Exhibit (a)(1)(A)

Offer To Purchase For Cash

by

Winmark Corporation

of

Up to 400,000 Shares of its Common Stock

At a Purchase Price of $124.48 Per Share

The tender offer, proration period and withdrawal rights will expire at
12:00 Midnight, Eastern Daylight Time, on August 16, 2017
unless the tender offer is extended.

Winmark Corporation, a Minnesota corporation (“Winmark,” the “Company,” “we” or “us”), is offering to purchase up to 400,000 shares of its common stock, no par value per share, at a price of $124.48 per share, net to the seller in cash, without interest, upon the terms and subject to the conditions set forth in this Offer to Purchase and the related Letter of Transmittal, which together, as they may be amended and supplemented from time to time, constitute the tender offer. Unless the context otherwise requires, all references to shares shall refer to the shares of common stock, no par value per share, of Winmark.

Only shares properly tendered and not properly withdrawn pursuant to the tender offer will be purchased, upon the terms and subject to the conditions of the tender offer. However, because of the proration provisions described in this Offer to Purchase, all of the shares tendered may not be purchased if more than the number of shares we seek are properly tendered. Shares tendered but not purchased pursuant to the tender offer will be returned at our expense promptly after the expiration date. See Section 1.

The tender offer is not conditioned on any minimum number of shares being tendered, but is subject to other conditions discussed in this Offer to Purchase .

Our shares are listed and traded on the NASDAQ Global Market under the symbol “WINA.” On July 18, 2017, the last trading day prior to the commencement of the tender offer, the last sale price of our shares reported on the NASDAQ Global Market was $131.80 per share. You are urged to obtain current market quotations for the shares before deciding whether to tender your shares. See Section 7.

Our board of directors has approved the tender offer. However, neither Winmark, our board of directors, the Depositary nor the Information Agent makes any recommendation to you as to whether to tender or refrain from tendering any shares. You should carefully evaluate all information in the Offer to Purchase and the related Letter of Transmittal, should consult with your own financial and tax advisors, and should make your own decisions about whether to tender shares, and, if so, how many shares to tender.

John L. Morgan, our Executive Chairman of the Board, has indicated his non-binding intention to tender 870,654 shares in the tender offer. All of our other directors and officers have indicated that they do not intend to tender shares in the tender offer. If Mr. Morgan tenders the 870,654 shares as he has indicated and because of the debt financing being used in order to finance the tender offer, our capital and ownership structure following completion of the tender offer will be materially different from our capital and ownership structure prior to the tender offer. See Section 2.  For a pro

forma illustration of the effect of the tender offer and of borrowing to finance the tender offer on our earnings per share and other financial results, see Section 9.

The tender offer has not been approved or disapproved by the Securities and Exchange Commission (the “Commission”) nor has the Commission passed upon the fairness or merits of the tender offer nor upon the accuracy or adequacy of the information contained in this document. Any representation to the contrary is unlawful.

Questions and requests for assistance may be directed to D.F. King & Co., Inc., the Information Agent for the tender offer, at its address and telephone number set forth on the back cover page of this Offer to Purchase. Requests for additional copies of this Offer to Purchase, the Letter of Transmittal or the Notice of Guaranteed Delivery, or any document incorporated herein by reference, may be directed to the Information Agent.

This document contains important information about the tender offer. We urge you to read it in its entirety.

Offer to Purchase dated July 19, 2017

IMPORTANT PROCEDURES

If you wish to tender all or any part of your shares, you must do one of the following before the tender offer expires:

·                                           if your shares are registered in the name of a broker, dealer, commercial bank, trust company or other nominee, contact the nominee and instruct the nominee to tender your shares for you, or

·                                           if you hold certificates in your own name, properly complete and sign a Letter of Transmittal according to its instructions, and deliver it, together with any required signature guarantees, the certificates for your shares and any other documents required by the Letter of Transmittal, to Wells Fargo Bank, N.A., the Depositary for the tender offer, at the address appearing on the back cover of this document, or

·                                           if you are an institution participating in The Depositary Trust Company, tender your shares according to the procedure for book-entry transfer described in Section 3, or

·                                           if you are a holder of stock options to purchase shares under the Company’s stock option plans, you may exercise your stock options and tender any of the shares issued upon exercise in accordance with the Company’s policies and procedures for the applicable equity plan.

If your shares are registered in the name of a broker, dealer, commercial bank, trust company or other nominee, you should contact that person if you desire to tender your shares. If you desire to tender shares pursuant to the tender offer and the certificates for your shares are not immediately available or you cannot deliver certificates for your shares and all other required documents to the Depositary before the expiration of the tender offer, or your shares cannot be delivered before the expiration of the tender offer under the procedure for book-entry transfer, you must tender your shares according to the guaranteed delivery procedure described in Section 3.

The tender offer does not constitute an offer to buy or the solicitation of an offer to sell securities in any jurisdiction in which such offer or solicitation would not be in compliance with the laws of the jurisdiction, provided that we will comply with the requirements of Rule 13e-4(f)(8) of the Securities Exchange Act of 1934, as amended.

You should only rely on the information contained in this Offer to Purchase and the Letter of Transmittal. We have not authorized any person to make any recommendation on our behalf as to whether you should tender or refrain from tendering your shares in the tender offer. We have not authorized any person to give any information or to make any representation in connection with the tender offer other than those contained in this Offer to Purchase or in the Letter of Transmittal. If given or made, any recommendation or any such information or representation must not be relied upon as having been authorized by us, the Information Agent or the Depositary.

i

SUMMARY TERM SHEET

We are providing this summary term sheet for your convenience. It highlights the most material information in this Offer to Purchase, but you should understand that it does not describe all of the details of the tender offer to the same extent described in this Offer to Purchase. We urge you to read the entire Offer to Purchase and the related Letter of Transmittal because they contain the full details of the tender offer. We have included references to the sections of this Offer to Purchase where you will find a more complete discussion.

1

2

3

4

5

FORWARD-LOOKING STATEMENTS

We make forward-looking statements in this Offer to Purchase and may make such statements in future filings with the Commission. We may also make forward-looking statements in our press releases or other public or shareholder communications. Our forward-looking statements are subject to risks and uncertainties and include information about our expectations and possible or assumed future results of operations. When we use any of the words “may,” “will,” “should,” “believe,” “expect,” “anticipate,” “assume,” “forecast,” “estimate,” “intend,” “plan,” “target” or similar expressions, we are making forward-looking statements.

These forward-looking statements represent our outlook only as of the date of this Offer to Purchase. While we believe that our forward-looking statements are reasonable, actual results could differ materially since the statements are based on our current expectations, which are subject to risks and uncertainties. Factors that might cause such a difference include, but are not limited to, the Risk Factors set forth in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2016, other risk factors discussed herein or listed from time to time in our reports filed with the Commission and the following:

·                                           We are dependent on franchise renewals.

·                                           We may make additional investments outside of our core businesses.

·                                           We may sell franchises for a territory, but the franchisee may not open.

·                                           Our retail franchisees are dependent on supply of used merchandise.

·                                           We may be unable to collect accounts receivable from franchisees.

·                                           We operate in extremely competitive industries.

·                                           We are subject to credit risk in our lease portfolio and our allowance for credit losses may be inadequate to absorb losses.

·                                           Deterioration in economic or business conditions may negatively impact our leasing business.

·                                           We are subject to restrictions and counterparty risk in our credit facilities, including the amended revolving line of credit facility and the amended note agreement, and our additional leverage may adversely affect our capital resources, financial condition and liquidity.

·                                           We are subject to government regulation.

·                                           We may be unable to protect against data security risks.

6

INTRODUCTION

To the Shareholders of Winmark Corporation:

We invite our shareholders to tender shares of our common stock, no par value. Upon the terms and subject to the conditions of this Offer to Purchase and the related Letter of Transmittal, we are offering to purchase up to 400,000 shares of our common stock at a price of $124.48 per share, net to the seller in cash.

This Offer to Purchase and the related Letter of Transmittal as amended and supplemented from time to time, together constitute the tender offer. Unless the context otherwise requires, all references to shares shall refer to the shares of common stock, no par value per share, of Winmark Corporation.

