8-K

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): September 10, 2021

Winmark Corporation

(Exact Name of Registrant as Specified in Its Charter)

Minnesota

(State or Other Jurisdiction of Incorporation)

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; Creation of a Direct Financial Obligation or an Obligation under and Off-Balance Sheet Arrangement of a Registrant.

Credit Agreement

On September 10, 2021, Winmark Corporation and is subsidiaries’ (collectively, the “Company”) entered into Amendment No. 9 to its Credit Agreement with CIBC Bank USA (formerly known as The PrivateBank and Trust Company) (the “Lender”). The amendment, among other things,

	PGIM, Inc. (formerly Prudential Investment Management, Inc.)
●	Permits the Company to issue up to $30 million in additional term notes to one or more affiliates or managed accounts of PGIM, Inc. (formerly Prudential Investment Management, Inc.) (collectively, “Prudential”);
●	Removes the tangible net worth covenant minimum requirement, amends the fixed charge coverage ratio definition, and amends the restricted payments covenant to allow the Company more flexibility with respect to shareholder distributions and/or common stock repurchases as long as certain conditions are met (as defined within Amendment No. 9);
●	Amends the provisions that allow for the replacement of LIBOR as an interest rate option in connection with borrowings under the Credit Agreement.

Amendment No. 9 to the Credit Agreement is effective as of September 10, 2021. The foregoing description of Amendment No. 9 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 September 10, 2021, the Company also entered into Amendment No. 5 to its Note Agreement with Prudential. The amendment, among other things,

	o o o o
●	Provides for the issuance of $30.0 million in new senior secured notes, summarized as follows: o Prudential will purchase from the Company notes in the aggregate of $30.0 million; o The final maturity of the notes is 7 years; o Interest at a rate of 3.18% per annum on the outstanding principal balance is payable quarterly; o The notes may be prepaid, at the option of the Company, in whole or in part (in minimum amount of $1 million), but prepayments will require payment of a Yield Maintenance Amount.
●	Removes the tangible net worth covenant minimum requirement, amends the fixed charge coverage ratio definition, and amends the restricted payments covenant to allow the Company more flexibility with respect to shareholder distributions and/or common stock repurchases as long as certain conditions are met (as defined within Amendment No. 5).

Amendment No. 5 to the Note Agreement is effective as of September 10, 2021. The foregoing description of Amendment No. 5 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 7.01; 8.01Regulation FD Disclosure; Other Events.

On September 10, 2021, the Company announced in a press release the issuance of the $30.0 million of senior secured notes described in Items 1.01 and 2.03 above. A copy of the press release is attached as Exhibit 99.1 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 26, 2020 and Quarterly Report on Form 10-Q for the second quarter ended June 26, 2021. 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	Amendment No. 9 to Credit Agreement dated September 10, 2021*
10.2	Credit Agreement dated July 13, 2010, among Winmark Corporation and its subsidiaries and CIBC Bank USA (formerly known as The PrivateBank and Trust Company) (1)
10.3	Amendment No. 5 to Note Agreement dated September 10, 2021*
10.4	Note Agreement dated May 14, 2015, among Winmark Corporation and its subsidiaries and PGIM, Inc. (formerly Prudential Investment Management, Inc.), its affiliates and managed accounts (2)
10.5	Amendment No. 3 to Intercreditor and Collateral Agency Agreement dated September 10, 2021*
99.1	Press Release dated September 10, 2021*
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.

	WINMARK CORPORATION
Date: September 10, 2021	By:	/s/Anthony D. Ishaug
	Anthony D. Ishaug
	Chief Financial Officer and Treasurer

EX-10.1

Exhibit 10.1

AMENDMENT NO. 9

to

CREDIT AGREEMENT

THIS AMENDMENT NO. 9 TO CREDIT AGREEMENT (this “Amendment”) is dated as of September 10, 2021, by and among WINMARK CORPORATION, WIRTH BUSINESS CREDIT, INC., WINMARK CAPITAL CORPORATION and GROW BIZ GAMES, INC. (each of the foregoing are referred to herein individually as a “Loan Party” and collectively as the “Loan Parties”), and CIBC BANK USA (the “Administrative Agent” and a “Lender”).

RECITALS:

A.The Loan Parties, the Administrative Agent, and the Lender are parties to that certain Credit Agreement, dated as of July 13, 2010, as amended prior to the date hereof (the “Credit Agreement”).

B. The Loan Parties, the Administrative Agent, and the Lender desire to further amend the Credit Agreement as provided herein.

AGREEMENTS:

IN CONSIDERATION of the premises and mutual covenants herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

1.Definitions.  Capitalized terms not otherwise defined in this Amendment have the same meanings as set forth in the Credit Agreement.

2.Amendment of Section 1.1.  Section 1.1 of the Credit Agreement is hereby amended first by deleting the definitions of “Additional Prudential Debt”, “Fixed Charge Coverage Ratio”, “Interest Period” and “Tangible Net Worth”, and second by adding the following definitions to such Section in their correct alphabetical order:

“Additional Prudential Debt” means Debt owing to Prudential in an aggregate amount incurred not to exceed $30,000,000, to the extent that each of the following conditions shall have been satisfied:

(a)no Unmatured Event of Default or Event of Default shall exist at the time of funding or effectiveness of such Additional Prudential Debt;

(b)the Company and the Subsidiaries shall be in pro forma compliance with the financial covenants contained in Section 11.15, 11.16, and 11.17 at the time of funding or effectiveness of such Additional Prudential Debt;

(c)at the time of funding or effectiveness of such Additional Prudential Debt, all representations and warranties by the Loan Parties contained herein or in any other Loan

Document shall be true and correct in all material respects (without duplication of any materiality qualifier contained therein) as of the date of incurrence of such Additional Prudential Debt and after giving pro forma effect thereto, except to the extent that such representation or warranty expressly relates to an earlier date (in which event such representations and warranties shall be true and correct in all material respects (without duplication of any materiality qualifier contained therein) as of such earlier date);

(d)the Additional Prudential Debt shall be on terms and conditions acceptable to the Agent and the Lenders; provided, however that Agent and the Lenders shall grant such acceptance if such Additional Prudential Debt is issued and subject to substantially the same terms and conditions of Debt owed to Prudential prior to the Seventh Amendment Effective Date (other than with respect to applicable maturity dates, interest rates, and amortization);

(e)Agent shall have received true, correct, and complete copies of all documents entered into by any Loan Party in connection therewith, each of which shall be in form and substance acceptable to the Agent; and

(f)the Agent shall have received a certificate of a Senior Officer of the Loan Parties certifying as to the foregoing.

“Fixed Charge Coverage Ratio”:  As of any date of determination and calculated for a trailing twelve month period ending on such date of determination, the ratio of (a) the total EBITDA of the Loan Parties for such period, minus (i) the sum of income taxes paid in cash by the Loan Parties in such period, (ii) the sum of all Capital Expenditures made by the Loan Parties in such period, and (iii) the sum of all distributions (excluding any Special Dividend made in such period) made by the Loan Parties in such period, divided by (b) the sum for such period of (i) cash interest expense plus (ii) all scheduled payments of principal on Debt (excluding, for the avoidance of doubt, any payment pursuant to Section 6).

“Interest Period As to any LIBOR Loan, the period commencing on the date such Loan is borrowed or continued as, or converted into, a LIBOR Loan and ending on the date one, three, six or twelve months thereafter as selected by the Company pursuant to Section 2.2.2 or 2.2.3, as the case may be; provided that:

(a)if any Interest Period would otherwise end on a day that is not a Business Day, such Interest Period shall be extended to the following Business Day unless the result of such extension would be to carry such Interest Period into another calendar month, in which event such Interest Period shall end on the preceding Business Day;

(b)any Interest Period that begins on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period shall end on the last Business Day of the calendar month at the end of such Interest Period; and

(c)the Company may not select any Interest Period for a Loan which would extend beyond the scheduled Termination Date.

“Program Repurchases” shall mean immaterial repurchases or redemptions of Capital Securities of the Company using operating cash on the balance sheet of the Company or proceeds of Loans, in each case pursuant to a share repurchase program approved by the Company’s board of directors.

“Regular Dividends” means those regular quarterly cash dividends paid by the Company in respect of its Capital Securities consistent with past practices in an amount not to exceed $10,000,000 in the aggregate in any fiscal year of the Company.

“Special Dividends” means the 2020 Special Dividend and all other dividends or other distributions paid by the Company in respect of its Capital Securities other than Regular Dividends, whether paid in cash or other property.

“Special Dividend Payment/Redemption Conditions” with respect to the payment of any Special Dividend or any purchase or redemption of the Company’s Capital Securities (other than Program Repurchases), the satisfaction of the following conditions:

(a)as of the date of the payment of such Special Dividend or purchase or redemption of Capital Securities and immediately after giving effect thereto, no Unmatured Event of Default or Event of Default has occurred and is continuing;

(b)after giving pro forma effect to the payment such Special Dividend or purchase or redemption of Capital Securities, the Leverage Ratio shall be equal to or less than 2.00; and

(c)the Administrative Agent shall have received a certificate of a Senior Officer of the Company certifying as to compliance with the preceding clauses and demonstrating (in reasonable detail) the calculations required thereby.

3.Amendment of Section 4.5. Section 4.5 of the Credit Agreement is hereby amended and restated in its entirety to read as follows:

4.5Benchmark Replacement Setting. Notwithstanding anything to the contrary herein or in any other Loan Document (and any Hedging Agreement shall be deemed not to be a “Loan Document” for purposes of this Section):

(a)Replacing USD LIBOR. On March 5, 2021 the Financial Conduct Authority (“FCA”), the regulatory supervisor of USD LIBOR’s administrator (“IBA”), announced in a public statement the future cessation or loss of representativeness of overnight/Spot Next, 1-month, 3-month, 6-month and 12-month USD LIBOR tenor settings.  On the earlier of (i) the date that all Available Tenors of USD LIBOR have either permanently or indefinitely ceased to be provided by IBA or have been announced by the FCA pursuant to public statement or publication of information to be no longer representative and (ii) the Early Opt-in Effective Date, if the then-current Benchmark is USD LIBOR, the Benchmark Replacement will replace such Benchmark for

all purposes hereunder and under any Loan Document in respect of any setting of such Benchmark on such day and all subsequent settings without any amendment to, or further action or consent of any other party to this Agreement or any other Loan Document. If the Benchmark Replacement is Daily Simple SOFR, all interest payments will be payable on a monthly basis.

