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Hebert Acquisitions, LLC v. Tremur Consulting Contractors, Inc – Case Brief Summary (Texas)

In Hebert Acquisitions, LLC v. Tremur Consulting Contractors, Inc., No. 03-09-00386-CV, 2011 WL 350466 (Tex. App.--Austin Feb. 4, 2011, no pet.), Hebert acquired the assets of Tremur, a construction company, pursuant to the asset purchase agreement executed by the parties.

The agreement included a provision detailing additional payments, called contingent price payments, to be made on the first three anniversaries of the closing if specified thresholds for gross revenue were met.

In its opinion, the Hebert court noted that the maximum contingent price payment available for the first year ranged from $55,950 if the company had gross revenue of at least $2 million up to $447,600 if the company achieved gross revenues of at least $5 million during the first year it was operated by Hebert. See id.

Thus, the parties clearly contemplated a "floor," i.e. $55,950, and there is nothing in Hebert reflecting that the earn-out payments between the defined amounts were prorated. Notably, the gross revenues for the first year were $6 million and Hebert did not dispute that it owed the $447,600 contingent price payment to the appellees.