Only shares properly tendered and not properly withdrawn pursuant to the tender offer will be purchased, upon the terms and subject to the conditions of the tender offer. However, because of the proration provisions described in this Offer to Purchase, all of the shares tendered may not be purchased if more than 400,000 shares are properly tendered and not properly withdrawn. Shares tendered but not purchased pursuant to the tender offer will be returned at our expense promptly after the expiration date. See Section 1.

The tender offer will expire at 12:00 Midnight, Eastern Daylight Time, on August 16, 2017, unless the tender offer is extended.

The tender offer is not conditioned on any minimum number of shares being tendered, but is subject to other conditions discussed in this Offer to Purchase. See Sections 6 and 8.

Winmark’s board of directors has approved the tender offer. However, neither Winmark, Winmark’s board of directors, the Depositary nor the Information Agent makes any recommendation to any shareholder as to whether to tender or refrain from tendering any shares. We have not authorized any person to make any recommendation. Shareholders should carefully evaluate all information in this Offer to Purchase and the related Letter of Transmittal, should consult their own financial and tax advisors, and should make their own decisions about whether to tender shares, and, if so, how many shares to tender.

John L. Morgan, our Executive Chairman of the Board, has indicated his non-binding intention to tender 870,654 shares in the tender offer. All of our other directors and officers have indicated that they do not intend to tender shares in the tender offer. See Sections 1 and 10.

The purchase price will be paid net to the tendering shareholder in cash, without interest, for all the shares purchased. Tendering shareholders who hold shares registered in their own name and who tender their shares directly to the Depositary will not be obligated to pay brokerage commissions, solicitation fees or, subject to Instruction 13 of the Letter of Transmittal, stock transfer taxes on the purchase of shares in the tender offer. Shareholders holding shares through brokers or banks are urged to consult the brokers or banks to determine whether transaction costs may apply if shareholders tender shares through the brokers or banks and not directly to the Depositary. Also, any tendering shareholder or other payee who fails to complete, sign and return to the Depositary the Substitute Form W-9 that is included as part of the Letter of Transmittal or the applicable Form W-8 obtained from the Depositary may be subject to required United States federal income tax backup withholding equal to 28% of the gross proceeds payable to the tendering shareholder or other payee pursuant to the tender offer. See Section 3.

As of July 14, 2017, we had 4,215,528 issued and outstanding shares, excluding 251,252 shares of common stock currently available for future awards under our stock option plans and 652,234 shares reserved for issuance upon exercise of outstanding stock awards granted under our stock option plans. The 400,000 shares that we are offering to purchase represent approximately 9.5% of the shares outstanding on July 14, 2017. On July 18, 2017, the last trading day before the date of announcement of the tender offer, the last reported sale price of our common stock on the NASDAQ Global Market was $131.80 per share. The purchase price in the tender offer is a 5.6% discount to the last reported sales price on July 18, 2017. Shareholders are urged to obtain current market quotations for their shares before deciding whether to tender shares pursuant to the tender offer. See Section 7.

7

THE TENDER OFFER

Section 1.                                           Number of Shares; Proration

General . Upon the terms and subject to the conditions of the tender offer, we will purchase 400,000 shares, or such fewer number of shares as are properly tendered and not properly withdrawn in accordance with Section 4, before the scheduled expiration date of the tender offer, at a price of $124.48 per share, net to the seller in cash, without interest.

The term “expiration date” means 12:00 Midnight, Eastern Daylight Time, on August 16, 2017, unless and until we, in our sole discretion, extend the period of time during which the tender offer will remain open, in which event the term “expiration date” shall refer to the latest time and date at which the tender offer, as so extended by us, expires. See Section 13 for a description of our right to extend, delay, terminate or amend the tender offer. In the event of an over-subscription of the tender offer as described below, shares tendered will be subject to proration. Except as described herein, withdrawal rights expire on the expiration date.

If (1)(a) we increase or decrease the price to be paid for shares, (b) we increase the number of shares being sought in the tender offer, or (c) we decrease the number of shares being sought, and (2) the tender offer is scheduled to expire at any time earlier than the expiration of a period ending on the tenth business day from, and including, the date that notice of any increase or decrease is first published, sent or given in the manner specified in Section 13, the tender offer will be extended until the expiration of ten business days from the date that notice of any increase or decrease is first published. For the purposes of the tender offer, a “business day” means any day other than a Saturday, Sunday or U.S. federal holiday and consists of the time period from 12:01 a.m. through 12:00 Midnight, Eastern Daylight Time.

The tender offer is not conditioned on any minimum number of shares being tendered, but is subject to other conditions discussed in this Offer to Purchase. See Sections 6 and 8.

Only shares properly tendered and not properly withdrawn will be purchased, upon the terms and subject to the conditions of the tender offer. However, because of the proration provisions described in this Offer to Purchase, all of the shares tendered may not be purchased if more than 400,000 shares are properly tendered and not properly withdrawn.  All shares tendered and not purchased pursuant to the tender offer, including shares not purchased because of proration, will be returned at our expense promptly after the expiration date.

If the number of shares properly tendered and not properly withdrawn prior to the expiration date is fewer than or equal to 400,000 shares, we will, upon the terms and subject to the conditions of the tender offer, purchase all such shares.

Proration . If proration of tendered shares is required, we will determine the proration factor as soon as practicable following the expiration date. Subject to adjustment to avoid the purchase of fractional shares, proration for each shareholder tendering shares shall be based on the ratio of the number of shares properly tendered and not properly withdrawn by the shareholder to the total number of shares properly tendered and not properly withdrawn by all shareholders.

If Mr. Morgan tenders 870,654 shares as he has indicated, the proration factor in the tender offer would be substantially impacted. As a result, only a limited number of shares properly tendered by other shareholders would be purchased. See Section 10.

Shareholders also can specify the order in which the specified portions will be purchased in the event that, as a result of the proration provisions or otherwise, some but not all of the tendered shares are purchased pursuant to the tender offer. In the event a shareholder does not designate the order and fewer than all shares are purchased due to proration, the order of shares purchased will be selected by the Depositary.

8

Because of the difficulty in determining the number of shares properly tendered (including shares tendered by the guaranteed delivery procedure as described in Section 3) and not properly withdrawn, we do not expect that we will be able to announce the final proration factor or commence payment for any shares purchased pursuant to the tender offer until at least five business days after the expiration date and as promptly thereafter as practicable. The preliminary results of any proration will be announced by press release promptly after the expiration date. Shareholders may obtain preliminary proration information from the Information Agent and may be able to obtain this information from their brokers.

As described in Section 12, the number of shares that we will purchase from a shareholder pursuant to the tender offer may affect the U.S. federal income tax consequences to that shareholder and, therefore, may be relevant to that shareholder’s decision whether or not to tender shares. The Letter of Transmittal affords each shareholder who tenders shares registered in such shareholder’s name directly to the Depositary the opportunity to designate the order of priority in which shares tendered are to be purchased in the event of proration.

This Offer to Purchase and the Letter of Transmittal will be mailed to record holders of shares and will be furnished to brokers, dealers, commercial banks, trust companies and other nominee shareholders and similar persons whose names, or the names of whose nominees, appear on Winmark’s shareholder list or, if applicable, that are listed as participants in a clearing agency’s security position listing for subsequent transmittal to beneficial owners of shares.

Section 2.                                           Purpose of the Tender Offer; Certain Effects of the Tender Offer; Plans and Proposals

Purpose of the Tender Offer . In determining to authorize the tender offer, our board of directors considered a broad range of factors, including current market conditions for a transaction of this nature, our financial condition, operations, capital needs, strategy and expectations for the future and the potential attractiveness of the tender offer to our shareholders.  The board also considered the outcome of the Company’s tender offer for 875,000 shares of common stock in May 2015, and the Company’s partial repayment of debt incurred in that transaction.  The board of directors also considered risks and uncertainties, including the potential for negative developments relating to our business and the securities markets in general.  Our board of directors  has determined that the tender offer is a prudent use of our financial resources given our business profile, operating cash flow and the current market price for our shares and that the tender offer presents an appropriate balance between meeting the needs of our business and delivering value to our shareholders. The board of directors determined that the tender offer price discount to the last reported sales price was appropriate in light of the Company’s trading volume and past repurchases by the Company.

