N.A.’s Canada branch, and a bankers’ acceptance equivalent rate for a one-month interest period plus 1.0%) plus an applicable margin, or the annual rates applicable to Canadian Dollar bankers’ acceptances, plus five basis points and an applicable margin.  The initial applicable margin for base rate and prime rate loans is 0.50%, and the initial applicable margin for LIBOR and Canadian Dollar bankers’ acceptances-rate loans is 1.50%.

The Amended and Restated Credit Facility is guaranteed by most of the Company’s wholly-owned subsidiaries that are not also Borrowers.  The U.S. Borrowers’ and guarantors’ obligations are secured by all of the U.S. Borrowers’ and the guarantors’ accounts receivable, inventory and certain other assets arising therefrom or related thereto.  UNFI Canada’s obligations under the Amended and Restated Credit Agreement are secured by all of the Borrowers’ and the guarantors’ accounts receivable, inventory and certain other assets arising therefrom or related thereto.