EXHIBIT 10.2
SECURITY AGREEMENT
THIS SECURITY AGREEMENT (this “
Security Agreement ”), dated as of September 30, 2009,
is by and among each party identified as a “Grantor” on
the signature pages hereto and such other parties as may become
Grantors hereunder after the date hereof (individually a “
Grantor ”, and collectively the “
Grantors ”) and BANK OF AMERICA, N.A., in its capacity
as Administrative Agent.
W I T N E S S E T H
WHEREAS, a revolving credit and term loan
facility has been established in favor of Huron Consulting Group
Inc., a Delaware corporation (the “ Company ”),
pursuant to the terms of that certain Credit Agreement, dated as of
June 7, 2006 (as amended, modified, increased, extended, renewed or
replaced, the “ Credit Agreement ”) among the
Company, the Lenders from time to time party thereto and Bank of
America, N.A., as Administrative Agent; and
WHEREAS, this Security Agreement is required by
the terms of that Eighth Amendment to Credit Agreement dated as of
the date hereof (the “ Eighth Amendment ”) by
and among the Company, the Guarantors, the Lenders party thereto
and Bank of America, N.A., as Administrative Agent, Swing Line
Lender and Issuing Lender;
NOW, THEREFORE, in consideration of these
premises and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
1.
Definitions and Interpretive Provisions .
(a) Capitalized
terms used and not otherwise defined herein shall have the meanings
provided in the Credit Agreement. In addition, the
following terms, which are defined in the UCC as in effect in the
State of Illinois on the date hereof, are used as defined
therein: Accession, Account, As-Extracted Collateral,
Chattel Paper, Commercial Tort Claim, Consumer Goods ,
Deposit Account, Document, Equipment, Farm Products, Fixtures,
General Intangibles, Goods, Instrument, Inventory, Investment
Property, Letter-of-Credit Right, Manufactured Homes, Proceeds,
Software, Standing Timber, Supporting Obligation and Tangible
Chattel Paper.
(b) As
used herein, the following terms shall have the meanings set forth
below:
“ Collateral ” has the
meaning provided in Section 2 hereof.
“ Company ” has the meaning
provided in the recitals hereof, together with its permitted
successors and assigns.
“ Credit Agreement ” has the
meaning provided in the recitals hereof.
“ Debtor Relief Laws ” means
the Bankruptcy Code of the United States, and all other
liquidation, conservatorship, bankruptcy, assignment for the
benefit of creditors, moratorium, rearrangement, receivership,
insolvency, reorganization, or similar debtor relief Laws of the
United States or other applicable jurisdictions from time to time
in effect and affecting the rights of creditors
generally.
“ Eighth Amendment ” has the
meaning provided in the recitals hereof.
“ Excluded Property ” means
(a) any personal Property (including motor vehicles) in respect of
which perfection of a Lien is not accomplished by the filing of a
UCC financing statement under Article 9 of the UCC, (b) any
leasehold interests, (c) any Property that is subject to a Lien
existing on the Closing Date and listed on Schedule 11.2 to
the Credit Agreement or a Lien securing Capital Leases obligations
or purchase money obligations permitted under Section
11.2(d) of the Credit Agreement, in either case, pursuant to
documents that prohibit (or give rise to a right of termination or
other remedies upon) the grant of any other Liens in such property,
provided in any such case the prohibition is not rendered
ineffective by the UCC (including the provisions of Section 9-407
and 9-408) or other applicable law, (d) any permit, lease, license
or other contract pursuant to documents that prohibit (or give rise
to a right of termination or other remedies upon) the grant of any
other Liens therein, provided in any such case the prohibition is
not rendered ineffective by the UCC (including the provisions of
Section 9-407 and 9-408) or other applicable law, and (e) any
Property or assets owned or held by any member of the Company and
its Subsidiaries for or relating to any qualified or non-qualified
deferred compensation plan.
“ Grantor ” and “
Grantors ” has the meaning provided in the
introductory paragraph hereof.
“ Indemnified Party ” has the
meaning provided in Section 7(b) hereof.
“ Property ” means an
interest of any kind in any property or asset, whether real,
personal or mixed, and whether tangible or intangible.
“ Secured Obligations ”
means, without duplication, (a) all Obligations and (b) all
reasonable costs and expenses incurred in connection with
enforcement and collection of the Secured Obligations, including
reasonable attorneys’ fees and disbursements.
