NEW YORK — Sam Ben-Avraham received close to $28 million earlier this year when Advanstar Communications amended its previous purchase agreement for Project Global Tradeshow, which it acquired in August 2005.
In a 10-Q filing with the SEC on May 8, Advanstar Communications noted that the lump-sum payment was made to the former owners of Project in lieu of contingent payments that were required this year and in 2008 based on Project’s performance, as well as certain obligations under stock-purchase and employment agreements. Ben-Avraham, who founded Project in 2003, was previously the principal owner of Project and received the great majority of the $28 million.
The filing noted this payment was on top of the original purchase price of $9.9 million in cash for Project.
In what Ben-Avraham described as a formality that does not reflect his continuing role at Project, the filing stated that the two parties amended the agreement “in order to terminate the principal former owner’s employment with the company.” But Ben-Avraham—who originally signed a three-year employment agreement to remain as president of Project—told DNR he remains at the helm of the show, is intimately involved with every aspect of it and intends to remain at Project into the future. He dismissed the language of the amendment as a detail related to the completion of the acquisition of Project by Advanstar.
“It’s really simple—it was a finalization of the buyout,” explained Ben-Avraham of the amendment. “We’ve grown Project to a size we are all happy with, so they paid the growth bonus now. Besides that, everything is the same. I am 100 percent involved with Project, I still report to [Advanstar CEO] Joe Loggia, I love the show and have absolutely no reason to leave.”
Advanstar’s 10-Q filing also provided details on the company’s purchase of the Pool trade show, also in August 2005. Advanstar—which owns the MAGIC Marketplace—originally paid Pool founder Ronda Walker $3 million in cash for the streetwear show. Last July, Advanstar amended that purchase agreement to eliminate future contingent payments and terminate Walker’s employment with Pool, in exchange for another payment of $1.5 million plus $500,000 due this July. Unlike Ben-Avraham, Walker did in fact sever all ties to her former company.