| Item 1.01. |
Entry
into a Material Definitive Agreement. |
Amendment
to Revolving Credit Facility
On
November 18, 2022, Rubicon Global, LLC, a Delaware limited liability company (“Global”), and Riverroad Waste Solutions,
Inc., a New Jersey corporation (“Riverroad” and, together with Global, the “Borrowers”), Rubicon Technologies
Holdings, LLC, a Delaware limited liability company (“Holdings LLC”), Cleanco LLC, a New Jersey limited liability company
(“Cleanco”), Charter Waste Management, Inc., a Delaware corporation (“Charter”), and Rubicon Technologies International,
Inc., a Delaware corporation (“International,” together with Charter, Holdings LLC and Cleanco, the “Guarantors”),
entered into an amendment (the “Revolving Facility Amendment”) to the $60.0 million revolving loan facility entered into
on December 14, 2018 and as previously amended on March 29, 2019, February 27, 2020, March 24, 2021, October 15,
2021 and April 25, 2022 (the “Revolving Facility”) with Eclipse Business Capital LLC, a Delaware limited liability company
(the “Revolving Agent”), and the lenders thereto. The material assets of Rubicon Technologies, Inc., a Delaware corporation
(the “Company”), are the equity interests of Holdings LLC. Pursuant to the Revolving Facility Amendment, the Revolving Agent,
on behalf of the Revolving Facility lenders, consented to the Subordinate Term Loan Amendment (as defined below). The Revolving Facility
Amendment also extends the scheduled maturity date of the Revolving Facility from December 14, 2022 to December 14, 2023 and
modifies the interest rate the Revolving Facility bears to the secured overnight financing rate (“SOFR”) plus 5.5%.
Additionally,
Holdings LLC committed to: (i) contribute, on or before November 23, 2022, $4.96 million to the Borrowers from the net proceeds
of a transaction or series of transactions in which, upon the issuance by the Company of debt and/or equity securities (including, without
limitation, shares of capital stock, securities convertible into or exchangeable for capital stock, warrants, options, or other similar
rights), the Company contributes the net proceeds of such issuance to Holdings LLC for additional equity in the form of membership interests
in Holdings LLC (a “Financing Transaction”); and (ii) contribute an additional $25.0 million from the net proceeds of a Financing
Transaction by the earlier of (a) five business days after the date the Company’s S-1 registration statement filed with the Securities
and Exchange Commission (“SEC”) on August 22, 2022 (the “S-1 Filing”) becomes effective and (b) January 31,
2023. The Borrowers also committed to notify the Revolving Agent promptly upon the S-1 Filing having become effective and to continue
to engage the Berkeley Research Group as a consultant.
In
consideration of the Revolving Agent entering into the Revolving Facility Amendment, the Borrowers accrued a $0.9 million amendment fee
payable to the Revolving Agent with $0.3 million paid on November 18, 2022 and the remaining $0.6 million payable on the earlier
of five business days after the date the S-1 Filing becomes effective and January 31, 2023.
Amendment
to Term Loan Facility
On
November 18, 2022, the Borrowers and Guarantors entered into an amendment (the “Term Loan Amendment”) to the $60.0 million
term loan facility entered into on March 29, 2019 and as previously amended on February 27, 2020, March 24, 2021, October 15,
2021 and April 25, 2022 (the “Term Loan Facility”) with Pathlight Capital LP, a Delaware limited partnership (the “Term
Agent”), and the lenders thereto. Pursuant to the Term Loan Amendment, the Term Agent, on behalf of the Term Loan Facility lenders,
consented to the Subordinate Term Loan Amendment (as defined below).
Additionally,
Holdings LLC committed to: (i) contribute, on or before November 23, 2022, $4.96 million to the Borrowers from the net proceeds
of a Financing Transaction; and (ii) contribute an additional $25.0 million from the net proceeds of a Financing Transaction by the earlier
of (a) five business days after the date the S-1 Filing becomes effective and (b) January 31, 2023. The Borrowers also committed
to notify the Term Agent promptly upon the S-1 Filing having become effective and to continue to engage the Berkeley Research Group as
a consultant.
