Dave & Buster's Entertainment, Inc.

Previous wording

The following discussion and analysis of our financial condition and results of operations should be read together with the accompanying consolidated financial statements and the related notes in Item 1 and with the audited consolidated financial statements and the related notes included in our Annual Report on Form 10-K as filed with the SEC on April 2, 2024. Amounts included in the following discussion, except for operating weeks and per share amounts, are rounded in millions.

Current wording

The following discussion and analysis of our financial condition and results of operations should be read together with the accompanying consolidated financial statements and the related notes in Item 1 and with the audited consolidated financial statements and the related notes included in our Annual Report on Form 10-K as filed with the SEC on April 7, 2025.

Previous wording

•Comparable store sales decreased 7.7% compared to the same calendar period in 2023. The same calendar period compares the 91 days of the third quarter from August 7, 2024 through November 5, 2024 to the 91 days of the prior year from August 9, 2023 through November 7, 2023. See further discussion of comparable store sales below at Revenues.

Current wording

•Comparable store sales decreased 8.3% compared to the same calendar period in 2024. See further discussion of comparable store sales below at Revenues.

Previous wording

•Net loss totaled $32.7 million, or $0.84 per diluted share, compared with net loss of $5.2 million, or $0.12 per diluted share in the third quarter of 2023.

Current wording

•Net income totaled $21.7, or $0.62 per diluted share, compared with net income of $41.4, or $0.99 per diluted share in the first quarter of 2024.

Previous wording

Reconciliations of Non-GAAP Financial Measures

Current wording

•Adjusted EBITDA of $136.1 decreased 14.5%, or $23.0, from the first quarter of 2024. See further discussion of Adjusted EBITDA, a non-GAAP measure, at Non-GAAP Financial Measures below along with a reconciliation to net income, the most comparable GAAP measure, at Reconciliations of Non-GAAP Financial Measures below.

Previous wording

We are a leading owner and operator of high-volume venues in North America that combine dining and entertainment for both adults and families under the “Dave & Buster’s” and “Main Event” brands. The core of our concept is to offer our customers quality dining and various forms of entertainment all in one location. Our entertainment offerings provide an extensive assortment of attractions centered around playing games, bowling, and watching live sports and other televised events. Our brands appeal to a relatively balanced mix of male and female adults, as well as families and young adults. We believe we appeal to a diverse customer base by providing a highly customizable experience in a dynamic and fun setting.

Current wording

We are a leading owner and operator of high-volume venues primarily in North America that combine dining and entertainment for both adults and families under the “Dave & Buster’s” and “Main Event” brands. The core of our concept is to offer our customers various forms of entertainment along with quality dining all in one location. Our entertainment offerings provide an extensive assortment of attractions centered around playing games, bowling, and watching live sports and other televised events. Our brands appeal to a relatively balanced mix of male and female adults, as well as families and teenagers. We believe we appeal to a diverse customer base by providing a highly customizable experience in a dynamic and fun setting.

Previous wording

Our Dave & Buster’s stores average 40,000 square feet and range in size between 16,000 and 70,000 square feet. Our Main Event stores average 54,000 square feet and range in size between 37,500 and 78,000 square feet. Generally, our stores are open seven days a week, with normal hours of operation generally from between 10:00 to 11:30 a.m. until midnight, with stores typically open for extended hours on weekends.

Current wording

Our Dave & Buster’s stores average 37,000 square feet and range in size between 16,000 and 70,000 square feet. Our Main Event stores average 54,000 square feet and range in size between 37,500 and 78,000 square feet. Generally, our stores are open seven days a week, with normal hours of operation generally from between 10:00 to 11:30 a.m. until midnight, with stores typically open for extended hours on weekends.

Previous wording

Comparable store sales —Comparable store sales are a comparison of sales to the same period of prior years for the comparable store base. We historically define the comparable store base to include those stores open for a full 18 months before the beginning of the current fiscal year and excluding stores permanently closed or planned for closure during the current fiscal year. For fiscal 2024, our comparable store base consists of 195 stores, of which 146 are Dave & Buster's branded stores and 49 are Main Event branded stores.

Current wording

Comparable store sales —Comparable store sales are a comparison of sales to the same period of prior years for the comparable store base. We historically define the comparable store base to include those stores open for a full 18 months before the beginning of the current fiscal year and excluding stores permanently closed or planned for closure during the current fiscal year. For fiscal 2025, our comparable store base consists of 210 stores, of which 153 are Dave & Buster's branded stores and 57 are Main Event branded stores.