We believe that the tender offer represents a mechanism to provide all shareholders with the opportunity to tender all or a portion of their shares and, thereby, receive a return of their investment if they so elect. This format of repurchase also provides a method for shareholders not participating to increase their relative percentage interest in Winmark and our future performance. The tender offer provides shareholders (particularly those who, because of the size of their shareholdings, might not be able to sell their shares without potential disruption to the share price) with an opportunity to obtain liquidity with respect to all or a portion of their shares, without potential disruption to the share price and the usual transaction costs associated with market sales. In addition, if we complete the tender offer, shareholders who do not participate in the tender offer will automatically increase their relative percentage ownership interest in us and our future performance. The tender offer also provides our shareholders with an efficient way to sell their shares without incurring broker’s fees or commissions associated with open market sales.

On July 18, 2017, our board of directors authorized us to enter into this tender offer, approved spending approximately $50 million to repurchase shares tendered, and set the pricing of the tender offer. Prior to the authorization of this tender offer, Winmark had authorization to repurchase an additional 142,988 shares of common stock under its previously announced share repurchase program, which will remain available for repurchases of common stock under the share repurchase program after the consummation of the tender offer. In addition, depending on market conditions and the availability of capital, our board of directors may authorize additional repurchases in the future, including repurchases pursuant to additional tender offers.

After the tender offer is completed, we believe that our anticipated cash flow from operations and availability and access to credit will be adequate for our needs. For a pro forma illustration of the effect of the tender offer and of borrowing to finance the tender offer on our earnings per share and other financial results, see Section 9.

Depending on the number of shares purchased in the tender offer, the result and prospects of our business, prevailing economic and market conditions and the market price of the shares, we may continue our previously authorized repurchase program subsequent to the termination of the tender offer. However, Rule 13e-4 under the Exchange Act

9

prohibits Winmark and its affiliates from purchasing any shares, other than in the tender offer, until at least ten business days after the expiration date.

Winmark’s board of directors has approved the tender offer. However, neither Winmark, Winmark’s board of directors, the Depositary nor the Information Agent makes any recommendation to any shareholder as to whether to tender or refrain from tendering any shares. We have not authorized any person to make any recommendation. Shareholders should carefully evaluate all information in this Offer to Purchase and the related Letter of Transmittal, should consult their own financial and tax advisors, and should make their own decisions about whether to tender shares, and, if so, how many shares to tender.

John L. Morgan, our Executive Chairman of the Board, has indicated his non-binding intention to tender 870,654 shares in the tender offer. All of our other directors and officers have indicated that they do not intend to tender shares in the tender offer. See Sections 1 and 10.

Certain Effects of the Tender Offer . Upon the completion of the tender offer, non-tendering shareholders will realize a proportionate increase in their relative ownership interest in Winmark and thus in our future earnings and assets, subject to our right to issue additional shares of common stock and other equity securities in the future, but will bear the attendant risks associated with owning our common stock, including risks associated with our higher leverage resulting from the consummation of the tender offer and borrowing under an amended revolving line of credit facility and a new term loan to fund a portion of the tender offer. For a pro forma illustration of the effect of the tender offer and of borrowing to finance the tender offer on our earnings per share and other financial results, see Section 9. Shareholders may be able to sell non-tendered shares in the future in market transactions or otherwise, at a net price higher or lower than the purchase price in the tender offer. We can give no assurance, however, as to the price at which a shareholder may be able to sell his or her shares in the future, which price may be higher or lower than the purchase price paid in the tender offer.

Shares that we acquire pursuant to the tender offer will be cancelled and will have the status of authorized but unissued shares.

The purchase of shares in the tender offer will reduce the number of shares that might otherwise trade publicly and is likely to reduce the number of our shareholders. As of July 14, 2017, there were 4,215,528 shares issued and outstanding. Assuming we acquire 400,000 shares in the tender offer, approximately 3,815,528 shares will be outstanding immediately after the tender offer. This may reduce the volume of trading in the shares and make it more difficult to buy or sell a significant number of shares without materially affecting the market price.

The shares are registered under the Exchange Act, which requires, among other things, that we furnish information to our shareholders and to the Commission and comply with the Commission’s proxy rules in connection with meetings of shareholders. We believe that the purchase of shares pursuant to the tender offer will not result in the shares becoming eligible for deregistration under the Exchange Act or delisting from the NASDAQ Global Market.

The shares are currently “margin securities” under the rules of the Federal Reserve Board. This has the effect, among other things, of allowing brokers to extend credit to their customers using the shares as collateral. We believe that, following the purchase of the shares pursuant to the tender offer, the shares will continue to be “margin securities” for purposes of the Federal Reserve Board’s margin rules and regulations as long as our shares continue to be listed on the NASDAQ Global Market.

Plans and Proposals . Except as disclosed elsewhere in this Offer to Purchase, or as may occur in the ordinary course of its business, Winmark currently has no plans, proposals or negotiations that relate to or would result in:

·                                           an extraordinary transaction, such as a merger, reorganization or liquidation, involving Winmark or any of its subsidiaries;

·                                           any purchase, sale or transfer of a material amount of Winmark’s assets or any of its subsidiaries’ assets;

·                                           any material change in Winmark’s present dividend rate or policy, indebtedness or capitalization;

·                                           any change in Winmark’s present board of directors or management, including, but not limited to, any plans or proposals to change the number or the term of directors, or to fill any existing vacancies on the board or to change any material term of the employment contract of any executive officer;

·                                           any other material change in Winmark’s corporate structure or business;

10

·                                           a class of Winmark’s equity security being delisted from a national securities exchange or ceasing to be authorized to be quoted in an automated quotations system of a registered national securities association;

·                                           a class of Winmark’s equity securities becoming eligible for termination of registration pursuant to Section 12(g)(4) of the Exchange Act;

·                                           the suspension of Winmark’s obligation to file reports pursuant to Section 15(d) of the Exchange Act;

·                                           the acquisition by any person of additional securities of Winmark, or the disposition by any person of securities of Winmark; or

·                                           any changes in Winmark’s articles of incorporation, bylaws or other governing instruments or other actions that could impede the acquisition of control of Winmark.

Winmark reserves the right to change its plans and intentions at any time, as it deems appropriate.

Section 3.                                           Procedures for Tendering Shares

Proper Tender of Shares . For shares to be tendered properly pursuant to the tender offer:

·                                           the share certificates (or confirmation of receipt of such shares under the procedure for book-entry transfer set forth below), together with a properly completed and duly executed Letter of Transmittal, or a manually signed facsimile thereof, including any required signature guarantees, or an “agent’s message” (as defined below) in the case of a book-entry transfer, and any other documents required by the Letter of Transmittal, must be received prior to the expiration date by the Depositary at one of its addresses set forth on the back cover page of this Offer to Purchase, or

·                                           the tendering shareholder must comply with the guaranteed delivery procedure set forth below.

Brokers, dealers, commercial banks, trust companies or other nominee holders of shares likely will have an earlier deadline for shareholders to act to instruct them to accept the tender offer on a their behalf. Shareholders who hold shares through nominee holders are urged to immediately contact the nominee holder of their shares to determine the applicable deadline.

Shareholders who hold shares through a broker, dealer, commercial bank, trust company or other nominee, must contact their broker, dealer, commercial bank, trust company or other nominee in order to tender their shares. Shareholders who hold their shares through nominee holders are urged to consult the nominee holders of their shares to determine whether transaction costs are applicable if they tender shares through the brokers or banks and not directly to the Depositary.

