EXHIBIT 4.9
FUNDING AGREEMENT
THIS FUNDING AGREEMENT (this "Agreement"), is made as of September
10, 1998 by and between RMX Industries, Inc., a Delaware corporation (the
"Company"), and Main Street Merchant Partners II, L.P., a Delaware limited
partnership ("Sponsor").
PRELIMINARY STATEMENT
The Company proposes to acquire a number of companies (each, a
"Founding Company") in the ready-mixed concrete and related products industry
(the "Proposed Acquisitions") for combinations of cash and common stock of the
Company ("Common Stock") prior to any initial underwritten public offering of
Common Stock by the Company.
The Company desires to obtain up to $3,000,000.00 of financing to
pay the fees and expenses of its legal counsel and independent public
accountants, its organizational expenses and the various other expenses the
Company expects to incur up to the time the Proposed Acquisitions close
(collectively, the "Expenses"). To the date hereof, Sponsor has paid an
aggregate of $45,000.00 of Expenses on behalf of the Company (the "Previously
Advanced Amount"), and Sponsor is willing to make that commitment on the terms
and subject to the conditions this Agreement hereinafter sets forth.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements this Agreement contains, the parties hereto hereby agree as follows:
ARTICLE I
THE COMMITMENT
Section 1.01 THE ADVANCES. (a) Subject to the terms and conditions
of this Agreement, Sponsor will make advances (the "Advances") to the Company
from time to time between the date hereof and the Termination Date (as
hereinafter defined) up to an aggregate principal amount of $3,000,000.00,
including the Previously Advanced Amount. The term "Termination Date" means the
earliest of (i) September 30, 1999, (ii) the date on which the Company first
effects the acquisition of one or more Founding Companies (the "Closing Date")
or (iii) the tenth calendar day after either party to this Agreement receives
written notice of termination from the other party hereto (which notice may be
given by either party hereto at any time in its sole discretion).
Section 1.02 THE PROMISSORY NOTE. When the Company executes and
delivers this Agreement to Sponsor, the Company also will execute and deliver to
Sponsor a Promissory Note
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in the form of Exhibit A hereto (the "Note"). The Note will evidence the
Company's obligation to repay the Previously Advanced Amount and all Advances
Sponsor makes pursuant to this Agreement.
Section 1.03 PROCEDURE FOR ADVANCES. Between the date hereof and the
Termination Date, the Company may request an Advance hereunder by delivering to
Sponsor a written or oral request for Advance (a "Request for Advance"). A
Request for Advance may request that Sponsor make the Advance to the Company or
directly to such third parties as the Request for Advance specifies. Any amounts
Sponsor pays to third parties pursuant to such a direction in a Request for
Advance will be deemed to be made on behalf of the Company and, to the extent
those amounts constitute expenses, those amounts will constitute expenses of the
Company for all purposes and the Company will be the owner of any and all
benefits attributable to those expenses. Within five business days after Sponsor
receives any Request for Advance from the Company, Sponsor will notify the
Company in writing as to whether or not Sponsor will make the Advance requested
thereby and the date by which Sponsor will make the Advance. Notwithstanding any
provision hereof to the contrary, Sponsor may decline to make any Advance
hereunder for any reason in its sole discretion.
Section 1.04 REPAYMENT OF THE NOTE. The Note will become due and
payable on the Termination Date.
Section 1.05 INTEREST RATE. The Advances will bear interest at the
rate of 6% per annum unless an Event of Default (as defined in Section 5.01)
occurs and is continuing. On the occurrence and during the continuance of an
Event of Default, the Advances will bear interest at the rate of 10% per annum.
Interest on the Note will be computed on the basis of a year of 365 or 366 days,
as the case may be, and will be payable on the Termination Date.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to Sponsor that all the
following representations this Article II sets forth are as of the date of this
Agreement, and will be on each date Sponsor makes an Advance, true and correct:
Section 2.01 ORGANIZATION. The Company is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware and has the corporate power to (i) conduct its business as now
conducted and as proposed to be conducted, (ii) enter into and perform its
obligations under this Agreement and (iii) issue and perform its obligations
under the Note.