(b)Replacing Future Benchmarks. Upon the occurrence of a Benchmark Transition Event, the Benchmark Replacement will replace the then-current Benchmark for all purposes hereunder and under any Loan Document in respect of any Benchmark setting at or after 5:00 p.m. on the fifth (5th) Business Day after the date notice of such Benchmark Replacement is provided to the Lenders without any amendment to, or further action or consent of any other party to, this Agreement or any other Loan Document so long as Administrative Agent has not received, by such time, written notice of objection to such Benchmark Replacement from Lenders comprising the Required Lenders. At any time that the administrator of the then-current Benchmark has permanently or indefinitely ceased to provide such Benchmark or such Benchmark has been announced by the regulatory supervisor for the administrator of such Benchmark pursuant to public statement or publication of information to be no longer representative of the underlying market and economic reality that such Benchmark is intended to measure and that representativeness will not be restored, Borrower may revoke any request for a borrowing of, conversion to or continuation of Loans to be made, converted or continued that would bear interest by reference to such Benchmark until Borrower’s receipt of notice from Administrative Agent that a Benchmark Replacement has replaced such Benchmark, and, failing that, Borrower will be deemed to have converted any such request into a request for a borrowing of or conversion to Base Rate Loans.

(c)Benchmark Replacement Conforming Changes. In connection with the implementation and administration of a Benchmark Replacement, Administrative Agent will have the right to make Benchmark Replacement Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Loan Document, any amendments implementing such Benchmark Replacement Conforming Changes will become effective without any further action or consent of any other party to this Agreement.

(d)Notices; Standards for Decisions and Determinations. Administrative Agent will promptly notify Borrower and Lenders of (i) the implementation of any Benchmark Replacement and (ii) the effectiveness of any Benchmark Replacement Conforming Changes. Any determination, decision or election that may be made by Administrative Agent or, if applicable, any Lender (or group of Lenders) pursuant to this Section, including any determination with respect to a tenor, rate or adjustment or of the occurrence or non-occurrence of an event, circumstance or date and any decision to take or refrain from taking any action, will be conclusive and binding absent manifest error and may be made in its or their sole discretion and without consent from any other party hereto, except, in each case, as expressly required pursuant to this Section.

(e)Unavailability of Tenor of Benchmark. At any time (including in connection with the implementation of a Benchmark Replacement), (i) if the then-current Benchmark is a term rate (including Term SOFR or USD LIBOR), then Administrative Agent may remove any tenor of such Benchmark that is unavailable or non-representative for Benchmark (including Benchmark

Replacement) settings and (ii) Administrative Agent may reinstate any such previously removed tenor for Benchmark (including Benchmark Replacement) settings.

(f) Definitions.

“Available Tenor” means, as of any date of determination and with respect to the then-current Benchmark, as applicable, (x) if the then-current Benchmark is a term rate, any tenor for such Benchmark that is or may be used for determining the length of an Interest Period or (y) otherwise, any payment period for interest calculated with reference to such Benchmark, as applicable, pursuant to this Agreement as of such date.

“Benchmark” means, initially, USD LIBOR; provided that if a replacement of the Benchmark has occurred pursuant to this Section titled “Benchmark Replacement Setting”, then “Benchmark” means the applicable Benchmark Replacement to the extent that such Benchmark Replacement has replaced such prior benchmark rate. Any reference to “Benchmark” shall include, as applicable, the published component used in the calculation thereof.

“Benchmark Replacement” means, for any Available Tenor:

(1) For purposes of clause (a) of this Section, the first alternative set forth below that can be determined by Administrative Agent:

(a)the sum of: (i) Term SOFR and (ii) 0.11448% (11.448 basis points) for an Available Tenor of one-month’s duration, 0.26161% (26.161 basis points) for an Available Tenor of three-months’ duration, and 0.42826% (42.826 basis points) for an Available Tenor of six-months’ duration, or

(b)the sum of: (i) Daily Simple SOFR   and (ii) the spread adjustment selected or recommended by the Relevant Governmental Body for the replacement of the tenor of USD LIBOR with a SOFR-based rate having approximately the same length as the interest payment period specified in clause (a) of this Section; and

(2)For purposes of clause (b) of this Section, the sum of (a) the alternate benchmark rate and (b) an adjustment (which may be a positive or negative value or zero), in each case, that has been selected by Administrative Agent and Borrower as the replacement for such Available Tenor of such Benchmark giving due consideration to any evolving or then-prevailing market convention, including any applicable recommendations made by the Relevant Governmental Body, for U.S. dollar-denominated syndicated credit facilities at such time; provided that, if the Benchmark Replacement as determined pursuant to clause (1) or (2) above would be less than the Floor, the Benchmark Replacement will be deemed to be the Floor for the purposes of this Agreement and the other Loan Documents.

“Benchmark Replacement Conforming Changes” means, with respect to any Benchmark Replacement, any technical, administrative or operational changes (including changes to the definition of “Base Rate,” the definition of “Business Day,” the definition of “Interest Period,” timing and frequency of determining rates and making payments of interest, timing of borrowing requests or prepayment, conversion or continuation notices, the applicability and length of lookback periods, the applicability of breakage provisions, and other technical, administrative or operational matters) that Administrative Agent decides may be appropriate to reflect the adoption and implementation of such Benchmark Replacement and to permit the administration thereof by Administrative Agent in a manner substantially consistent with market practice (or, if Administrative Agent decides that adoption of any portion of such market practice is not administratively feasible or if Administrative Agent determines that no market practice for the administration of such Benchmark Replacement exists, in such other manner of administration as Administrative Agent decides is reasonably necessary in connection with the administration of this Agreement and the other Loan Documents).

“Benchmark Transition Event” means, with respect to any then-current Benchmark other than USD LIBOR, the occurrence of a public statement or publication of information by or on behalf of the administrator of the then-current Benchmark, the regulatory supervisor for the administrator of such Benchmark, the Board of Governors of the Federal Reserve System, the Federal Reserve Bank of New York, an insolvency official with jurisdiction over the administrator for such Benchmark, a resolution authority with jurisdiction over the administrator for such Benchmark or a court or an entity with similar insolvency or resolution authority over the administrator for such Benchmark, announcing or stating that (a) such administrator has ceased or will cease on a specified date to provide all Available Tenors of such Benchmark, permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark or (b) all Available Tenors of such Benchmark are or will no longer be representative of the underlying market and economic reality that such Benchmark is intended to measure and that representativeness will not be restored.

“Daily Simple SOFR” means, for any day, SOFR, with the conventions for this rate (which will include a lookback) being established by Administrative Agent in accordance with the conventions for this rate recommended by the Relevant Governmental Body for determining “Daily Simple SOFR” for syndicated business loans; provided, that if Administrative Agent decides that any such convention is not administratively feasible for Administrative Agent, then Administrative Agent may establish another convention in its reasonable discretion.

“Early Opt-in Effective Date” means, with respect to any Early Opt-in Election, the sixth (6th) Business Day after the date notice of such Early Opt-in Election is provided to Lenders, so long as Administrative Agent has not received, by 5:00 p.m. (Chicago time) on the fifth (5th) Business Day after the date notice of such Early Opt-in Election is

provided to Lenders, written notice of objection to such Early Opt-in Election from Lenders comprising Required Lenders.

“Early Opt-in Election” means the occurrence of:

(1)a notification by Administrative Agent to (or the request by Borrower to Administrative Agent to notify) each of the other parties hereto that at least ten currently outstanding U.S. dollar-denominated syndicated credit facilities at such time contain (as a result of amendment or as originally executed) a SOFR-based rate (including SOFR, a term SOFR or any other rate based upon SOFR) as a benchmark rate (and such syndicated credit facilities are identified in such notice and are publicly available for review), and

(2)the joint election by Administrative Agent and Borrower to trigger a fallback from USD LIBOR and the provision by Administrative Agent of written notice of such election to Lenders.

“Floor” means the benchmark rate floor, if any, provided in this Agreement initially (as of the execution of this Agreement, the modification, amendment or renewal of this Agreement or otherwise) with respect to USD LIBOR.

“Relevant Governmental Body” means the Board of Governors of the Federal Reserve System or the Federal Reserve Bank of New York, or a committee officially endorsed or convened by the Board of Governors of the Federal Reserve System or the Federal Reserve Bank of New York, or any successor thereto.

“SOFR” means a rate per annum equal to the secured overnight financing rate for such Business Day published by the Federal Reserve Bank of New York (or a successor administrator of the secured overnight financing rate) on the website of the Federal Reserve Bank of New York, currently at http://www.newyorkfed.org (or any successor source for the secured overnight financing rate identified as such by the administrator of the secured overnight financing rate from time to time).

“Term SOFR” means, for the applicable corresponding tenor, the forward-looking term rate based on SOFR that has been selected or recommended by the Relevant Governmental Body.

“USD LIBOR” means the LIBOR Rate or the London interbank offered rate for U.S. dollars.

4.Amendment of Section 11.4.  Section 11.4 of the Credit Agreement is hereby amended and restated in its entirety to read as follows:

11.4Restricted Payments. Not, and not permit any other Loan Party to, (a) make any distribution to any holders of its Capital Securities, (b) purchase or redeem any of its Capital Securities, (c) pay any management fees or similar fees to any of its equityholders or any Affiliate thereof, (d) make any redemption, prepayment, defeasance, repurchase or any other

payment in respect of any Subordinated Debt other than regular payments of principal and interest as and when due under the Unsecured Notes subject to the terms of the Subordination Agreement related thereto, or (e) set aside funds for any of the foregoing. Notwithstanding the foregoing, so long as no Unmatured Event of Default or Event of Default has occurred and is continuing or would occur as a result of any of the following, (i) any Subsidiary may pay dividends or make other distributions to the Company or to a domestic Wholly-Owned Subsidiary; (ii) the Company may pay Regular Dividends and make Program Repurchases, so long as, in each case, after giving effect to such Regular Dividend or Program Repurchase the Company will remain in compliance with all the financial ratios and restrictions set forth in Sections 11.15, 11.16 and 11.17, as certified by the Company in form and substance satisfactory to Agent and the Required Lenders; (iii) the Company may make payments in respect of Subordinated Debt to the extent permitted under the applicable Subordination Agreement, (iv) the Company may grant stock options pursuant to a plan approved by the Shareholders of the Company, and (v) the Company may pay Special Dividends and purchase or redeem any of its Capital Securities (other than Program Repurchases), so long as each of the Special Dividend Payment/Redemption Conditions have been satisfied.

5.Amendment of Section 11.15.  Section 11.15 of the Credit Agreement is hereby amended and restated in its entirety to read as follows:

11.15[Reserved].

6.Amendment of Exhibit B.  Exhibit B of the Credit Agreement (Form of Compliance Certificate) is hereby amended in its entirety to read as set forth in the Exhibit B attached to this Amendment.

