HOFV
Hall of Fame Resort & Entertainment CO
NASDAQ
8-K: Hall of Fame Resort & Entertainment Secures Additional $2 Million in Related-Party Financing, Announces Key Accounting Officer Departure
Sentiment:
Current Report
29 May 2025 8:05 PM
Hall of Fame Resort & Entertainment Company has amended its note and security agreement to increase its credit facility by $2 million from a related-party lender, while also announcing the upcoming resignation of its Vice President of Accounting.
Capital raise
The company increased its existing credit facility by $2,000,000, raising the total available amount to $12,000,000.
This capital is provided by CH Capital Lending, LLC, an affiliate of a company director, Stuart Lichter.
The funds are designated for general corporate purposes.
Summary
- Hall of Fame Resort & Entertainment Company (HOFV) and its subsidiaries (HOF Village Newco, LLC, HOF Village Retail I, LLC, and HOF Village Retail II, LLC) entered into a Seventh Amendment to their Note and Security Agreement with CH Capital Lending, LLC on May 27, 2025.
- The amendment increases the 'Facility Amount' from $10,000,000 to $12,000,000, providing the Borrowers with an additional $2,000,000 for general corporate purposes, subject to certain restrictions.
- CH Capital Lending, LLC is an affiliate of Stuart Lichter, a director of the Company, indicating a related-party transaction.
- John Van Buiten, the Company's Vice President of Accounting, Corporate Controller, and interim principal accounting officer, notified the Company of his intent to resign on May 22, 2025.
- Mr. Van Buiten's resignation will be effective the earlier of five business days following the closure of a contemplated merger with HOFV Holdings, LLC, or August 31, 2025.
- His resignation is explicitly stated not to be a result of any disagreement with the Company or its Board of Directors regarding operations, policies, or practices.
Sentiment
Score: 5
Explanation: The sentiment is neutral to slightly negative. While securing additional financing is positive for liquidity, the reliance on related-party debt and the departure of a key accounting officer introduce elements of concern. The stated reason for the resignation mitigates some negativity, but the overall picture is mixed, not strongly positive or negative.
Positives
- Secured an additional $2,000,000 in financing, increasing the total facility amount to $12,000,000, which can be used for general corporate purposes, enhancing liquidity.
- The resignation of John Van Buiten is stated not to be a result of any disagreement with the Company or its Board, suggesting a potentially smooth transition.
Negatives
- The additional financing is sourced from a related-party lender (CH Capital Lending, LLC, an affiliate of director Stuart Lichter), which may indicate challenges in securing non-related party financing or higher costs.
- The departure of a key financial officer (VP of Accounting, Corporate Controller, and interim principal accounting officer) could create a temporary leadership gap in the accounting department.
Risks
- Increased reliance on related-party financing, which could raise questions about the company's ability to secure independent funding and potentially impact perceptions of corporate governance.
- Potential disruption to financial reporting and accounting operations due to the departure of the Vice President of Accounting and interim principal accounting officer, John Van Buiten, until a replacement is fully integrated.
- The 'contemplated merger with HOFV Holdings, LLC' is mentioned, and its non-closure could impact the effective date of the accounting officer's resignation, introducing uncertainty.
Future Outlook
The document mentions a 'contemplated merger with HOFV Holdings, LLC' which could impact the effective date of the accounting officer's resignation, but provides no further details or guidance on future financial performance or strategic initiatives beyond securing additional general corporate purpose funds.
Management Comments
- "Mr. Van Buiten's resignation is not as a result of any disagreement with the Company or its Board of Directors, on any matter relating to the Company's operations, policies or practices."
Industry Context
The entertainment and resort development industry often requires significant capital investment. Companies in this sector frequently seek financing to fund ongoing operations, expansion projects, and strategic initiatives. The reliance on related-party debt, while providing immediate liquidity, can sometimes be viewed by the market as a sign of limited access to broader capital markets or a higher cost of capital compared to traditional lenders.
Comparison to Industry Standards
- NA
Stakeholder Impact
- Shareholders: The additional financing provides liquidity for general corporate purposes, potentially reducing immediate dilution risk, but the reliance on related-party debt might be viewed cautiously. The departure of a key financial officer could introduce uncertainty.
- Creditors: The increased facility amount from a related party lender indicates continued support from that specific lender.
- Employees: The departure of a senior accounting officer may lead to internal restructuring or new hires in the finance department.
