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| CUO > SEC Filings for CUO > Form 8-K on 23-Jul-2009 | All Recent SEC Filings |
23-Jul-2009
Completion of Acquisition or Disposition of Assets, Other Events
Sale of Rocky Mountain Ready Mix Concrete, Inc.
On July 17, 2009, Continental Materials Corporation (the "Company") completed the sale of all of the outstanding capital stock of Rocky Mountain Ready Mix Concrete, Inc. (RMRM), a Colorado corporation to Campbells C-Ment Contracting, Inc. (Buyer), a Colorado corporation. RMRM operated a ready mix concrete business in the Denver metropolitan area.
The Company received $1,905,000 in cash at closing and a Promissory Note in the original principal amount of $1,294,035, the estimated closing date net working capital amount of RMRM. The principal amount of the Promissory Note will be adjusted upon a final determination of the closing date net working capital. The Promissory Note bears interest at 5% per annum. The initial principal payment is due September 30, 2010 with final principal payment due June 30, 2012. Principal payments will commence earlier if the Buyer achieves certain sales volume levels.
The Company and its' wholly-owned subsidiary Transit Mix Concrete, Co. (Transit
Mix) also entered into a Non-Competition, Non-Disclosure and Non-Solicitation
Agreement with the Buyer for a period of six years. In consideration of the
covenants made by the Company and Transit Mix, beginning in 2010 the Company
will receive compensation if certain sales volume or operating profit thresholds
are reached by the Buyer. There is no assurance that the future operating
results of the Buyer will be such that any future consideration will be due to
the Company under this Agreement.
Update on the 2008 Sale of Land in Colorado Springs
As disclosed in the 2008 Annual Report on Form 10-K, the Company received $2,114,000 during 2008 from the sale of land in Colorado Springs resulting in a pre-tax profit of $1,947,000. On July 2, 2009, the Company and the buyer of the property reached an agreement on the final price for the property. Under the terms of the agreement, the Company will receive an additional cash payment of $2,026,000. The Company expects to receive the cash prior to the end of July 2009.
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