Previous wording

New store openings —Our ability to expand our business and reach new customers is influenced by the opening of additional stores in both new and existing markets. The success of our new stores is indicative of our brand appeal and the efficacy of our site selection and operating models. For the nine months ended November 5, 2024, we opened nine new stores (seven Dave & Buster's branded stores and two Main Event branded stores).

Current wording

New store openings —Our ability to expand our business and reach new customers is influenced by the opening of additional stores in both new and existing markets. The success of our new stores is indicative of our brand appeal and the efficacy of our site selection and operating models. For the three months ended May 6, 2025, we opened two new Dave & Buster’s branded stores and relocated one additional Dave & Buster’s branded store.

Previous wording

Although we use these non-GAAP measures to assess the operating performance of our business, they have significant limitations as an analytical tool because they exclude certain material costs. For example, Adjusted EBITDA does not take into account a number of significant items, including our interest expense and depreciation and amortization expense. In addition, Adjusted EBITDA excludes certain other costs which may be important in analyzing our GAAP results. Because Adjusted EBITDA does not account for these expenses, its utility as a measure of our operating performance has material limitations. Our calculations of Adjusted EBITDA adjust for these amounts because they do not directly relate to the ongoing operations of the currently underlying business of our stores and therefore complicate comparison of the underlying business between periods. Nevertheless, because of the limitations described above, management does not view Adjusted EBITDA, Credit Adjusted EBITDA or Store Operating Income Before Depreciation and Amortization in isolation and also uses other measures, such as revenues, gross margin, operating income and net income to measure operating performance.

Current wording

Although we use these non-GAAP measures to assess the operating performance of our business, they have significant limitations as an analytical tool because they exclude certain material costs. For example, Adjusted EBITDA does not take into account a number of significant items, including our interest expense and depreciation and amortization expense. In addition, Adjusted EBITDA excludes certain other costs that may be important in analyzing our GAAP results. Because Adjusted EBITDA does not account for these expenses, its utility as a measure of our operating performance has material limitations. Our calculations of Adjusted EBITDA adjust for these amounts because they do not directly relate to the ongoing operations of the currently underlying business of our stores and therefore complicate comparison of the underlying business between periods. Nevertheless, because of the limitations described above, management does not view Adjusted EBITDA, Credit Adjusted EBITDA or Store Operating Income Before Depreciation and Amortization in isolation and also uses other measures, such as revenues, gross margin, operating income and net income to measure operating performance.

Previous wording

We define “Store Operating Income Before Depreciation and Amortization” as operating income, plus depreciation and amortization expense, general and administrative expenses and pre-opening costs. Store Operating Income Before Depreciation and Amortization allows us to evaluate operating performance of each store across stores of varying size and volume.

Current wording

We define “Store Operating Income Before Depreciation and Amortization” as operating income, plus depreciation and amortization expense, general and administrative expenses, pre-opening costs and other charges and gains. Store Operating Income Before Depreciation and Amortization allows us to evaluate operating performance of each store across stores of varying size and volume.

Previous wording

We believe that Store Operating Income Before Depreciation and Amortization is another useful measure in evaluating our operating performance because it removes the impact of general and administrative expenses, which are not incurred at the store level, and the costs of opening new stores, which are non-recurring at the store level, and thereby enables the comparability of the operating performance of our stores for the periods presented. We also believe that Store Operating Income Before Depreciation and Amortization is a useful measure in evaluating our operating performance within the entertainment and dining industry because it permits the evaluation of store-level productivity, efficiency, and performance, and we use Store Operating Income Before Depreciation and Amortization as a means of evaluating store financial performance compared with our competitors. However, because this measure excludes significant items such as general and administrative expenses and pre-opening costs, as well as our interest expense, net, loss on debt refinancing and depreciation and amortization expense, which are important in evaluating our consolidated financial performance from period to period, the value of this measure is limited as a measure of our consolidated financial performance.

