Investment Agreement - RC Transaction Corp., Evercore Capital Partners LP, Evercore Capital Partners (NQ) LP, Evercore Capital Offshore Partners LP and Evercore Co-Investmenet Partnership LP
EXECUTION COPY
INVESTMENT AGREEMENT
This INVESTMENT AGREEMENT (this "Agreement") is entered into between
RC TRANSACTION CORP., a Delaware corporation (the "Company"), EVERCORE CAPITAL
PARTNERS L.P., a Delaware limited partnership, EVERCORE CAPITAL PARTNERS (NQ)
L.P., a Delaware limited partnership, EVERCORE CAPITAL OFFSHORE PARTNERS L.P., a
Cayman Islands exempted limited partnership, EVERCORE CO-INVESTMENT PARTNERSHIP
L.P., a Delaware limited partnership (collectively, the "Evercore Funds") and
each of the investors named on the signature pages hereto (each, an "Investor"
and collectively, the "Investors") as of the 1st day of April, 1999.
W I T N E S S E T H:
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WHEREAS, the Company is a newly formed corporation with 3,500,000
authorized shares of Common Stock, par value $.01 per share, and 2,500,000 of
such shares are designated as Class A Common Stock, par value $.01 per share,
300,000 of such shares are designated as Class B Common Stock, par value $.01
per share, and 700,000 of such shares are designated as Class C Common Stock,
par value $.01 per share;
WHEREAS, the Company, Deloitte & Touche LLP, Deloitte & Touche
Acquisition Company LLC and Re:sources Connection LLC intend to enter into a
Purchase Agreement providing, among other things, for the purchase by the
Company of all the limited liability company interests of Re:sources Connection
LLC (the "Purchase Agreement"); and
WHEREAS, in connection with the transactions contemplated by the
Purchase Agreement, the Evercore Funds and the Investors desire to subscribe for
an aggregate of 861,528 shares of the Company's Class A Common Stock and an
aggregate of 76,473 shares of the Company's Class B Common Stock, (collectively,
the "Common Shares") and an aggregate principal amount of $20,636,022 of the
Company's 12% Junior Subordinated Promissory Notes (the "Notes," and together
with the Common Shares, the "Securities") and the Company desires to accept the
subscription offer of the Evercore Funds and the Investors.
NOW, THEREFORE, in consideration of the premises, the mutual covenants
and agreements contained herein and other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the Company, the Evercore
Funds and the Investors hereby agree as follows:
1. Sale and Purchase of the Securities; the Closing. On the terms
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and subject to the conditions set forth in this Agreement, on the date hereof
(the "Closing Date") (i) the Company shall issue a stock certificate or
certificates to each Evercore Fund and each Investor representing the number of
shares of the Company's Class A Common Stock and Class B Common Stock set forth
with respect to each Evercore Fund and each Investor on Schedule I, against
delivery by the Evercore Funds and the Investors of an aggregate of $9,379,995
(the
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"Common Share Purchase Price," with the Common Share Purchase Price contributed
by each Evercore Fund and each Investor in the amounts set forth on Schedule I),
(ii) the Company shall issue a promissory note in the form attached hereto as
Exhibit A to each Evercore Fund and each Investor representing the principal
amount to be invested in the Notes by each Evercore Fund and Investor set forth
with respect to each Evercore Fund and each Investor on Schedule I, against
delivery by the Evercore Funds and the Investors of an aggregate of $20,636,022
(the "Note Purchase Price," and together with the Common Share Purchase Price,
the "Purchase Price," with the Note Purchase Price contributed by each Evercore
Fund and each Investor in the amounts set forth on Schedule I), and (iii) the
Evercore Funds and the Investors shall deliver to the Company, against issuance
by the Company of the Securities, the Purchase Price by wire transfer in
immediately available funds.
2. Representations of the Company. The Company represents and
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warrants to the Evercore Funds and the Investors that: (a) the Company is duly
organized, validly existing and in good standing under the laws of the State of
Delaware; (b) neither the execution and delivery of this Agreement by the
Company (including the issuance of the Securities) nor the consummation by the
Company of the transactions contemplated herein will require any consent,
approval or notice under, constitute a violation of, or default under, or
conflict with, any contract, commitment, agreement, understanding, arrangement
or restriction of any kind by which the Company is bound; (c) the execution and
delivery of this Agreement by the Company and the consummation by it of the
transactions contemplated hereby (including the issuance of the Securities) have
been approved by all necessary corporate action required on the part of the
Company; (d) each of this Agreement and each of the Notes has been duly executed
and delivered by the Company and constitutes a legal, valid and binding
obligation of the Company enforceable against the Company in accordance with its
terms; (e) the delivery to the Evercore Funds and the Investors hereunder of
their respective Securities in exchange for the Purhcase Price will transfer to
each of the Evercore Funds and the Investors, respectively, good, valid and
marketable title to such Securities, free and clear of all claims, liens,
encumbrances, restrictions, security interests and charges of any nature
whatsoever; (f) on the date hereof, after giving effect to the transactions
contemplated hereby, (i) the authorized capital stock of the Company shall
consist of (A) 3,500,000 Common Shares, of which 1,424,528 shares of Class A
Common Stock, 76,473 shares of Class B Common Stock and no shares of Class C
Common Stock shall be issued and outstanding and (B) 500,000 shares of preferred
stock, par value $.01 per share, of which no shares shall be issued and
outstanding and (ii) the aggregate principal amount of Notes outstanding shall
be $20,636,022; and (g) following consummation of the additional offering of
Common Shares and Notes to certain employees of the Company on or before July 1,
1999, (i) the Company expects that 1,548,526 shares of Class A Common Stock,
14,474 shares of Class B Common Stock and no shares of Class C Common Stock
shall be issued and outstanding and (ii) the aggregate principal amount of Notes
outstanding shall be $22,000,000.