Signature Guarantees and Method of Delivery . No signature guarantee is required:

·                                           if the Letter of Transmittal is signed by the registered holder of the shares (which term, for purposes of this Section 3, shall include any participant in The Depositary Trust Company, referred to as the “book-entry transfer facility,” whose name appears on a security position listing as the owner of the shares) tendered therewith and such holder has not completed the box entitled “Special Payment Instructions” in the Letter of Transmittal, or

·                                           if shares are tendered for the account of a bank, broker, dealer, credit union, savings association or other entity which is a member in good standing of the Securities Transfer Agents Medallion Program or a bank, broker, dealer, credit union, savings association or other entity which is an “eligible guarantor institution,” as such term is defined in Rule 17Ad-15 under the Exchange Act (each of the foregoing is referred to as an “Eligible Institution”).

11

See Instruction 1 of the Letter of Transmittal.

In all other cases, all signatures on any Letter of Transmittal for shares tendered thereby must be guaranteed by an Eligible Institution. If a certificate for shares tendered is registered in the name of a person other than the person executing the Letter of Transmittal, or if payment is to be made to, or certificates for shares not tendered or not accepted for payment are to be registered in the name of, a person other than the registered holder of the certificates surrendered, then the tendered certificates must be endorsed or accompanied by appropriate stock powers, in either case signed exactly as the name or names of the registered holders or owners appear on the certificates, with the signature guaranteed by an Eligible Institution.

In all cases, payment for shares tendered and accepted for payment pursuant to the tender offer will be made only after the expiration of the tender offer and after timely receipt by the Depositary of share certificates or a timely confirmation of the book-entry transfer of the shares into the Depositary’s account at the book-entry transfer facility as described above, a properly completed and duly executed Letter of Transmittal or a manually signed facsimile thereof including any required signature guarantees, or an agent’s message in the case of a book-entry transfer, and any other documents required by the Letter of Transmittal.

The method of delivery of all documents, including share certificates, the Letter of Transmittal and any other required documents, is at the election and risk of the tendering shareholder. If delivery is by mail, registered mail with return requested, properly insured, is recommended. In all cases, sufficient time should be allowed to ensure timely delivery.

Book-Entry Delivery . The Depositary will establish an account with respect to the shares for purposes of the tender offer at the book-entry transfer facility within two business days after the date of this Offer to Purchase, and any financial institution that is a participant in the book-entry transfer facility’s system may make book-entry delivery of the shares by causing the book-entry transfer facility to transfer shares into the Depositary’s account in accordance with the book-entry transfer facility’s procedure for transfer. Although delivery of shares may be effected through a book-entry transfer into the Depositary’s account at the book-entry transfer facility, either

·                                           a properly completed and duly executed Letter of Transmittal, or a manually signed facsimile thereof, including any required signature guarantees, or an agent’s message, and any other required documents must, in any case, be transmitted to and received by the Depositary at one of its addresses set forth on the back cover page of this Offer to Purchase before the expiration date, or

·                                           the guaranteed delivery procedure described below must be followed. Delivery of the Letter of Transmittal and any other required documents to the book-entry transfer facility does not constitute delivery to the Depositary.

The term “agent’s message” means a message transmitted by the book-entry transfer facility to, and received by, the Depositary, which states that the book-entry transfer facility has received an express acknowledgment from the participant in the book-entry transfer facility tendering the shares that the participant has received and agrees to be bound by the terms of the Letter of Transmittal and that Winmark may enforce such agreement against such participant.

Federal Backup Withholding Tax . Under the United States federal backup withholding tax rules, 28% of the gross proceeds payable to a shareholder or other payee pursuant to the tender offer must be withheld and remitted to the United States Treasury, unless the shareholder or other payee provides such person’s taxpayer identification number (employer identification number or social security number) to the Depositary and certifies under penalties of perjury that such number is correct or otherwise establishes an exemption. If the Depositary is not provided with the correct taxpayer identification number or another adequate basis for exemption, the holder may be subject to certain penalties imposed by the Internal Revenue Service. Therefore, each tendering shareholder should complete and sign the Substitute Form W-9 included as part of the Letter of Transmittal in order to provide the information and certification necessary to avoid backup withholding, unless such shareholder otherwise establishes to the satisfaction of the Depositary that the shareholder is not subject to backup withholding. Specified shareholders (including, among others, all corporations and certain foreign shareholders (in addition to foreign corporations)) are exempted from the backup withholding and reporting requirements rules. In order for a foreign shareholder to qualify as an exempt recipient, that shareholder must submit the applicable IRS Form W-8, signed under penalties of perjury, attesting to that shareholder’s exempt status. The applicable form can be obtained from the Information Agent. See Instructions 7 and 8 of the Letter of Transmittal.

12

To prevent federal backup withholding tax equal to 28% of the gross payments made to shareholders for shares purchased pursuant to the tender offer, each shareholder who does not otherwise establish an exemption from such withholding must provide the Depositary with the shareholder’s correct taxpayer identification number and provide other information by completing the substitute Form W-9 included with the Letter of Transmittal. For a discussion of United States federal income tax consequences to tendering shareholders, see Section 12.

Federal Income Tax Withholding on Foreign Shareholders . Even if a foreign shareholder has provided the required certification as described in the preceding paragraph to avoid backup withholding, the Depositary will withhold United States federal income taxes at a rate of 30% of the gross payment payable to a foreign shareholder or his or her agent unless the Depositary determines that an exemption from, or a reduced rate of, withholding tax is available under a tax treaty or that an exemption from withholding is applicable because such gross proceeds are effectively connected with the conduct of a trade or business of the foreign shareholder within the United States or that such proceeds are subject to capital gains treatment. For this purpose, a foreign shareholder is any shareholder that is not a “United States holder” (as defined in Section 12). In order to obtain a reduced rate of withholding under a tax treaty, a foreign shareholder must deliver to the Depositary before the payment the applicable completed and executed IRS Form W-8. In order to obtain an exemption from withholding on the grounds that the gross proceeds paid pursuant to the tender offer are effectively connected with the conduct of a trade or business within the United States, a foreign shareholder must deliver to the Depositary before the payment a properly completed and executed IRS Form W-8ECI or any other equivalent form. A foreign shareholder may be eligible to obtain a refund of all or a portion of any tax withheld if such shareholder satisfies one of the “Section 302 tests” for capital gain treatment described in Section 12 or is otherwise able to establish that no withholding or a reduced amount of withholding is due. Federal backup withholding generally will not apply to amounts subject to the 30% or a treaty-reduced rate of federal income tax withholding.

Foreign shareholders are urged to consult their tax advisors regarding the application of U.S. federal income tax withholding, including eligibility for a reduction of or an exemption from withholding tax, and the refund procedure. See Instructions 9 and 10 of the Letter of Transmittal.

Guaranteed Delivery . If a shareholder desires to tender shares pursuant to the tender offer and the certificates for the shareholder’s shares are not immediately available or the shareholder cannot deliver certificates for its shares and all other required documents to the Depositary before the expiration date, or the shareholder’s shares cannot be delivered before the expiration date under the procedure for book-entry transfer, the shares may nevertheless be tendered, provided that all of the following conditions are satisfied:

·                                           the tender is made by or through an Eligible Institution;

·                                           the Depositary receives by mail, overnight courier or facsimile transmission, before the expiration date, a properly completed and duly executed Notice of Guaranteed Delivery in the form Winmark has provided with this Offer to Purchase, including (where required) a signature guarantee by an eligible guarantor institution in the form set forth in such Notice of Guaranteed Delivery; and

·                                           the share certificates, in proper form for transfer, or confirmation of book-entry transfer of the shares into the Depositary’s account at the book-entry transfer facility, together with a properly completed and duly executed Letter of Transmittal, or a manually signed facsimile thereof, and including any required signature guarantees, or an agent’s message, in the case of a book-entry transfer, and any other documents required by the Letter of Transmittal, are received by the Depositary within three business days after the date of receipt by the Depositary of the Notice of Guaranteed Delivery.