7.Conditions to Effectiveness.  The effectiveness of this Amendment is subject to the satisfaction of the following conditions precedent:

(a)The Administrative Agent shall have received a counterpart signature page to this Amendment, duly executed by the Loan Parties and the Lender.

(b)The Lender and the Administrative Agent shall have received an amendment to the Note Agreement, dated May 14, 2015 (as amended) with Prudential, in form and substance acceptable to the Lender and the Administrative Agent, duly executed by Prudential and the Loan Parties.

(c)The Lender and the Administrative Agent shall have received an amendment to the Prudential Intercreditor Agreement, in form and substance acceptable to the Lender and the Administrative Agent, duly executed by Prudential and the Loan Parties.

(d)The Administrative Agent shall have received payment of the Amendment Fee as forth in Section 14 of this Amendment.

(e)The Administrative Agent shall have received such certificates of good standing, in each case respecting the Loan Parties, as the Administrative Agent may request.

(f)The representations and warranties set forth in Section 8 below shall be true and correct as of the effective date.

(g)All legal, tax, environmental and regulatory matters shall be satisfactory to the Administrative Agent.

For the avoidance of doubt, the amendments and consent contemplated by this Amendment shall not be effective until each of the foregoing conditions have been satisfied or waived in writing by the Lender and the Administrative Agent.  

8.Representations and Warranties.  To induce the Administrative Agent and the Lender to enter into this Amendment, the Loan Parties, jointly and severally, represent and warrant to the Administrative Agent and the Lender as follows:

(a)The execution, delivery and performance by the Loan Parties of this Amendment and any other documents required to be executed and/or delivered by the Loan Parties by the terms of this Amendment have been duly authorized by all necessary corporate action, do not require any approval or consent of, or any registration, qualification or filing with, any government agency or authority or any approval or consent of any other person, do not and will not conflict with, result in any violation of or constitute any default under, any provision of the Loan Parties’ organizational documents, any agreement binding on or applicable to the Loan Parties or any of their property, or any law or governmental regulation or court decree or order, binding upon or applicable to the Loan Parties or of any of their property and will not result in the creation or imposition of any Lien in or on any of their property pursuant to the provisions of any agreement applicable to the Loan Parties or any of their property, other than Liens in favor of the Administrative Agent.

(b)Both before and after giving effect to this Amendment, the representations and warranties contained in the Credit Agreement are true and correct as of the date hereof and will be true and correct as of the effectiveness of this Amendment, as though made on each such date, except to the extent that such representations and warranties relate solely to an earlier date.

(c)There does not exist any Unmatured Event of Default or Event of Default.

9.No Waiver.  This Amendment is not intended to operate as, and shall not be construed as, a waiver of any Unmatured Event of Default or Event of Default whether known to the Administrative Agent and/or the Lender, or unknown, as to which all rights and remedies of the Administrative Agent and the Lender shall remain reserved.

10.Binding Nature of Loan Documents.  Each Loan Party acknowledges and agrees that the terms, conditions and provisions of the Credit Agreement and of each Loan Document are fully binding and enforceable agreements, and are not subject to any defense, counterclaim, set off or other claim of any kind or nature.  Each Loan Party hereby reaffirms and restates its duties, obligations and liability under the Credit Agreement, as amended hereby, and each other Loan Document.

11.Reference to the Loan Documents.  From and after the effectiveness of this Amendment, each reference in the Credit Agreement to “this Agreement”, “hereunder”, “hereof”, “herein” or words of like import referring to the Credit Agreement, and each reference to the “Credit Agreement” or “Agreement”, “thereunder”, “thereof”, “therein” or words of like import referring to the Credit Agreement in any other Loan Document, shall mean and be a reference to the Credit Agreement as amended hereby.

12.Release.  Each Loan Party hereby releases, acquits, and forever discharges each of the Administrative Agent and the Lender and each and every past and present subsidiary, affiliate, stockholder, officer, director, agent, servant, employee, representative, and attorney of any of them from any and all claims, causes of action, suits, debts, liens, obligations, liabilities, demands, losses, costs and expenses (including attorneys’ fees) of any kind, character, or nature whatsoever, known or unknown, fixed or contingent, which any Loan Party may have or claim to have now or which may hereafter arise out of or be connected with any act of commission or omission of the Administrative Agent and/or the Lender existing or occurring prior to the date of this Amendment or any instrument executed prior to the date of this Amendment including, without limitation, any claims, liabilities or obligations arising with respect to the indebtedness evidenced by any Loan Document.  The provisions of this Section shall survive payment of all Obligations and shall be binding upon the Loan Parties and shall inure to the benefit of the Administrative Agent and the Lender and their respective successors and assigns.

13.Estoppel.  Each Loan Party represents and warrants that there are no known claims, causes of action, suits, debts, liens, obligations, liabilities, demands, losses, costs and expenses (including attorneys’ fees) of any kind, character or nature whatsoever, fixed or contingent, which any Loan Party may have or claim to have against the Administrative Agent and/or the Lender, which might arise out of or be connected with any act of commission or omission of the Administrative Agent and/or the Lender existing or occurring on or prior to the date of this Amendment, including, without limitation, any claims, liabilities or obligations arising with respect to the indebtedness evidenced by any Loan Document.

14.Amendment Fee. The Loan Parties, jointly and severally, agree to pay to the Administrative Agent an amendment fee as set forth in that certain Amendment No. 9 Fee Letter dated as of the date hereof (the “Amendment Fee”).  Such Amendment Fee shall be due and payable upon the execution of this Amendment and shall be fully earned when paid and shall not be refundable for any reason whatsoever.

15.Expenses.  Without in any way limiting the generality of Section 16.5 of the Credit Agreement, the Loan Parties, jointly and severally, hereby agree to pay to the Administrative Agent all of the Administrative Agent’s reasonable legal fees and expenses incurred in connection

with this Amendment, the Credit Agreement and/or any other Loan Document, which amount shall be due and payable upon execution of this Amendment.

16.Captions. The captions or headings herein are for convenience only and in no way define, limit or describe the scope or intent of any provision of this Amendment.

17.Counterparts.  This Amendment may be executed in any number of counterparts, each of which shall be deemed an original, but all of which shall constitute one and the same instrument.  Any executed counterpart of this Amendment delivered by facsimile or other electronic transmission to a party hereto shall constitute an original counterpart of this Amendment.

18.No Other Modification.  Except as expressly amended by the terms of this Amendment, all other terms of the Credit Agreement shall remain unchanged and in full force and effect.

[The signature pages follow.]

THE PARTIES HAVE EXECUTED this Amendment No. 9 to Credit Agreement in the manner appropriate to each as of the date and year first above written.

LOAN PARTIES:

WINMARK CORPORATION

By: /s/ Anthony D. Ishaug​ ​

Name: Anthony D. Ishaug

Title: Chief Financial Officer

WIRTH BUSINESS CREDIT, INC.

By: /s/ Anthony D. Ishaug​ ​

Name: Anthony D. Ishaug

Title: Chief Financial Officer

WINMARK CAPITAL CORPORATION

By: /s/ Anthony D. Ishaug​ ​

Name: Anthony D. Ishaug

Title: Chief Financial Officer

GROW BIZ GAMES, INC.

By: /s/ Anthony D. Ishaug​ ​

Name: Anthony D. Ishaug

Title: Chief Financial Officer

(Signatures continue on next page.)

ADMINISTRATIVE AGENT

AND A LENDER:

CIBC BANK USA

By: /s/ Leanne Manning​ ​

Name: Leanne Manning

Title:    Managing Director

EXHIBIT B

FORM OF COMPLIANCE CERTIFICATE

TO: CIBC BANK USA (formerly known as The PrivateBank and Trust Company) (the “Administrative Agent”) and the other Lenders referred to below

Please refer to the Credit Agreement dated as of July 13, 2010 (as amended, restated, supplemented  or otherwise modified from time to time, the “Credit Agreement”) among Winmark Corporation (the “Company”) and its subsidiaries (together with the Company, the “Loan Parties”), each lender from time to time party hereto (collectively, the “Lenders” and individually, a “Lender”), and CIBC BANK USA (formerly known as The PrivateBank and Trust Company), as a Lender and as Administrative Agent for the Lenders.  Terms used but not otherwise defined herein are used herein as defined in the Credit Agreement.

I. Reports.  Enclosed herewith is a copy of the monthly report of the Loan Parties as of __________________, 20___ (the “Computation Date”), which report fairly presents in all material respects the financial condition and results of operations of the Loan Parties as of the Computation Date and has been prepared in accordance with GAAP consistently applied.

II. Fixed Charge Coverage Ratio.  The Company hereby certifies and warrants to you that the following is a true and correct computation of the Fixed Charge Coverage Ratio requirement set forth in Section 11.16 of the Credit Agreement, which is not less than the ratio set forth in Section 11.16 of the Credit Agreement.

A.TTM EBITDA: (i)TTM income from operations (ii)TTM leasing related cash interest expense (iii)TTM depreciation (iv)TTM amortization (v)TTM compensation related to stock options TTM EBITDA [(i + ii + iii + iv + v)]	$​ ​​ ​$​ ​​ ​ $​ ​​ ​$​ ​​ ​$​ ​​ ​	$​ ​​ ​
	$​ ​​ ​$​ ​​ ​$​ ​​ ​$​ ​​ ​

B.Cash flow available for Debt service: (i)TTM EBITDA (ii)TTM cash taxes (iii)TTM capital expenditures (iv)TTM dividends and distributions Cash flow available for Debt service [i - (ii + iii + iv)]		$​ ​​ ​
C.Debt Service: (i)TTM principal payments (ii)TTM cash interest expense (including leasing related cash interest expense) Debt Service [i + ii]	$​ ​​ ​$​ ​​ ​	$​ ​​ ​
Actual Fixed Charge Coverage Ratio [B/C]: Required minimum covenant level

III. Leverage Ratio.  The Company hereby certifies and warrants to you that the following is a true and correct computation of the Leverage Ratio requirement set forth in Section 11.17 of the Credit Agreement, which is not greater than the ratio set forth in Section 11.17 of the Credit Agreement:

A.Recourse senior Debt:	$​ ​​ ​
B.TTM EBITDA:	$​ ​​ ​
Actual Leverage Ratio [A/B]: Maximum covenant level

The Company further certifies to you that no Event of Default or Unmatured Event of Default has occurred and is continuing.

The Company has caused this Certificate to be executed and delivered by its duly authorized officer on ​ ​​ ​ ___, 20___.