“ Security Agreement ” has
the meaning provided in the introductory paragraph hereof, as the
same may be amended, supplemented and modified from time to
time.
“ UCC ” means the Uniform
Commercial Code.
(c) Each
of the terms and provisions of Section 1.2 of the Credit Agreement
(as the same may be amended or modified as provided therein) are
incorporated herein by reference to the same extent and with the
same effect as if fully set forth herein.
2.
Grant of Security Interest in the Collateral . To
secure the prompt payment and performance in full when due, whether
by lapse of time, acceleration, mandatory prepayment or otherwise,
of the Secured Obligations, each Grantor hereby grants to the
Administrative Agent, for the benefit of the Administrative Agent
and the other holders of the Secured Obligations, a continuing
security interest in, and a right to set off against, any and all
right, title and interest of such Grantor in and to all of its
personal property, of whatever type or description, whether now
owned or existing or owned, acquired, or arising hereafter,
including the following (collectively, the “
Collateral ”):
(b) all
cash and currency;
(d) those
Commercial Tort Claims identified on Schedule 2(d) attached
hereto;
(e) Deposit
Accounts (other than payroll accounts);
(h) all
General Intangibles (including contract rights, payment intangibles
and intellectual property);
(k) all
Investment Property;
(l) Letter
of Credit Rights;
(n) all
Supporting Obligations;
(o) all
other personal property of such Grantor of whatever type or
description; and
(p) to
the extent not otherwise included, all Accessions and all Proceeds
of any and all of the foregoing.
Notwithstanding anything to the contrary
contained herein, the security interests granted under this
Security Agreement shall not extend to (i) any Excluded Property,
(ii) the Pledged Collateral, as defined in and which shall be
governed by the terms of the Pledge Agreement, and (iii) any
Capital Securities in any Subsidiary (which, if the Administrative
Agent has any security interest therein, shall be provided for and
governed by the Pledge Agreement or other document). The
Grantors and the Administrative Agent, on behalf of itself and the
other holders of the Secured Obligations, hereby acknowledge and
agree that the security interest created hereby in the Collateral
(A) constitutes continuing collateral security for all of the
Secured Obligations, whether now existing or hereafter arising and
(B) is not to be construed as an assignment of any intellectual
property.
3.
Representations and Warranties . Each Grantor
hereby represents and warrants to the Administrative Agent, for the
benefit of the Administrative Agent and the other holders of the
Secured Obligations, that:
(a)
Legal Name; Chief Executive Office . As of the
date hereof:
(i) The
Grantor’s exact legal name is (and for the prior five (5)
years, or since its formation if less than five (5) years, has
been) and state of incorporation or formation, principal place of
business and chief executive office are (and for the prior five (5)
months, or since its formation if less than five (5) months, have
been) as set forth on Schedule 3(a)(i) attached
hereto.
(ii) Other
than as set forth on Schedule 3(a)(ii) attached hereto, the
Grantor has not been party to a merger, consolidation or other
change in structure or used any tradename in the prior five (5)
years.
(b)
Ownership . The Grantor is the legal and
beneficial owner of its Collateral and has the right to pledge,
sell, assign or transfer the same.
(c)
Security Interest/Priority . This Security
Agreement creates a valid security interest in favor of the
Administrative Agent, for the benefit of Administrative Agent and
the other holders of the Secured Obligations, in the Collateral of
the Grantor and, when properly perfected by filing, shall
constitute a valid perfected security interest in such Collateral,
to the extent such security interest can be perfected by filing
under the UCC, free and clear of all Liens except for Permitted
Liens.
(d)
Types of Collateral . None of the Collateral
consists of, or is the Accessions or the Proceeds of, As-Extracted
Collateral, Consumer Goods, Farm Products, Manufactured Homes, or
Standing Timber.
(e)
Inventory . No Inventory of the Grantor is held
by any Person other than the Grantor pursuant to consignment, sale
or return, sale on approval or similar arrangement.
4.
Covenants . Each Grantor covenants that, so long
as any of the Secured Obligations remains outstanding and until all
of the commitments relating thereto have been terminated, such
Grantor shall:
(a)
Other Liens . Defend the Collateral against the
claims and demands of all other parties claiming an interest
therein, keep the Collateral free from all Liens, except for
Permitted Liens, and not sell, exchange, transfer, assign, lease or
otherwise dispose of the Collateral or any interest therein, except
as permitted under the Credit Agreement.
