Item 1.01 Entry into a Material Definitive Agreement
On January 6, 2020, Halo, Purely for Pets, Inc. ("Halo"), a wholly-owned
subsidiary of Better Choice Company Inc. (the "Company"), entered into a
long-term credit facility with Old Plank Trail Community Bank, N.A., a Wintrust
community bank ("Lender") consisting of a $6,00,000 term loan and a revolving
line of credit in the aggregate amount of $6,000,000.00 (the "Wintrust
Facility"), pursuant to that certain Loan and Security Agreement (the "Loan
Agreement"), dated as of January 6, 2021, by and between Halo and Lender. The
Wintrust Facility is also evidenced by that certain Revolving Note, dated as of
January 6, 2021 (the "Revolving Note") and that certain Term Note A, dated as of
January 6, 2021 (the "Term Note"), each issued by Halo in favor of Lender. The
proceeds of the Wintrust Facility will be used (i) to repay all principal,
interest and fees outstanding under the Company's existing revolving credit
facility and term loan and (ii) for general corporate purposes.
The revolving line of credit portion and the term loan portion of the Wintrust
Facility each matures on January 6, 2024 and bears interest at a variable rate
of LIBOR plus 250 basis points, with an interest rate floor of 2.50% per annum.
Accrued interest on the Wintrust Facility is payable monthly commencing on
February 1, 2021. The Loan Agreement, Revolving Note and Term Note provide for
customary financial covenants and customary events of default, including, among
others, those relating to failure to make payment, bankruptcy, breaches of
representations and material adverse effects. Halo may prepay the principal of
the Wintrust Facility at any time without incurring any prepayment charges.
The Wintrust Facility is secured by a general guaranty and security interest on
the assets, including the intellectual property, of the Company and its
subsidiaries, TruPet LLC, a Delaware limited liability company ("TruPet") and
Bona Vida, Inc., a Delaware corporation ("Bona Vida") pursuant to (i) that
certain Guaranty and Security Agreement, dated January 6, 2021, made by the
Company, TruPet LLC, and Bona Vida in favor of Lender (the "Guaranty and
Security Agreement") and (ii) that certain Intellectual Property Security
Agreement, dated as of January 6, 2021, executed and delivered by the Company,
TruPet and Bona Vida in favor of Lender. The Company has also pledged all of the
capital stock of Halo held by the Company as additional collateral for the
Wintrust Facility pursuant to that certain Stock Pledge Agreement, dated as of
January 6, 2021, executed and delivered by the Company in favor of Lender (the
"Intellectual Property Security Agreement"). Furthermore, the Wintrust Facility
is supported by a collateral pledge by John M. Word, III, a member of the
Company's board of directors ("Word"), pursuant to that certain Collateral
Pledge Agreement, dated as of January 6, 2021 executed and delivered by Word in
favor of Lender (the "Collateral Pledge Agreement").
The foregoing description of the Wintrust Facility does not purport to be
complete and is qualified in its entirety by reference to the full text of the
Loan Agreement, the Revolving Note, the Term Note, the Guaranty and Security
Agreement, the Intellectual Property Security Agreement, the Stock Pledge
Agreement and the Collateral Pledge Agreement attached to this Form 8-K as
Exhibits 10.1, 10.2, 10.3, 10.4, 10.5, 10.6 and 10.7, respectively, and
incorporated herein by reference.
Item 2.03 Creation of a Direct Financial Obligation or and Obligation under an
Off Balance Sheet Arrangement of the Registrant
The disclosure in Item 1.01 and Exhibits 10.1, 10.2, 10.3, 10.4, 10.5, 10.6 and
10.7 of this report are incorporated herein by reference.
Item 1.01 Other Events
On January 11, 2021, the Company announced the closing of the Wintrust Facility.
A copy of the press release is attached hereto as Exhibit 99.1.
Item 9.01. Financial Statements and Exhibits
(d)Exhibits.
2
--------------------------------------------------------------------------------
Exhibits Description
10.1 Loan and Security Agreement, dated as of January 6, 2021, by and between
Old Plank Trail Community Bank, N.A. ("Lender") and Halo, Purely for Pets,
Inc., a Delaware corporation ("Halo")
10.2 Revolving Promissory Note, dated as of January 6, 2021, issued by Halo
in favor of Lender
10.3 Term Note A, dated as of January 6, 2021, issued by Halo in favor of
Lender
10.4 Guaranty and Security Agreement, dated as of January 6, 2021, made by
Better Choice Company Inc. (the "Company"), TruPet LLC, a Delaware limited
liability company ("TruPet") and Bona Vida, Inc., a Delaware corporation
("Bona Vida"), in favor of Lender
10.5 Intellectual Property Security Agreement, dated as of January 6, 2021,
executed and delivered by the Company, TruPet and Bona Vida in favor of
Lender
10.6 Stock Pledge Agreement, dated as of January 6, 2021, executed and
delivered by the Company in favor of Lender
10.7 Collateral Pledge Agreement, dated as of January 6, 2021, executed and
delivered by John M. Word, III in favor of Lender
99.1 Press release dated January 11, 2021
3
--------------------------------------------------------------------------------
© Edgar Online, source Glimpses