Next Steps
- Closure of the contemplated merger with HOFV Holdings, LLC, which will determine the earlier effective date for John Van Buiten's resignation.
- Potential appointment of a new Vice President of Accounting, Corporate Controller, and principal accounting officer.
Legal Proceedings
- N
- A
Related Party Transactions
- Hall of Fame Resort & Entertainment Company and its subsidiaries entered into a Seventh Amendment to Note and Security Agreement with CH Capital Lending, LLC, which is an affiliate of Stuart Lichter, a director of the Company. This transaction increased the credit facility from $10,000,000 to $12,000,000.
Key Dates
- 2024-11-14: Original Note and Security Agreement date.
- 2025-05-22: Date John Van Buiten notified the Company of his intent to resign.
- 2025-05-27: Date of the Seventh Amendment to Note and Security Agreement.
- 2025-05-29: Date the 8-K report was signed.
- 2025-08-31: Latest effective date for John Van Buiten's resignation.
Keywords
Hall of Fame Resort & Entertainment Company, HOFV, SEC Filing, 8-K, Credit Facility, Debt Financing, Related Party Transaction, Corporate Governance, Executive Resignation, Financial Reporting, Nasdaq Capital Market, Entertainment Industry, Resort Development
HOFV
Hall of Fame Resort & Entertainment CO
NASDAQ
Sector: Communication Services
Filings with Classifications
Delay expected
25 June 2025 4:05 PM
Delisting Notice and Debt Amendment
- The company failed to hold its annual meeting of shareholders on or prior to June 30, 2025, which is a requirement by Nasdaq Listing Rule 5620(a).
Worse than expected
25 June 2025 4:05 PM
Delisting Notice and Debt Amendment
- The company is facing imminent delisting from Nasdaq, a significant negative event for a publicly traded company.
- The delisting is due to a failure to meet a fundamental corporate governance requirement (holding an annual shareholder meeting).
- While new funding was secured, it is from a related party, which can be viewed less favorably than arms-length financing, especially in the context of delisting.
Capital raise
25 June 2025 4:05 PM
Delisting Notice and Debt Amendment
- The company increased its 'Facility Amount' under the Note and Security Agreement by $2,000,000, from $12,000,000 to $14,000,000.
- This additional funding is provided by CH Capital Lending, LLC, an affiliate of a company director, Stuart Lichter.
Capital raise
29 May 2025 8:05 PM
Current Report
- The company increased its existing credit facility by $2,000,000, raising the total available amount to $12,000,000.
- This capital is provided by CH Capital Lending, LLC, an affiliate of a company director, Stuart Lichter.
- The funds are designated for general corporate purposes.
Delay expected
19 May 2025 4:05 PM
8-K Filing
- The maturity date was extended from March 31, 2025, to September 30, 2025, indicating a delay in the company's ability to meet its original repayment schedule.
Worse than expected
13 May 2025 4:06 PM
Quarterly Report
- The company's net loss increased slightly compared to the same period last year.
- Total revenue decreased significantly due to lower sponsorship and event revenues.
- Management expresses substantial doubt about the company's ability to continue as a going concern.
Capital raise
13 May 2025 4:06 PM
Quarterly Report
- The company states that it will need to raise additional financing to accomplish its development plan and fund its working capital.
- The company is seeking to obtain additional funding through debt, construction lending, and equity financing.
- There are no assurances that the company will be able to raise capital on terms acceptable to the company or at all.
Capital raise
12 May 2025 11:32 PM
Merger Announcement
- The Buyer Parties' obligation to consummate the Merger is conditioned on receiving 'Parent Acquisition Financing' in an aggregate amount of not less than $20 million.
- The Buyer Parties' obligation to consummate the Merger is additionally conditioned on receiving 'additional project level financing' in an aggregate amount not less than $125 million.
Capital raise
8 May 2025 9:23 PM
Merger Announcement
- The merger is contingent on the Investor obtaining $20 million in financing.
- The merger is also conditioned on securing $125 million in additional project-level financing.
Worse than expected
8 May 2025 9:23 PM
Merger Announcement
- The acquisition price of $0.90 per share is significantly lower than the company's previous trading price, indicating a less favorable outcome for shareholders compared to previous expectations.