(b)
Preservation of Collateral . Keep the Collateral
in good order, condition and repair and not use the Collateral in
violation of the provisions of this Security Agreement and the
other Loan Documents or any other agreement relating to the
Collateral, any policy insuring the Collateral or any applicable
law.
(c)
Change in Structure, Location or Type . Not,
without providing ten (10) Business Days’ prior written
notice to the Administrative Agent and without filing such
financing statements and amendments to any previously filed
financing statements as the Administrative Agent may require,
change its name or state of formation or be party to a merger,
consolidation or other change in structure or use any tradename
other than as set forth on Schedule 3(a)(ii) attached
hereto.
(d)
Inspection . Upon reasonable notice, and during
reasonable hours, at all times allow the Administrative Agent or
its representatives to visit and inspect the Collateral as set
forth in Section 10.2 of the Credit Agreement.
(e)
Perfection of Security Interest . Execute and
deliver to the Administrative Agent such agreements, assignments or
instruments (including affidavits, notices, reaffirmations and
amendments and restatements of existing documents, as the
Administrative Agent may reasonably request) and do all such other
things as the Administrative Agent may reasonably deem necessary,
appropriate or convenient to assure to the
Administrative Agent the effectiveness and priority of its security
interests hereunder, including such financing statements (including
renewal statements), amendments and supplements or such other
instruments as the Administrative Agent may from time to time
reasonably request in order to (i) perfect and maintain the
security interests granted hereunder in accordance with the UCC,
(ii) consummate the transactions contemplated hereby and (iii)
otherwise protect and assure the Administrative Agent of its rights
and interests hereunder. To that end, the Grantor
authorizes the Administrative Agent to file one or more financing
statements (with
collateral descriptions that may be broader
and/or less specific than the description of Collateral contained
herein and which may describe the collateral as “all
assets” or “all personal property”) disclosing
the Administrative Agent’s security interest in any or all of
the Collateral of the Grantor without the Grantor’s signature
thereon, and further the Grantor also hereby irrevocably makes,
constitutes and appoints the Administrative Agent, its nominee or
any other Person whom the Administrative Agent may designate, as
the Grantor’s attorney-in-fact with full power and for the
limited purpose to sign in the name of the Grantor any such
financing statements (including renewal statements), amendments and
supplements, notices or any similar documents that in the
Administrative Agent’s reasonable discretion would be
necessary, appropriate or convenient in order to perfect and
maintain perfection of the security interests granted hereunder,
such power, being coupled with an interest, being and remaining
irrevocable so long as the Secured Obligations remain unpaid and
until the commitments relating thereto shall have been
terminated. The Grantor hereby agrees that a carbon,
photographic or other reproduction of this Security Agreement or
any such financing statement is sufficient for filing as a
financing statement by the Administrative Agent without notice
thereof to the Grantor wherever the Administrative Agent may in its
sole discretion desire to file the same. In the event
for any reason the law of any jurisdiction other than Illinois
becomes or is applicable to the Collateral of the Grantor or any
part thereof, or to any of the Secured Obligations, the Grantor
agrees to execute and deliver all such instruments and to do all
such other things as the Administrative Agent in its sole
discretion reasonably deems necessary, appropriate or convenient to
preserve, protect and enforce the security interests of the
Administrative Agent under the law of such other jurisdiction (and,
if the Grantor shall fail to do so promptly upon the request of the
Administrative Agent, then the Administrative Agent may execute any
and all such requested documents on behalf of the Grantor pursuant
to the power of attorney granted hereinabove). If any
Collateral is in the possession or control of the Grantor’s
agents and the Administrative Agent so requests, the Grantor agrees
to notify such agents in writing of the Administrative
Agent’s security interest therein and, upon the
Administrative Agent’s request, instruct them to hold all
such Collateral for the account of the Administrative Agent and the
other holders of the Secured Obligations and subject to the
Administrative Agent’s instructions.
(f)
Insurance . Insure, repair and replace the
Collateral of the Grantor as set forth in the Credit Agreement;
provided that, in any event, the Administrative Agent will be shown
as loss payee for casualty insurance to the extent of the
collateral interests herein.
(g)
Commercial Tort Claims .
(i) Promptly
notify the Administrative Agent in writing of the initiation of any
Commercial Tort Claim in excess of $500,000 before any court or
other governmental authority by or in favor of the Grantor or any
of its Subsidiaries.
