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<TITLE>FORM 8-K - CURRENT REPORT</TITLE>
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<DIV style=margin-left:72pt;width:468pt><HR style='border:0;height:0;width:0;margin:14pt 0 0 0'><A name=_Hlk25141024 /><P align=center style='font:12pt Times New Roman;margin:0'><A name=_Hlk25249112 /><B>UNITED STATES</B><BR><B>SECURITIES AND EXCHANGE COMMISSION</B></P>
<P align=center style='font:12pt Times New Roman;margin-top:0pt;margin-bottom:12pt'><B>Washington, D.C. 20549</B></P>
<P align=center style='font:14pt Times New Roman;margin-top:0pt;margin-bottom:12pt'><B>FORM 8-K</B></P>
<P align=center style='font:12pt Times New Roman;margin:0'><B>CURRENT REPORT</B></P>
<P align=center style='font:12pt Times New Roman;margin-top:0pt;margin-bottom:12pt'><B>Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934</B></P>
<P style='font:12pt Times New Roman;margin-top:0pt;margin-bottom:12pt;text-indent:36pt'>&nbsp;</P>
<TABLE style=border-collapse:collapse><TR><TD colspan=2 valign=top style=width:239.4pt><P style='font:12pt Times New Roman;margin:0'>Date of report (Date of earliest event reported)</P>
</TD><TD colspan=4 valign=top style='width:239.4pt;border-bottom:0.5pt solid #000000'><P style='font:12pt Times New Roman;margin:0'>August 19, 2020 (August 17, 2020)</P>
</TD></TR>
<TR><TD colspan=2 valign=top style=width:239.4pt><P style='font:12pt Times New Roman;margin:0'>&nbsp;</P>
</TD><TD colspan=4 valign=top style='width:239.4pt;border-top:0.5pt solid #000000'><P style='font:12pt Times New Roman;margin:0'>&nbsp;</P>
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<TR><TD colspan=6 valign=top style='width:478.8pt;border-bottom:0.5pt solid #000000'><P align=center style='font:14pt Times New Roman;margin:0'>1<SUP>st</SUP> Franklin Financial Corporation</P>
</TD></TR>
<TR><TD colspan=6 valign=top style='width:478.8pt;border-top:0.5pt solid #000000'><P align=center style='font:12pt Times New Roman;margin:0'>(Exact name of registrant as specified in its charter)</P>
</TD></TR>
<TR><TD colspan=2 valign=top style=width:239.4pt><P style='font:12pt Times New Roman;margin:0'>&nbsp;</P>
</TD><TD colspan=4 valign=top style=width:239.4pt><P style='font:12pt Times New Roman;margin:0'>&nbsp;</P>
</TD></TR>
<TR><TD valign=top style='width:159.6pt;border-bottom:0.5pt solid #000000'><P align=center style='font:12pt Times New Roman;margin:0'>Georgia</P>
</TD><TD colspan=3 valign=top style='width:159.6pt;border-bottom:0.5pt solid #000000'><P align=center style='font:12pt Times New Roman;margin:0'>2-27985</P>
</TD><TD colspan=2 valign=top style='width:159.6pt;border-bottom:0.5pt solid #000000'><P align=center style='font:12pt Times New Roman;margin:0'>58-0521233</P>
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<TR><TD valign=top style='width:159.6pt;border-top:0.5pt solid #000000'><P align=center style='font:12pt Times New Roman;margin:0'>(State or other jurisdiction <BR>of incorporation)</P>
</TD><TD colspan=3 valign=top style='width:159.6pt;border-top:0.5pt solid #000000'><P align=center style='font:12pt Times New Roman;margin:0'>(Commission File Number)</P>
</TD><TD colspan=2 valign=top style='width:159.6pt;border-top:0.5pt solid #000000'><P align=center style='font:12pt Times New Roman;margin:0'>(IRS employer <BR>Identification No.)</P>
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<TR><TD colspan=2 valign=top style=width:239.4pt><P style='font:12pt Times New Roman;margin:0'>&nbsp;</P>
</TD><TD colspan=4 valign=top style=width:239.4pt><P style='font:12pt Times New Roman;margin:0'>&nbsp;</P>
</TD></TR>
<TR><TD colspan=5 valign=top style='width:414.9pt;border-bottom:0.5pt solid #000000'><P align=center style='font:12pt Times New Roman;margin:0'>135 East Tugalo Street, P.O. Box 880, Toccoa, Georgia</P>