WINMARK CORPORATION

By:​ ​​ ​​ ​​ ​​ ​​ ​​ ​

Name:​ ​​ ​​ ​​ ​​ ​​ ​​ ​

Title:​ ​​ ​

EX-10.3

Exhibit 10.3

September 10, 2021

WINMARK CORPORATION

WIRTH BUSINESS CREDIT, INC.

WINMARK CAPITAL CORPORATION

GROW BIZ GAMES, INC.

c/o Winmark Corporation

605 Highway 169 North, Suite 400

Minneapolis, MN  55441

Re: Amendment No. 5 to Note Agreement

Ladies and Gentlemen:

Reference is made to the Note Agreement dated as of May 14, 2015 (as amended from time to time, the “Note Agreement”), among Winmark Corporation, a Minnesota corporation (the “Company”), Wirth Business Credit, Inc., a Minnesota corporation (“Wirth”), Winmark Capital Corporation, a Minnesota corporation (“Winmark Capital”), Grow Biz Games, Inc., a Minnesota corporation (“Grow Biz”; the Company, Wirth, Winmark Capital, Grow Biz and any other Person who joins the Note Agreement as an Issuer pursuant to paragraph 5J, collectively, the “Issuers”), The Prudential Insurance Company of America (“PICA”), Pruco Life Insurance Company (“Pruco”), Prudential Retirement Guaranteed Cost Business Trust (“PRG”), PAR U Hartford Life Insurance Comfort Trust (“PAR”), Prudential Annuities Life Assurance Corporation (“PALA”) and The Prudential Life Insurance Company, Ltd. (“PLIC”; PICA, Pruco, PRG, PAR and PALA collectively, the “Holders”). PICA, PALA and PLIC are herein collectively referred to as the “Series C Purchasers” and each individually a “Series C Purchaser”.  Capitalized terms used herein that are not otherwise defined herein shall have the meaning specified in the Note Agreement.  

The Issuers have requested that the Holders agree to certain amendments to the Note Agreement as set forth below.  Subject to the terms and conditions hereof, the Holders are willing to agree to such request.  Accordingly, and in accordance with the provisions of paragraph 11C of the Note Agreement, the parties hereto agree as follows:

SECTION 1.Amendments to the Note Agreement.  From and after the Effective Date (as defined in Section 4 hereof), the Note Agreement is amended as follows:

1.1The cover page is amended to (i) delete the reference to “$25,000,000 5.50% SENIOR SECURED NOTES DUE MAY 14, 2025 $12,500,000 5.10% SENIOR SECURED NOTES DUE AUGUST 17, 2027” and (ii) replace it with the following:

$25,000,000 5.50% SENIOR SECURED NOTES DUE MAY 14, 2025

$12,500,000 5.10% SENIOR SECURED NOTES DUE AUGUST 17, 2027

$30,000,000 3.18% SENIOR SECURED NOTES DUE SEPTEMBER 10, 2028

1.2Paragraph 1 is amended and restated as follows:

1.AUTHORIZATION OF ISSUE OF NOTES{TC \1 “1”} .  The Issuers will authorize (a) the issue of their senior secured promissory notes (the “Series A Notes”) in the aggregate principal amount of $25,000,000, to be dated the date of issue thereof, to mature May 14, 2025, to bear interest on the unpaid balance thereof from the date thereof until the principal thereof shall have become due and payable at the rate of 5.50% per annum (provided that, during any period when an Event of Default shall be in existence, at the election of the Required Holder(s) the outstanding principal balance of the Series A Notes shall bear interest from and after the date of such Event of Default and until the date such Event of Default ceases to be in existence at the rate per annum from time to time equal to the Default Rate) and on overdue payments at the rate per annum from time to time equal to the Default Rate, and to be substantially in the form of Exhibit A attached hereto, (b) the issue of their senior secured promissory notes (the “Series B Notes”) in the aggregate principal amount of $12,500,000, to be dated the First Amendment Effective Date, to mature August 17, 2027, to bear interest on the unpaid balance thereof from the Series B Closing Date until the principal thereof shall have become due and payable at the rate of 5.10% per annum (provided that, during any period when an Event of Default shall be in existence, at the election of the Required Holder(s) the outstanding principal balance of the Series B Notes shall bear interest from and after the date of such Event of Default and until the date such Event of Default ceases to be in existence at the rate per annum from time to time equal to the Default Rate) and on overdue payments at the rate per annum from time to time equal to the Default Rate, and to be substantially in the form of Exhibit A-2 attached hereto, and (c) the issue of their senior secured promissory notes (the “Series C Notes”; together with the Series A Notes and the Series B Notes, the “Notes”) in the aggregate principal amount of $30,000,000, to be dated the Fifth Amendment Effective Date, to mature September 10, 2028, to bear interest on the unpaid balance thereof from the Series C Closing Date until the principal thereof shall have become due and payable at the rate of 3.18% per annum (provided that, during any period when an Event of Default shall be in existence, at the election of the Required Holder(s) the outstanding principal balance of the Series C Notes shall bear interest from and after the date of such Event of Default and until the date such Event of Default ceases to be in existence at the rate per annum from time to time equal to the Default Rate) and on overdue payments at the rate per annum from time to time equal to the Default Rate, and to be substantially in the form of Exhibit A-3 attached hereto.  Each Series C Note shall be in the principal face amount set forth in the Purchaser Schedule and shall evidence the purchase of the Series C Notes made as contemplated by the Fifth Amendment.  The term “Notes” as used herein shall include each such senior secured promissory note delivered pursuant to any provision of this Agreement and each such senior secured promissory note delivered in substitution or exchange for any other Note pursuant to any such provision.

1.3Paragraph 3J is amended and restated as follows:

3J[Reserved.]

1.4Paragraph 4A(1) is amended and restated as follows:

4A(1)Required Prepayments and Interest Payments.  (i) Until the Series A Notes shall be paid in full, the Issuers shall apply to the prepayment of the Series A Notes, without premium, the sum of (x) $500,000 on each February 14, May 14, August 14 and November 14 during the period from August 14, 2015 through and including May 14, 2020 and (y) $750,000 on each February 14, May 14, August 14 and November 14 during the period from August 14, 2020 through and including February 14, 2025 and such principal amounts of the Series A Notes, together with interest thereon to the prepayment dates, shall become due on such prepayment dates, (ii) until the Series B Notes shall be paid in full, the Issuers shall apply to the prepayment of the Series B Notes, without premium, the sum of $312,500 on each February 17, May 17, August 17 and November 17 during the period from November 17, 2017 through and including May 17, 2027 and such principal amounts of the Series B Notes, together with interest thereon to the prepayment dates, shall become due on such prepayment dates, and (iii) until the Series C Notes shall be paid in full, the Issuers shall make payments of interest accrued on the outstanding balance of the Series C Notes on each December 10, March 10, June 10 and September 10 during the period from December 10, 2021 through and including June 10, 2028;  provided that upon any prepayment or purchase of the Notes pursuant to paragraph 4F the principal amount of each required prepayment of the Notes of a series becoming due under this paragraph 4A(1) on and after the date of such prepayment or purchase shall be reduced in the same proportion as the aggregate unpaid principal amount of the Notes of such series is reduced as a result of such prepayment or purchase.  The remaining outstanding principal amount of the Series A Notes, together with any accrued and unpaid interest thereon, shall become due on May 14, 2025, the maturity date of the Series A Notes.  The remaining outstanding principal amount of the Series B Notes, together with any accrued and unpaid interest thereon, shall become due on August 17, 2027, the maturity date of the Series B Notes.  The remaining outstanding principal amount of the Series C Notes, together with any accrued and unpaid interest thereon, shall become due on September 10, 2028, the maturity date of the Series C Notes.

1.5Paragraph 6A is amended by deleting existing clause 6A(1) thereof in its entirety and renumbering existing clauses 6A(2) and 6A(3) thereof 6A(1) and 6A(2), respectively.

1.6Paragraph 6B is amended by replacing the reference to “$75,000,000” contained in clause (ii) thereof with a reference to “$30,000,000.”

1.7Paragraph 6E is amended and restated as follows:

6E.Restricted Payments. Each Issuer covenants that it will not, and not permit any of its Subsidiaries to, (i) make any dividend or distribution to any holders of its Capital Securities, (ii) purchase or redeem any of its Capital Securities, (iii) pay any management fees or similar fees to any of its equityholders or any Affiliate thereof, (iv) make any redemption, prepayment, defeasance, repurchase or any other payment in respect of any Subordinated Debt, or (v) set aside funds for any of the foregoing. Notwithstanding the foregoing, so long as no Event of Default or Default has occurred and is continuing or would occur as a result of any of the following, (a) any Subsidiary may pay dividends or make other distributions to the Company or to a domestic Wholly-Owned Subsidiary, (b) the Company may pay Regular Dividends and make Program Repurchases, so long as, in each case, after giving effect to each such Regular Dividend the Company will remain in compliance with all the financial ratios and restrictions set forth in paragraph 6A, as certified by the Company in form and substance satisfactory to the Required Holder(s), (c) the Company may make payments in respect of Subordinated Debt to the extent permitted under the applicable Subordination Agreement, (d) the Company may grant stock options pursuant to a plan approved by the shareholders of the Company and (e) the Company may pay Special Dividends and purchase or redeem any of its Capital Securities (other than Program Repurchases), so long as each of the Special Dividend Payment/Redemption Conditions have been satisfied.

1.8Paragraph 8I is amended and restated as follows:

8I.Use of Proceeds.  Neither any Issuer nor any of its Subsidiaries   owns or has any present intention of acquiring any “margin stock” as defined in Regulation U (12 CFR Part 221) of the Board of Governors of the Federal Reserve System (herein called “margin stock”).  The proceeds of sale of the  Series A Notes will be used to finance a portion of the 2015 Tender Offer, refinance existing Debt, consummate Acquisitions permitted under paragraph 6F, pay dividends or make repurchases of Capital Securities permitted under paragraph 6E, or for general corporate purposes.  The proceeds of the Series B Loans will be used to finance a portion of the 2017 Tender Offer, refinance existing Debt, pay dividends or make repurchases of Capital Securities permitted under paragraph 6E, or for general corporate purposes.  The proceeds of the Series C Notes will be used for general corporate purposes which may include, among other things, share repurchases and/or shareholder distributions.  None of such proceeds will be used, directly or indirectly, for the purpose, whether immediate, incidental or ultimate, of purchasing or carrying any margin stock or for the purpose of maintaining, reducing or retiring any Debt which was originally incurred to purchase or carry any stock that is currently a margin stock or for any other purpose which might constitute the sale or purchase of any Notes a “purpose credit” within the meaning of such Regulation U.  No Issuer is engaged principally, or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying margin stock.  Neither any Issuer nor any agent acting on its behalf has taken or will take any action which might cause this Agreement, any of the other Transaction Documents or any Note to violate Regulation T, Regulation U or any other regulation of the

Board of Governors of the Federal Reserve System or to violate the Exchange Act, in each case as in effect now or as the same may hereafter be in effect.

