AMENDMENT TO ASSET PURCHASE AGREEMENT
EXHIBIT
2.1
AMENDMENT TO ASSET PURCHASE
AGREEMENT
This
AMENDMENT TO ASSET PURCHASE AGREEMENT, dated as of April 4, 2008, is entered
into by and among CP4 Warbird Holdings, LLC (f/k/a Callaway Partners, LLC), a
Georgia limited liability company (“Seller”), Huron
Demand LLC, a Delaware limited liability company (“Purchaser”), and
certain of the current and former members of Seller listed on the signature
pages hereto (collectively, “Guarantors”). Certain
capitalized terms used herein shall have the meaning ascribed them in the
Original Agreement (as defined herein).
W I T N E S S E T
H:
WHEREAS,
the Parties hereto entered in that certain Asset Purchase Agreement dated as of
July 28, 2007 (the “Original Agreement”);
WHEREAS,
the Parties are desirous of amending the Original Agreement by the execution of
this amendment (the “Amendment”).
NOW
THEREFORE, in consideration of the foregoing and the respective covenants and
agreements contained herein and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
1. Earn-Out
Payment. In full payment of the Purchaser's obligations to
make Earn-Out Payments to Seller as described in Section 3.3 of the Original
Agreement, Purchaser is delivering to Seller concurrently with the execution
hereof a promissory note for the sum of $23,000,000 in the form attached hereto
as Exhibit A (the "Note"). Upon delivery of the Note, Sections 3.3
and 3.5 of the Original Agreement shall be terminated in their entirety and the
obligation of Purchaser to make Earn-Out Payments shall become null and
void. Seller hereby agrees and represents that the entire amount
payable pursuant to the Note ($23,000,000 together with interest as provided in
the Note), when received by Seller, shall be distributed by Seller (i) only
to the Class A and Class B Members of the Seller as of the date of this
Amendment, and (ii) in accordance with the provisions of the Seller’s Operating
Agreement in effect as of the date of this Amendment. Further,
Seller hereby agrees and represents that, to the knowledge of Seller, the
Class A and Class B Members of Seller will not share any portion of
the amount payable pursuant to the Note ($23,000,000 together with interest as
provided in the Note) with any employee of the Purchaser in the form of
compensation for services provided or to be provided to Purchaser.
2. Sales Attribution
Payments. In addition, upon delivery of the Note, Section 3.4
of the Original Agreement shall be terminated in its entirety effective January
1, 2008 and the obligation of Purchaser to pay the Sales Attribution Amount
shall become null and void.
3. Accounts
Receivable. The parties acknowledge that Purchaser has
previously paid to Seller all sums due pursuant to Section 3.6 of the Original
Agreement in settlement of the accounts receivable as described
therein. As further required by Section 3.6 of the Original
Agreement, Seller agrees to promptly transfer to Purchaser all remaining unpaid
Accounts Receivable (or accounts receivable for which there are no applicable
reserves) pursuant to a special purpose xxxx of sale in the form of Exhibit
B. The aforesaid xxxx of sale will be delivered to Seller
concurrently with the execution hereof.
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4. Survival of Representations
and Warranties; Indemnity. In consideration for the agreement
of the parties set forth above, Section 12.1 of the Original Agreement is hereby
amended to terminate the period of survivability of all representations and
warranties effective as of the date of this Amendment; provided however, that the
survivability of the representations and warranties contained in Section 4.15 of
the Original Agreement (and the corresponding indemnification obligation of the
Seller with respect thereto under Section 12.2 of the Original Agreement) shall
continue under Section 12.1 of the Original Agreement, without modification,
after the date of this Amendment. In addition, in consideration for
the mutual undertakings of the parties hereunder, the obligation of
the Seller and the Guarantors to indemnify the Purchaser Indemnified Parties as
set forth in Section 12.2(a) and (c) of the Original Agreement is also hereby
terminated, except that the Seller and Guarantors shall continue to indemnify
Purchaser under Section 12.2 of the Original Agreement for all Losses incurred
in connection with, arising out of, or resulting from: (i) the matter entitled
Xxxxxxx Xxxx, xx.xx.
x. Xxxxxxxx Partners, LLC currently pending in the Northern District of
Georgia, Atlanta Division, civil action number 1:06-CV-1993-CC (the “Xxxx Case”)
or any cause of action related thereto or arising from the facts alleged
thereunder, (ii) any breach or inaccuracy of any representation or warranty made
by Seller or Guarantors in Section 4.15 of the Original Agreement, and (iii) any
Taxes of the type described in clause (f) of the definition of Excluded
Obligations. For the avoidance of doubt, the obligation of Seller and
Guarantors under Section 12.2(b) of the Original Agreement shall not be affected
hereby, although the obligation to indemnify under Section 5 of this Amendment
is specifically excluded from the scope of Section 12.2(b).