Stock Options . Options to purchase shares cannot be tendered in the tender offer. Holders of vested but unexercised options may exercise such options in accordance with the terms of the related share-based compensation plans and Winmark’s policies and practices, and tender the shares received upon such exercise in accordance with the tender offer. Exercises of options cannot be revoked even if some or all of the shares received upon the exercise thereof and tendered in the tender offer are not purchased pursuant to the tender offer for any reason. Holders of vested but unexpired options should evaluate this Offer to Purchase carefully to determine if participation would be advantageous to them based on their stock option exercise prices and the expiration date of their options, the tender price and the provisions for pro rata purchases by Winmark. We strongly encourage option holders to discuss the tender offer with their own financial or tax advisor.

13

Please be advised that it is the option holder’s responsibility to tender shares in the tender offer to the extent such holder wants to participate and it may be difficult to secure delivery of shares issued pursuant to vested stock options in a time period sufficient to allow tender of those shares prior to the expiration date. Accordingly, we suggest that, in the event that you wish to exercise your vested options, options for such shares be exercised in accordance with the terms of the related stock option plan and option agreement and Winmark policies and practices at least four business days prior to the expiration date.

Return of Unpurchased Shares . If any tendered shares are not purchased pursuant to the tender offer or are properly withdrawn before the expiration date, or if fewer than all shares evidenced by share certificates are tendered, these shares will be returned promptly after the expiration or termination of the tender offer or the proper withdrawal of the shares, as applicable, in each case without expense to the shareholder.  In the case of shares originally tendered by book-entry transfer at the book-entry transfer facility or in the case of shares originally tendered by a certificate not bearing restrictive legends, the shares will be returned by credit to the appropriate account maintained by the tendering shareholder at the book-entry transfer facility. In the case of shares originally tendered by a certificate bearing restrictive legend, the shares will be returned by a certificate bearing the same restrictive legend as the certificate originally tendered.

Determination of Validity; Rejection of Shares; Waiver of Defects; No Obligation to Give Notice of Defects . All questions as to the number of shares to be accepted, the price to be paid for shares to be accepted and the validity, form, eligibility (including time of receipt) and acceptance for payment of any tender of shares will be determined by us, in our sole discretion, and our determination will be final and binding on all parties, subject to a court of law having jurisdiction regarding such matters. We reserve the absolute right to reject any or all tenders of any shares that we determine are not in proper form or the acceptance for payment of or payment for which we determine may be unlawful. We also reserve the absolute right to waive any of the conditions of the tender offer prior to the expiration of the tender offer or any defect or irregularity in any tender with respect to any particular shares or any particular shareholder, whether or not we waive similar defects or irregularities in the case of any other shareholder, and our interpretation of the terms of the tender offer will be final and binding on all parties, subject to a court of law having jurisdiction regarding such matters. In the event a condition to the tender offer is waived with respect to any particular shareholder prior to the expiration of the tender offer, the same condition will be waived with respect to all shareholders. No tender of shares will be deemed to have been properly made until all defects or irregularities have been cured by the tendering shareholder or waived by us. None of Winmark, the Depositary, the Information Agent or any other person will be obligated to give notice of any defects or irregularities in any tender, nor will any of them incur any liability for failure to give this notice.

Tendering Shareholder’s Representation and Warranty; Winmark’s Acceptance Constitutes an Agreement . A tender of shares under any of the procedures described above will constitute the tendering shareholder’s acceptance of the terms and conditions of the tender offer, as well as the tendering shareholder’s representation and warranty to Winmark that (1) the shareholder has a net long position in the shares or equivalent securities at least equal to the shares tendered within the meaning of Rule 14e-4 promulgated by the Commission under the Exchange Act, and (2) the tender of shares complies with Rule 14e-4. It is a violation of Rule 14e-4 for a person, directly or indirectly, to tender shares for that person’s own account unless, at the time of tender and at the end of the period during which shares are accepted by lot (including any extensions thereof), the person so tendering (1) has a net long position equal to or greater than the amount tendered in (a) the subject securities, or (b) securities immediately convertible into, or exchangeable or exercisable for, the subject securities, and (2) will deliver or cause to be delivered the shares in accordance with the terms of the tender offer. Rule 14e-4 provides a similar restriction applicable to the tender or guarantee of a tender on behalf of another person. Our acceptance for payment of shares tendered pursuant to the tender offer will constitute a binding agreement between the tendering shareholder and Winmark upon the terms and conditions of the tender offer.

Lost or Destroyed Certificates . Shareholders whose share certificate for part or all of their shares has been lost, stolen, destroyed or mutilated may contact the Depositary at (800) 468-9716 for instructions as to obtaining the necessary documents. Those documents will then be required to be submitted together with the Letter of Transmittal in order to receive payment for shares that are tendered and accepted for payment. A bond will be required to be posted by the shareholder to secure against the risk that the share certificates may be subsequently recirculated. Shareholders are urged to contact the Depositary immediately in order to permit timely processing of this documentation.

14

Share certificates, together with a properly completed and duly executed Letter of Transmittal, or a manually signed facsimile thereof, including any signature guarantees, and any other required documents must be delivered to the Depositary and not to Winmark or the Information Agent. Any such documents delivered to Winmark or the Information Agent will not be forwarded to the Depositary and, therefore, will not be deemed to be properly tendered.

Section 4.                                           Withdrawal Rights

Except as otherwise provided in this Section 4, tenders of shares pursuant to the tender offer are irrevocable. Shares tendered pursuant to the tender offer may be withdrawn at any time prior to the expiration date and, unless previously accepted for payment by us pursuant to the tender offer, also may be withdrawn at any time after September 18, 2017. Shareholders who tendered their shares by giving instructions to a bank, broker, dealer, trust company or other nominee must instruct that person to arrange for the withdrawal of their shares.

For a withdrawal to be effective, a written or facsimile notice of withdrawal must be timely received by the Depositary at one of its addresses set forth on the back cover page of this Offer to Purchase. Any such notice of withdrawal must specify the name of the tendering shareholder, the number of shares to be withdrawn and the name of the registered holder of the shares. If the share certificates to be withdrawn have been delivered or otherwise identified to the Depositary, then, before the release of the share certificates, the tendering shareholder also must submit the serial numbers shown on the share certificates for those shares to be withdrawn to the Depositary and the signature(s) on the notice of withdrawal must be guaranteed by an Eligible Institution, unless the shares have been tendered for the account of an Eligible Institution. If shares have been tendered under the procedure for book-entry transfer set forth in Section 3, any notice of withdrawal also must specify the name and the number of the account at the book-entry transfer facility to be credited with the withdrawn shares and must otherwise comply with the book-entry transfer facility’s procedure.

All questions as to the form and validity (including the time of receipt) of any notice of withdrawal will be determined by us, in our sole discretion, and our determination will be final and binding, subject to a court of law having jurisdiction regarding such matters. We reserve the absolute right to waive any defect or irregularity in the notice of withdrawal or method of withdrawal of shares by any shareholder, whether or not we waive similar defects or irregularities in the case of any other shareholder. None of Winmark, the Depositary, the Information Agent or any other person will be obligated to give notice of any defects or irregularities in any notice of withdrawal, nor will any of them incur any liability for failure to give any such notice.

Withdrawals may not be rescinded and any shares properly withdrawn thereafter will be deemed not properly tendered for purposes of the tender offer, unless the withdrawn shares are properly re-tendered before the expiration date by following one of the procedures described in Section 3.

If we extend the tender offer, are delayed in our purchase of shares or are unable to purchase shares pursuant to the tender offer for any reason, then, without prejudice to our rights under the tender offer, the Depositary may, subject to applicable law, retain tendered shares on our behalf, and these shares may not be withdrawn except to the extent tendering shareholders are entitled to withdrawal rights as described in this Section 4. The right to retain shares is subject to our legal obligation to pay for shares properly tendered and not properly withdrawn promptly following the expiration date (subject to the terms and conditions of the tender offer) or to return the tendered securities promptly after the termination of the tender offer.

Section 5.                                           Purchase of Shares and Payment of Purchase Price

Upon the terms and subject to the conditions of the tender offer, promptly following the expiration date, we will accept for payment and pay for, and thereby purchase, shares properly tendered and not properly withdrawn prior to the expiration date. For purposes of the tender offer, we will be deemed to have accepted for payment, and therefore purchased shares, that are properly tendered and not properly withdrawn, only when, as and if we give oral or written notice to the Depositary of its acceptance of the shares for payment pursuant to the tender offer.

