UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): October 14, 2020
Winmark Corporation
(Exact Name of Registrant as Specified in Its Charter)
Minnesota
(State or Other Jurisdiction of Incorporation)
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000-22012 | 41-1622691 |
(Commission File Number) | (I.R.S. Employer Identification Number) |
605 Highway 169 North, Suite 400, Minneapolis, Minnesota 55441
(Address of Principal Executive Offices) (Zip Code)
(763) 520-8500
(Registrant’s Telephone Number, Including Area Code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
Title of each class: | Trading Symbol | Name of each exchange on which registered: |
Common Stock, no par value per share | WINA | Nasdaq Global Market |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01; 2.03Entry into a Material Definitive Agreement.
Credit Agreement
On October 14, 2020, Winmark Corporation and is subsidiaries’ (collectively, the “Company”) entered into Amendment No. 8 to its Credit Agreement with CIBC Bank USA (formerly known as The PrivateBank and Trust Company) (the “Lender”). The amendment, among other things,
● | Provides the consent of the Lender for the Company’s declaration and payment of a special $3.00 per share cash dividend to its shareholders that the Company announced on October 14, 2020 (the “2020 Special Dividend”); |
● | Amends the fixed charge coverage ratio definition to remove the effect of the 2020 Special Dividend. |
The foregoing description of Amendment No. 8 to the Credit Agreement does not purport to be complete and is qualified in its entirety by reference to the full amendment included hereto as Exhibit 10.1
Note Agreement
On October 14, 2020, the Company also entered into Amendment No. 4 to its Note Agreement with Prudential Investment Management, Inc., its affiliates and managed accounts (collectively, “Prudential”). The amendment, among other things,
● | Provides the consent of Prudential for the 2020 Special Dividend; |
● | Amends the fixed charge coverage ratio definition to remove the effect of the 2020 Special Dividend. |
The foregoing description of Amendment No. 4 to the Note Agreement does not purport to be complete and is qualified in its entirety by reference to the full amendment included hereto as Exhibit 10.3
Item 2.02Results of Operations and Financial Condition
On October 14, 2020, the Company announced in a press release its results of operations and financial condition for the third quarter ended September 26, 2020. A copy of the press release is attached as Exhibit 99.1 of this Current Report on Form 8-K.
Item 7.01Regulation FD Disclosure
On October 14, 2020, the Company announced in a press release its results of operations and financial condition for the third quarter ended September 26, 2020. A copy of the press release is attached as Exhibit 99.1 of this Current Report on Form 8-K.
On October 14, 2020, the Company also announced in a press release that its Board of Directors has approved the payment of a quarterly cash dividend to its shareholders. The quarterly dividend of $0.25 per share will be paid on December 1, 2020 to shareholders of record on the close of business on November 11, 2020. Additionally, the Board of Directors approved the payment of the 2020 Special Dividend. The 2020 Special Dividend will be paid on December 15, 2020 to shareholders of record on the close of business on November 11, 2020. The total amount of the 2020 Special Dividend payment will be approximately $11.2 million based on the current number of shares outstanding. Future regular or special dividends will be subject to Board approval. A copy of the press release is attached as Exhibit 99.2 of this Current Report on Form 8-K.
Item 8.01Other Events
On October 14, 2020, the Company announced in a press release that its Board of Directors has approved the payment of a cash dividend to its shareholders. The quarterly dividend of $0.25 per share will be paid on December 1, 2020 to shareholders of record on the close of business on November 11, 2020. Additionally, the Board of Directors approved the payment of the 2020 Special Dividend. The 2020 Special Dividend will be paid on December 15, 2020 to shareholders of record on the close of business on November 11, 2020. The total amount of the 2020 Special Dividend payment will be approximately $11.2 million based on the current number of shares outstanding. Future regular and special dividends will be subject to Board approval. A copy of the press release is attached as Exhibit 99.2 of this Current Report on Form 8-K.
Forward Looking Statements
Certain statements in this Current Report on Form 8-K are forward looking statements made under the safe harbor provision of the Private Securities Litigation Reform Act. Such statements are based on management’s current expectations as of the date of this Report, but involve risks, uncertainties and other factors that may cause actual results to differ materially from those contemplated by such forward looking statements. Investors are cautioned to consider these forward looking statements in light of important factors which may result in material variations between results contemplated by such forward looking statements and actual results and conditions. More detailed information about these factors is contained under the headings “Forward Looking Statements” and “Risk Factors” in the Company’s periodic reports filed with the SEC, including the Company’s most recent Annual Report on Form 10-K for the fiscal year ended December 28, 2019 and Quarterly Report on Form 10-Q for the second quarter ended June 27, 2020. We caution investors to not place undue reliance on these forward-looking statements, which speak only as of the date they were made. The Company undertakes no obligation to revise or update publicly any forward-looking statements for any reason.
Item 9.01Financial Statements and Exhibits
(d)Exhibits
10.1 |
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10.2 |
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10.3 |
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10.4 |
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99.1 | | |
99.2 | | Quarterly Cash Dividend and Special Dividend Press Release dated October 14, 2020* |
104 | | Cover Page Interactive Data File (embedded within the Inline XBRL Document and incorporated as Exhibit 101) |
*Filed Herewith
(1) Incorporated by reference to Exhibit 10.2 to the Quarterly Report on Form 10-Q for the fiscal quarter ended June 26, 2010
(2) Incorporated by reference to Exhibit 10.8 to the Current Report on Form 8-K filed on May 18, 2015
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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| WINMARK CORPORATION | |
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Date: October 14, 2020 | By: | /s/Anthony D. Ishaug |
| Anthony D. Ishaug | |
| Chief Financial Officer and Treasurer |