UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
(Address of principal executive offices, including zip code)
Registrant’s telephone
number, including area code: (
(Former name or former address, if changed since last report)
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(s) |
Name of each exchange on which registered | ||
| Capital 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 Entry into a Material Definitive Agreement.
$5,000,000 Loan from Stark County Port Authority
On August 31, 2022, the Company entered into a Business Loan Agreement (the “Business Loan Agreement”) with Stark County Port Authority (“Stark Port Authority”), pursuant to which the Company borrowed $5,000,000 (the “SCPA Loan”). The interest rate applicable to the SCPA Loan is six percent (6.0%) per annum (compounded quarterly). Interest payments under the SCPA Loan are paid quarterly beginning on December 31, 2022. The SCPA Loan is unsecured. The SCPA Loan matures on August 30, 2029. The Company may prepay the SCPA Loan without penalty.
Events of default under the Business Loan Agreement include without limitation: (i) a payment default, (ii) the Company’s failure to complete the infrastructure development for Phase II on or before December 31, 2024, and (iii) the Company’s failure, following notice from Stark Port Authority, to comply with any non-monetary covenant contained in the Business Loan Agreement, subject to a cure period. Upon the occurrence of an event of default under the Business Loan Agreement beyond any applicable grace or cure period: (a) interest due will increase by 5% per annum; and (b) Stark Port Authority may, at its option, declare the Company’s obligations under the Business Loan Agreement to be immediately due and payable.
The Business Loan Agreement contains customary affirmative and negative covenants for this type of loan, including without limitation (i) affirmative covenants, including furnish Stark Port Authority with such financial statements and other related information at such frequencies and in such detail as Stark Port Authority may reasonably request and use all SCPA Loan proceeds solely for the infrastructure development for the construction of Phase II, and (ii) negative covenants, including restrictions on additional indebtedness, prepayment of other indebtedness, transactions with related parties, additional liens, mergers and acquisitions, and standard prohibitions on change of control.
In connection with entering into the SCPA Loan, the Company paid customary fees and expenses.
The foregoing description of the Business Loan Agreement does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Business Loan Agreement, which is attached as Exhibit 10.1 to this Current Report on Form 8-K, and is incorporated herein by reference.
Item 2.03 - Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant
The information set forth above under Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference into this Item 2.03.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
| Exhibit No. | Document | |
| 10.1 | Business Loan Agreement, dated August 31, 2022, between Hall of Fame Resort & Entertainment Company and Stark County Port Authority | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
1
SIGNATURE
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.
| HALL OF FAME RESORT & ENTERTAINMENT COMPANY | |||
| By: | /s/ Michael Crawford | ||
| Name: | Michael Crawford | ||
| Title: | President and Chief Executive Officer | ||
| Dated: September 7, 2022 | |||
2