(ii) Execute
and deliver such statements, documents and notices and do and cause
to be done all such things as the Administrative Agent may
reasonably deem necessary, appropriate or convenient, or as are
required by applicable law, to create, perfect and maintain the
Administrative Agent’s security interest in any Commercial
Tort Claim.
5.
Advances by the Administrative Agent . On failure
of any Grantor to perform any of the covenants and agreements
contained herein, the Administrative Agent may, at its sole option
and in its sole discretion, perform the same and in so doing may
expend such sums as the Administrative Agent may reasonably deem
advisable in the performance thereof, including the payment of any
insurance premiums, the payment of any taxes, a payment to obtain a
release of a Lien or potential Lien, expenditures made in defending
against any adverse claim and all other expenditures that the
Administrative Agent may make for the protection of the security
hereof or that may be compelled to make by operation of
law. All such sums
and amounts so
expended shall be repayable by the Grantors on a joint and several
basis (subject to Section 22 hereof) promptly upon timely
notice thereof and demand therefor, shall constitute additional
Secured Obligations and shall, subject to Section 4.1 of the Credit
Agreement, bear interest from the date said amounts are expended at
the rate then applicable to Revolving Loans that are Base Rate
Loans. No such performance of any covenant or agreement
by the Administrative Agent on behalf of any Grantor, and no such
advance or expenditure therefor, shall relieve the Grantors of any
default under the terms of this Security Agreement, the other Loan
Documents or any other documents relating to the Secured
Obligations. The Administrative Agent may make any
payment hereby authorized in accordance with any bill, statement or
estimate procured from the appropriate public office or holder of
the claim to be discharged without inquiry into the accuracy of
such bill, statement or estimate or into the validity of any tax
assessment, sale, forfeiture, tax lien, title or claim except to
the extent such payment is being contested in good faith by a
Grantor in appropriate proceedings and against which adequate
reserves are being maintained in accordance with GAAP.
6.
Remedies .
(a)
General Remedies . Upon the occurrence of an
Event of Default and during the continuation thereof with prior
written notice to the Grantors, the Administrative Agent and the
other holders of the Secured Obligations shall have, in addition to
the rights and remedies provided herein, in the Loan Documents, in
any other documents relating to the Secured Obligations, or by law
(including levy of attachment and garnishment), the rights and
remedies of a secured party under the UCC of the jurisdiction
applicable to the affected Collateral and, further, the
Administrative Agent may, with or without judicial process or the
aid and assistance of others, (i) enter on any premises on which
any of the Collateral may be located and, without resistance or
interference by the Grantors, take possession of the Collateral,
(ii) dispose of any Collateral on any such premises, (iii) require
the Grantors to assemble and make available to the Administrative
Agent at the expense of the Grantors any Collateral at any place
and time designated by the Administrative Agent that is reasonably
convenient to both parties, (iv) remove any Collateral from any
such premises for the purpose of effecting sale or other
disposition thereof, and/or (v) without demand and without
advertisement, notice, hearing or process of law, all of which each
of the Grantors hereby waives to the fullest extent permitted by
law, at any place and time or times, sell and deliver any or all
Collateral held by or for it at public or private sale, by one or
more contracts, in one or more parcels, for cash, upon credit or
otherwise, at such prices and upon such terms as the Administrative
Agent deems advisable, in its sole discretion (subject to any and
all mandatory legal requirements). Each of the Grantors
acknowledges that any private sale referenced above may be at
prices and on terms less favorable to the seller than the prices
and terms that might have been obtained at a public sale and agrees
that such private sale shall be deemed to have been made in a
commercially reasonable manner. Neither the
Administrative Agent’s compliance with applicable law nor its
disclaimer of warranties relating to the Collateral shall be
considered to adversely affect the commercial reasonableness of any
sale. In addition to all other sums due the
Administrative Agent and the other holders of the Secured
Obligations with respect to the Secured Obligations, the Grantors
shall pay the Administrative Agent and each of the other holders of
the Secured Obligations all reasonable costs and expenses incurred
by the Administrative Agent or any such other holder of the Secured
Obligations (including reasonable attorneys’ fees and
disbursements and court costs) in obtaining or liquidating the
Collateral, in enforcing payment of the Secured Obligations, or in
the prosecution or defense of any action or proceeding by or
against the Administrative Agent or the other holders of the
Secured Obligations or the Grantors concerning any matter arising
out of or connected with this Security Agreement, any Collateral or
the Secured Obligations, including any of the foregoing arising in,
arising under or related to a case under De