5. Insurance Coverage and
Reimbursement of Deductible. Purchaser agrees to maintain
professional liability insurance covering the Completed Engagements and Seller’s
performance under the In-Process Engagements to the extent occurring prior to
the Closing Date (collectively, the “Covered Engagements”). If a
claim is made after the date hereof by a third party in respect of the Covered
Engagements by July 27, 2009, and such claim results in a Loss by Purchaser or a
Purchaser Indemnified Party, Seller agrees to reimburse Purchaser or the
applicable Purchaser Indemnified Party for one half (1/2) of the deductible
applicable to each such Covered Engagement, provided that the reimbursement
obligation under this paragraph 5 shall not exceed $375,000 for any Covered
Engagement for which Purchaser or a Purchaser Indemnified Party incurs a
Loss. Notwithstanding the foregoing, in the event of Default (as
defined in the Note) should occur, the obligation of the Seller to indemnify
Purchaser under this provision shall terminate, regardless of whether a claim
has been made prior to the Default.
6. Acknowledgement. In
connection with and as a condition to the delivery of the Note, each of the
following persons shall execute and deliver an acknowledgement (the "Acknowledgement") to
Purchaser in the form attached hereto as Exhibit C, acknowledging that such
persons shall, after the execution of this Amendment, be placed under the bonus
plans of Huron Consulting Group, Inc. and that future bonus compensation for
such persons will not be based on the performance of Purchaser as described in
the respective Senior Management Agreement for each person:
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Xxxxxxx
Xxxxxxxx
Xxxxx
Xxxxxx
Xxxxx X.
Xxx
Xxxxxxx
Xxxx
Xxxx
Xxxxx
Xxxxx
Xxxx
Xxxxx
Xxxxxx
Xxxxxxxxxx
X'Xxxx
J.
Xxxxxxx Xxxx
Xxxxxxx
X. Xxxxxxxxxx Xx.
7. Representations and
Warranties. Each of the parties hereto agrees that this
Amendment and the Note shall constitute “Related Agreements” under the Original
Agreement and the the representations and warranties of the parties as contained
in Sections 4.1 through 4.4 (with respect to the Seller) and Sections 5.1
through 5.4 (with respect to the Purchaser) shall apply to this Amendment and
the Note as of the date of this Amendment and the date of the Note,
respectively.
8. Further
Assurances. Each of the parties hereto agrees that they shall
execute and deliver such further documents, releases, assignments and other
instruments and do or cause to be done such further acts as may be necessary or
required to effectuate the purposes of this Amendment.
9. Applicable
Law. This Agreement shall be governed by and construed and
enforced in accordance with the internal laws of the State of Illinois without
giving effect to the principles of conflicts of law thereof.
10. Counterparts. This
Agreement may be executed in counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.
11. Facsimile
Signatures. Any signature page delivered via a fax machine
shall be binding to the same extent as an original signature
page. Any party who delivers such a signature page agrees to later
deliver an original counterpart to any party which requests it.
[Signature
page follows]
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IN
WITNESS WHEREOF, the parties have caused this Agreement to be executed and
delivered as of the date first written above.
PURCHASER:
HURON
DEMAND LLC
By: Huron
Consulting Group Holdings, LLC
Its Managing Member
By: Huron
Consulting Group, Inc.
Its
Managers
By: /s/ Xxxxxx X. Xxxxxxxxxx
Name: Xxxxxx X.
Xxxxxxxxxx
Title:
COO
SELLER:
CP4
WARBIRD HOLDINGS, LLC (f/k/a CALLAWAY PARTNERS, LLC)
By:
/s/ Xxxxx X.
Xxx
Name:
Xxxxx X. Xxx
Title:
/s/ Xxxxxxx
Xxxx
Name:
Xxxxxxx Xxxx
Title: Managing
Director
/s/ J. Xxxxxxx
Xxxx
Name: J.
Xxxxxxx Xxxx
Title:
/s/ Xxxxx
Xxxxxx
Name: Xxxxx
Xxxxxx
Title:
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HURON
CORPORATE GUARANTEE
Huron
Consulting Group Inc. hereby guarantees (i) the payment obligations of Purchaser
under the Original Agreement, as modified hereby, and under the Note, and (ii)
the due performance by Purchaser of all other obligations of Purchaser under the
Original Agreement and under the Note.
By: /s/
Xxxxxx X. Xxxxxxxxxx
Name: Xxxxxx X. Xxxxxxxxxx
Title:
COO
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EXHIBIT
A
PROMISSORY
NOTE
$23,000,000 April
4, 2008
FOR VALUE
RECEIVED, the undersigned, Huron Demand LLC, a Delaware limited liability
company (the “Payor”), hereby
promises to pay to the order of CP4 Warbird Holdings, LLC (f/k/a Callaway
Partners, LLC), a Georgia limited liability company (the “Payee”) the principal
amount of TWENTY-THREE MILLION DOLLARS ($23,000,000), together with interest on
the unpaid principal amount hereof from time to time outstanding at the initial
rate of 5% per annum (calculated on the basis of a year of 365 or, if
applicable, 366 days), such rate to increase automatically to 8% per annum on
July 1, 2008. The principal amount shall be payable in a single
installment of $23,000,000, which shall be due and payable, without further
notice, no later than August 31, 2008, together with accrued and unpaid interest
on the outstanding principal amount hereof (unless the Payor elects to extend
the maturity date hereof until January 31, 2009 in accordance with the terms
hereof).