Upon the terms and subject to the conditions of the tender offer, promptly after the expiration date, we will accept for payment and pay the per share purchase price of $124.48 for 400,000 shares, subject to increase or decrease as provided in Section 13, if properly tendered and not properly withdrawn, or such fewer number of shares as are properly tendered and not properly withdrawn. In all cases, payment for shares tendered and accepted for payment pursuant to the tender offer will be made promptly, but only after timely receipt by the Depositary of:

15

·                                           certificates for shares or a timely book-entry confirmation of shares into the Depositary’s account at the book-entry transfer facility;

·                                           a properly completed and duly executed Letter of Transmittal, or manually signed facsimile of the Letter of Transmittal, including any required signature guarantees, or an agent’s message, in the case of a book-entry transfer; and

·                                           any other required documents.

We will pay for shares purchased pursuant to the tender offer by depositing the aggregate purchase price for these shares with the Depositary, which will act as agent for tendering shareholders for the purpose of receiving payment from us and transmitting payment to the tendering shareholders.

In the event of proration, we will determine the proration factor and pay for those tendered shares accepted for payment promptly after the expiration date; however, we do not expect to be able to announce the final results of any proration and commence payment for shares purchased until at least five business days after the expiration date and as promptly thereafter as practicable. Certificates for all shares tendered and not purchased, including shares not purchased due to proration, will not be returned.  Certificated shares tendered and not purchased and shares tendered by book-entry transfer and not purchased, including shares not purchased due to proration, will be credited to the account maintained with the book-entry transfer facility by the participant therein who so delivered the shares, at our expense promptly after the expiration date or termination of the tender offer.

Under no circumstances will we pay interest on the purchase price regardless of any delay in making the payment. In addition, if certain events occur, we may not be obligated to purchase shares pursuant to the tender offer. See Section 6.

We will pay all stock transfer taxes, if any, payable on the transfer to us of shares purchased pursuant to the tender offer. If, however, payment of the purchase price is to be made to, or (in the circumstances permitted by the tender offer) if unpurchased shares are to be registered in the name of, any person other than the registered holder, or if tendered certificates are registered in the name of any person other than the person signing the Letter of Transmittal, the amount of all stock transfer taxes, if any (whether imposed on the registered holder or the other person), payable on account of the transfer to the person will be deducted from the purchase price unless satisfactory evidence of the payment of the stock transfer taxes, or exemption therefrom, is submitted. See Instruction 13 of the Letter of Transmittal.

Section 6.                                           Conditions of the Tender Offer

Notwithstanding any other provision of the tender offer, we will not be required to accept for payment, purchase or pay for any shares tendered, and may terminate or amend the tender offer or may postpone the acceptance for payment of, or the purchase of or the payment for shares tendered, subject to Rule 13e-4(f) under the Exchange Act if any of the following events or circumstance shall have occurred (or shall have been determined by us in our reasonable judgment to have occurred):

·                                           there shall have been proposed, instituted or pending, or Winmark shall have received notice of, any legal action or proceeding by any government or governmental, regulatory or administrative agency, authority or tribunal or any other person, domestic or foreign, before any court, authority, agency, tribunal or arbitrator or arbitral panel that directly or indirectly (a) challenges or seeks to challenge the making of the tender offer or the acquisition of some or all of the shares pursuant to the tender offer, (b) delays or restricts or seeks to delay or restrict Winmark’s ability to, or renders or seeks to render Winmark unable to, accept for payment some or all of the shares pursuant to the tender offer or (c) otherwise relates in any manner to the tender offer or seeks to obtain material damages in respect of the tender offer;

·                                           there shall have been any action threatened, pending or taken, or approval withheld, or any statute, rule, regulation, judgment, order or injunction threatened, proposed, sought, promulgated, enacted, entered, amended, enforced or deemed to be applicable to the tender offer or Winmark or any of its subsidiaries, by any court or any authority, agency, tribunal or arbitrator or arbitral panel that, in Winmark’s reasonable judgment, would or might, directly or indirectly, (a) make the acceptance for payment of, or payment for, some or all of the shares illegal or otherwise restrict or prohibit completion of the tender offer, or (b) delay or restrict the ability of Winmark, or render Winmark unable, to accept for payment or pay for some or all of the shares under the tender offer;

16

·                                           there shall have occurred (a) any general suspension of trading in, or limitation on prices for, securities on any national securities exchange or in the over-the-counter market in the United States, (b) the declaration of a banking moratorium or any suspension of payments in respect of banks in the United States, whether or not mandatory, (c) the commencement or escalation of a war, armed hostilities or other international or national calamity directly or indirectly involving the United States or any of its territories, including, but not limited to, an act of terrorism, (d) any limitation (whether or not mandatory) by any governmental, regulatory or administrative agency or authority on, or any event, or any adverse change in the financial or capital markets generally, that, in Winmark’s reasonable judgment, might affect, the extension of credit by banks or other lending institutions in the United States, (e) any change in the general political, market, economic or financial conditions in the United States or abroad that could, in the reasonable judgment of Winmark, have a material adverse effect on the business, properties, assets, liabilities, capitalization, shareholders’ equity, financial condition, operations, results of operations or business or financial prospects of Winmark or any of its subsidiaries, taken as a whole, (f) any decline of 10% or more in the market price for the shares, the Dow Jones Industrial Average, New York Stock Exchange Index, Nasdaq Composite Index or the Standard and Poor’s 500 Composite Index from the close of business on July 18, 2017, or (g) in the case of any of the foregoing existing at the time of the commencement of the tender offer, a material acceleration or worsening thereof;

·                                           a tender or exchange offer for any or all of the shares (other than this tender offer), or any merger, acquisition, business combination or other similar transaction with or involving Winmark or any of its subsidiaries, has been proposed, announced or made by any person or has been publicly disclosed or Winmark or any of its subsidiaries has entered into a definitive agreement or an agreement in principle with any person with respect to a merger, acquisition, business combination or other similar transaction;

·                                           Winmark learns that (a) any entity, “group” (as that term is used in Section 13(d)(3) of the Exchange Act) or person has acquired or proposes to acquire beneficial ownership of more than 5% of the outstanding shares, whether through the acquisition of stock, the formation of a group, the grant of any option or right, or otherwise (other than as and to the extent disclosed in a Schedule 13D or Schedule 13G filed with the Commission on or before July 18, 2017), (b) any entity, group or person who has filed a Schedule 13D or Schedule 13G with the Commission on or before July 18, 2017 has acquired or proposes to acquire, whether through the acquisition of stock, the formation of a group, the grant of any option or right, or otherwise (other than by virtue of the tender offer made hereby), beneficial ownership of an additional 2% or more of the outstanding shares, or (c) any new group has been formed that beneficially owns more than 5% of Winmark’s outstanding shares (options for and other rights to acquire shares that are acquired or proposed to be acquired being deemed to be immediately exercisable or convertible for purposes of this clause);

·                                           any person, entity or group has filed a Notification and Report Form under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, reflecting an intent to acquire Winmark or any of its subsidiaries or any of the respective assets or securities of Winmark and its subsidiaries;

·                                           any change, condition, event or development (or any condition, event or development involving a prospective change) shall have occurred (or Winmark learns of any such condition, event or development), in the business, properties, assets, liabilities, capitalization, shareholders’ equity, financial condition, operations, licenses, franchises, permits, permit applications, results of operations or business or financial prospects of Winmark or any of its subsidiaries that, in Winmark’s reasonable judgment, has, or could reasonably be expected to have, a material adverse effect on Winmark and its subsidiaries, taken as a whole, on the value of or trading in the shares, on Winmark’s ability to consummate the tender offer or on the benefits of the tender offer to Winmark;

·                                           there shall be any reasonable likelihood, as determined by Winmark in its reasonable judgment, that the consummation of the tender offer and the purchase of shares could result in the tender offer being considered a “going private transaction” under Rule 13e-3 of the Exchange Act; or

·                                           we shall have determined that the consummation of the tender offer and the purchase of the shares may cause the shares to be delisted from the NASDAQ Global Market.

