Item
2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
On
July 14, 2021, LDRV Holdings Corp., Lazydays RV America, LLC, Lazydays RV Discount, LLC and Lazydays Mile HI RV, LLC (collectively with
certain other subsidiary entities, the “Borrowers”) executed an amended and restated credit agreement with Manufacturers
and Traders Trust Company (“M&T”), as Administrative Agent, Swingline Lender, Issuing Bank and a Lender, and other financial
institutions as Lender parties thereto (the “Credit Agreement”). The Credit Agreement amends and restates the existing credit
agreement which includes an existing $175.0 million prior floor plan credit facility, a $20.0 million prior term loan, a $5.0 million
prior revolving credit facility, and an approximately $5.8 million prior mortgage loan facility.
The
Credit Agreement evidences an approximately $369 million aggregate credit facility (the “Credit Facility”), consisting of
a $327.0 million floor plan credit facility (the “Floor Plan Facility”) with LIBOR borrowings bearing interest at LIBOR plus
a range of 2.0% to 2.3% based on a total net leverage matrix and a base rate margin range of 1.0% to 1.3% based on a total net leverage
matrix, a term loan of approximately $11.3 million (the “Term Loan”) with LIBOR borrowings bearing interest at LIBOR plus
a range of 2.25% to 3.0% based on the total net leverage matrix and a base rate margin range of 1.25% to 2.0% based on a total net leverage
matrix, a $25.0 million revolving credit (the “Revolver”) with LIBOR borrowings bearing interest at the same rate index margin
range as the Term Loan, and a mortgage loan facility of approximately $5.8 million (the “Mortgage Facility”) with LIBOR borrowings
bearing interest at LIBOR plus 2.25% and a base rate margin of 1.25%. The
Borrowers are obligated to pay a commitment fee of 0.15% per annum on the average unused portion of the commitment under the Floor Plan
Facility, and a commitment fee range of 0.25% to 0.50% per annum (based on a total net leverage matrix) on the average unused portion
of the commitment under the Revolver.
As
of July 15, 2021, there was approximately $76.2 million in outstanding borrowings under the Credit Agreement consisting of: $59.1 million
under the Floor Plan Facility, $11.3 million under the Term Loan, $0 million under the Revolver, and $5.8 million under the Mortgage
Facility. Amounts to be borrowed under the Credit Agreement are subject to the satisfaction of customary conditions to borrowing. The
Floor Plan Facility, Mortgage Facility, Term Loan and Revolver components of the Credit Facility are scheduled to mature on July 14,
2024.
The
Credit Agreement contains certain customary representations and warranties, and certain customary covenants that restrict the Borrowers’
ability to, among other things: (i) create, incur, assume or permit indebtedness, (ii) create, incur, assume or permit liens, (iii) make
loans and investments, (iv) engage in fundamental changes, including mergers, acquisitions, dissolutions and liquidations, (v) make certain
restricted payments, (vi) engage in transactions with affiliates, (vii) allow the total net leverage ratio to exceed a ratio of 3.00
to 1.00 or allow the consolidated fixed charge coverage ratio to be less than a ratio of 1.25 to 1.00, and (viii) make or become legally
obligated to make any capital expenditures in any fiscal year, except for capital expenditures in the ordinary course of business not
exceeding an amount equal to 25% of consolidated EBITDA for such fiscal year.
Events
of default under the Credit Agreement include, but are not limited to: (i) failure to pay principal, interest or fees when due, (ii)
breach of any representation or warranty, (iii) failure or refusal to perform, observe or comply with certain covenants, (iv) insolvency,
(v) cross default under certain other material indebtedness, (vi) unsatisfied final judgments over a specified threshold in excess of
available insurance proceeds, (vii) the attempt to terminate or limit any portion of a guarantor’s obligations under a guaranty
agreement, and (viii) a change in control.
All
of the obligations under the Credit Agreement are required to be guaranteed by Lazydays Holdings, Inc., Lazy Days’ R.V. Center,
Inc., Lazydays Land Holdings, LLC, Lazydays Land of Elkhart, LLC, Lazydays Service of Elkhart, LLC, Lazydays Land of Chicagoland, LLC,
and all other domestic subsidiaries from time to time of Lazydays Holdings, Inc. (collectively, the “Guarantors”). The
Credit Facilities are secured by substantially all of the operating assets of the Borrowers and Guarantors as collateral.
This
description of the Credit Agreement is qualified in its entirety by reference to the complete terms and conditions of the Credit Agreement
which is expected to be filed as an exhibit to the Company’s Quarterly Report on Form 10-Q for its fiscal quarter ended September
30, 2021.