Section 2.02 PROPOSED ACQUISITIONS. The Company has provided to
Sponsor a copy of each letter of intent it heretofore has entered into with
respect to any Proposed Acquisition, if any.
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Section 2.03 NO LITIGATION. No claims, actions, suits, proceedings
or investigations are pending or, to the knowledge of the Company, threatened
against the Company. The Company is not subject to any continuing court or
administrative order, writ, injunction or decree applicable to it or its assets
or operations. No outstanding judgments against the Company exist.
Section 2.04 NO GOVERNMENTAL APPROVALS. No authorization, approval,
consent or order of, or registration, declaration or filing with, any court or
governmental body is required by or on behalf of the Company in connection with
the Company's execution or performance of this Agreement or the Note. To the
Company's knowledge, the Company and its subsidiaries are conducting their
respective businesses and operations in compliance with all governmental rules
and regulations applicable thereto, including, without limitation, those
relating to occupational safety, health and employment practices, and none of
them is in violation or default in any material respect under any statute, law,
rule, ordinance, judgment, order, decree or other governmental authorization or
approval applicable to it, except for any such violation or default that would
not result in a material adverse effect on the condition (financial or other),
business, properties or results of operations of the Company and its
subsidiaries taken as a whole.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SPONSOR
Sponsor represents and warrants to the Company as follows:
Section 3.01 AUTHORITY OF SPONSOR. Sponsor has all requisite
authority to enter into this Agreement and to perform all the obligations
required to be performed by Sponsor under this Agreement.
Section 3.02 NO GOVERNMENTAL APPROVALS. No authorization, approval,
consent or order of, or registration, declaration or filing with, any court or
governmental body is required by or on behalf of Sponsor in connection with
Sponsor's execution or performance of this Agreement.
ARTICLE IV
CONDITIONS TO ADVANCES
Section 4.01 CONDITIONS. Sponsor will not be obligated to make any
Advance unless it has received the Note, duly executed and delivered by the
Company and has notified the Company in writing that Sponsor will make the
Advance requested in a Request for Advance pursuant to Section 1.03. In
addition, Sponsor will not be obligated to make any Advance unless on the
applicable date it is to make that Advance (and after giving effect to the
requested Advance): (i) all the representations and warranties of the Company in
this Agreement are true and correct in all material respects; and (ii) no
Default or Event of Default (as defined in Section 5.01) exists.
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ARTICLE V
EVENTS OF DEFAULT AND CONSEQUENCES
Section 5.01 EVENTS OF DEFAULT. For purposes of this Agreement, the
occurrence of any one or more of the following events is an "Event of Default"
(and the occurrence of an event that, but for the passage of time or the giving
of notice or both, would be an Event of Default is a "Default"):
(i) the failure of the Company to pay any amount due under the Note
when it becomes due;
(ii) the Company (A) voluntarily seeks, consents to or acquiesces in
the benefit or benefits of any Debtor Relief Law (as hereinafter defined)
or (B) becomes party to (or becomes the subject of) any proceeding any
Debtor Relief Law provides, other than as a creditor or claimant, that
could suspend or otherwise adversely affect the rights this Agreement and
the Note afford Sponsor (or the then current holder of the Note) (unless
in the event that proceeding is involuntary, the petition instituting the
same is dismissed within 90 days of the filing of same) (as used herein,
the term "Debtor Relief Law" means the Bankruptcy Code of the United
States of America and all other applicable liquidation, conservatorship,
bankruptcy, moratorium, rearrangement, receivership, insolvency,
reorganization or similar debtor relief laws from time to time in effect
affecting the rights of creditors generally); or
(iii) any material representation or warranty made by the Company
herein at any time proves to have been materially incorrect when made.