17

The foregoing conditions are for the sole benefit of Winmark, and we may assert them, and, with the exception of the last two conditions described above, waive them, in whole or in part, at any time and from time to time in its sole discretion prior to the expiration of the tender offer. Our failure at any time to exercise any of the foregoing rights shall not be deemed a waiver of any of these rights, and each of these rights shall be deemed an ongoing right that may be asserted at any time and from time to time prior to the expiration of the tender offer. In certain circumstances, if we waive any of the conditions described above, we may be required to extend the expiration date. Our determinations or judgments concerning the events described above will be final and binding on all parties, subject to a court of law having jurisdiction regarding such matters.

Section 7.                                           Price Range of Shares; Dividends

Winmark’s shares are traded on the NASDAQ Global Market under the trading symbol “WINA.” The following table sets forth the high and low sales prices per share reported on the NASDAQ Global Market for each of the fiscal periods indicated.

On July 18, 2017, the last trading day before the date of announcement of the tender offer, the last reported sale price of the shares on the NASDAQ Global Market was $131.80 per share. As shown in the table, during fiscal year 2017 and 2016, the common stock has traded at prices higher than $124.48 per share. As a result, it is possible that you may receive less for your shares if you tender them than you would receive in a market sale of your shares. Shareholders are urged to obtain current market quotations for their shares before deciding whether to tender shares pursuant to the tender offer.

We declared and paid cash dividends per common share of $0.10 and $0.11 during the first and second quarters respectively, of our fiscal year ending December 30, 2017, and have not declared or paid any cash dividends in the third quarter through July 19, 2017, the date of this tender offer.  We have also declared and paid cash dividends in  the following amounts in each of the quarterly periods indicated:

18

Any future declaration of dividends will be subject to the discretion of our board of directors and subject to our results of operations, financial condition, cash requirements, compliance with loan covenants and other factors deemed relevant by our board of directors.

Our amended revolving line of credit agreement with The PrivateBank and Trust Company and BMO Harris Bank N.A. and amended note agreement with Prudential contain covenants that may limit the repurchase of common stock or payment of dividends on common stock. See Section 8.

Section 8.                                           Source and Amount of Funds

Assuming we purchase 400,000 shares in the tender offer, approximately $49.8 million will be required to purchase such shares.

We have funds available to purchase all shares properly tendered in the tender offer by borrowing approximately $37.3 million under an amended revolving line of credit facility with The PrivateBank and Trust Company and BMO Harris Bank N.A. (the “Revolver Lenders”) that is described below and by borrowing $12.5 million under a new term loan from Prudential Investment Management, Inc. and one or more of its affiliates and managed accounts (“Prudential”) that is described below. We intend to pay fees and expenses relating to the tender offer and the debt financing from our available cash. The tender offer is not subject to a financing condition.

On July 18, 2017, Winmark and its subsidiaries (collectively, the loan parties) entered into an Amendment No. 5 to our credit agreement with the Revolver Lenders and The PrivateBank and Trust Company as the Administrative Agent for the Revolver Lenders. We intend to draw $37.3 million from the credit facility to partially fund the purchase of shares in the tender offer. Our amended line of credit facility is summarized as follows:

·                                           We may borrow up to $50 million in senior secured revolving loans, subject to a defined borrowing base formula, with the loans designated as LIBOR Loans or Base Rate Loans;

·                                           On each anniversary of the effective date of Amendment No. 5, beginning with the second anniversary, the aggregate commitment of the credit facility will be reduced by $5 million and if our outstanding borrowings exceed the adjusted aggregate commitment, we must repay such excess;

·                                           The obligations of the amended revolving line of credit facility are secured by all assets of Winmark and each of its subsidiaries;

·                                           The interest rate on LIBOR Loans is based upon the Leverage Ratio, with a Leverage Ratio of 2.00 or greater resulting in a rate equal to the LIBOR rate plus 2.25% and a Leverage Ratio of less than 2.00 resulting in a rate equal to the LIBOR rate plus 2.00%;

·                                           The interest rate on Base Rate Loans is equal to the greater of the Federal Funds Rate plus 0.5% and the Prime Rate;

·                                           For revolving loans that are Base Rate Loans, interest is payable monthly and at maturity.  For revolving loans that are LIBOR Loans with an interest period of less than 3 months, interest is payable on the last day of the interest period, upon prepayment and at maturity. For revolving loans that are LIBOR Loans with an interest period more than 3 months, interest is payable every three months, upon prepayment and at maturity;

·                                           There is a 0.25% non-utilization fee on the daily average unused portion of the revolving loan commitment;

·                                           The facility will terminate upon the earlier to occur of the four-year anniversary of the effective date of Amendment No. 5 or such other date on which the revolving loan commitment terminates following an Event of Default (as defined in the amended credit agreement);

19

·                                           We may from time to time prepay the revolving loans in whole or in part, subject to notice and minimum prepayment requirements, and we are required to prepay the revolving loans if the outstanding loan amounts exceed the borrowing base by an amount equal to such excess or if we receive net cash proceeds from an “Asset Disposition” by an amount equal to such net cash proceeds;

·                                           We are subject to affirmative covenants that provide, among other customary covenants, that we provide to the Administrative Agent certain reports, certificates and other information, that we maintain our properties and corporate existence, and that we comply with laws; and

·                                           We are subject to negative covenants that provide, among other customary covenants, that we may not incur certain debt, permit certain liens, make distribution to holders of our stock except regular dividends (defined to be dividends paid in any fiscal year not to exceed $4 million in the aggregate) or purchase or redeem any of our stock.  These negative covenants have exceptions to permit the term loan and related agreements with Prudential, as described below.

The negative covenants also prohibit us from having less than a minimum Tangible Net Worth (which calculation excludes the effect of the tender offer), less than a minimum Fixed Charge Coverage Ratio, or more than a maximum Leverage Ratio, with each of these capitalized terms defined in the Credit Agreement as amended.

Amendment No. 5 is effective as of July 19, 2017. Through Amendment No. 5, the Revolver Lenders consented to the tender offer.

On July 19, 2017, we entered into Amendment No. 1 to the Note Agreement with Prudential Investment Management, Inc. and affiliates to provide for a new $12.5 million term loan. The new term loan is summarized as follows:

·                                           Prudential will purchase from Winmark and its subsidiaries (collectively, the loan parties) senior notes of $12.5 million;

·                                           The final maturity of the notes is 10 years;

·                                           Interest at a rate of 5.10% per annum on the outstanding principal balance is payable quarterly, along with required prepayments of the principal of $312,500 quarterly until the principal is paid in full;

·                                           The term notes are secured by all assets of Winmark and each of its subsidiaries and the term notes will rank pari passu with our obligations to the Revolver Lenders under the amended line of credit facility;

·                                           The term notes may be prepaid, at the option of the borrowers, in whole or in part (in a minimum amount of $1 million), but prepayments will require payment of a Yield Maintenance Amount; and

·                                           The amended note agreement contains customary affirmative covenants and negative covenants that are substantially the same as those contained in the amended line of credit agreement with the Revolver Lenders.

Amendment No. 1 is effective as of July 19, 2017. Through Amendment No. 1, Prudential consented to the tender offer.

We will incur increased indebtedness in connection with the purchase of shares in the tender offer and, as a result, will be more leveraged. We expect to generate the cash necessary to pay our expenses, finance our leasing business and to pay the principal and interest on all of our outstanding debt from cash flows provided by operating activities and by opportunistically using other means to repay or refinance our obligations as we determine appropriate. Our ability to pay our expenses, finance our leasing business and meet our debt service obligations depends on our future performance, which may be affected by financial, business, economic, and other factors. If we do not have enough money to pay our debt service obligations, we may be required to refinance all or part of our existing debt, sell assets, borrow more money or raise equity. In such an event, we may not be able to refinance our debt, sell assets, borrow more money or raise equity on terms acceptable to us or at all. Also, our ability to carry out any of these activities on favorable terms, if at all, may be further impacted by any financial or credit crisis which may limit access to the credit markets and increase our cost of capital.

