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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): December 21, 2022
 
 
GROVE COLLABORATIVE HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
 
 
 
Delaware 001-40263 88-2840659
(State or other jurisdiction
of incorporation)
 
(Commission
File Number)
 (IRS Employer
Identification No.)
 
1301 Sansome Street
San Francisco, California
 94111
(Address of principal executive offices) (Zip Code)
(800) 231-8527
(Registrant’s telephone number, including area code)
Not Applicable
(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:
 
Title of each class 
Trading
Symbol(s)
 
Name of each exchange
on which registered
Class A common stock, par value $0.0001 GROV New York Stock Exchange
Redeemable warrants, each whole warrant exercisable for one share of Class A common stock at an exercise price of $11.50 per share GROV.WS New York Stock Exchange
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.  ☐

 
 



Item 1.01 Entry into a Material Definitive Agreement.

Loan Agreement

On December 21, 2022, Grove Collaborative Holdings, Inc., a Delaware public benefit corporation (“Holdings”), and Grove Collaborative, Inc., a Delaware public benefit corporation (“Grove”), as borrowers (Holdings and Grove, collectively, the “Borrowers”) entered into that certain Loan and Security Agreement, dated as of December 21, 2022 (the “Loan Agreement”), among Holdings, Grove, Ocean II PLO LLC, a California limited liability company, as administrative and collateral agent (the “Agent”), and the lending institutions party thereto. Capitalized terms used but not otherwise defined herein have the meanings ascribed to such terms in the Loan Agreement.

On the Closing Date, the Loan Agreement replaced Grove’s existing credit facilities by and among (i) Grove and Silicon Valley Bank dated as of July 29, 2020 and (ii) Grove, Silicon Valley Bank, as administrative agent and collateral agent thereunder and the lenders party thereto, dated as of July 29, 2020. Among other things, the Loan Agreement provides for a four-year $72.0 million term loan. The term loan will bear interest at the greater of (i) fifteen percent (15.0%), and (ii) seven and one-half of one percent (7.50%) plus the Prime Rate then in effect.

In connection with the Loan Agreement, the Company also entered into two Issuance Agreements (as defined below) with two lending institutions party to the Loan Agreement and affiliates thereof. See below for additional details.

The Borrowers’ obligations under the Loan Agreement may be accelerated or the commitments terminated upon the occurrence of an event of default under the Loan Agreement, which includes payment events of default, breaches in the performance of certain affirmative and negative covenants, the inaccuracy of representations or warranties, bankruptcy and insolvency related events of default, events of default arising in connection with changes in control and other customary events of default.

The foregoing description of the Loan Agreement is subject to and qualified in its entirety by reference to the full text of the of the Loan Agreement, a copy of which is included as Exhibit 10.1 hereto, and the terms of which are incorporated herein by reference.

Issuance Agreement

On December 21, 2022, in connection with the Loan Agreement, the Company entered into two Security Issuance Agreements (the “Issuance Agreements”), one with Structural Capital Investments III, LP and certain of its affiliates (the “Structural Investors”) and one with Avenue Sustainable Solutions Fund, L.P. (the “Avenue Investor” and, together with the Structural Investors, the “Investors”). Except for the number of shares of the Company’s Class A Common Stock, par value $0.0001 per share (“Class A Common Stock”), that have been issued or may become issuable thereunder, each Security Issuance Agreement has substantially the same terms and conditions.

Pursuant to the Issuance Agreements, and as an inducement to enter into the Loan Agreement and consummate the transactions contemplated thereby, among other things, on the Closing Date (i) the Company issued to the Structural Investors an aggregate of 3,437,500 shares of Class A Common Stock (the “Structural Closing Shares”) and (ii) the Company issued to the Avenue Investor 1,512,500 shares of Class A Common Stock (together with the Structural Closing Shares, the “Closing Shares”).

In addition, if there are any Outstanding Obligations (as defined in the Loan Agreement) under the Loan Agreement on the thirty-month anniversary of the Closing Date, (i) the Company will issue to the Structural Investors an aggregate number of shares of Class A Common Stock (the “Structural Subsequent Closing Shares”) equal to $6,875,000 divided by the lower of $2.00 and, except as otherwise described therein, the volume weighted average price of Class A Common Stock for the sixty trading days prior to such date (the “Then-Current 60-Day VWAP”) and (ii) the Company will issue to the Avenue Investor an aggregate number of shares of Class A Common Stock (together with the Structural Subsequent Closing Shares, the “Subsequent Closing Shares”) equal to $3,025,000 divided by the lower of $2.00 and the Then-Current 60-Day VWAP. The Closing Shares are being and,
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if applicable, the Subsequent Closing Shares will be, offered and sold in reliance on the exemption from registration afforded by Section 4(a)(2) under the Securities Act of 1933, as amended (the “Securities Act”).

Pursuant to the Issuance Agreements, the Company agreed to register the Closing Shares and, if applicable, the Subsequent Closing Shares for resale under the Securities Act by filing with the Securities and Exchange Commission one or more registration statements. The Company has also agreed to give Investors customary “piggyback” registration rights.

The foregoing description of the Issuance Agreements is subject to and qualified in its entirety by reference to the full texts of the Issuance Agreements, copies of which are included as Exhibits 10.2 and 10.3 hereto, and the terms of which are incorporated herein by reference.

On December 27, 2022, the Company issued a press release announcing the Loan Agreement and the Issuance Agreements. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

Item 3.02 Unregistered Sales of Equity Securities.

The information contained above in Item 1.01 is hereby incorporated by reference into this Item 3.02.


Item 9.01    Financial Statements and Exhibits.
(d) Exhibits.
Exhibit
No.		Description
10.1†
10.2†
10.3†
99.1
104Cover Page Interactive Data File (formatted as Inline XBRL)
† Schedules and exhibits to this Exhibit omitted pursuant to Regulation S-K Item 601(b)(2). The Registrant agrees to furnish supplementally a copy of any omitted schedule of exhibit to the SEC upon request.
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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.
 
GROVE COLLABORATIVE HOLDINGS, INC.
By:
 /s/ Stuart Landesberg
Name:
 
Stuart Landesberg
Title:
 
Chief Executive Officer
Date: December 27, 2022
 
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