Current Report Filing (8-k)
April 30 2020 - 5:24PM
Edgar (US Regulatory)
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):
April 24, 2020
Town Sports International Holdings, Inc. |
(Exact Name of Registrant as Specified in Its Charter) |
|
|
|
Delaware |
001-36803 |
20-0640002 |
(State or Other Jurisdiction
of Incorporation) |
(Commission
File Number) |
(IRS Employer
Identification No.) |
|
|
|
1001 US North Highway 1, Suite 201, Jupiter, Florida |
33477 |
(Address of Principal Executive Offices) |
(Zip Code) |
|
|
399 Executive Boulevard, Elmsford, New York |
10523 |
(Address of Principal Executive Offices) |
(Zip Code) |
Registrant’s Telephone Number, Including
Area Code: (212) 246-6700
|
(Former Name or Former Address, If Changed Since Last Report) |
Check the appropriate box below if the Form 8-K filing is intended
to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction
A.2. below):
☐ Written communications
pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material
pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c)
under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class |
Trading Symbol(s) |
Name of Each Exchange on Which Registered |
Common stock, $0.001 par value per share |
CLUB |
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 2.03 | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
On April 24, 2020, Town Sports International,
LLC (“TSI LLC”), a wholly-owned operating subsidiary of Town Sports International Holdings, Inc. (the “Company”)
received funding in connection with “Small Business Loans” under the federal Paycheck Protection Program provided
in Section 7(a) of the Small Business Act of 1953, as amended by the Coronavirus Aid, Relief and Economic Security Act, as amended
from time to time (the “PPP”). Pursuant to the terms of the Business Loan Agreement and Promissory Note dated as of
April 20, 2020, by TSI LLC in favor of BankUnited, N.A., a national banking association, TSI LLC borrowed $2,742,200 original
principal amount, which was funded on April 24, 2020 (the “PPP Loan”). The PPP Loan bears interest at 1% per annum
and matures in two years from the date of disbursement of funds under the PPP Loan. Interest and principal payments under the
PPP Loan will be deferred for a period of six months. Under certain circumstances, all or a portion of the PPP Loan may be forgiven,
however, there can be no assurance that any portion of the PPP Loan will be forgiven and that TSI LLC would not be required to
repay the PPP Loan in full.
The PPP Loan contains certain covenants
which, among other things, restrict the borrower’s use of the proceeds of the PPP Loan to the payment of payroll costs, interest
on mortgage obligations, rent obligations and utility expenses, require compliance with all other loans or other agreements with
any creditor of the borrower, to the extent that a default under any loan or other agreement would materially affect the borrower’s
ability to repay the PPP Loan and limit the ability of the borrower to make certain changes to its ownership structure.
If TSI LLC defaults on the PPP Loan
(i) an event of default will occur under the Company’s $370 million senior secured credit facility pursuant to a credit agreement among Town Sports International, LLC, TSI Holdings II, LLC, as a guarantor, the
lenders party thereto, Deutsche Bank AG, as administrative agent, and Keybank National Association, as syndication agent and (ii)
TSI LLC may be required to immediately repay the PPP Loan.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits.
Exhibit
No. |
|
Description |
10.1 |
|
Business Loan Agreement and Promissory Note, dated April 20, 2020,
by and between TSI LLC and BankUnited, N.A.
|
SIGNATURE
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
|
TOWN SPORTS INTERNATIONAL HOLDINGS, INC. |
|
(Registrant) |
|
|
Date: April 30, 2020 |
By: |
/s/ Patrick Walsh |
|
|
Patrick Walsh |
|
|
Chairman and Chief Executive Officer |
This regulatory filing also includes additional resources:
ex101to8k11125001_04302020.pdf
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