Execution Version
Exhibit 10.20
FIRST AMENDMENT TO
FINANCING AGREEMENT
FIRST AMENDMENT, dated as of July 27, 2021 (this “Amendment”), to the Financing Agreement, dated as of April 19, 2021 (as amended, restated, supplemented or otherwise modified, the “Financing Agreement”), by and among Xponential Intermediate Holdings, LLC, a Delaware limited liability company (the “Parent”), Xponential Fitness LLC, a Delaware limited liability company (“XF”), each Subsidiary (as defined therein) of Parent listed as a “Borrower” on the signature pages hereto (together with XF and each other Person that executes a joinder agreement and becomes a “Borrower” thereunder, each a “Borrower” and collectively, the “Borrowers”), each other Subsidiary of Parent listed as a “Guarantor” on the signature pages thereto (together with Parent and each other Person that executes a joinder agreement and becomes a “Guarantor” thereunder or otherwise guaranties all or any part of the Obligations (as defined therein), each a “Guarantor” and collectively, the “Guarantors”), the lenders from time to time party thereto (each a “Lender” and collectively, the “Lenders”), Wilmington Trust, National Association (“Wilmington Trust”), as collateral agent for the Lenders (in such capacity, together with its successors and assigns, the “Collateral Agent”) and Wilmington Trust, as administrative agent for the Lenders (in such capacity, together with its successors and assigns, the “Administrative Agent” and together with the Collateral Agent, each an “Agent” and collectively, the “Agents”). All terms used herein that are defined in the Financing Agreement and not otherwise defined herein shall have the meanings assigned to them in the Financing Agreement (as amended hereby).
WHEREAS, the Loan Parties have requested that the Agents and the Lenders amend the Financing Agreement in certain respects, and the Agents and the Lenders are agreeable to such request, on and subject to the terms and conditions set forth herein; and
NOW THEREFORE, in consideration of the premises and other good and valuable consideration, the parties hereto hereby agree as follows:
““Affiliate” means, with respect to any Person, any other Person that directly or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, such Person. For purposes of this definition, “control” of a Person means the power, directly or indirectly, either to (a) vote 10% or more of the Equity Interests having ordinary voting power for the election of members of the Board of Directors of such Person or (b) direct or cause the direction of the management and policies of such Person whether by contract or otherwise. Notwithstanding anything herein to the contrary, in no event shall: (i) any Agent or any Lender be considered an “Affiliate” of any Loan Party or (ii)
any Agent or any Lender be considered an “Affiliate” of the Sponsor solely as a result of its ownership of the PubCo Convertible Preferred or any shares of common stock of PubCo issuable upon conversion of the PubCo Convertible Preferred.”
“In connection with an initial public offering of Equity Interests of the Parent or any direct or indirect parent company of the Parent, including PubCo (such initial public offering, an “IPO”): (a) in connection with the first $60,000,000 of principal amount of Term Loans prepaid (including for the avoidance of doubt, prepayments made pursuant to Section 2.05(c)(x)) with the proceeds of, and substantially concurrently with the consummation of, such IPO, no Applicable Prepayment Premium shall be due and owing, (b) in connection with the next $65,000,000 of principal amount of Term Loans prepaid (i.e., the amount prepaid in excess of $60,000,000 of principal up to an aggregate principal prepayment amount of $125,000,000) (such aggregate principal amount, the “Excess IPO Prepayment Amount”) with the proceeds of and substantially concurrently with the consummation of, such IPO or the proceeds of and substantially concurrently with the consummation of, the PubCo Convertible Preferred, an amount equal to 0.75% of such Excess IPO Prepayment Amount shall be due and owing and (c) in connection with any Term Loans in excess of $125,000,000 of principal amount prepaid with the proceeds of such IPO or the proceeds of the PubCo Convertible Preferred, the Applicable Prepayment Premium shall be due and owing with respect to such excess amount.”