Section 5.02 CONSEQUENCES. If an Event of Default Section 5.01(ii)
describes exists, Sponsor's commitment to make Advances automatically will
terminate and the entire unpaid balance of the Advances automatically will
become due and payable without any action of any kind by Sponsor. If any other
Event of Default exists, Sponsor may do any one or more of the following: (i)
declare the entire unpaid balance of all or any part of the Advances immediately
due and payable; (ii) reduce any claim to judgment; and (iii) exercise any and
all other legal or equitable rights afforded by this Agreement or the Note or
the laws of the State of New York or any other applicable jurisdiction. The
Company waives presentment and demand for payment, protest, notice of intention
to accelerate, notice of acceleration and notice of protest and nonpayment. No
waiver of a Default or an Event of Default by Sponsor will be deemed a waiver of
any other then existing or subsequent Default or Event of Default. No delay or
omission by Sponsor in exercising any right under this Agreement or the Note
will impair that right or be construed as a waiver of that right, nor will any
single partial exercise of any right preclude any other or further exercise of
that or any other right.
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ARTICLE VI
MISCELLANEOUS
Section 6.01 REMEDIES NOT EXCLUSIVE. No remedy any provision of this
Agreement confers is intended by either party hereto to be exclusive of any
other remedy, and each and every remedy will be cumulative and in addition to
every other remedy given hereunder or now or hereafter existing at law or in
equity or by statute or otherwise. The election of any one or more remedies by
either party hereto will not constitute a waiver of the right to pursue other
available remedies.
Section 6.02 PARTIES BOUND; ASSIGNMENT. Except as this Agreement
otherwise expressly provides, this Agreement will be binding upon and inure to
the benefit of the parties hereto and their respective heirs, representatives,
administrators, guardians, successors and assigns; and no other person will have
any right, benefit or obligation hereunder. The Company may assign its rights
and obligations hereunder to any corporation of which it becomes a wholly owned
subsidiary, but these rights and obligations are not otherwise assignable
without the prior written consent of Sponsor.
Section 6.03 NOTICES. All notices, reports, records or other
communications that are required or permitted to be given to the parties under
this Agreement will be sufficient in all respects if given in writing and
delivered in person, by telecopy, by overnight courier or by registered or
certified mail, postage prepaid, return receipt requested, to the receiving
party at the following address:
If to Sponsor: Main Street Merchant Partners II, L.P.
0000 Xxxx Xxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: Xxxxxxx X. Xxxxxx
If to the Company:RMX Industries, Inc.
0000 Xxxx Xxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: Xxxxxxx X. Xxxxxx
or to such other address as such party may have given to the other party by
notice pursuant to this Section 6.03. Notice will be deemed given on the date of
delivery, in the case of personal delivery or telecopy, or on the delivery or
refusal date, as specified on the return receipt, in the case of overnight
courier or registered or certified mail.
Section 6.04 GOVERNING LAW. This Agreement will be construed and
interpreted, and the rights of the parties hereto will be determined in
accordance with, the laws of the State of New York, without regard to any
conflicts of law provisions thereof.
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Section 6.05 ENTIRE AGREEMENT; AMENDMENTS AND WAIVERS. This
Agreement, and the Note constitute the entire agreement between the parties
hereto pertaining to the subject matter hereof and supersede all prior and
contemporaneous agreements, understandings, negotiations and discussions,
whether oral or written, of the parties. Except as this Agreement sets forth, no
warranties, representations or other agreements between the parties exist in
connection with the subject matter hereof. No supplement, modification or waiver
of any of the provisions of this Agreement will be binding unless it is
specifically designated to be a supplement, modification or waiver of this
Agreement and is executed in writing by each party to be bound thereby.
Section 6.06 FURTHER ASSURANCES. From time to time hereafter and
without further consideration, each party hereto will execute and deliver such
documents and instruments and take such actions as the other party hereto may
reasonably request in order to more effectively consummate the transactions this
Agreement contemplates or as shall be reasonably necessary or appropriate in
connection with the carrying out of the parties' respective obligations
hereunder or the purposes of this Agreement.