The
Term Loan Amendment also requires Holdings LLC and the Borrowers to cause the Company to, each week from and after the effectiveness
of the SEPA Registration Statement (as defined below) and until the Term Loan Facility is repaid in full, deliver notice to YA II PN,
Ltd. (“Yorkville”) and to use reasonable best efforts to ensure that the Company has satisfied the conditions precedent in
that Standby Equity Purchase Agreement entered into between the Company and Yorkville on August 31, 2022 (as more particularly described
in Item 1.01 of the Company’s Current Report on Form 8-K, dated August 31, 2022, Commission File Number 001-40910,
the “SEPA”), to cause Yorkville to purchase the maximum amount of equity interests of the Company that may be issued in accordance
with the SEPA. The Term Loan Amendment further requires the Borrowers to prepay the Term Loan Facility by the amount of net proceeds
received from the aforementioned purchases, subject to the condition that the Borrowers’ excess availability under the Revolving
Facility (i.e. the maximum amount available for draws under the Revolving Facility less reserves, principal outstanding, and fees due
the Revolving Agent, thereunder) is at least $15.0 million, until the Term Loan Facility has been repaid in full.
Holdings
LLC also committed to: (i) cause the Company to promptly (but in any event on or before December 26, 2022 or such later date approved
by the Term Agent in writing) file a registration statement (the “SEPA Registration Statement”) with the SEC with respect
to the resale of the shares of Class A common stock, par value $0.0001, of the Company (“Common Stock”) issuable pursuant
to the SEPA and to have such SEPA Registration Statement declared effective as soon as practicable after the filing thereof, and thereafter,
to remain in effect; and (ii) cause the Company to (a) deliver to the Term Agent, within one business day following receipt, any comments
by the SEC with respect to the SEPA Registration Statement (such comments, an “SEC Comment Letter”) and (b) respond to such
SEC Comment Letter and file an amendment to the SEPA Registration Statement promptly (and in any event within ten business days following
the Company’s receipt of an SEC Comment Letter).
Amendment
to Subordinate Term Loan
On
November 18, 2022, the Borrowers and Guarantors entered into an amendment (the “Subordinate Term Loan Amendment”) to
the $20.0 million subordinate term loan facility entered into on December 22, 2021 (the “Subordinate Term Loan”) with
Mizzen Capital LP, a Delaware limited partnership (the “Subordinate Term Loan Agent”), and the lenders thereto. Pursuant
to the Subordinate Term Loan Amendment, the scheduled maturity date of the Subordinate Term Loan was extended from December 22,
2022 to December 31, 2023. Additionally, the Subordinate Term Loan Amendment modified certain financial covenants to commit the
Borrowers to more frequent liquidity testing intervals which determine the amount, if any, of the principal balance of the Subordinate
Term Loan subject to required prepayment (subject to the rights and obligations of the Revolving Agent, Term Agent and Subordinate Term
Loan Agent under the Subordination and Intercreditor Agreement, dated December 22, 2021, entered into by the Revolving Agent, Term
Agent, Subordinate Term Loan Agent, Borrowers and Guarantors).
Concurrently
with the execution and delivery of the Subordinate Term Loan Amendment, Holdings LLC and the Subordinate Term Loan lenders entered into
amendments (the “Warrant Amendments”) to the Common Unit Purchase Warrants (the “Subordinate Term Loan Warrants”)
delivered by Holdings LLC to the Subordinate Term Loan lenders on December 22, 2021 in connection with the Subordinate Term Loan.
The Warrant Amendments: (i) increased the number of Common Stock the Subordinate Term Loan lenders have the right to purchase under the
Subordinate Term Loan Warrants to such number of Common Stock worth $2.6 million ($2.0 million prior to the Warrant Amendments); (ii)
caused the Subordinate Term Loan Warrants to be immediately exercisable upon execution of the Warrant Amendments; and (iii) increased
the value of Common Stock the Subordinated Term Loan Warrants will accrue each additional full calendar month after March 22, 2023
to $0.25 million ($0.2 million prior to the Warrant Amendments) until the Borrowers repay the Subordinate Term Loan in full.
In
consideration of the Subordinate Term Loan Agent entering into the Subordinate Term Loan Amendment, the Borrowers accrued a $258,401.80
amendment fee payable to the Subordinate Term Loan Agent paid on November 18, 2022.
The
foregoing descriptions of the Revolving Facility Amendment, the Term Loan Amendment and the Subordinate Term Loan Amendment are qualified
in their entirety by reference to the full text of the Revolving Facility Amendment, the Term Loan Amendment and the Subordinate Term
Loan Amendment, which are attached to this Current Report on Form 8-K as Exhibits 10.1, 10.2 and 10.3, respectively, and which are
incorporated herein by reference.
