Item 1.01. Entry into a Material Definitive Agreement.
Forward Purchase Agreement
On August 4, 2022, Founder SPAC (the "FOUN") and ACM ARRT F LLC, a Delaware
limited liability company ("Seller"), entered into an agreement (the "Forward
Purchase Agreement") for an OTC Equity Prepaid Forward Transaction (the "Forward
Purchase Transaction"). Pursuant to the terms of the Forward Purchase Agreement,
Seller intends, but is not obligated, to purchase (a) Class A ordinary shares,
par value $0.0001 per share, of FOUN (the "Shares") after the date of the
Forward Purchase Agreement from holders of Shares (other than FOUN or affiliates
of FOUN) who have elected to redeem Shares (such purchased Shares, the "Recycled
Shares") pursuant to the redemption rights set forth in FOUN's amended and
restated memorandum and articles of association (the "Governing Documents") in
connection with the Business Combination (such holders, "Redeeming Holders") and
(b) Shares in an issuance from FOUN at a price per Share equal to the Per-Share
Redemption Price (as set forth in Section 1.1 of the Governing Documents) (such
Shares, the "Additional Shares" and, together with the Recycled Shares, the
"Subject Shares"). In addition, Seller has agreed to purchase 1,000,000 Shares
from Redeeming Holders (the "Separate Shares"). The aggregate total Subject
Shares will be 15,000,000 (the "Maximum Number of Shares"). Seller also may not
beneficially own greater than 9.9% of the Shares on a post-combination pro forma
basis. Seller has agreed to waive any redemption rights with respect to any
Subject Shares and Separate Shares in connection with the Business Combination.
Such waiver may reduce the number of Shares redeemed in connection with the
Business Combination, which reduction could alter the perception of the
potential strength of the Business Combination.
The Forward Purchase Agreement provides that not later than one local business
day following the closing ("Closing") of the proposed business combination (the
"Business Combination") with Rubicon Technologies, LLC ("Rubicon"), FOUN will
pay to Seller, out of funds held in FOUN's trust account, (a) an amount (the
"Prepayment Amount") equal to (x) the Per Share Redemption Price (the "Initial
Price") multiplied by the number of Subject Shares on the date of such
prepayment, less (y) 50% of the product of the Subject Shares on the date of
such prepayment multiplied by $1.33 (the "Prepayment Shortfall") and (b) an
amount equal to the product of the Separate Shares multiplied by the Per-Share
Redemption Price.
From time to time following the Closing, Seller, in its discretion, may sell the
Subject Shares in an aggregate amount with net proceeds (including commissions)
equal to the Prepayment Shortfall (the "Shortfall Sales") without payment to
FOUN of a Forward Price. FOUN shall be entitled to 50% of such net proceeds
(including commissions) from the Shortfall Sales, which shall be paid in cash to
FOUN following the sale of the Shortfall Sales. In connection with all Shortfall
Sales, FOUN will be obligated to issue additional Shares to Seller equal to the
number of Shares sold pursuant to such Shortfall Sale (the "Reissued Shares").
with such Reissued Shares to be registered under the Securities Act of 1933, as
amended (the "Securities Act") pursuant to terms to be mutually agreed to
between FOUN and Seller.
Seller may, in its discretion, sell Subject Shares, the effect of which is to
terminate the Forward Purchase Agreement in respect of such Subject Shares sold
(the "Terminated Shares"). FOUN shall be entitled to proceeds from such sales of
Terminated Shares (other than any Subject Shares sold in Shortfall Shares) equal
to the product of (x) the number of Terminated Shares multiplied by (y) the
Forward Price. Following the Closing, the "Forward Price" will initially be the
Per-Share Redemption Price, but will be adjusted on a monthly basis to the lower
of (a) the then-current Forward Price, (b) the Per-Share Redemption Price, and
(c) the volume weighted average price ("VWAP") price of the last trading day of
the prior month, but not lower than $6.00; provided, however, that if FOUN
offers and sells Shares, or currently outstanding or future issued securities
are exercised or converted, at a price lower than then then-current Forward
Price (the "Offering Price"), but excluding certain issuances, then the Forward
Price shall be adjusted to the Offering Price.
In the event that VWAP price per Share (a) within the first 90 days following
Closing, is less than $3.00 per Share 20 trading days during any 30 trading day
period or (b) from the 91st day following the Closing, is less than $5.00 per
Share 20 trading days during any 30 trading day period, then Seller may
accelerate the maturity date, which otherwise will be the third anniversary of
the closing of FOUN's Business Combination. Upon the occurrence of the Maturity
Date, FOUN is obligated to pay to Seller an amount equal to the product of (a)
(x) the Maximum Number of Shares, less (y) the number of Terminated Shares, plus
(z) Shortfall Shares that constitute Terminated Shares, multiplied by (b) $2.00
(the "Maturity Consideration"). The Maturity Consideration shall be payable by
FOUN as equity, issued in Shares, with a per Share issue price based on the
average daily VWAP Price over 30 Scheduled Trading Days commencing on (i) the
Maturity Date to the extent the Shares used to pay the Maturity Consideration
are freely tradeable by Seller, or (ii) if not freely tradeable by Seller, the
date on which the Shares used to pay the Maturity Consideration are registered
under the Securities Act and delivered to Seller, which will be payable on a net
basis with Shares the Seller continues to hold at the Maturity Date.
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Seller's obligations to FOUN under the Forward Purchase Agreement are secured by
perfected liens on (i) the proceeds of any sale or other disposition of the
Subject Shares and (ii) the deposit account (the "Deposit Account") into which
such proceeds are required to be deposited. The Deposit Account will be subject
to a customary deposit account control agreement in favor of FOUN.
The Forward Purchase Agreement may be terminated if any of the following events
occurs (a) failure to consummate the Business Combination within two weeks of
the date of the Forward Purchase Agreement, (b) termination of the Business
Combination, (c) occurrence of a material adverse change (as detailed in the
Forward Purchase Agreement and (d) receipt by FOUN of less than $100 million in
proceeds pursuant to the Subscription Agreements, dated as of December 15, 2021,
entered into by FOUN and certain investors. Upon such a termination event, a
breakup fee is payable equal to (w) $5,000 in structuring fees, (x) $500,000,
(y) up to $75,000 in legal fees, and (z) costs and expenses incurred in
connection with the acquisition of Subject Shares in an amount not to exceed
$0.10 per Share.
The description of the Forward Purchase Agreement does not purport to be
complete and is qualified in its entirety by the terms and conditions thereof, a
copy of which is attached hereto as Exhibit 10.1 and incorporated herein by
reference.
Item 3.02. Unregistered Sale of Equity Securities
The disclosure set forth above in Item 1.01 of this Current Report on Form 8-K
with respect to the Forward Purchase Agreement is incorporated by reference
herein. The securities of FOUN that may be issued in connection with the Forward
Purchase Agreement will not be registered under the Securities Act of 1933, as
amended (the "Securities Act"), in reliance on the exemption from registration
provided by Section 4(a)(2) of the Securities Act.
Item 7.01. Regulation FD Disclosure.
On August 5, 2022, the Company issued a press release announcing its entry into
the Forward Purchase Agreement, a copy of which is attached as Exhibit 99.1 to
this Current Report on Form 8-K.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. Description
10.1 Forward Purchase Agreement, dated August 4, 2022, by and between ACM
ARRT F LLC and Founder SPAC.
99.1 Press Release, dated August 5, 2022.
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