Section 6.07 SEVERABILITY. If any one or more of the provisions
herein, or the application thereof in any circumstances, is invalid, illegal or
unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions herein will not be in any way impaired thereby, it being intended by
the parties hereto that all their respective rights and privileges hereunder
will be enforceable to the fullest extent applicable law permits.
Section 6.08 NO PARTNERSHIP. Nothing in this Agreement creates or is
intended by the parties hereto to create any partnership or joint venture
between Sponsor and the Company.
Section 6.09 NO RECOURSE TO OTHERS. No stockholder, director,
officer, incorporator, controlling person, employee or agent of the Company will
have any liability for (i) any obligations of the Company on the Note or under
this Agreement or (ii) any claim based on, in respect of or by reason of those
obligations or their creation, and Sponsor, for itself and its successor and
assigns and any subsequent holder of the Note, waives and releases all those
liabilities.
Section 6.10 MULTIPLE COUNTERPARTS. This Agreement may be executed
in one or more counterparts, each of which will be deemed an original, but all
of which together will constitute one and the same agreement.
Section 6.11 HEADINGS AND REFERENCES. Headings of Sections are for
convenience of reference only and are not intended to be a part of or to affect
the meaning or interpretation of this Agreement. References in this Agreement to
"Sections" are to Sections of this Agreement.
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IN WITNESS WHEREOF, the parties have duly executed this Agreement as
of the date first written above.
RMX INDUSTRIES, INC.
By: /S/ XXXXXXX X. XXXXXX
Xxxxxxx X. Xxxxxx
Chief Financial Officer
MAIN STREET MERCHANT PARTNERS II, L.P.
By:/s/XXX X. XXXXXXXXX
Xxx X. Xxxxxxxxx
Managing Director
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EXHIBIT A
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY BE
SOLD OR OTHERWISE TRANSFERRED ONLY IF THE HOLDER HEREOF COMPLIES WITH THAT LAW
AND OTHER APPLICABLE SECURITIES LAWS.
PROMISSORY NOTE
$3,000,000.00 September 10, 1998
FOR VALUE RECEIVED, the undersigned, RMX Industries, Inc., a Delaware
corporation ("Maker"), hereby promises to pay to the order of Main Street
Merchant Partners II, L.P., a Delaware limited partnership ("Payee"), at such
address as Payee specifies in writing to Maker, the principal sum of Three
Million United States Dollars (U.S. $3,000,000.00) or, if less, the aggregate
principal amount of all Advances (this and certain other terms this Promissory
Note (this "Note") uses, but does not define, having the meanings the Funding
Agreement referred to below assigns to them) made by Payee to Maker, at the time
specified in the Funding Agreement. The Funding Agreement prescribes when the
unpaid principal amount hereof will become payable. Maker promises to pay
interest on the unpaid principal amount hereof until that principal amount is
repaid in full at the rate per annum of 6%; provided, that during the
continuation of each Event of Default, if any, that rate per annum will be 10%.
When the principal amount of this Note becomes payable, the interest accrued
hereon also will become payable; provided, however, that if the principal amount
of this Note does not become due and payable on or before the first anniversary
of the date of this Note, an installment of interest on this Note will become
due and payable on that anniversary. This Note is the Note referred to in, and
is entitled to the benefits of, the Funding Agreement dated as of September 10,
1998, by and between Maker and Payee (as supplemented, modified and amended from
time to time, the "Funding Agreement"), which Funding Agreement contains among
its provisions certain provisions for the acceleration of the maturity of this
Note on the happening of certain stated events.
EXECUTED as of the date set forth above.
RMX INDUSTRIES, INC.
By:___________________________________
Xxxxxxx X. Xxxxxx
Chief Financial Officer
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