HF Foods Group Inc. Amends Credit Agreement, Increases Revolver to $140M

What Happened
HF Foods Group Inc. filed an 8‑K on July 31, 2026 reporting that on July 29, 2026 it and certain subsidiaries entered into a Joinder and Amendment No. 7 to its Third Amended and Restated Credit Agreement with JPMorgan Chase Bank, N.A. (Administrative Agent) and other lenders. The amendment (the “Seventh Amendment”) increases the asset‑based revolver commitments to $140 million, refinances existing term loans and funds an additional term loan advance so that term loans total $125 million immediately after closing. Wells Fargo ceased to be a lender in the amended facility. The amendment does not novate prior obligations—existing obligations remain in effect under the Amended Credit Agreement.

Key Details

• Revolving credit facility increased from $125.0M to $140.0M; letter of credit sublimit is $15.0M.
• Term loans aggregated to $125.0M after a ~$40.1M additional advance; term loan maturity: July 29, 2036. Revolver maturity: July 29, 2031.
• Interest: Term loans carry a SOFR‑based margin (2.50% initially, stepping to 2.00% or 2.25 after achieving Total Leverage ≤5.00x); revolver margin 1.50% or 1.75% depending on availability. CB Floating Rate pricing reduces margins (term loans −0.625%, revolver −1.125%). Commitment fee on unused revolver: 0.15% or 0.20% p.a.
• Term loan amortization: monthly principal payments of ~$0.7M; remaining balance due at maturity. If HF Foods does not close the anticipated Searay Foods acquisition within 120 days, ~ $6.8M of the term loans must be prepaid (non‑reborrowable).
• Facility is secured by liens on substantially all borrowers’ and guarantors’ assets (including mortgages on Real Estate Borrowers); availability is subject to a borrowing base of eligible accounts and inventory.
• Financial covenants include a Fixed Charge Coverage Ratio ≥1.10x each quarter and minimum availability of $12.5M through the first year, then $7.5M thereafter. Customary affirmative/negative covenants and default remedies apply.

Why It Matters
This amendment provides HF Foods with increased liquidity and longer‑dated term debt, which can support working capital, general corporate needs and permitted acquisitions (including the proposed Searay Foods deal, which lenders consented to subject to conditions). However, the company now has specific covenant tests (coverage ratio and minimum availability) and pledged collateral, which could limit flexibility for additional borrowing, dividends, asset sales or certain transactions if performance weakens. Investors should watch the company’s leverage, borrowing‑base availability (accounts and inventory levels), and progress on the Searay acquisition because those factors affect required prepayments, interest margins and covenant compliance.