1.9Paragraph 10A is amended to add the following new definition of “Applicable Reinvestment Yield Percentage” in proper sequence and to amend and restate the definition of “Reinvestment Yield” in its entirety as follows:

“Applicable Reinvestment Yield Percentage” shall mean 1.00% with respect to Series A Notes and Series B Notes, and 0.50% with respect to Series C Notes.

“Reinvestment Yield” shall mean, with respect to the Called Principal of any Note, the Applicable Reinvestment Yield Percentage with respect to such Note over the yield to maturity implied by (i) the ask-side yields reported as of 10:00 a.m. (New York City local time) on the Business Day next preceding the Settlement Date with respect to such Called Principal for the most recent actively traded on the run U.S. Treasury securities having a maturity equal to the Remaining Average Life of such Called Principal as of such Settlement Date on the display designated as “Page PX1” on Bloomberg Financial Markets (or such other display as may replace Page PX1 on Bloomberg Financial Markets or, if Bloomberg Financial Markets shall cease to report such yields or shall cease to be Prudential Capital Group’s customary source of information for calculating yield-maintenance amounts on privately placed notes, then such source as is then Prudential Capital Group’s customary source of such information), or (ii) if such yields shall not be reported as of such time or the yields reported as of such time shall not be ascertainable (including by way of interpolation), the Treasury Constant Maturity Series yields reported, for the latest day for which such yields shall have been so reported as of the Business Day next preceding the Settlement Date with respect to such Called Principal, in Federal Reserve Statistical Release 11.15 (or any comparable successor publication) for U.S. Treasury securities having a constant maturity equal to the Remaining Average Life of such Called Principal as of such Settlement Date. In the case of each determination under clause (i) or (ii) of the preceding sentence, such implied yield shall be determined, if necessary, by (a) converting U.S. Treasury bill quotations to bond equivalent yields in accordance with accepted financial practice and (b) interpolating linearly between (1) the applicable U.S. Treasury security with the maturity closest to and greater than such Remaining Average Life and (2) the applicable U.S. Treasury security with the maturity closest to and less than such Remaining Average Life. The Reinvestment Yield shall be rounded to that number of decimal places as appears in the coupon of the applicable Note.

1.10Paragraph 10B is amended to add in proper sequence or to amend and restated, as applicable, the following definitions:

“Fifth Amendment” shall mean that certain Amendment No. 5 to this Agreement dated as of September 10, 2021.

“Fifth Amendment Effective Date” shall mean the “Effective Date” as defined in the Fifth Amendment.

“Fixed Charge Coverage Ratio” shall mean as of any date of determination and calculated for a trailing twelve month period ending on such date of determination, the ratio of (a) the total EBITDA of the Company and its Subsidiaries for such period, minus (i) the sum of income taxes paid in cash by the Company and its Subsidiaries in such period, (ii) the sum of all Capital Expenditures made by the Company and its Subsidiaries in such period, and (iii) the sum of all distributions (excluding any Special Dividend made in such period) made by the Company and its Subsidiaries in such period, divided by (b) the sum for such period of (i) cash interest expense plus (ii) all scheduled payments of principal on Debt (excluding, for the avoidance of doubt, any payment pursuant to Section 6 of the Credit Agreement).

“Program Repurchases” shall mean immaterial repurchases or redemptions of Capital Securities of the Company using operating cash on the balance sheet of the Company or proceeds of revolving loans under the Primary Bank Facility, in each case pursuant to a share repurchase program approved by the Company’s board of directors.

“Regular Dividends” means those regular quarterly cash dividends paid by the Company in respect of its Capital Securities consistent with past practices in an amount not to exceed $10,000,000 in the aggregate in any fiscal year of the Company.

“Series C Notes” shall have the meaning given in paragraph 1 hereof.

“Series C Purchase Request” shall have the meaning given therefor in the Fifth Amendment.

“Special Dividends” means the 2020 Special Dividend and all other dividends or other distributions paid by the Company in respect of its Capital Securities other than Regular Dividends, whether paid in cash or other property.

“Special Dividend Payment/Redemption Conditions” with respect to the payment of any Special Dividend or any purchase or redemption of the Company’s Capital Securities (other than Program Repurchases), the satisfaction of the following conditions:  

(a)as of the date of the payment of such Special Dividend or purchase or redemption of Capital Securities and immediately after giving effect thereto, no Default or Event of Default has occurred and is continuing;

(b)after giving pro forma effect to the payment such Special Dividend or purchase or redemption of Capital Securities, the Leverage Ratio shall be equal to or less than 2.00; and

(c)Prudential and the Purchasers shall have received a certificate of a Responsible Officer of the Company certifying as to compliance with the preceding clauses and demonstrating (in reasonable detail) the calculations required thereby.

1.11The Purchaser Schedule attached to the Note Agreement is hereby amended to add to the end thereof the Purchaser Schedule with respect to the Series C Note Purchasers set forth on Exhibit A attached hereto.

1.12A new Exhibit A-3 is added to the Note Agreement in the form of Annex I hereto.  Notes issued in such form in connection with the transaction contemplated by this letter are herein referred to collectively as the “Series C Notes.”

SECTION 2.Purchasing of Series C Notes; Rate Lock Delayed Delivery Fee; Rate Lock Cancellation Fee.  

2.1Subject to and upon the terms and conditions set forth in this letter agreement and the Note Agreement, each Series C Purchaser agrees to purchase from the Issuers on the date hereof or such other date no later than October 31, 2021 as may be agreed to in writing by each Series C Purchaser (such date, the “Series C Closing Date”) a Series C Note in an amount equal to the aggregate amount set forth for such Series C Purchaser on the Purchaser Schedule.  In the event the Issuers do not request that the Series C Notes be purchased on the Series C Closing Date or the Series C Notes are not purchased on the Series C Closing Date, no Series C Purchaser shall have any further commitment to purchase a Series C Note.  No portion of any Series C Note that is prepaid may thereafter be reborrowed.  The principal amount of the Series C Notes purchased on the Series C Closing Date shall be in an aggregate amount equal to $30,000,000.

2.2The Series C Purchasers shall receive from the Issuers no later than 12:00 noon (New York City time), by facsimile or electronic transmission (receipt confirmed), U.S. mail or overnight delivery service, a completed request, substantially in the form of Exhibit B hereto (a “Series C Purchase Request”), at least five days prior to the Series C Closing Date, which Series C Purchase Request shall be delivered to the applicable address set forth on the Purchaser Schedule (or to such other place or in such other manner as any Series C Purchaser may by written notice to the Issuers designate from time to time).  Following receipt of the Series C Purchase Request providing for the purchasing of Series C Notes and such other documentation as may be required pursuant to Section 5 hereof, in form and substance satisfactory to each Series C Purchaser, such Series C Purchaser shall purchase a Series C Note in the principal amount specified opposite its name on the Purchaser Schedule by wire transfer for credit to the account or accounts as shall be specified in the applicable Series C Purchase Request.

2.3The provisions relating to the Rate Lock Delayed Delivery Fee and the Rate Lock Cancellation Fee, in each case, of and as defined in the Letter Agreement dated August 26, 2021 from PGIM, Inc., and accepted and agreed to by the Company shall apply to the Series C Notes as if such provisions were set forth herein.

SECTION 3.  Representations and Warranties.

3.1Each Issuer represents and warrants that (a) the execution and delivery of this letter by each Issuer and the Series C Notes by the Issuers and the purchasing of the Series C Notes to the Issuers have been duly authorized by all necessary corporate action on behalf of the Issuers, this letter and the Series C Notes have been executed and delivered by a duly authorized officer of the Issuers, as applicable, and this letter and the Series C Notes constitute legal, valid and binding obligations of the Issuers, enforceable against the Issuers in accordance with their terms, except as such enforceability may be limited by (i) bankruptcy, insolvency, reorganization or other similar laws affecting the enforcement of creditors’ rights generally and (ii) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law), (b) each representation and warranty set forth in paragraph 8 of the Note Agreement and the other Transaction Documents to which it is a party is true and correct as of the date of execution and delivery of this letter by the Issuers with the same effect as if made on such date, before and after giving effect to this letter and the issuance of the Series C Notes (except to the extent such representations and warranties expressly refer to an earlier date, in which case they were true and correct as of such earlier date), (c) no Event of Default or Default exists or has occurred and is continuing on the date hereof, before and after giving effect to this letter and the issuance of the Series C Notes and (d) neither any Issuer nor any Subsidiary has paid or agreed to pay, and neither any Issuer nor any Subsidiary will pay or agree to pay, any fees or other consideration to any Person in connection with the amendment referenced in Section 4.1(iv) hereof, other than as set forth in Section 14 of such amendment and reimbursement of out-of-pocket fees and expenses of their own legal counsel and legal counsel to the Banks and the Bank Agent.

3.2Each Series C Purchaser severally represents and warrants that each representation and warranty set forth in paragraph 9 of the Note Agreement is true and correct as of the date of execution and delivery of this letter by the Series C Purchasers with the same effect as if made on such date, before and after giving effect to this letter and the issuance of the Series C Notes.