</TD><TD valign=top style='width:63.9pt;border-bottom:0.5pt solid #000000'><P align=center style='font:12pt Times New Roman;margin:0'>30577</P>
</TD></TR>
<TR><TD colspan=5 valign=top style='width:414.9pt;border-top:0.5pt solid #000000'><P align=center style='font:12pt Times New Roman;margin:0'>(Address of principal executive offices)</P>
</TD><TD valign=top style='width:63.9pt;border-top:0.5pt solid #000000'><P align=center style='font:12pt Times New Roman;margin:0'>(Zip Code)</P>
</TD></TR>
<TR><TD colspan=2 valign=top style=width:239.4pt><P style='font:12pt Times New Roman;margin:0'>&nbsp;</P>
</TD><TD colspan=4 valign=top style=width:239.4pt><P style='font:12pt Times New Roman;margin:0'>&nbsp;</P>
</TD></TR>
<TR><TD colspan=3 valign=top style=width:261.9pt><P style='font:12pt Times New Roman;margin:0'>Registrant's telephone number, including area code</P>
</TD><TD colspan=3 valign=top style='width:216.9pt;border-bottom:0.5pt solid #000000'><P style='font:12pt Times New Roman;margin:0'>(706) 886-7571</P>
</TD></TR>
<TR><TD colspan=2 valign=top style=width:239.4pt><P style='font:12pt Times New Roman;margin:0'>&nbsp;</P>
</TD><TD colspan=4 valign=top style=width:239.4pt><P style='font:12pt Times New Roman;margin:0'>&nbsp;</P>
</TD></TR>
<TR><TD colspan=6 valign=top style='width:478.8pt;border-bottom:0.5pt solid #000000'><P align=center style='font:12pt Times New Roman;margin:0'>n/a</P>
</TD></TR>
<TR><TD colspan=6 valign=top style='width:478.8pt;border-top:0.5pt solid #000000'><P align=center style='font:12pt Times New Roman;margin:0'>(Former name or former address, if changed since last report)</P>
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<P style='font:12pt Times New Roman;margin:0'>&nbsp;</P>
<P align=justify style='font:10pt Times New Roman;margin-top:0pt;margin-bottom:12pt'>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: `</P>
<P style='font:10pt Times New Roman;margin-top:0pt;margin-bottom:12pt'>[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) </P>
<P style='font:10pt Times New Roman;margin-top:0pt;margin-bottom:12pt'>[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) </P>
<P style='font:10pt Times New Roman;margin-top:0pt;margin-bottom:12pt'>[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) </P>
<P style='font:10pt Times New Roman;margin-top:0pt;margin-bottom:12pt'>[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) </P>
<P style='font:10pt Times New Roman;margin-top:0pt;margin-bottom:12pt'>Securities registered pursuant to Section 12(b) of the Act: &nbsp;None</P>
<P align=justify style='font:10pt Times New Roman;margin:0'>Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (&#167;230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (&#167;240.12b-2 of this chapter).</P>
<P align=justify style='font:10pt Times New Roman;margin:0'>Emerging growth company [ ]</P>
<P align=justify style='font:10pt Times New Roman;margin:0'>&nbsp;</P>
<P align=justify style='font:10pt Times New Roman;margin:0'>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. &nbsp;[ ]</P>
<HR style='border:0;height:0;width:0;margin:14pt 0 0 0'><HR style='page-break-after:always;border:0;height:3pt;background-color:#909090;margin:8pt 0'><P style=line-height:0;margin:0></P>
<HR style='border:0;height:0;width:0;margin:14pt 0 0 0'><P style='font:12pt Times New Roman;margin-top:0pt;margin-bottom:12pt'><B>Section 1 &#8211;&nbsp;Registrant&#8217;s Business and Operations</B></P>
<P style='font:12pt Times New Roman;margin-top:0pt;margin-bottom:12pt'><B>I</B><A name=_Hlk533687637 /><B>tem 1.01 &#8211;&nbsp;Entry into a Material Definitive Agreement</B>.</P>