Worse than expected
8 May 2025 5:21 PM
Merger Announcement
- The company is being acquired for $0.90 per share, which may be considered worse than expected for investors who anticipated higher returns or continued growth as a public entity.
Capital raise
8 May 2025 5:21 PM
Merger Announcement
- The transaction is contingent on the Investor obtaining $20 million in financing.
- The transaction is also conditioned on prior or concurrent consummation of additional project level financing in an aggregate amount not less than $125 million.
Worse than expected
16 April 2025 4:05 PM
8-K Filing
- The company received a deficiency letter from Nasdaq due to its stock price falling below the minimum bid price requirement, indicating a negative development.
Delay expected
4 April 2025 8:05 PM
Current Report (8-K)
- The maturity dates of debt instruments and convertible notes have been delayed.
Delay expected
3 April 2025 11:43 AM
SEC Form 4
- The maturity dates of several convertible debt instruments were extended from March 31, 2025, to either September 30, 2025, or December 31, 2025.
Delay expected
26 March 2025 5:00 PM
Annual Report
- The Company postponed its 2024 Annual Meeting of Stockholders.
Capital raise
26 March 2025 5:00 PM
Annual Report
- The company's cash position is deficient, and it requires additional capital to fund operations and debt service.
- The company is seeking to obtain additional funding through debt, construction lending, and equity financing.
Worse than expected
26 March 2025 5:00 PM
Annual Report
- The company's revenue decreased from 2023 to 2024.
- The company's net loss decreased from 2023 to 2024.
- The company's cash position is deficient and it requires additional capital to fund operations and debt service.
Delay expected
16 January 2025 5:13 PM
8-K Filing
- The company failed to hold its annual meeting within 12 months of its fiscal year end, resulting in a delay and a delisting notice from Nasdaq.
Worse than expected
16 January 2025 5:13 PM
8-K Filing
- The company received a delisting notice from Nasdaq for failing to hold its annual meeting within the required timeframe, which is a negative development.
Worse than expected
20 November 2024 4:05 PM
Current Report
- The high interest rate of 12%, potentially rising to 17%, suggests the company is in a weaker financial position and had to accept unfavorable terms.
- The extensive security interest granted to the lender indicates a lack of financial flexibility and a higher risk profile.
Capital raise
13 November 2024 5:18 PM
Quarterly Report
- The company is seeking additional funding through debt, construction lending, and equity financing.
- The company's ability to raise capital on acceptable terms or at all is uncertain.
Delay expected
13 November 2024 5:18 PM
Quarterly Report
- The company's waterpark project has been delayed due to the termination of the ground lease.
Worse than expected
13 November 2024 5:18 PM
Quarterly Report
- The company's net loss of $34.5 million for the nine months ended September 30, 2024, is worse than expected.
- The company's default on the waterpark ground lease and the risk of default on other loan agreements are worse than expected.
- The company's precarious cash position and the substantial doubt about its ability to continue as a going concern are worse than expected.
Capital raise
31 October 2024 4:05 PM
Current Report
- The company is in discussions with IRG Canton Village Member, LLC regarding a non-binding proposal to take the company private, which could involve a capital raise or restructuring.
- The company's current financial situation suggests that a capital raise or restructuring is likely necessary to address its liquidity issues.
Worse than expected
31 October 2024 4:05 PM
Current Report
- The termination of the waterpark ground lease due to a payment default is a significantly worse outcome than expected.
- The company's inability to meet its financial obligations and the potential loss of key assets are also worse than expected.
Delay expected
23 October 2024 4:05 PM
Current Report
- The 2024 Annual Meeting of Stockholders has been postponed from its original date of November 21, 2024.
Better than expected
17 September 2024 4:05 PM
Material Definitive Agreement
- The removal of the annual license fee and the waiver of the $600,000 payment for 2024 are better than the previous agreement.
Delay expected
19 August 2024 5:04 PM
Shareholder Letter
- The funding process for the Gameday Bay Waterpark and Hilton Tapestry Hotel has taken longer than originally anticipated due to a restrictive lending environment and multiple stakeholders.
Worse than expected
19 August 2024 5:04 PM
Shareholder Letter
- Second quarter revenue was below the prior year, indicating worse than expected performance.
Worse than expected
15 August 2024 4:05 PM
Quarterly Report
- The company's revenue decreased by 23% year-over-year, indicating worse than expected performance.
- The net loss attributable to shareholders increased to $15.8 million from $13.6 million in the prior year, indicating worse than expected performance.