Current wording

We believe that Store Operating Income Before Depreciation and Amortization is another useful measure in evaluating our operating performance because it removes the impact of general and administrative expenses, which are not incurred at the store level, and the costs of opening new stores, which are non-recurring at the store level, and thereby enables the comparability of the operating performance of our stores for the periods presented. We also believe that Store Operating Income Before Depreciation and Amortization is a useful measure in evaluating our operating performance within the entertainment and dining industry because it permits the evaluation of store-level productivity, efficiency, and performance, and we use Store Operating Income Before Depreciation and Amortization as a means of evaluating store financial performance compared with our competitors. However, because this measure excludes significant items such as general and administrative expenses, pre-opening costs, and other charges and gains, as well as our interest expense, net, loss on debt refinancing and depreciation and amortization expense, which are important in evaluating our consolidated financial performance from period to period, the value of this measure is limited as a measure of our consolidated financial performance.

Previous wording

We have historically operated on a 52 or 53-week fiscal year that ends on the Sunday after the Saturday closest to January 31. Each quarterly period reported has 13 weeks, except for 53-week fiscal years when the fourth quarter has 14 weeks. Fiscal 2023, which ended on February 4, 2024, followed this calendar and had 53 weeks. The first quarter of fiscal 2024 also followed this calendar and had 13 weeks.

Current wording

We operate on a 52- or 53-week fiscal year that ends on the Tuesday after the Monday closest to January 31. Each quarterly period reported has 13 weeks, except for 53-week fiscal years when the fourth quarter has 14 weeks. Fiscal 2024, which ended on February 4, 2025, followed this calendar and had 52 weeks. The first quarter of both fiscal 2025 and 2024 had 13 weeks, however the first quarter of 2024 followed our previous fiscal calendar, which ended on a Sunday. The fourth quarter of fiscal 2025 will end on February 3, 2026.

Previous wording

We operate stores varying in size and have experienced significant variability among stores in volumes, operating results and net investment costs.

Current wording

We operate stores of various sizes and experience significant store variability in volumes, operating results and net investment costs.

Previous wording

Our new stores typically open with sales volumes in excess of their expected long-term run-rate levels, which we refer to as a “honeymoon” effect. We traditionally expect our new store sales volumes in year two to be 10% to 20% lower than our year one targets, and to grow in line with the rest of our comparable store base thereafter. As a result of the substantial revenues associated with each new store, the number and timing of new store openings will result in significant fluctuations in quarterly results.

Current wording

Our new stores typically open with sales volumes in excess of their expected long-term run-rate levels, which we refer to as a “honeymoon” effect. We traditionally expect our new store sales volumes in year two to be lower than our year one targets, and to grow in line with the rest of our comparable store base thereafter. As a result of the substantial revenues associated with each new store, the number and timing of new store openings will result in significant fluctuations in quarterly results.

Previous wording

New store operating margins (excluding pre-opening expenses) during the first year of operation historically benefit from honeymoon sales leverage on occupancy, management labor and other fixed costs. This benefit is partially offset by normal inefficiencies in hourly labor and other costs associated with establishing a new store. In year two, operating margins may decline due to the loss of honeymoon sales leverage on fixed costs which is partially offset by improvements in store operating efficiency.

Current wording

New store operating margins (excluding pre-opening expenses) during the first year of operation may benefit from honeymoon sales leverage on occupancy, management labor and other fixed costs. This benefit is partially offset by normal inefficiencies in hourly labor and other costs associated with establishing a new store. In year two, operating margins may decline due to the loss of honeymoon sales leverage on fixed costs, which is partially offset by improvements in store operating efficiency.

Previous wording

Our operating results historically have fluctuated due to seasonal factors. Typically, we have higher revenues associated with the spring and year-end holidays, which will continue to be susceptible to the impact of severe or unseasonably mild weather on customer traffic and sales during that period. Our third quarter, which encompasses the back-to-school fall season, has historically had lower revenues as compared to other quarters.

Current wording

Our operating results historically have fluctuated due to seasonal factors. Typically, we have higher revenues associated with the spring and year-end holidays, and sales and customer traffic during these periods are susceptible to the impact of severe, unfavorable or unseasonably mild weather. Our third quarter, which encompasses the back-to-school fall season, has historically had lower revenues as compared to other quarters.

Previous wording

We expect that economic and environmental conditions and changes in regulatory legislation will continue to exert pressure on both supplier pricing and consumer spending related to entertainment and dining alternatives. There is no assurance that our cost of products will remain stable or that federal, state, or local minimum wage rates will not increase beyond amounts currently legislated, however, the effects of any supplier price increase or wage rate increases might be partially offset by selective price increases if competitively appropriate.