SECTION 4.Conditions Precedent (Amendment).  The amendments in Sections 1 and 2 of this letter shall become effective as of the date (the “Effective Date”) that each of the following conditions has been satisfied:

4.1Documents.Each Purchaser shall have received original counterparts or, if satisfactory to such Purchaser, certified or other copies of all of the following, in form and substance satisfactory to such Purchaser, dated the date hereof unless otherwise indicated, and on the date hereof in full force and effect:

(i)the Series C Note or Series C Notes to be issued to it as contemplated hereby, in each case duly executed by the Issuers;

(ii)counterparts of this letter executed by the Issuers and the Purchasers;

(iii)counterparts of an amendment to the Intercreditor Agreement, duly executed by the Purchasers, the Bank Agent and the Issuers;

(iv)a copy of an amendment to the Credit Agreement, duly executed by the Issuers, the Bank Agent and the Banks, and the conditions precedent to the effectiveness of such amendment shall have been satisfied and such amendment shall be in full force and effect;

(v)a Secretary’s Certificate signed by the Secretary or an Assistant Secretary and one other officer of each Issuer certifying, among other things, (a) as to the names, titles and true signatures of the officers of such Issuer, as the case may be, authorized to sign the Transaction Documents to which such Issuer, as the case may be, is a party, (b) that attached thereto is a true, accurate and complete copy of the certificate of incorporation or other formation document of such Issuer, as the case may be, certified by the Secretary of State of the state of organization of such Issuer, as the case may be, as of a recent date (or certifying that such certificate of incorporation or other formation document remains unchanged from the relevant document certified on the date of the closing), (c) that attached thereto is a true, accurate and complete copy of the by-laws, operating agreement or other organizational document of such Issuer, as the case may be, which were duly adopted and are in effect as of the Effective Date and have been in effect immediately prior to and at all times since the adoption of the resolutions referred to in clause (d), below (or certifying that such by-laws, operating agreement or other organization document remains unchanged from the relevant document certified on the date of the closing), (d) that attached thereto is a true, accurate and complete copy of the resolutions of the board of directors or other managing body of such Issuer, as the case may be, duly adopted at a meeting or by unanimous written consent of such board of directors or other managing body, authorizing the execution, delivery and performance of the Transaction Documents to which such Issuer, as the case may be, is a party, and that such resolutions have not been amended, modified, revoked or rescinded, are in full force and effect and are the only resolutions of the shareholders, partners or members of such Issuer, as the case may be, or of such board of directors or other managing body or any committee thereof relating to the subject matter thereof, and (e) that no dissolution or liquidation proceedings as to such Issuer have been commenced or are contemplated;

(vi)a certificate of corporate or other type of entity and tax good standing for each Issuer and each of its Subsidiaries from the Secretary of State or other appropriate governmental official of the jurisdiction of organization of such Issuer or such Subsidiary and of each jurisdiction in which such Issuer or such Subsidiary is required to be qualified to transact business as a foreign organization, in each case dated as of a recent date;

(vii)an Officer’s Certificate certifying that, after giving effect to the amendments contemplated hereby, the amendment to the Credit Agreement referenced in Section 4.1(iv) above and the issuance of the Series C Notes certifying as to the matters set forth in Section 3.1 hereof; and

(viii)a favorable opinion of Ballard Spahr LLP, special counsel for the Issuers, in the form acceptable to the Required Holders and Series C Purchasers and each Issuer, by its execution hereof, hereby requests and authorizes such special counsel to render such opinion and to allow the Purchasers to rely on such opinion, and understands and agrees

that the Purchasers receiving such an opinion will be relying, and are hereby authorized to rely, on such opinion.

4.2Fees and Expenses.  The Issuers shall have paid the reasonable fees, charges and disbursements of Taft Stettinius & Hollister LLP, special counsel to the Purchasers, incurred in connection with this letter agreement.

4.3Proceedings.  All corporate and other proceedings taken or to be taken in connection with the transactions contemplated by this letter and all documents incident thereto shall be satisfactory to such Purchaser and its counsel, and such Purchaser shall have received all such counterpart originals or certified or other copies of such documents as they may reasonably request.

SECTION 5.Conditions Precedent (Series C Notes).  Each Series C Purchaser’s obligation to purchase a Series C Note (if any) shall be subject to the satisfaction of the following conditions (the date on which such conditions have been satisfied herein referred to as the “Series C Closing Date”):

5.1Documents.Each Series C Purchaser shall have received a duly executed Series C Purchase Request as and when required by Section 2.2.

5.2Representations and Warranties; No Default.  The representations and warranties contained in Section 3.1 of this letter agreement shall be true on and as of the date of the purchase of the Series C Note, both before and immediately after giving effect to the making of such purchase of the Series C Note; there shall exist on the date of such purchase of the Series C Note no Default or Event of Default, both before and immediately after giving effect to the making of such purchase of the Series C Note; and the Issuers shall have delivered an Officer’s Certificate to the Series C Purchasers to each such effect.

5.3Material Adverse Change.  No material adverse change in the business, condition (financial or otherwise), property, assets, operations or prospects of the Issuers and their Subsidiaries, taken as a whole, since December 26, 2020 shall have occurred or be threatened, as determined by such Series C Purchaser in its sole judgment.

5.4Purchase Permitted By Applicable Laws; Approvals.  The purchase of and payment for the Series C Notes to be purchased by such Series C Purchaser on the Series C Closing Date on the terms and conditions herein provided (including the use of the proceeds of such Series C Notes by the Issuers) shall not violate any applicable law or governmental regulation (including, without limitation, section 5 of the Securities Act or Regulation T, U or X of the Board of Governors of the Federal Reserve System) and shall not subject such Series C Purchaser to any tax, penalty, liability or other onerous condition under or pursuant to any applicable law or governmental regulation, and such Series C Purchaser shall have received such certificates or other evidence as it may request to establish compliance with this condition.  All necessary authorizations, consents, approvals, exceptions or other actions by or notices to or filings with any court or administrative or governmental body or other Person required in connection with the execution, delivery and performance of the Note Agreement, the Series C Notes and the other Transaction Documents or the consummation of the transactions contemplated hereby or thereby

shall have been issued or made, shall be final and in full force and effect and shall be in form and substance satisfactory to such Series C Purchaser.

5.5Fees and Expenses.  The Issuers shall have paid the reasonable fees, charges and disbursements of Taft Stettinius & Hollister LLP, special counsel to the Purchasers, incurred in connection with the Series C Notes.

SECTION 6.Reference to and Effect on Note Agreement; Ratification of Transaction Documents.  Upon the effectiveness of the amendments in Section 1 and Section 2 of this letter, each reference to the Note Agreement in any other document, instrument or agreement shall mean and be a reference to the Note Agreement as modified by this letter.  Except as specifically set forth in Section 1 and Section 2, the Note Agreement shall remain in full force and effect and is hereby ratified and confirmed in all respects.  Except as expressly amended hereby, each of the Note Agreement and the other Transaction Documents are hereby ratified and confirmed in all respects and shall continue in full force and effect. Except as specifically stated in this letter, the execution, delivery and effectiveness of this letter shall not (a) amend the Note Agreement or any Note, (b) operate as a waiver of any right, power or remedy of any holder of the Notes, or (c) constitute a waiver of, or consent to any departure from, any provision of the Note Agreement or any Note at any time.  The execution, delivery and effectiveness of this letter shall not be construed as a course of dealing or other implication that any holder of the Notes has agreed to or is prepared to grant any consents or agree to any waiver to the Note Agreement in the future, whether or not under similar circumstances.

SECTION 7.Release. Each of the Issuershereby absolutely and unconditionally releases and forever discharges each Purchaser, and any and all participants, parent corporations, subsidiary corporations, affiliated corporations, insurers, indemnitors, successors and assigns thereof, together with all of the present and former directors, officers, agents and employees of any of the foregoing, from any and all claims, counterclaims, demands or causes of action of any kind, nature or description, whether arising in law or equity or upon contract or tort or under any state or federal law or otherwise, which the Issuershas had, now has or has made claim to have against any such person for or by reason of any act, omission, matter, cause or thing whatsoever arising from the beginning of time to and including the date of this letter, whether such claims, counterclaims, demands or causes of action are matured or unmatured or known or unknown.

SECTION 8.Expenses. Each Issuer hereby confirms its obligations under the Note Agreement, whether or not the transactions hereby contemplated are consummated, to pay, promptly after request by any holder of the Notes, all reasonable out-of-pocket costs and expenses, including attorneys’ fees and expenses, incurred by any holder of the Notes in connection with this letter agreement or the transactions contemplated hereby, in enforcing any rights under this letter agreement, or in responding to any subpoena or other legal process or informal investigative demand issued in connection with this letter agreement or the transactions contemplated hereby.  The obligations of the Issuers under this Section 8 shall survive transfer by any holder of any Note and payment of any Note.

SECTION 9.Governing Law.  THIS LETTER SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAW OF THE STATE OF ILLINOIS (EXCLUDING ANY

CONFLICTS OF LAW RULES WHICH WOULD OTHERWISE CAUSE THIS AGREEMENT TO BE CONSTRUED OR ENFORCED IN ACCORDANCE WITH, OR THE RIGHTS OF THE PARTIES TO BE GOVERNED BY, THE LAWS OF ANY OTHER JURISDICTION).

SECTION 10.  Counterparts; Section Titles.  This letter may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which when taken together shall constitute but one and the same instrument.  Delivery of an executed counterpart of a signature page to this letter by facsimile or electronic transmission shall be effective as delivery of a manually executed counterpart of this letter. The section titles contained in this letter are and shall be without substance, meaning or content of any kind whatsoever and are not a part of the agreement between the parties hereto.

(Signature Page Follows)

Very truly yours,

PAR U HARTFORD LIFE INSURANCE COMFORT TRUST

By: Prudential Arizona Reinsurance Universal Company, as Grantor

By: PGIM, Inc., as investment manager


By:/s/ Anna Sabiston​ ​​ ​​ ​ Vice President

PRUCO LIFE INSURANCE COMPANY

By: PGIM, Inc., as investment manager


By:/s/ Anna Sabiston​ ​​ ​​ ​ Vice President

PRUDENTIAL RETIREMENT GUARANTEED COST BUSINESS TRUST

By: Prudential Retirement Insurance and Annuity Company (as Grantor)

By: PGIM, Inc. (as Investment Manager)


By:/s/ Anna Sabiston​ ​​ ​​ ​ Vice President

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

By: PGIM, Inc., as investment manager


By:/s/ Anna Sabiston​ ​​ ​​ ​ Vice President

PRUDENTIAL ANNUITIES LIFE ASSURANCE CORPORATION

By: PGIM, Inc., as investment manager

By:/s/ Anna Sabiston​ ​​ ​​ ​ Vice President

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

By: PGIM, Inc., as investment manager

By:/s/ Anna Sabiston​ ​​ ​​ ​ Vice President

THE PRUDENTIAL LIFE INSURANCE COMPANY, LTD.

By: PGIM Japan Co., Ltd., as Investment Manager

By: PGIM, Inc., as Sub-Adviser

By:/s/ Anna Sabiston​ ​​ ​​ ​ Vice President

The foregoing letter is
hereby accepted as of the
date first above written.

WINMARK CORPORATION



By: /s/ Anthony D. Ishaug​ ​
Name: Anthony D. Ishaug
Title: Executive Vice President and Chief

Financial Officer

WIRTH BUSINESS CREDIT, INC.



By: /s/ Anthony D. Ishaug​ ​
Name: Anthony D. Ishaug
Title: Chief Financial Officer and Treasurer

WINMARK CAPITAL CORPORATION



By: /s/ Anthony D. Ishaug​ ​
Name: Anthony D. Ishaug
Title: Chief Financial Officer and Treasurer

GROW BIZ GAMES, INC.