20

The amended line of credit facility with the Revolver Lenders and the amended note agreement with Prudential contain affirmative and negative covenants, including covenants that in certain circumstances restrict our ability to incur additional indebtedness, pay dividends on and redeem capital stock, make other payments, including investments, sell assets and enter into consolidations, mergers and transfers of all or substantially all of our assets.

The amended note agreement with Prudential and the amended line of credit facility with the Revolver Lenders contain financial covenants summarized above. Our ability to meet these financial covenants can be affected by events beyond our control and we cannot assure you that we will meet those covenants. A breach of any of these covenants could result in an event of default under the amended line of credit facility with the Revolver Lenders or under the amended note agreement with Prudential.  An event of default with respect to one credit facility will constitute an event of default with respect to the other credit facility. If an event of default exists under the amended line of credit facility with the Revolver Lenders or under the amended note agreement with Prudential, the lenders could declare all amounts outstanding thereunder to be immediately due and payable and the Revolver Lenders could elect to cease making revolving loans.  If the lenders accelerate the payment of the indebtedness outstanding at the time of the event of default, our assets may not be sufficient to repay in full that indebtedness and any other indebtedness that would become due as a result of any acceleration.

The foregoing description is a summary of the material terms of Amendment No. 5 to the line of credit with the Revolver Lenders and the amended note agreement with Prudential, which have been filed as exhibits to the Schedule TO. The foregoing summary is subject to the terms of Amendment No. 5 to the line of credit with the Revolving Lenders and Amendment No. 1 to the Note Agreement with Prudential. Since the terms of Amendment No. 5 to the line credit with the Revolving Lenders and Amendment No. 1 to the Note Agreement with Prudential are more detailed than the summary provided above, we urge you to read the actual provisions of these documents.

Section 9.                                           Certain Information Concerning Winmark

Principal Business . Winmark Corporation is a franchisor of five value-oriented retail store concepts that buy, sell and trade gently used merchandise.  Each of our retail store brands emphasizes consumer value by offering high-quality used merchandise at substantial savings from the price of new merchandise and by purchasing customers’ used goods that have been outgrown or are no longer used.  Our concepts also offer a limited amount of new merchandise to customers.  As of July 1, 2017, we had 1,199 franchised stores across the United States and Canada.

We recently launched a new initiative to provide services, support and capital to emerging franchisors. Under the Winmark Franchise Partners mark, we intend to leverage our experience in franchising through strategic partnering with select companies interested in franchising to grow their brands.

We also operate a middle-market equipment leasing business through our wholly owned subsidiary, Winmark Capital Corporation.  Our middle-market leasing business serves large and medium-sized businesses and focuses on technology-based assets which typically cost more than $250,000.  The businesses we target generally have annual revenue of between $30 million and several billion dollars.  We generate middle-market equipment leases primarily through business alliances, equipment vendors and directly from customers.

Additionally, we operate a small-ticket financing business through our wholly owned subsidiary, Wirth Business Credit, Inc.  Our small-ticket financing business serves small businesses and focuses on assets which generally have a cost of $5,000 to $100,000.

Our significant assets are located within the United States, and we generate all revenues from United States operations other than franchising revenues from Canadian operations of approximately $3.3 million, $2.9 million and $2.9 million for 2016, 2015 and 2014, respectively.  We were incorporated in Minnesota in 1988.

Our offices are located at 605 Highway 169 North, Suite 400, Minneapolis, Minnesota 55441 and our telephone number is (763) 520-8500.

Our audited financial statements for the fiscal years ended December 31, 2016 and December 26, 2015 are incorporated herein by reference to our Annual Report on Form 10-K for the year ended December 31, 2016 filed with the Commission on March 10, 2017.

Please refer to “Where You Can Find More Information” below for instructions on how you can obtain copies of our filings with the Commission, including filings that contain our financial statements.

21

Summary Historical and Pro Forma Condensed Consolidated Financial Data.

Historical Financial Information. We incorporate by reference the financial statements and notes thereto included in Part II, Item 8 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2016. We also incorporate by reference the unaudited financial information included in our Form 10-Q for the quarterly period ended April 1, 2017. Please refer to “Where You Can Find More Information” below for instructions on how you can obtain copies of our SEC filings, including filings that contain our financial statements.

Summary Historical Consolidated Financial Data. The following table sets forth our summary historical consolidated financial data for the years ended December 31, 2016 and December 26, 2015, and for the quarterly periods ended April 1, 2017 and March 26, 2017, and certain selected ratios for such periods. This financial data has been derived from, and should be read in conjunction with, our audited consolidated financial statements and the related notes filed as part of our Annual Report on Form 10-K for the year ended December 31, 2016, and our unaudited consolidated financial statements and notes filed as part of our Quarterly Report on Form 10-Q for the quarter ended April 1, 2017.

(a)          Earnings included in the calculation of this ratio consist of income before income taxes and fixed charges. Fixed charges include interest expense, amortized premiums and discounts, and an estimate of interest within rental expense

22

(a)                                  Reflects shareholders’ equity (deficit) divided by shares of common stock outstanding.

23

(a)                                  Earnings included in the calculation of this ratio consist of income before income taxes and fixed charges. Fixed charges include interest expense, amortized premiums and discounts, and an estimate of interest within rental expense

(a)                                  Reflects shareholders’ equity (deficit) divided by shares of common stock outstanding.

24

Summary Unaudited Pro Forma Consolidated Financial Data. The following table sets forth summary unaudited pro forma consolidated financial data for the year ended December 31, 2016, for the quarterly period ended April 1, 2017 and certain ratios for such periods. This summary unaudited pro forma consolidated financial data gives effect to the purchase of shares by us in the tender offer, as if such purchases had occurred on the first day of the fiscal year (December 27, 2015) for the consolidated statements of income data for the year ended December 31, 2016, on December 31, 2016 for the consolidated balance sheet data as of December 31, 2016, on the first day of the fiscal quarter (January 1, 2017) for the consolidated statements of income data for the quarter ended April 1, 2017, and on April 1, 2017 for the consolidated balance sheet data as of April 1, 2017. Such data also assumes that the purchase of shares is financed with debt on the terms described in the footnotes to the tables below. This information should be read in conjunction with Summary Historical Consolidated Financial Data, our audited consolidated financial statements and the related notes filed as part of our Annual Report on Form 10-K for the year ended December 31, 2016, and our unaudited consolidated financial statements and related notes filed as part of our Quarterly Report on Form 10-Q for the quarter ended April 1, 2017. This summary unaudited pro forma consolidated financial data is not necessarily indicative of either our financial position or results of operations that actually would have been attained had the purchase of shares in the tender offer and the related debt financing or that will be achieved in the future. Our future results are subject to prevailing economic and industry specific conditions and financial, business and other known and unknown risks and uncertainties, certain of which are beyond our control. These factors include, without limitation, those described in this Offer to Purchase under “Forward-Looking Statements.”

(a)                                  Reflects interest expense from borrowings totaling $49.8 million on the credit facilities described in Section 8. Source and Amount of Funds at a weighted average interest rate of 3.98% per annum.

(b)                                  Earnings included in the calculation of this ratio consist of income before income taxes and fixed charges. Fixed charges include interest expense, amortized premiums and discounts, and an estimate of interest within rental expense.

25

(a)          Reflects the effect of purchase of 400,000 shares tendered at $124.48 per share and use of approximately $49.8 million in borrowings under the credit facilities described in Section 8. Source and Amount of Funds. Does not reflect the payment of approximately $210,000 of estimated fees and expenses relating to the tender offer and the credit arrangements, which we will pay with our available cash.

(b)          Reflects shareholders’ equity (deficit) divided by shares of common stock outstanding.

26

(a)          Reflects interest expense from borrowings totaling $49.8 million on the credit facilities described in Section 8. Source and Amount of Funds at a weighted average interest rate of 3.98% per annum.

(b)          Earnings included in the calculation of this ratio consist of income before income taxes and fixed charges. Fixed charges include interest expense, amortized premiums and discounts, and an estimate of interest within rental expense.