Current wording

Economic and environmental conditions and changes in regulatory legislation could exert pressure on both supplier pricing and consumer spending related to entertainment and dining alternatives. There is no assurance that our cost of products will remain stable or that federal, state, or local minimum wage rates will not increase beyond amounts currently legislated, however, the effects of any supplier price increase or wage rate increases might be partially offset by selective price increases if competitively appropriate.

Previous wording

Nine Months Ended November 5, 2024 (the “2024 period”) Compared to the Nine Months Ended October 29, 2023 (the “2023 period”)

Current wording

Three Months Ended May 6, 2025 (the “2025 period”) Compared to the Three Months Ended May 5, 2024 (the “2024 period”)

Previous wording

The following table sets forth selected data for the periods indicated. All information is derived from the accompanying consolidated statement of comprehensive income.

Current wording

The following table sets forth selected data for the periods indicated (in dollars and a percentage of revenues). All information is derived from the accompanying Consolidated Statement of Comprehensive Income.

Previous wording

(4)The amount for the third quarter of 2024 primarily consisted of $1.3 million of one-time, third-party consulting fees, $0.3 million of severance costs and a $0.4 million gain on property and equipment transactions. The amount for the third quarter of 2023 primarily consisted of losses on property and equipment transactions. The third-party consulting fees are not part of our ongoing operations and were incurred to execute two related, discrete, and project-based strategic initiatives aimed at transforming our marketing strategy and one discrete, project-based initiative to transform our supply chain operational efficiency. They are included in general and administrative expenses on the consolidated statement of comprehensive income. The transformative nature, narrow scope, and limited duration of these incremental consulting fees are not reflective of the ordinary course expenses incurred to operate our business.

Current wording

(5)The amount for the 2025 period primarily consisted of $0.9 of discretionary retention incentives, $0.3 of severance costs and a $3.7 loss on property and equipment transactions. The amount for the 2024 period primarily consisted of $1.8 of one-time, third-party consulting fees and $0.8 severance and restructuring charges, partially offset by a $0.3 gain on property and equipment transactions. The third-party consulting fees are not part of our ongoing operations and were incurred to execute two related, discrete, and project-based strategic initiatives aimed at transforming our marketing strategy, and one discrete, project-based initiative to transform our supply chain operational efficiency. The transformative nature, narrow scope, and limited duration of these incremental consulting fees are not reflective of the ordinary course expenses incurred to operate our business. Third-party consulting fees, discretionary retention incentives and severance costs are included in General and administrative expenses on the Consolidated Statement of Comprehensive Income. (Gain) loss on property and equipment transactions is included in Other charges and gains on the Consolidated Statement of Comprehensive Income.

Previous wording

Selected revenue and store data for the periods indicated are as follows:

Current wording

Revenues -Selected revenue data and store data for the periods indicated are as follows:

Previous wording

The decrease in revenue is primarily attributable to a $43.3 million decrease in comparable store sales, partially offset by $15.9 million of incremental sales from new stores, an increase in other noncomparable revenues of $0.7 million, and $12.8 million in changes in entertainment revenue deferrals. The decrease in comparable store revenues is due primarily to a reduction in demand relative to a more robust consumer environment in the prior year period. The changes in entertainment revenue deferrals reflect breakage on unredeemed game play credits and tickets corresponding to guest redemption patterns over time. See Revenue Recognition at Note 1 to the unaudited consolidated financial statements for discussion of revenue recognition associated with play credits and tickets.

Current wording

Total revenues for the 2025 period decreased $20.4, or 3.5%, to $567.7 compared to $588.1 for the 2024 period. The decrease in revenue is primarily attributable to a $46.6 decrease in comparable store sales, partially offset by a $15.7 increase in new store revenues and an increase of $10.5 in other noncomparable revenues. The decrease in comparable store revenues is due primarily to a reduction in walk-in business relative to the prior year period. The change in other noncomparable revenues reflects breakage on unredeemed game play credits and tickets corresponding to guest redemption patterns over time. See Revenue Recognition at Note 1 to the unaudited consolidated financial statements for discussion of revenue recognition associated with game play credits and tickets.