By: /s/ Anthony D. Ishaug​ ​
Name: Anthony D. Ishaug
Title: Chief Financial Officer, Treasurer and

Secretary

EXHIBIT A

PURCHASER SCHEDULE

3.18% SERIES C Senior Secured Notes Due September 10, 2028

	Aggregate Principal Amount of Notes to be Purchased	Note Denomination
PRUDENTIAL ANNUITIES LIFE ASSURANCE CORPORATION	$4,750,000.00	$4,750,000.00
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA	$13,000,000.00	$11,500,000.00
		$1,500,000.00
THE PRUDENTIAL LIFE INSURANCE COMPANY, LTD	$12,250,000.00	$12,250,000.00

EXHIBIT B

[FORM OF SERIES C REQUEST FOR PURCHASE]
WINMARK CORPORATION

WIRTH BUSINESS CREDIT, INC.

WINMARK CAPITAL CORPORATION

GROW BIZ GAMES, INC.SERIES C REQUEST FOR PURCHASE

To:[NAMES OF PURCHASERS]

c/o Prudential Capital Group
60 S. 6^th Street, Suite 3700
Minneapolis, Minnesota 55402-4422
Attention: Managing Director

Reference is made to the Note Agreement dated as of May 14, 2015 (as amended from time to time including by Amendment No. 5 thereto dated September [10], 2021 (the “Fifth Amendment”), the “Note Agreement”), among Winmark Corporation, a Minnesota corporation (the “Company”), Wirth Business Credit, Inc., a Minnesota corporation (“Wirth”), Winmark Capital Corporation, a Minnesota corporation (“Winmark Capital”), Grow Biz Games, Inc., a Minnesota corporation (“Grow Biz”; the Company, Wirth, Winmark Capital, Grow Biz and any other Person who joins the Note Agreement as an Issuer pursuant to paragraph 5J, collectively, the “Issuers”), and the purchasers party thereto.  Pursuant to paragraph 2C(2) of the Agreement, the undersigned hereby certify as follows:

Pursuant to Section 2 of the Fifth Amendment, the Issuers hereby make the following request for the purchase of the Series C Notes:

1. Aggregate principal amount of the Series C Notes covered hereby (the “Secired C Notes”) $30,000,000.

2. The proceeds of the requested Series C Notes are to be transferred as follows:

Name, Address
and ABA RoutingNumber ofName and Telephone No.
Number of Bank  Account    of Bank Office            

[To be completed by the Issuers]

3. The Issuers hereby further certify that (a) all conditions precedent to the purchasing of the Series C Notes requested hereby set forth in Section 2 of the Fifth Amendment have been, or immediately prior to the purchasing of the Series C Notes will be, satisfied, (b) the representations and warranties contained in 3.1 of the Fifth Amendment are true and correct on and as of the date of this Series C Purchase Request (except to the extent that any expressly relate to an earlier date) and will be true on and as of the date of the purchasing of the Series C Notes requested herein, (c) no event has occurred and is continuing, or would result from the requested purchase of the Series C Notes

or the application of the proceeds therefrom, which constitutes a Default or Event of Default, and (d) after giving effect to the purchasing of the Series C Notes requested herein, the Issuers shall have no right to request, and no Series C Purchaser shall have any obligation to purchase, additional Series C Notes or other extensions of credit.

Unless otherwise defined herein, capitalized terms used herein shall have the meanings assigned to such terms in the Agreement.

Date:​ ​​ ​​ ​​ ​

WINMARK CORPORATION

By:‌Name: Title:  

WIRTH BUSINESS CREDIT, INC.

By:‌Name: Title:  

WINMARK CAPITAL CORPORATION

By:‌Name: Title:  

GROW BIZ GAMES, INC.

By:‌Name: Title:  

Annex I

Exhibit A-3

[FORM OF SERIES C NOTE]

WINMARK CORPORATION
WIRTH BUSINESS CREDIT, INC.
WINMARK CAPITAL CORPORATION
GROW BIZ GAMES, INC.

3.18% SENIOR SECURED NOTE DUE SEPTMEBER 10, 2028

No. C-___‌[Date]

$________‌PPN:  97424* AA2

FOR VALUE RECEIVED, the undersigned, WINMARK CORPORATION, a corporation organized and existing under the laws of the State of Minnesota (herein called the “Company”), Wirth Business Credit, Inc., a corporation organized and existing under the laws of the State of Minnesota (herein called “Wirth”), Winmark Capital Corporation, a corporation organized and existing under the laws of the State of Minnesota (herein called “Winmark Capital”), and Grow Biz Games, Inc., a corporation organized and existing under the laws of the State of Minnesota (“Grow Biz”; the Company, Wirth, Winmark Capital and Grow Biz being collectively called the “Issuers”), hereby jointly and severally promise to pay to _______________________________, or registered assigns, the principal sum of _______________________________ DOLLARS on September 10, 2028, with interest (computed on the basis of a 360-day year--30-day month) (a) on the unpaid balance thereof at the rate of 3.18% per annum from the date hereof, payable quarterly on the 10^th day of December, March, June, September in each year, commencing with the December 10,  March 10, June 10 or September 10 next succeeding the date hereof, until the principal hereof shall have become due and payable, and (b) (i) on any overdue payment (including any overdue prepayment) of principal, any overdue payment of Yield-Maintenance Amount, any overdue payment of interest (to the extent permitted by applicable law), and (ii) during any period when an Event of Default shall be in existence, at the election of the Required Holder(s), on the entire principal amount hereof, at a rate per annum from time to time equal to the Default Rate, payable quarterly as aforesaid (or, at the option of the registered holder hereof, on demand). The “Default Rate” shall mean a rate per annum from time to time equal to the lesser of (i) the maximum rate permitted by applicable law, and (ii) the greater of (a) 5.18% or (b) 2.00% over the rate of interest publicly announced by JPMorgan Chase Bank, National Association, from time to time in New York City as its Prime Rate.  

Payments of principal of, interest on and any Yield-Maintenance Amount payable with respect to this Note are to be made at the main office of JPMorgan Chase Bank in New

York City or at such other place as the holder hereof shall designate to the Company in writing, in lawful money of the United States of America.  

This Note is one of a series of Senior Secured Notes (herein called the “Notes”) issued pursuant to a Note Agreement, dated as of May 14, 2015 (herein called the “Agreement”), among the Issuers and the original purchasers of the Notes named in the Purchaser Schedule attached thereto and is entitled to the benefits thereof.

This Note is a registered Note and, as provided in the Agreement, upon surrender of this Note for registration of transfer, duly endorsed, or accompanied by a written instrument of transfer duly executed, by the registered holder hereof or such holder’s attorney duly authorized in writing, a new Note for a like principal amount will be issued to, and registered in the name of, the transferee. Prior to due presentment for registration of transfer, the Issuers may treat the person in whose name this Note is registered as the owner hereof for the purpose of receiving payment and for all other purposes, and the Issuers shall not be affected by any notice to the contrary.

The Issuers jointly and severally agrees to make required prepayments of principal on the dates and in the amounts specified in the Agreement. This Note is also subject to optional prepayment, in whole or from time to time in part, on the terms specified in the Agreement, but not otherwise.

This Note is secured by, and entitled to the benefits of, the Collateral Documents. Reference is made to the Collateral Documents for a statement concerning the terms and conditions governing the collateral security for the obligations of the Issuers hereunder.

Each Issuer and any and all endorsers, guarantors and sureties severally waive demand, presentment for payment, notice of dishonor or default, notice of intent to accelerate, notice of acceleration (except to the extent required in the Agreement), protest and diligence in collecting in connection with this Note, whether now or hereafter required by applicable law.

In case an Event of Default shall occur and be continuing, the principal of this Note may be declared or otherwise become due and payable in the manner and with the effect provided in the Agreement.

Capitalized terms used herein which are defined in the Agreement and not otherwise defined herein shall have the meanings as defined in the Agreement.

THIS NOTE IS INTENDED TO BE PERFORMED IN THE STATE OF ILLINOIS AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAW OF SUCH STATE (EXCLUDING ANY CONFLICTS OF LAW RULES WHICH WOULD OTHERWISE CAUSE THIS NOTE TO BE CONSTRUED OR ENFORCED IN ACCORDANCE WITH THE LAWS OF ANY OTHER JURISDICTION).

WINMARK CORPORATION

By:‌

Name: ‌

Title: ‌

WIRTH BUSINESS CREDIT, INC.

By:‌

Name: ‌

Title: ‌

WINMARK CAPITAL CORPORATION

By:‌

Name: ‌

Title: ‌

GROW BIZ GAMES, INC.

By:‌

Name: ‌

Title: ‌

EX-10.5

Exhibit 10.5

AMENDMENT NO. 3 TO
INTERCREDITOR AND COLLATERAL AGENCY AGREEMENT

This Amendment No. 3 to Intercreditor and Collateral Agency Agreement (this “Amendment”), dated as of this 10th day of September, 2021, is by and among CIBC Bank USA, formerly known as The PrivateBank and Trust Company (“CIBC”), The Prudential Insurance Company of America (“Prudential”), Pruco Life Insurance Company (“Pruco”), Prudential Retirement Guaranteed Cost Business Trust (“Prudential Guaranteed”), PAR U Hartford Life Insurance Comfort Trust (“PAR”), Prudential Annuities Life Assurance Corporation (“PALA”) and The Prudential Life Insurance Company, Ltd. (“PLIC”), CIBC, in its capacity as Bank Agent, and CIBC, in its capacity as Collateral Agent.  

WITNESSETH:

WHEREAS, the parties to this Amendment are party to the Intercreditor and Collateral Agency Agreement dated as of May 14, 2015 (the “Intercreditor Agreement”), as the same shall be amended by this Amendment and amended or otherwise modified from time to time;

WHEREAS, the Borrowers and CIBC are entering into the Amendment No. 9 to Credit Agreement, dated as of the date hereof (“Bank Amendment”);

WHEREAS, the Borrowers, Prudential, Pruco, Prudential Guaranteed, PAR, PALA and PLIC are entering into the Amendment No. 5 to Note Purchase Agreement, dated as of the date hereof (the “Note Amendment”);

WHEREAS, as a condition to the execution and delivery of each of the Bank Amendment and the Note Amendment, the parties thereto require the execution and delivery of this Amendment by the parties hereto.

NOW, THEREFORE, for the above reasons, in consideration of the mutual covenants herein, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

SECTION 1.Definitions.  Capitalized terms used but not defined in this Amendment have the meanings assigned thereto in the Intercreditor Agreement, as amended by this Amendment.

