$72 million deal creates additional liquidity
for Grove over the next 2+ years
Grove Collaborative Holdings, Inc. (NYSE: GROV) (“Grove” or “the
Company”), a leading sustainable consumer products company and
certified B Corp™, today announced that it has entered into a new
Loan and Security Agreement (the “Loan Agreement”) providing for a
four-year $72.0 million term loan.
With this transaction, Grove also welcomes two capital partners
with deep experience in consumer, disruptive commerce, and ESG to
its capitalization table, Structural Capital (“Structural”) and
Avenue Sustainable Solutions Fund, L.P. (“Avenue”).
The new funds will be used to refinance existing debt and to
fund ongoing business operations as Grove continues to push to
profitability. The term loan bears an annual interest at the
greater of 15% or prime plus 7.5%, payable monthly. The principal
repayment period commences in July 2025 and the term loan matures
in December 2026.
“We are pleased to announce this agreement, which provides
greater financial flexibility to our cash and liquidity position,”
said Stuart Landesberg, Co-Founder and CEO of Grove. “This
transaction better positions Grove for long-term success, enabling
us to execute against our strategic value creation plan with the
goal of achieving profitability in 2024. We are thrilled to have
new partners, Structural and Avenue, who deeply understand our
business and our mission to drive the consumer products industry to
be a positive force for human and environmental health.”
”We are excited to partner with Grove by providing a compelling
capital solution. Grove is an innovative leader in the consumer
products industry and we look forward to supporting the Company’s
management team in advancing their vision,” stated Kai Tse,
Co-Founder and Managing Partner of Structural Capital.
“This transaction, executed on fair terms in a challenging
market, speaks to the financial profile of the Company and the
depth of our partnership with Structural and Avenue’s ESG-oriented
Sustainable Solutions Fund,” said Sergio Cervantes, CFO of Grove.
“This transaction aligns our capital structure to our ongoing
improvements to become profitable and to our internal operating
timelines and gives us the financial backing to weather an extended
challenge in market sentiment.”
Loan and Security Agreement Details
The Loan Agreement replaces 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.
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.
Pursuant to the Issuance Agreements, among other things, on the
Closing Date (as defined therein) (i) the Company issued to the
Structural Investors an aggregate of 3,437,500 shares of the
Company’s Class A Common Stock, par value $0.0001 per share (“Class
A Common Stock”), and (ii) the Company issued to Avenue 1,512,500
shares of Class A Common Stock. In addition, the Company may be
required to issue additional shares of Class A Common Stock to the
Structural Investors and Avenue if there are outstanding
obligations under the Loan Agreement on the thirty-month
anniversary of the Closing Date, in accordance with the terms of
the Issuance Agreements.
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 in our
filings with the Securities and Exchange Commission and can be
found on Grove’s Investor Relations page at investors.grove.co and
at www.sec.gov.
Union Square Advisors LLC acted as exclusive financial advisor
to Grove in connection with the Loan Agreement.
About Grove Collaborative Holdings,
Inc.
Launched in 2016 as a Certified B Corp, Grove Collaborative
Holdings, Inc. (NYSE: GROV) is transforming consumer products into
a positive force for human and environmental good. Driven by the
belief that sustainability is the only future, Grove creates and
curates more than 150 high-performing eco-friendly brands of
household cleaning, personal care, laundry, clean beauty, baby and
pet care products serving millions of households across the U.S.
each year. With a flexible monthly delivery model and access to
knowledgeable Grove Guides, Grove makes it easy for everyone to
build sustainable routines.
Every product Grove offers — from its flagship brand of
sustainably powerful home care essentials, Grove Co., plastic-free,
vegan personal care line, Peach Not Plastic, and zero-waste pet
care brand, Good Fur, to its exceptional third-party brands — has
been thoroughly vetted against Grove’s strict standards to be
beautifully effective, supportive of healthy habits, ethically
produced and cruelty-free. Grove is a public benefit corporation on
a mission to move Beyond Plastic™ and in 2021, entered physical
retail for the first time at Target stores nationwide, making
sustainable home care products even more accessible. Grove is the
first plastic neutral retailer in the world and is committed to
being 100% plastic-free by 2025.
About Structural Capital
Structural Capital is an investment firm that provides
expansion-stage loans to venture capital and private equity-backed
companies in technology enabled and disruptive commerce sectors.
The firm provides flexible financing solutions to high-growth
companies seeking a less dilutive source of capital. Since starting
in 2014, Structural Capital has successfully launched four funds.
For more information, please visit structuralcapital.com.
Caution Concerning Forward-Looking
Statements
This press release contains "forward-looking statements” within
the meaning of the Private Securities Litigation Reform Act of
1995. Such statements include, but are not limited to, the
Company’s ability to achieve profitability, the classification of
the Company’s debt in its financial statements, the Company’s
ability to execute against its strategic value creation plan and
the potential requirement to issue additional shares of Class A
Common Stock to the Structural Investors and Avenue. Any statements
contained herein that are not statements of historical fact may be
deemed to be forward-looking statements. In addition, any
statements that refer to projections, forecasts or other
characterizations of future events or circumstances, including any
underlying assumptions, are forward-looking statements. The words
“anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,”
“intends,” “may,” “might,” “plan,” “possible,” “potential,”
“predict,” “project,” “should,” “would” and similar expressions may
identify forward-looking statements, but the absence of these words
does not mean that a statement is not forward-looking. The
forward-looking statements contained in this press release are
based on our current expectations and beliefs made by our
management in light of their experience and their perception of
historical trends, current conditions and expected future
developments and their potential effects on the Company as well as
other factors they believe are appropriate in the circumstances.
There can be no assurance that future developments affecting the
Company will be those that we have anticipated. These
forward-looking statements involve a number of risks, uncertainties
(some of which are beyond our control) or other assumptions that
may cause actual results or performance to be materially different
from those expressed or implied by these forward-looking
statements, including changes in domestic and foreign business,
market, financial, political and legal conditions; risks relating
to the uncertainty of the projected financial information with
respect to Grove; Grove’s ability to successfully expand its
business; competition; the uncertain effects of the COVID-19
pandemic; risks relating to growing inflation and rising interest
rates; and those factors discussed in documents of Grove filed, or
to be filed, with the U.S. Securities and Exchange Commission (the
“SEC”). Should one or more of these risks or uncertainties
materialize, or should any of our assumptions prove incorrect,
actual results may vary in material respects from those projected
in these forward-looking statements. All forward-looking statements
in this press release are made as of the date hereof, based on
information available to Grove as of the date hereof, and Grove
assumes no obligation to update any forward-looking statement,
whether as a result of new information, future events or otherwise,
except as may be required under applicable securities laws.
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version on businesswire.com: https://www.businesswire.com/news/home/20221227005247/en/
Investor Relations Contact
Alexis Tessier ir@grove.co
Media Relations Contact
pr@grove.co
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