3. Representations of the Evercore Funds and the Investors. Each
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Evercore Fund and each Investor severally (and not jointly) represents and
warrants to the Company that: (a) such Evercore Fund and, if such Investor is
not an individual, such Investor, is duly organized, validly existing and in
good standing under the laws of the jurisdiction of its organization; (b)
neither the execution and delivery of this Agreement by such Evercore Fund or
such Investor nor
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the consummation by such Evercore Fund or such Investor of the transactions
contemplated herein will require any consent, approval or notice under,
constitute a violation of, or default under, or conflict with, any contract,
commitment, agreement, understanding, arrangement or restriction of any kind by
which such Evercore Fund or such Investor, as the case may be, is bound; (c) the
execution and delivery of this Agreement by such Evercore Fund and such Investor
and the consummation by it of the transactions contemplated hereby have been
approved by all necessary partnership or, if such Investor is not a partnership,
other action required on the part of such Evercore Fund and such Investor, as
the case may be; (d) if such Investor is an individual, such Investor has the
legal capacity and authority to enter into this Agreement; and (e) this
Agreement has been duly executed and delivered by such Evercore Fund and such
Investor and constitutes a legal, valid and binding obligation of such Evercore
Fund and such Investor, as the case may be, enforceable against such Evercore
Fund and such Investor, as the case may be, in accordance with its terms.
4. Investment Representations. Each Evercore Fund and each
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Investor severally (and not jointly) represents and warrants to the Company
that: (i) he, she or it understands and agrees that (A) the Securities will be
subject to a Stockholders Agreement in substantially the form attached hereto as
Exhibit B, (B) the Securities may not be transferred except in accordance with
such Stockholders Agreement, (C) the certificates evidencing the Common Shares
and each Note will bear restrictive legends in accordance with such Stockholders
Agreement, (D) the Securities have not been registered under the Securities Act
of 1933, as amended ("the Act") or registered or qualified under the securities
laws of any state or other jurisdiction, are characterized as "restricted
securities" under the Act, and cannot be sold or otherwise transferred except in
compliance with the registration requirements of the Act and the registration or
qualification requirements of all applicable securities laws of states and other
jurisdictions, or in compliance with applicable exemptions therefrom, and (E)
there is no market, and no market may exist in the future, for the resale of the
Securities, and he, she or it may be required to hold the Securities
indefinitely; (ii) he, she or it is not an underwriter within the meaning of the
Act, and is acquiring the Securities for investment purposes only, for his, her
or its own account and not with a view to or for resale in connection with any
distribution thereof within the meaning of the Act; (iii) he, she or it is able
to bear the economic risk of his, her or its investment in the Securities and
has such knowledge and experience in financial and business matters that he, she
or it is capable of evaluating the merits and risks of an investment in the
Shares; and (iv) except as set forth on Schedule II, he, she or it is an
"accredited investor" as such term is defined in Rule 501(a) of Regulation D
promulgated under the Act.
5. Amendments. No amendment or waiver of any provision of this
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Agreement shall be effective unless the same shall be in a writing and signed by
or on behalf of the Company and by or on behalf of the Evercore Funds, provided
that if any such amendment or waiver shall adversely affect any Investor or all
of the Investors as such in a manner in which the Evercore Funds are not
similarly affected, such amendment or waiver shall not be effective unless
signed by such Investor or Investors.
6. Governing Law. This Agreement shall be governed by and
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construed in accordance with the laws of the State of New York.
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7. Entire Agreement. This Agreement constitutes the entire agreement
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among the parties hereto and supersedes any prior agreements and understandings,
oral and written, among the parties hereto with respect to the subject matter
hereof.
8. Counterparts. This Agreement may be executed in one or more
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counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first above written.
RC TRANSACTION CORP.
By: ______________________________________________
Name:
Title:
EVERCORE CAPITAL PARTNERS L.P.
By: Evercore Partners L.L.C., its
General Partner
By: ______________________________________________
Name:
Title:
EVERCORE CAPITAL PARTNERS (NQ) L.P.
By: Evercore Partners L.L.C., its
General Partner
By: ______________________________________________
Name:
Title:
EVERCORE CAPITAL OFFSHORE
PARTNERS L.P.
By: Evercore Partners L.L.C., its
General Partner
By: ______________________________________________
Name:
Title:
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EVERCORE CO-INVESTMENT
PARTNERSHIP L.P.
By: Evercore Partners L.L.C., its
General Partner
By: ______________________________________________
Name:
Title:
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__________________________________________________
RICHARD GERSTEN
__________________________________________________
PAUL LATTANZIO
__________________________________________________
GERALD ROSENFELD
MAINZ Holdings Ltd
By: ______________________________________________
Name: Alain Andrey
Title: Attorney in fact
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PT CAPITAL INVESTORS, L.P.
By: ______________________________________________
Name:
Title:
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BANCBOSTON INVESTMENTS INC.
By: ______________________________________________
Name:
Title:
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__________________________________________________
DONALD B. MURRAY
__________________________________________________
STEPHEN J. GIUSTO
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