Previous wording

The total cost of products was $236.9 million for the 2024 period and $257.8 million for the 2023 period. The total cost of products as a percentage of total revenues decreased to 14.8% for the 2024 period compared to 16.0% for the 2023 period.

Current wording

Cost of products -The total cost of products was $82.1 for the 2025 period and $87.3 for the 2024 period. The total cost of products as a percentage of total revenues decreased to 14.5% for the 2025 period compared to 14.8% for the 2024 period.

Previous wording

Cost of entertainment decreased to $91.2 million in the 2024 period compared to $101.0 million in the 2023 period. The cost of entertainment, as a percentage of entertainment revenues, decreased to 8.6% for the 2024 period from 9.6% in the 2023 period. The decrease was primarily attributable to price increases.

Current wording

Cost of entertainment decreased to $30.6 in the 2025 period compared to $33.2 in the 2024 period. The cost of entertainment, as a percentage of entertainment revenues, decreased to 8.3% for the 2025 period from 8.6% in the 2024 period. The decrease was primarily attributable to sales price increases.

Previous wording

Cost of food and beverage products decreased to $145.7 million for the 2024 period compared to $156.8 million for the 2023 period. Cost of food and beverage products, as a percentage of food and beverage revenues, decreased to 26.9% for the 2024 period from 28.5% for the 2023 period. The decrease was primarily attributable to food and beverage menu price increases, continued supply chain and ingredient optimization, and the mix of products sold with our new menu, partially offset by promotional pricing to drive traffic and loyalty engagement.

Current wording

Cost of food and beverage products decreased to $51.5 for the 2025 period compared to $54.1 for the 2024 period. Cost of food and beverage products as a percentage of food and beverage revenues decreased to 25.6% for the 2025 period from 26.7% for the 2024 period. The decrease was due to food and beverage menu price increases, and the mix of products sold with our new menu, offset by certain commodity pricing increases.

Previous wording

Total operating payroll and benefits increased to $393.7 million in the 2024 period compared to $377.5 million in the 2023 period. The total cost of operating payroll and benefits as a percentage of total revenues was 24.6% in the 2024 period compared to 23.5% in the 2023 period. This increase is primarily due to additional stores in the current year and $9.6 million in employee retention tax credits recognized in the prior year, partially offset by labor management efficiencies.

Current wording

Total operating payroll and benefits decreased to $135.0 in the 2025 period compared to $141.6 in the 2024 period. The total cost of operating payroll and benefits as a percentage of total revenues was relatively comparable at 23.8% in the 2025 period compared to 24.1% in the 2024 period.

Previous wording

Other store operating expenses was $171.7 million in the third quarter of 2024 compared to $167.7 million in the third quarter of 2023. Other store operating expense as a percentage of total revenues increased to 37.9% in the third quarter of 2024 compared to 35.9% in the third quarter of 2023. The increase is primarily due to higher occupancy costs for new stores and repairs & maintenance costs.

Current wording

Other store operating expenses increased to $188.4 in the 2025 period compared to $176.0 in the 2024 period. Other store operating expense as a percentage of total revenues increased to 33.2% in the 2025 period compared to 29.9% in the 2024 period. This increase in expense as a percentage of total revenues was primarily due to increased marketing costs, incremental occupancy costs for new stores and timing of essential repairs & maintenance costs.

Previous wording

General and administrative expenses decreased to $89.1 million in the 2024 period compared to $92.0 million in the 2023 period. The decrease in general and administrative expenses was driven primarily by lower share-based and incentive compensation in the current year, partially offset by increased consulting and other costs related to discrete, one-time initiatives. General and administrative expenses as a percentage of total revenues decreased to 5.6% in the 2024 period compared to 5.7% in the 2023 period due primarily to the reasons noted above.

Current wording

General and administrative expenses decreased to $24.4 in the 2025 period compared to $28.0 in the 2024 period. The decrease in general and administrative expenses was driven primarily by lower labor and consulting costs and decreased share-based compensation in the current year. General and administrative expenses as a percentage of total revenues decreased to 4.3% in the 2025 period compared to 4.8% in the 2024 period due primarily to the reasons noted above.

Previous wording

Pre-opening costs of $5.2 million in the third quarter of 2024 increased to $4.0 million in the third quarter of 2023 due to the timing of costs in our pipeline of new stores for each period.

Current wording

Pre-opening costs increased to $6.1 in the 2025 period compared to $3.3 in the 2024 period. This increase was primarily due to the timing of costs in our pipeline of new stores for each period.