Capital raise
13 August 2024 4:05 PM
Quarterly Report
- The company expects that it will need to raise additional financing to accomplish its development plan and fund its working capital.
- The company is seeking to obtain additional funding through debt, construction lending, and equity financing.
- The company may have to raise additional capital through the equity market, which could result in substantial dilution to existing stockholders.
Worse than expected
13 August 2024 4:05 PM
Quarterly Report
- The company's revenue decreased compared to the same period last year.
- The company's net loss increased compared to the same period last year.
- The company's hotel revenues decreased compared to the same period last year.
Delay expected
14 May 2024 4:06 PM
Quarterly Report
- The company has delayed payment of base rent for the waterpark ground lease, which could lead to a default.
Capital raise
14 May 2024 4:06 PM
Quarterly Report
- The company expects that it will need to raise additional financing to accomplish its development plan and fund its working capital.
- The company is seeking to obtain additional funding through debt, construction lending, and equity financing.
- There are no assurances that the company will be able to raise capital on terms acceptable to the Company or at all.
Worse than expected
14 May 2024 4:06 PM
Quarterly Report
- The company's net loss of $14.6 million and the substantial doubt about its ability to continue as a going concern indicate worse than expected results.
Better than expected
14 May 2024 8:39 AM
Quarterly Report
- The company's revenue increased by 34% year-over-year.
- The net loss attributable to shareholders decreased from $19.6 million to $14.9 million.
- The adjusted EBITDA loss improved from $10.9 million to $2.9 million.
Capital raise
29 April 2024 5:11 PM
Annual Report Amendment
- The company has multiple loan agreements with CH Capital Lending, LLC, and other related parties, some of which have been amended and restated.
- The company has issued Series A, B, and C Preferred Stock to related parties.
- The company has a history of using convertible notes and warrants to raise capital.
Worse than expected
29 April 2024 5:11 PM
Annual Report Amendment
- The company had to amend its annual report due to omitting required information, indicating a deficiency in internal controls or reporting processes.
Capital raise
29 April 2024 4:57 PM
SEC Form 4 Filing
- The document details multiple transactions involving convertible notes and term loans, indicating ongoing capital raising activities.
- CH Capital Lending, LLC advanced additional funds under the 2020 Convertible Term Loan in January and February 2024.
- The company has been paying interest by increasing the principal of the Convertible Notes due 2025.
Capital raise
8 April 2024 5:25 PM
8-K Filing
- The company has the ability to sell up to $14,661,873 of common stock through the at-the-market offering.
- The company amended its equity distribution agreement to increase agent compensation, which may incentivize sales.
Capital raise
25 March 2024 4:37 PM
Annual Results
- The company's authorized but unissued Common Stock and Preferred Stock are available for future issuances without stockholder approval.
- The company could utilize these shares for future offerings to raise additional capital.
Worse than expected
21 March 2024 8:20 AM
Quarterly Report
- The company's net loss for the full year increased significantly compared to the previous year, indicating worse than expected financial performance.
Capital raise
21 March 2024 8:20 AM
Quarterly Report
- The company completed a $2.8 million public offering of common stock and warrants to increase institutional ownership and improve stock trading volumes.
Worse than expected
29 February 2024 5:24 PM
Lease Amendment
- The company has increased its debt and diluted its equity through the warrant issuance.
- The company has increased its base rent obligations.
- The company has pledged a 20% membership interest in Sandlot HOFV Canton SC, LLC, as collateral.
Capital raise
29 February 2024 5:24 PM
Lease Amendment
- The company issued a Series H Common Stock Purchase Warrant to the landlord.
- The warrant allows the landlord to purchase 890,313 shares of the company's common stock.
- The exercise of the warrant could result in a capital raise for the company, but also dilute existing shareholders.
Worse than expected
18 January 2024 5:12 PM
Loan Agreement Amendment
- The company's debt has increased significantly to $12,751,934.09, indicating a worsening financial position despite the asset sale.
Disclaimer: This summary was generated by artificial intelligence and its accuracy is not guaranteed. The information provided here is for general informational purposes only and does not constitute financial advice, recommendation, or endorsement of any kind. It may contain errors or omissions. You should not rely on this information to make financial decisions. Always seek the advice of a qualified financial professional before making any investment or financial decisions. Use of this information is at your own risk.