<P align=justify style='font:12pt Times New Roman;margin-top:0pt;margin-bottom:12pt;text-indent:36pt'>On August 17, 2020, 1<SUP>st</SUP> Franklin Financial Corporation (the &#8220;Company&#8221;) entered into a First Amendment to the Amended and Restated Loan and Security Agreement dated as of November 19, 2019 (as so amended by the &#8220;First Amendment,&#8221; the &#8220;Amended Loan and Security Agreement&#8221;), by and among the Company, Wells Fargo Bank, N.A., as agent for the lenders (&#8220;the Agent&#8221;), and the other financial institutions from time to time party thereto. &nbsp;</P>
<P align=justify style='font:12pt Times New Roman;margin-top:0pt;margin-bottom:12pt;text-indent:36pt'>The First Amendment, among other things, increases the amount of borrowings available under the Company&#8217;s revolving credit facility to $230.0 million (the &#8220;Maximum Principal Amount&#8221;). &nbsp;Subject to the terms and conditions of the Amended and Security Agreement, the Company shall have the right at any time to increase the Maximum Principal Amount (the &#8220;Accordion Increase&#8221;) in an amount acceptable to the Agent in its sole and absolute discretion; provided however, that the aggregate amount of the Accordion Increase shall not exceed $70.0 million. &nbsp;Available but unborrowed amounts under the Amended Loan and Security Agreement are subject to a periodic unused line fee of .50%. &nbsp;Interest on any outstanding borrowings will bear interest at an annual rate at all times equal to the one-month LIBOR Rate plus the Applicable Margin. &nbsp;The Applicable Margin is based on the Funded Debt to Adjusted Net Worth Ratio as defined in the Amended Loan and Security Agreement. &nbsp;If the Funded Debt to Adjusted Net Worth Ratio is less than 2.75 to 1.0, the Applicable Margin will be 2.75%. &nbsp;The Applicable Margin will be 3.00% if the Funded Debt to Adjusted Net Worth Ration is greater than or equal to 2.75 to 1.0. &nbsp;The Company&#8217;s obligations under the Amended Loan and Security Agreement, which has a maturity date of February 28, 2022, are secured by the finance receivables of the Company. &nbsp;As of June 30, 2020, and giving effect to the First Amendment, the amount outstanding under the Amended Loan and Security Agreement was $97.2 million and available borrowings under the Amended Loan and Security Agreement were $102.8 million, at an interest rate of 3.50%.</P>
<P align=justify style='font:12pt Times New Roman;margin-top:0pt;margin-bottom:12pt;text-indent:36pt'>In connection with the First Amendment, the Company also entered into a Promissory Note with Renasant Bank (the &#8220;Renasant Note&#8221;), pursuant to which Renasant Bank agreed to make loans of up to $30.0 million under the Amended Loan and Security Agreement. &nbsp;The foregoing descriptions of the First Amendment to the Amended Loan and Security Agreement and the Promissory Note are qualified in their entirety by reference to the full text of the  First Amendment to the Amended Loan and Security Agreement and the Promissory Note, which are attached hereto as Exhibit 10.1 and Exhibit 10.2, and are incorporated herein by this reference.</P>
<P style='font:12pt Times New Roman;margin-top:0pt;margin-bottom:12pt'><B>Section 2 &#8211;&nbsp;Financial Information</B></P>
<P style='font:12pt Times New Roman;margin-top:0pt;margin-bottom:12pt'><B>Item 2.03 &#8211;&nbsp;Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.</B></P>
<P align=justify style='font:12pt Times New Roman;margin-top:0pt;margin-bottom:12pt'><KBD style=margin-left:36pt></KBD>The information set forth under Item 1.01 of this Current Report on Form 8-K with respect to the Renasant Note is incorporated by reference in this Item 2.03.&nbsp;</P>
