Attached files

file filename
EX-10.2 - EXHIBIT 10.2 CONSENT AND AGREEMENT OF GUARANTOR - FRANKLIN COVEY COexhibit10_2.htm
EX-10.1 - EXHIBIT 10.1 NINTH MODIFICATION AGREEMENT - FRANKLIN COVEY COexhibit10_1.htm
 


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):
August 17, 2018

FRANKLIN COVEY CO.

(Exact name of registrant as specified in its charter)

Commission File No. 1-11107

Utah
 
87-0401551
(State or other jurisdiction of incorporation)
 
(IRS Employer Identification Number)
     

2200 West Parkway Boulevard
Salt Lake City, Utah  84119-2099
(Address of principal executive offices)(Zip Code)

Registrant's telephone number, including area code:  (801) 817-1776
Former name or former address, if changed since last report: Not Applicable
______________________

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))

Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company □

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. □



Item 1.01        Entry into a Material Definitive Agreement

On August 17, 2018, Franklin Covey Co. (the Company) entered into the Ninth Modification Agreement to its existing amended and restated secured credit agreement (the Restated Credit Agreement) with JPMorgan Chase Bank, N.A. (the Lender).  The Lender also provides the majority of the Company's day-to-day banking services.

The purpose of the Ninth Modification Agreement is to extend the maturity date of the Restated Credit Agreement from March 31, 2020 to March 31, 2021.

The Ninth Modification Agreement preserves existing debt covenants that include (i) a Funded Debt to EBITDAR ratio of less than 3.0 to 1.0; (ii) a Fixed Charge Coverage ratio greater than 1.15 to 1.0; (iii) an annual limit on capital expenditures (excluding capitalized curriculum development) of $8.0 million; and (iv) consolidated accounts receivable must exceed 150 percent of the outstanding borrowings on the revolving line of credit.  The other key terms and conditions of the Ninth Modification Agreement are substantially the same as those defined in the Restated Credit Agreement and subsequent modifications.  The Restated Credit Agreement was described in the Company's Form 8-K filed on March 17, 2011, which information is incorporated by reference herein.

In connection with the Ninth Modification Agreement, the Company and certain of its subsidiaries entered into a new Consent and Agreement of Guarantor.

The foregoing description of the Ninth Modification to the Restated Credit Agreement does not purport to be complete and is qualified in its entirety by reference to the text of the Ninth Modification Agreement to the Restated Credit Agreement and the Consent and Agreement of Guarantor, which are filed as Exhibits 10.1 and 10.2 attached hereto.


Item 2.03
Creation of a Direct Financial Obligation or an Obligation Under an Off-Balance Sheet Arrangement

On August 17, 2018, the Company and certain of its subsidiaries entered into the Ninth Modification Agreement and Consent and Agreement of Guarantor with its primary Lender as described above in Item 1.01.  The information in Item 1.01 is incorporated by reference herein.




Item 9.01
Financial Statements and Exhibits

(d)
Exhibits:

10.1
Ninth Modification Agreement by and among JPMorgan Chase Bank, N.A., Franklin Covey Co., and the subsidiary guarantors signatory thereto, dated August 17, 2018.

10.2
Consent and Agreement of Guarantor by and between JPMorgan Chase Bank, N.A., Franklin Covey Co., and the subsidiary guarantors signatory thereto, dated August 17, 2018.







 







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.

     
FRANKLIN COVEY CO.
         
         
Date:
August 20, 2018
 
By:
/s/ Stephen D. Young
       
Stephen D. Young
       
Chief Financial Officer