“(J) Subsidiaries of the Parent may make distributions to Parent, which Parent shall promptly distribute, or cause to be distributed, to Xponential Fitness, Inc. (“PubCo”), for the payment of, and in amounts not to exceed the amounts required to be paid in respect of the Series A Convertible Preferred Stock or Series A-1 Convertible Preferred Stock (the “PubCo Convertible Preferred”), including (1) Preferential Coupons (as defined in each Certificate of Designations governing the PubCo Convertible Preferred), including any paid in cash and (2) any amounts due upon redemptions of the PubCo Convertible Preferred in accordance with the terms of the Certificates of Designations governing such PubCo Convertible Preferred.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their respective officers thereunto duly authorized, as of the date first above written.
BORROWER:
XPONENTIAL FITNESS LLC
By: /s/ John Meloun
Name: John Meloun
Title: Chief Financial Officer
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GUARANTORS:
XPONENTIAL INTERMEDIATE HOLDINGS, LLC
By: /s/ John Meloun
Name: John Meloun
Title: Chief Financial Officer
CLUB PILATES FRANCHISE, LLC
By: /s/ John Meloun
Name: John Meloun
Title: Chief Financial Officer
CYCLEBAR HOLDCO, LLC
By: /s/ John Meloun
Name: John Meloun
Title: Chief Financial Officer
CYCLEBAR FRANCHISING, LLC
By: /s/ John Meloun
Name: John Meloun
Title: Chief Financial Officer
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CYCLEBAR WORLDWIDE INC.
By: /s/ John Meloun
Name: John Meloun
Title: Chief Financial Officer
STRETCH LAB FRANCHISE, LLC
By: /s/ John Meloun
Name: John Meloun
Title: Chief Financial Officer
ROW HOUSE FRANCHISE, LLC
By: /s/ John Meloun
Name: John Meloun
Title: Chief Financial Officer
YOGA SIX FRANCHISE, LLC
By: /s/ John Meloun
Name: John Meloun
Title: Chief Financial Officer
AKT FRANCHISE, LLC
By: /s/ John Meloun
Name: John Meloun
Title: Chief Financial Officer
PB FRANCHISING, LLC
By: /s/ John Meloun
Name: John Meloun
Title: Chief Financial Officer
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STRIDE FRANCHISE, LLC
By: /s/ John Meloun
Name: John Meloun
Title: Chief Financial Officer
XPONENTIAL FITNESS BRANDS
INTERNATIONAL, LLC
By: /s/ John Meloun
Name: John Meloun
Title: Chief Financial Officer
RUMBLE FRANCHISE, LLC
By: /s/ John Meloun
Name: John Meloun
Title: Chief Financial Officer
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ADMINISTRATIVE AGENT AND
COLLATERAL AGENT:
WILMINGTON TRUST, NATIONAL ASSOCIATION, as Administrative Agent and Collateral Agent
By: /s/ Joseph B. Feil
Name: Joseph B. Feil
Title: Vice President
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LENDERS:
MSD XPO PARTNERS, LLC
By: /s/ Kenneth Gerold
Name: Kenneth Gerold
Title: Authorized Signatory
MSD PCOF Partners XXXIX, LLC
By: /s/ Kenneth Gerold
Name: Kenneth Gerold
Title: Authorized Signatory
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DESALKIV CAYMAN C-2, LTD.
By: /s/ Marianna Fassinotti
Name: Marianna Fassinotti
Title: Authorized Signatory
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CORBIN OPPORTUNITY FUND, LP
By: Redwood Capital Management, LLC,
as its sub-advisor
By: /s/ Sean Sauler
Name: Sean Sauler
Title: Deputy CEO
REDWOOD OPPORTUNITY MASTER FUND, LTD.
By: Redwood Capital Management, LLC,
its Investment Manager
By: /s/ Sean Sauler
Name: Sean Sauler
Title: Deputy CEO
REDWOOD MASTER FUND, LTD.
By: Redwood Capital Management, LLC,
its Investment Manager
By: /s/ Sean Sauler
Name: Sean Sauler
Title: Deputy CEO
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