SECTION 2.Amendments.  Effective as of the Effective Date (as defined below):

2.1Section 1 of the Intercreditor Agreement is hereby amended by inserting in appropriate alphabetical order the following defined term:

“Third Amendment” means that certain Amendment No. 3 to Intercreditor and Collateral Agency Agreement dated as of September 10, 2021 by and among the Collateral Agent, the Bank Lender and the Noteholders.

2.2Section 8 of the Intercreditor Agreement is hereby amended by amending and restating paragraph (a) thereof in its entirety to read as follows:

(a)(i)  The Bank Agent and each Bank Lender agrees that, without the consent in writing by Noteholders holding a majority of the outstanding principal amount of the Senior Secured Notes, it will not (A) make any Revolving Loan or issue any Letter of Credit if such loans or issuances would cause the aggregate outstanding principal amount of Revolving Loans and undrawn face amount of Letters of Credit to exceed the sum of (x) $30,000,000 less (y) the amount of all permanent reductions of the "Commitment" (as defined in the Credit Agreement) after the date of the Third Amendment, (B) except for (x) Persons becoming Borrowers after the date hereof and (y) the Guaranty Agreements, retain or obtain the primary or secondary obligations of any other obligor or obligors with respect to all or any part of the Senior Indebtedness, or (C) from and after the institution of any bankruptcy or insolvency proceeding involving any Loan Party, as respects the Collateral enter into any agreement with such Loan Party with respect to post-petition usage of cash collateral, post-petition financing arrangements or adequate protection. (ii)  Each Noteholder agrees that, without the consent in writing by the Bank Lenders holding a majority of the outstanding principal amount of the Loan and Reimbursement Obligations and Outstanding Letters of Credit Exposure, it will not (A) make note purchases, advances, loans or extensions of credit pursuant to the Note Agreement if such purchases, advances, loans or extensions of credit would cause the outstanding aggregate principal amount of Senior Indebtedness under the Note Agreement to exceed the sum of (x) $48,750,000 in the aggregate under Senior Secured Notes issued and outstanding as of the date of the Third Amendment (including Additional Notes issued on the date of the Third Amendment) plus (y) $5,000,000 in the aggregate under Additional Notes issued after the date of the Third Amendment less (z) the amount of all principal payments made on the Senior Secured Notes after the date of the Third Amendment, (B) except for (x) Persons becoming Borrowers after the date hereof and (y) the Guaranty Agreements, retain or obtain the primary or secondary obligations of any other obligor or obligors with respect to all or any part of the Senior Indebtedness, or (C) from and after the institution of any bankruptcy or insolvency proceeding involving any Loan Party, as respects the Collateral enter into any agreement with such Loan Party with respect to post-petition usage of cash collateral, post-petition financing arrangements or adequate protection.

SECTION 3.Effectiveness.  This Amendment shall become effective as of the date (the “Effective Date”) upon which this Amendment has been executed and delivered by each party hereto concurrently with the effectiveness of the Bank Amendment and the Note Amendment.

SECTION 4.Confirmations.  Each party hereto acknowledges and agrees that (i) each reference to the “Credit Agreement” in any Collateral Documents shall include the Credit Agreement as amended by the Bank Amendment and (ii) each reference to the “Note Agreement” in any Collateral Documents shall include the Note Agreement as amended by the Note Amendment.

SECTION 5.Effect of Amendment.  Upon the effectiveness of this Amendment, each reference to the Intercreditor Agreement in each Collateral Document and in any other document, instrument or agreement shall mean and be a reference to the Intercreditor Agreement as modified by this Amendment.  Except as specifically set forth in Section 2, the Intercreditor Agreement shall remain in full force and effect and is hereby ratified and confirmed in all respects.  Except as expressly amended hereby, the Intercreditor Agreement and each of the Collateral Documents are hereby ratified and confirmed in all respects and shall continue in full force and effect.  Except as specifically stated in this Amendment, the execution, delivery and effectiveness of this Amendment shall not (a) amend the Intercreditor Agreement, (b) operate as a waiver of any right, power or remedy of the Collateral Agent, any Bank Lender, the Bank Agent or any Noteholder, or (c) constitute a waiver of, or consent to any departure from, any provision of the Intercreditor Agreement at any time.  The execution, delivery and effectiveness of this Amendment shall not be construed as a course of dealing or other implication that the Collateral Agent, any Bank Lender, the Bank Agent or any Noteholder has agreed to or is prepared to grant any consents or agree to any amendment to the Intercreditor Agreement in the future, whether or not under similar circumstances.

SECTION 6.Entire Agreement.  The Intercreditor Agreement, as amended by this Amendment, constitutes the entire agreement and understanding between the parties to each with respect to the subject matter thereof and hereof and supersedes any and all oral communication and prior writings in respect thereof or hereof.

SECTION 7.Counterparts. This Amendment may be executed in several counterparts and by each party on a separate counterpart, each of which, when so executed and delivered, shall be an original, but all of which together shall constitute but one and the same instrument.

SECTION 8.Governing Law.  THIS AMENDMENT SHALL BE GOVERNED AS TO VALIDITY, INTERPRETATION, ENFORCEMENT AND EFFECT BY THE LAWS OF THE STATE OF MINNESOTA (EXCLUDING ANY CONFLICTS OF LAW RULES WHICH WOULD OTHERWISE CAUSE THIS AMENDMENT TO BE GOVERNED BY THE LAWS OF ANY OTHER JURISDICTION).

SECTION 9.Joinder.Each of PALA and PLIC, as additional Noteholders, hereby (i) consents and agrees to all the provisions of the Intercreditor Agreement applicable to it, (ii) agrees that it will be a “Noteholder” under the Note Agreement, (iii) adopts the Intercreditor Agreement applicable to it as a Noteholder with the same force and effect as if it was originally a party thereto, and (iv) agrees to be bound by the terms of the Intercreditor Agreement applicable to it as a Noteholder.  For purposes of Section 10 of the Intercreditor Agreement, following is the address for notices to each of PALA and PLIC:

c/o Prudential Private Capital

60 South Sixth St.
Suite 3710
Minneapolis, MN 55402

Attention: Managing Director

cc: Vice President and Corporate Counsel

[Signature page follows.]

IN WITNESS WHEREOF, the parties have executed this Amendment as of the day and year first written above.

CIBC BANK USA, in its individual capacity, as Bank Agent, as the sole Bank Lender and as Collateral Agent


By:/s/ Leanne Manning​ ​
Name: Leanne Manning
Title: Managing Director

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA

By: PGIM, Inc., as investment manager


By: /s/ Anna Sabiston​ ​​ ​​ ​
Vice President

PRUCO LIFE INSURANCE COMPANY

By: PGIM, Inc., as investment manager


By: /s/ Anna Sabiston​ ​​ ​​ ​
Vice President

PRUDENTIAL RETIREMENT
GUARANTEED COST BUSINESS
TRUST

By:Prudential Retirement Insurance and

Annuity Company (as Grantor)

By:PGIM, Inc. (as Investment Manager)

By: /s/ Anna Sabiston​ ​​ ​​ ​

Vice President

PAR U HARTFORD LIFE INSURANCE

PAR U HARTFORD LIFE INSURANCE COMFORT TRUST

By:Prudential Arizona Reinsurance

Universal Company, as Grantor

By:PGIM, Inc., as Investment Manager

By: /s/ Anna Sabiston​ ​​ ​​ ​

Vice President

PRUDENTIAL ANNUITIES LIFE ASSURANCE CORPORATION

By: PGIM, Inc., as investment manager

By: /s/ Anna Sabiston​ ​​ ​​ ​ Vice President

THE PRUDENTIAL LIFE INSURANCE COMPANY, LTD.

By: PGIM Japan Co., Ltd., as Investment Manager

By: PGIM, Inc., as Sub-Adviser

By: /s/ Anna Sabiston​ ​​ ​​ ​ Vice President

Acknowledged, consented and agreed:

WINMARK CORPORATION

By: /s/ Anthony D. Ishaug​ ​

Name:Anthony D. Ishaug
Title:Executive Vice President and Chief Financial Officer

WIRTH BUSINESS CREDIT, INC.

By: /s/ Anthony D. Ishaug​ ​

Name:Anthony D. Ishaug
Title:Chief Financial Officer and Treasurer

WINMARK CAPITAL CORPORATION

By: /s/ Anthony D. Ishaug​ ​

Name:Anthony D. Ishaug
Title:Chief Financial Officer and Treasurer

GROW BIZ GAMES, INC.

By: /s/ Anthony D. Ishaug​ ​

Name:Anthony D. Ishaug
Title:Chief Financial Officer, Treasurer and Secretary

EX-99.1

Exhibit 99.1

Contact:Brett D. Heffes

763/520-8500

FOR IMMEDIATE RELEASE

WINMARK CORPORATION ANNOUNCES ISSUANCE OF

$30.0 MILLION OF 3.18% NOTES DUE 2028

Minneapolis, MN (September 10, 2021)  -  Winmark Corporation (Nasdaq: WINA) announced today the issuance of $30.0 million of 3.18% Senior Secured Notes due 2028.  The financing was provided by affiliates of PGIM, Inc. (formerly Prudential Investment Management) under its existing note agreement.  Winmark intends to use the proceeds for general corporate purposes, which may include share repurchases and dividends.

Winmark - the Resale Company^TM, is a nationally recognized franchising business focused on sustainability and small business formation.  We champion and guide entrepreneurs interested in operating one of our award-winning resale franchises: Plato’s Closet®, Once Upon A Child®, Play It Again Sports®, Style Encore® and Music Go Round®.  At June 26, 2021, there were 1,266 franchises in operation and over 2,000 available territories.  An additional 36 franchises have been awarded but are not open.  

This press release contains forward-looking statements within the meaning of the safe harbor provisions of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), relating to future events or the future financial performance of the Company.  Such forward-looking statements are only predictions or statements of intention subject to risks and uncertainties and actual events or results could differ materially from those anticipated.  Because actual result may differ, shareholders and prospective investors are cautioned not to place undue reliance on such forward-looking statements.

XML

Document and Entity Information	Feb. 26, 2020
Document and Entity Information [Abstract]
Document Type	8-K
Document Period End Date	Sep. 10, 2021
Entity File Number	000-22012
Entity Registrant Name	Winmark Corporation
Entity Incorporation, State or Country Code	MN
Entity Tax Identification Number	41-1622691
Entity Address, Address Line One	605 Highway 169 North
Entity Address, Adress Line Two	Suite 400
Entity Address, City or Town	Minneapolis
Entity Address, State or Province	MN
Entity Address, Postal Zip Code	55441
City Area Code	763
Local Phone Number	520-8500
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, no par value per share
Trading Symbol	WINA
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	false
Entity Central Index Key	0000908315
Amendment Flag	false