Previous wording

Interest expense, net increased to $99.9 million in the 2024 period compared to $92.5 million in the 2023 period due primarily to incremental interest expense associated with sale-leaseback transactions and borrowings outstanding under our Credit Agreement, partially offset by a decrease in interest rates on our Credit Facility. See further discussion of the Company's debt activity and failed sale-leaseback transaction at Note 4 and Note 3, respectively, to the unaudited consolidated financial statements.

Current wording

Interest expense, net increased to $36.8 in the 2025 period compared to $33.1 in the 2024 period due primarily to incremental interest expense associated with sale-leaseback transactions and borrowings outstanding under our Credit Agreement, partially offset by a decrease in interest rates on our Credit Facility. See further discussion of the Company's debt activity and failed sale-leaseback transaction at Note 4 and Note 3, respectively, to the unaudited consolidated financial statements.

Previous wording

The effective tax rate for the 2024 period was 19.9%, compared to 19.9% for the 2023 period.

Current wording

The effective tax rate for the 2025 period was 17.8%, compared to 21.0% for the 2024 period. The effective tax rate decrease for the 2025 period in comparison to the 2024 period was impacted by a significant reduction in pre-tax book income. As pre-tax income decreases, the effect of certain tax attributes and permanent items, specifically our employment tax credits become more pronounced, which cause fluctuations in the effective tax rate.

Previous wording

The Company has a senior secured credit agreement (the "Credit Facility") including a revolving credit facility (the "Revolving Credit Facility") and a term loan facility (together with the Revolving Credit Facility, the “Credit Facility”). On November 1, 2024, D&B Inc. entered into an amendment with its banking syndicate, which amended the Credit Facility (the "Fourth Amendment"). For discussion of prior amendments, see Note 7 to the Consolidated Financial Statements in the Company's Annual Report on Form 10-K for the year ended February 4, 2024.

Current wording

In fiscal 2022, the Company entered into a senior secured credit agreement (the “Credit Facility”), which included a revolving credit facility (the “Revolving Credit Facility”) and a term loan facility (together with the Revolving Credit Facility, the “Credit Facility”). On November 1, 2024, D&B Inc. entered into an amendment with its banking syndicate, which amended the Credit Facility (the “Fourth Amendment”). The Credit Facility is unconditionally guaranteed by D&B Holdings and certain of D&B Inc.’s existing and future wholly owned material domestic subsidiaries.

Previous wording

•provides for a new tranche of term loans in an aggregate principal amount of $700.0 (the “Incremental Term B Loans”) with a maturity date of November 1, 2031, and

Current wording

•provided for a new tranche of term loans in an aggregate principal amount of $700.0 (the “Incremental Term B Loans”) with a maturity date of November 1, 2031, and

Previous wording

•redeem the $440.0 of outstanding senior secured notes (see 7.625% Senior Secured Notes below), and

Current wording

•redeem all $440.0 of outstanding senior secured notes (see 7.625% Senior Secured Notes below), and

Previous wording

Both the Existing Term B Loans and the Incremental Term B Loans bear interest at Term SOFR or ABR (each, as defined in the amended Credit Facility) plus (i) in the case of Term SOFR loans, 3.25% per annum and (ii) in the case of ABR loans, 2.25% per annum. Loans under the Revolving Credit Facility bear interest subject to a pricing grid based on net total leverage, at Term SOFR plus a spread ranging from 2.50% to 3.00% per annum or ABR plus a spread ranging from 1.50% to 2.00% per annum. Unused commitments under the Revolving Credit Facility incur initial commitment fees of 0.30% to 0.50%. Additionally, the interest rate margin applicable to the Existing Term B Loans and loans outstanding under the Revolving Credit Facility would be subject to an additional 0.25% step-down if a rating of B1/B+ or higher from Moody’s and S&P is achieved (which will step back up if such rating is subsequently not maintained).

