Item 1.01. Entry into a Material Definitive Agreement.
On August 20, 2021, The Scotts Company LLC ("Scotts LLC"), a wholly-owned
subsidiary of The Scotts Miracle-Gro Company ("Scotts Miracle-Gro"), entered
into Amendment No. 3 to the Master Repurchase Agreement (the "Repurchase
Amendment") and Amendment No. 5 to Master Framework Agreement (the "Framework
Amendment," and together with the Repurchase Amendment, the "Amendments"), by
and among Scotts LLC, Coöperatieve Rabobank, U.A. (New York Branch), as a
purchaser and agent of the purchasers ("Rabobank"), and Sumitomo Mitsui Banking
Corporation (New York Branch), as a purchaser ("Sumitomo") and Scotts
Miracle-Gro.
The Amendments, together with the Master Repurchase Agreement and Master
Framework Agreement (each, as previously amended) and in each case, as
originally entered into on April 7, 2017, by and among Scotts LLC, Coöperatieve
Rabobank, U.A. (New York Branch), as a purchaser and agent of the purchasers,
and Sumitomo Mitsui Banking Corporation (New York Branch), as a purchaser, are
collectively referred to as the "Receivables Facility."
Under the Receivables Facility, Scotts LLC may sell a portfolio of available and
eligible outstanding customer accounts receivable to the purchasers and
simultaneously agree to repurchase the receivables on a weekly basis. The
eligible amount of customer accounts receivables which may be sold is up to $400
million and the commitment amount during the seasonal commitment period is up to
$160 million (such amount, the "Seasonal Committed Amount"). Among other things,
the Amendments (i) extend the expiration date of the Receivables Facility from
August 20, 2021 to August 19, 2022, (ii) define the seasonal commitment period
of the Receivables Facility as beginning on February 25, 2022 and ending on June
17, 2022 (such period, the "Seasonal Commitment Period"), and (iii) revises the
repurchase price for customer accounts receivable sold (i) during the Seasonal
Commitment Period (a) in amounts up to the Seasonal Committed Amount, to the sum
of the daily simple secured overnight financing rate ("Daily Simple SOFR") (with
a floor of zero) plus 0.90% (from the sum of LIBOR (with a floor of zero) plus
1.075%) and (b) in amounts in excess of the Seasonal Committed Amount, to the
sum of Daily Simple SOFR plus an applicable margin rate agreed between the
parties at the time of any such transaction and (ii) during any period other
than the Seasonal Commitment Period, the sum of Daily Simple SOFR(with a floor
of zero) plus an applicable margin rate agreed between the parties at time of
any such transaction. Scotts Miracle-Gro continues to guarantee all of Scotts
LLC's obligations under the Receivables Facility. The Amendments also set forth
the mechanics for establishing Daily Simple SOFR as the benchmark rate to
establish the repurchase price for the customer accounts receivable sold.
The foregoing summary of the material terms of the Amendment is qualified in its
entirety by reference to the Repurchase Amendment and the Framework Amendment,
which are filed as Exhibit 10.1 and Exhibit 10.2, respectively to this Current
Report on Form 8-K and is 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 under Item 1.01 is incorporated herein by reference.
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