<HR style='border:0;height:0;width:0;margin:14pt 0 0 0'><HR style='page-break-after:always;border:0;height:3pt;background-color:#909090;margin:8pt 0'><P style=line-height:0;margin:0></P>
<HR style='border:0;height:0;width:0;margin:14pt 0 0 0'><P style='font:12pt Times New Roman;margin-top:0pt;margin-bottom:12pt'><B>Item 9.01 &#8211;&nbsp;Financial Statements and Exhibits</B>.</P>
<TABLE style=border-collapse:collapse><TR><TD valign=top style=width:49.85pt;padding-left:7.2pt;padding-right:7.2pt><P style='font:12pt Times New Roman;margin:0'><A href=ff_ex10z1.htm style=text-decoration:none><FONT style='color:#0000FF;border-bottom:1px solid #0000FF'>10.1</FONT></A></P>
<P style='font:12pt Times New Roman;margin:0'>&nbsp;</P>
</TD><TD valign=top style=width:418.15pt;padding-left:7.2pt;padding-right:7.2pt><P style='font:12pt Times New Roman;margin:0'><A href=ff_ex10z1.htm style=text-decoration:none><FONT style='color:#0000FF;border-bottom:1px solid #0000FF'>First Amendment to the Amended and Restated Loan and Security Agreement, dated as of November 19, 2019, by and among the Company, Wells Fargo Bank, N.A., as agent for the lenders, and the other financial institutions from time to time party thereto.</FONT></A></P>
</TD></TR>
<TR><TD valign=top style=width:49.85pt;padding-left:7.2pt;padding-right:7.2pt><P style='font:12pt Times New Roman;margin:0'>&nbsp;</P>
</TD><TD valign=top style=width:418.15pt;padding-left:7.2pt;padding-right:7.2pt><P style='font:12pt Times New Roman;margin:0'>&nbsp;</P>
</TD></TR>
<TR><TD valign=top style=width:49.85pt;padding-left:7.2pt;padding-right:7.2pt><P style='font:12pt Times New Roman;margin:0'><A href=ff_ex10z2.htm style=text-decoration:none><FONT style='color:#0000FF;border-bottom:1px solid #0000FF'>10.2</FONT></A></P>
</TD><TD valign=top style=width:418.15pt;padding-left:7.2pt;padding-right:7.2pt><P style='font:12pt Times New Roman;margin:0'><A href=ff_ex10z2.htm style=text-decoration:none><FONT style='color:#0000FF;border-bottom:1px solid #0000FF'>Promissory Note by the Company to Renasant Bank, dated as of August 17, 2020.</FONT></A></P>
</TD></TR>
</TABLE>
<P align=center style='font:12pt Times New Roman;margin-top:0pt;margin-bottom:12pt'>&nbsp;</P>
<P align=center style='font:12pt Times New Roman;margin-top:0pt;margin-bottom:12pt'><B>SIGNATURES</B></P>
<P style='font:12pt Times New Roman;margin-top:0pt;margin-bottom:12pt;text-indent:36pt'>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.</P>
<P style='font:12pt Times New Roman;margin:0'>&nbsp;</P>
<P style='font:12pt Times New Roman;margin:0;margin-left:234pt'>1<SUP>ST</SUP> FRANKLIN FINANCIAL CORPORATION</P>
<P style='font:12pt Times New Roman;margin:0;margin-left:234pt'>&nbsp;</P>
<P style='font:12pt Times New Roman;margin:0;margin-left:234pt'>By: &nbsp;<FONT style='border-bottom:1px solid #000000'>/s/ A. Roger Guimond&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</FONT></P>
<P style='font:12pt Times New Roman;margin:0;margin-left:252pt'> Name: &nbsp;A. Roger Guimond</P>
<P style='font:12pt Times New Roman;margin:0;margin-left:252pt'> Title: &nbsp;&nbsp;&nbsp;Executive Vice President and<BR>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Chief Financial Officer</P>
<P style='font:12pt Times New Roman;margin:0'>&nbsp;</P>
<P style='font:12pt Times New Roman;margin:0'>Date: &nbsp;August 19, 2020<BR></P>
<HR style='border:0;height:0;width:0;margin:14pt 0 0 0'></DIV>
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FORM 8-K - CURRENT REPORT
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 19, 2020 (August 17, 2020)
1
st
Franklin Financial Corporation
(Exact name of registrant as specified in its charter)
Georgia
2-27985
58-0521233
(State or other jurisdiction
of incorporation)
(Commission File Number)
(IRS employer
Identification No.)
