Item 1.01 Entry into a Material Definitive Agreement.
Third Amendment to Credit Agreements
As previously disclosed, in September 2021, Local Bounti Corporation (the
"Company"), along with certain subsidiaries of the Company, and Cargill
Financial Services International, Inc. ("Cargill Financial") entered into (a) a
credit agreement (the "Original Senior Credit Agreement") and (b) a subordinated
credit agreement (the "Original Subordinated Credit Agreement" and, together
with the Original Senior Credit Agreement, the "Original Credit Agreements").
Also as previously disclosed, in March 2022 and August 2022, the Company, along
with certain subsidiaries of the Company and Cargill Financial, entered into
that certain First Amendment to Credit Agreements and Subordination Agreement
and that Second Amendment to Credit Agreements, respectively, to amend the
Original Credit Agreements (as amended, the "Credit Agreements").
On December 30, 2022, the Company, along with certain subsidiaries of the
Company, entered into a Third Amendment to Credit Agreements (the "Third
Amendment") with Cargill Financial to further amend the Credit Agreements. The
Third Amendment (i) reduces the amount of cash required to be held in the debt
service reserve account for the Credit Agreements by approximately
$10.0 million; (ii) modifies the payment date of regularly scheduled interest
and principal payments and certain other payments under the Credit Agreements
from the last Business Day of the applicable quarter to the first Business Day
of the subsequent quarter; (iii) allows for the payment in kind of the quarterly
interest payment due and payable for the quarter ending December 31, 2022; and
(iv) implements a capital expenditures covenant which limits capital
expenditures to existing projects and restricts aggregate capital expenditures
for existing projects in excess of amounts set forth in the applicable
construction budget to $1,000,000 in any fiscal year. The aggregate amount of
outstanding loans and undrawn commitments under the Credit Agreements remains at
$170.0 million (plus interest paid in kind).
On January 6, 2023, the Company, along with certain subsidiaries of the Company,
entered into a Fourth Amendment to Credit Agreements (the "Fourth Amendment")
with Cargill Financial to further amend the Credit Agreements, as amended by the
Third Amendment. The Fourth Amendment reduces the minimum liquidity covenant in
each of the Credit Agreements from $20.0 million to $11.0 million (or
$10.0 million following a qualified offtake arrangement).
All capitalized terms above that are not defined elsewhere have the meanings
ascribed to them in the Third Amendment, Fourth Amendment or the Credit
Agreements, as applicable. The foregoing descriptions of the Third Amendment and
Fourth Amendment and the transactions contemplated thereby do not purport to be
complete and are qualified in their entirety by reference to the full text of
the Third Amendment and Fourth Amendment, copies of which are attached hereto as
Exhibits 10.1 and 10.2, respectively, and incorporated herein by reference.
Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
The information provided in Item 1.01 of this Current Report on Form 8-K is
incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. Description
10.1† Third Amendment to Credit Agreements, dated as of December 30,
2022, by and among Local Bounti Operating Company LLC, Local
Bounti Corporation, the guarantors party thereto and Cargill
Financial Services International, Inc.
10.2† Fourth Amendment to Credit Agreements, dated as of January 6,
2023, by and among Local Bounti Operating Company LLC, Local
Bounti Corporation, the guarantors party thereto and Cargill
Financial Services International, Inc.
104 Cover Page Interactive Data File (formatted as Inline XBRL)
† Certain exhibits and schedules to this Exhibit have been omitted in accordance
with Regulation S-K Item 601(a)(5). The Company hereby agrees to furnish
supplementally a copy of any omitted exhibit or schedule to the SEC upon its
request.
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