Current wording

Both the Existing Term B Loans and the Incremental Term B Loans bear interest at Term SOFR or ABR (each, as defined in the amended Credit Facility) plus (i) in the case of Term SOFR loans, 3.25% per annum and (ii) in the case of ABR loans, 2.25% per annum. Loans under the Revolving Credit Facility bear interest subject to a pricing grid based on net total leverage, at Term SOFR plus a spread ranging from 2.50% to 3.00% per annum or ABR plus a spread ranging from 1.50% to 2.00% per annum. Unused commitments under the Revolving Credit Facility incur initial commitment fees of 0.30% to 0.50%. Additionally, the interest rate margin applicable to the Existing Term B Loans and loans outstanding under the Revolving Credit Facility are subject to an additional 0.25% step-down if a rating of B1/B+ or higher from Moody’s and S&P is achieved (which will step up if such rating is subsequently not maintained).

Previous wording

A portion of the Revolving Credit Facility not to exceed $35.0 is available for the issuance of letters of credit. As of November 5, 2024, we had letters of credit outstanding of $11.6 and an unused commitment balance of $537.4 under the Revolving Credit Facility. The Credit Facility may be increased through incremental facilities, by an amount equal to the greater of (i) $650.0 and (ii) 0.75 times trailing twelve-month Adjusted EBITDA, as defined in the Credit Facility, plus additional amounts subject to compliance with applicable leverage ratio and/or interest coverage ratio requirements. The Credit Facility is unconditionally guaranteed by D&B Holdings and certain of D&B Inc.’s existing and future wholly owned material domestic subsidiaries.

Current wording

A portion of the Revolving Credit Facility not to exceed $35.0 is available for the issuance of letters of credit. As of May 6, 2025, we had letters of credit outstanding of $13.7 and an unused commitment balance of $411.3 under the Revolving Credit Facility. The Credit Facility may be increased through incremental facilities, by an amount equal to the greater of (i) $650.0 and (ii) 0.75 times trailing twelve-month Adjusted EBITDA, as defined in the Credit Facility, plus additional amounts subject to compliance with applicable leverage ratio and/or interest coverage ratio requirements.

Previous wording

On November 1, 2024, using the proceeds from the Fourth Amendment to the Credit Facility discussed above, the Company redeemed the remaining $440.0 outstanding principal amount of the Notes.

Current wording

In November 2024, using the proceeds from the Fourth Amendment to the Credit Facility discussed above, the Company redeemed the remaining $440.0 outstanding principal amount of the Notes.

Previous wording

In July 2024, the Company entered into a sale and master lease agreement (a "sale-leaseback") with an unrelated third party. Under this agreement, the Company sold two of its store properties, including land, buildings and certain improvements, at a sale price of $44.8 and then leased the assets back through the sale-leaseback transaction.

Current wording

The Company has entered into sale and master lease agreements (a “sale leaseback”) with unrelated third parties. Under these agreements, the Company has sold certain store properties, including land, buildings and certain improvements and then leased the assets back through the sale leaseback transactions.

Previous wording

These transactions were accounted for as failed sale-leasebacks based on GAAP under ASC 842, Leases. As a result, the store property assets remain on the consolidated balance sheet at their historical net book value and are depreciated over the remaining term of the applicable master lease. Financing liabilities were recognized in the amount of the proceeds received, net of certain transactions costs, in the amount of $44.3 and $28.0 related to the July 2024 and September 2024 transactions, respectively. The Company will not recognize rent expense related to the leased assets. Instead, monthly rent payments under the applicable master lease agreement (initially, $3.6 and $2.1 per year related to the July 2024 and September 2024 transactions, respectively) will be recorded as interest expense and a reduction of the outstanding liability.

Current wording

These transactions were accounted for as failed sale leasebacks based on GAAP under ASC 842, Leases. As a result, the store property assets remain on the Consolidated Balance Sheet at their historical net book value and are depreciated over the remaining term of the applicable master lease. Financing liabilities were recognized in the amount of the proceeds received, net of certain transactions costs. The Company will not recognize rent expense related to the leased assets. Instead, monthly rent payments under the applicable master lease agreement are recorded as interest expense and a reduction of the outstanding liability.

Previous wording

As of November 5, 2024, including the transactions noted above, the Company had financing liabilities related to seven properties. The current outstanding liability of $0.3 is included in accrued liabilities and the long-term outstanding liability of $155.0 is included in other long-term liabilities on the consolidated balance sheet.

Current wording

As of May 6, 2025, the Company had financing liabilities related to twelve properties. The current outstanding liability of $0.5 is included in accrued liabilities and the long-term outstanding liability of $263.4 is included in Other long-term liabilities on the Consolidated Balance Sheet.