135 East Tugalo Street, P.O. Box 880, Toccoa, Georgia
30577
(Address of principal executive offices)
(Zip Code)
Registrant's telephone number, including area code
(706) 886-7571
n/a
(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: `
[ ] 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:  None
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.  [ ]
Section 1 – Registrant's Business and Operations
I
tem 1.01 – Entry into a Material Definitive Agreement
.
On August 17, 2020, 1
st
Franklin Financial Corporation (the "Company") entered into a First Amendment to the Amended and Restated Loan and Security Agreement dated as of November 19, 2019 (as so amended by the "First Amendment," the "Amended Loan and Security Agreement"), by and among the Company, Wells Fargo Bank, N.A., as agent for the lenders ("the Agent"), and the other financial institutions from time to time party thereto.
The First Amendment, among other things, increases the amount of borrowings available under the Company's revolving credit facility to $230.0 million (the "Maximum Principal Amount").  Subject to the terms and conditions of the Amended and Security Agreement, the Company shall have the right at any time to increase the Maximum Principal Amount (the "Accordion Increase") in an amount acceptable to the Agent in its sole and absolute discretion; provided however, that the aggregate amount of the Accordion Increase shall not exceed $70.0 million.  Available but unborrowed amounts under the Amended Loan and Security Agreement are subject to a periodic unused line fee of .50%.  Interest on any outstanding borrowings will bear interest at an annual rate at all times equal to the one-month LIBOR Rate plus the Applicable Margin.  The Applicable Margin is based on the Funded Debt to Adjusted Net Worth Ratio as defined in the Amended Loan and Security Agreement.  If the Funded Debt to Adjusted Net Worth Ratio is less than 2.75 to 1.0, the Applicable Margin will be 2.75%.  The Applicable Margin will be 3.00% if the Funded Debt to Adjusted Net Worth Ration is greater than or equal to 2.75 to 1.0.  The Company's obligations under the Amended Loan and Security Agreement, which has a maturity date of February 28, 2022, are secured by the finance receivables of the Company.  As of June 30, 2020, and giving effect to the First Amendment, the amount outstanding under the Amended Loan and Security Agreement was $97.2 million and available borrowings under the Amended Loan and Security Agreement were $102.8 million, at an interest rate of 3.50%.
In connection with the First Amendment, the Company also entered into a Promissory Note with Renasant Bank (the "Renasant Note"), pursuant to which Renasant Bank agreed to make loans of up to $30.0 million under the Amended Loan and Security Agreement.  The foregoing descriptions of the First Amendment to the Amended Loan and Security Agreement and the Promissory Note are qualified in their entirety by reference to the full text of the  First Amendment to the Amended Loan and Security Agreement and the Promissory Note, which are attached hereto as Exhibit 10.1 and Exhibit 10.2, and are incorporated herein by this reference.
Section 2 – Financial Information
Item 2.03 – Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The information set forth under Item 1.01 of this Current Report on Form 8-K with respect to the Renasant Note is incorporated by reference in this Item 2.03.
Item 9.01 – Financial Statements and Exhibits
.
10.1
First Amendment to the Amended and Restated Loan and Security Agreement, dated as of November 19, 2019, by and among the Company, Wells Fargo Bank, N.A., as agent for the lenders, and the other financial institutions from time to time party thereto.
10.2
Promissory Note by the Company to Renasant Bank, dated as of August 17, 2020.
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.
1
ST
FRANKLIN FINANCIAL CORPORATION
By:
/s/ A. Roger Guimond
Name:  A. Roger Guimond
Title:    Executive Vice President and
Chief Financial Officer
Date:  August 19, 2020