Notwithstanding
anything herein to the contrary, the Payor may elect by written notice to the
Payee to extend the maturity date of this Note until January 31,
2009. If the Payor makes the foregoing election, interest shall
accrue for all periods after August 31, 2008 at a rate of interest of 14% per
annum (calculated on the basis of a year of 365 or, if applicable 366,
days).
This Note
is being delivered by the Payor to the Payee pursuant to that
certain Amendment to Asset Purchase Agreement, dated as of April 4,
2008 (the “Amendment”), by and
among the Payor, Payee, and certain of the current and former members of Payee
listed on the signature pages thereto (collectively, “Guarantors”) and is
subject to the terms and conditions thereof.
The Payor
may prepay all or any portion of this Note at any time and from time to time,
without premium or penalty.
Payments
on this Note shall be made by means of a wire transfer of immediately available
funds to a bank account designated in writing by the Payee.
If any
payment hereunder falls due on a day which is not a Business Day (which shall
mean any day other than a Saturday or Sunday on which commercial banks are
generally open for business in New York, New York), the due date for such
payment shall be extended to the next Business Day (and additional interest
shall accrue for the period of such extension).
Each of
the following shall constitute a “Default” under this Note:
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(a)
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failure
by the Payor to pay when due any principal of or interest on this
Note;
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(b)
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a
breach of any representation or warranty of Payor as contained herein or
in the Amendment, or the failure by the Payor to comply with or to perform
any other provision of this Note and continuance of such breach or failure
for ten Business Days after the Payor has received written notice thereof
from the Payee; and
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(c)
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the
Payor shall become insolvent or generally fail to pay, or admit in writing
its inability to pay, its debts as they become due; or the Payor shall
apply for, consent to, or acquiesce in the appointment of a trustee,
receiver or other custodian for it or any of its property; or, in the
absence of such application, consent or acquiescence, a trustee, receiver
or other custodian is appointed for the Payor or for a substantial part of
its property and is not discharged or dismissed within 60 days; any
bankruptcy, reorganization, liquidation or similar case or proceeding
shall be commenced by or against the Payor and, if such case or proceeding
is commenced against the Payor, it continues for 60 days undismissed; or
the Payor shall take any action to authorize, or in furtherance of, any of
the foregoing.
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If any
Default described in clause (c) of the
preceding paragraph occurs, all obligations of the Payor under this Note shall
become immediately due and payable. If any other Default occurs and
is continuing, the Payee may declare all obligations of the Payor under this
Note to be immediately due and payable, whereupon all such obligations shall
become immediately due and payable without demand, notice or presentment of any
kind.
No act of
omission or commission, delay or failure on the part of the Payee in the
exercise of any right or remedy shall operate as a waiver thereof, no acceptance
of a past due partial payment shall constitute a novation of this Note or a
reinstatement of the indebtedness evidenced hereby. Further, no
single or partial exercise by Payee of any right or remedy shall preclude other
or further exercise thereof or the exercise of any other right or remedy,
including, the right of Payee to insist upon strict compliance with the terms of
this Note. This Note may not be changed orally, but only by an agreement in
writing signed by the party against whom enforcement of any waiver, change,
modification, or discharge is sought.
The Payor
irrevocably waives the right to a trial by jury in connection with any matter
arising out of this Note and, to the fullest extent permitted by applicable
law. The Payor further agrees that it is liable to the holder hereof
for all costs and expenses arising out of or related to the enforcement of this
Note, including any of the foregoing related to the collection of the
indebtedness evidenced hereby and including reasonable attorneys’
fees. Time is of the essence with respect to all of Payors'
obligations and agreements under this Note.
The
rights and privileges of the Payee hereunder shall inure to the benefit of its
successors and assigns; provided, however, that this
Note shall not be assigned by the Payee without the prior written consent of the
Payor, unless the Note is in Default in which case Payee may assign the Note
without the consent of the Payor.
This Note
shall be unsecured and shall be subordinated pursuant to that certain
Subordination Agreement between LaSalle Bank National Association, as
Administrative Agent, and Payee dated April 1, 2008.
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This Note
shall be governed by and construed in accordance with the domestic laws of the
State of Georgia without giving effect to any choice or conflict of law
provision or rule (whether of the State of Georgia or any other jurisdiction)
that would cause the application of the laws of any jurisdiction other than the
State of Georgia. Payor agrees that any action by Payee to enforce
this Note may be brought in the Superior Court of Xxxxxx or Dekalb County,
Georgia, and Payor waives any objections to the jurisdiction or venue of an
action brought in such courts.
HURON
DEMAND LLC
By: /s/ Xxxxxx X.
Xxxxxxxxxx
Name: Xxxxxx X.
Xxxxxxxxxx
Title:
COO
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