Contingent Purchase Price Clause Samples
A Contingent Purchase Price clause defines a portion of the purchase price in a transaction that is dependent on the occurrence of specific future events or the achievement of certain performance targets. Typically, this means that the buyer will pay an additional amount to the seller if the acquired business meets agreed-upon milestones, such as revenue thresholds or regulatory approvals, after the closing of the deal. This clause allows parties to bridge valuation gaps and allocate risk by tying part of the payment to future outcomes, ensuring that the final price more accurately reflects the business's actual performance.
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Contingent Purchase Price. Promptly following the preparation of any Statements in accordance with subsection (a) of this Section, Buyer shall deliver to Seller (i) such Statements, and (ii) a reasonably detailed calculation of the Contingent Purchase Price payable as a consequence of the Adjusted EBITACO reflected thereon. The "Contingent Purchase Price" shall equal two times Adjusted EBITACO as shown on the 1997 Statements or on any of the Subsequent Statements, it being Seller's option (which option shall be exercisable during the time period specified in the next sentence) to elect which twelve-month period with respect to which it shall receive the Contingent Purchase Price. Within twenty (20) days after the expiration of the time period specified in Section 2.6(a) with respect to any Statements or, if there is a dispute regarding such Statements or the Contingent Purchase Price payable as a consequence of the contents thereof, within twenty (20) days after the resolution of such dispute pursuant to Section 2.6(b), Seller shall notify Buyer in writing if it elects to exercise its option to receive the Contingent Purchase Price with respect to such Statements and the twelve-month period covered thereby. If Seller fails to so notify Buyer that it elects to receive the Contingent Purchase Price with respect to such Statements and the twelve-month period covered thereby, it shall no longer have the option to receive the Contingent Purchase Price with respect to such Statements and the twelve-month period covered thereby and Buyer shall thereupon, for a period of twenty (20) days, have the right to require Seller to receive the Contingent Purchase Price with respect to such Statements and the twelve-month period covered thereby, PROVIDED, HOWEVER, that such right on the part of Buyer shall not apply with respect to the twelve-month periods ended on the first, second or third anniversaries of the Closing Date.
Contingent Purchase Price. (i) Base Earn-Out. Within 45 days of December 31, 2006, Buyer shall calculate the Buyer's Net Income, Before Taxes for its 2006 fiscal year. Seller shall be entitled to an earn-out payment with respect to such period (the "2006 Earn-Out Payment") equal to a maximum of $324,000 if the sum of Buyer's Net Income, Before Taxes for its 2006 fiscal year and its 2005 fiscal year exceeds $850,000 (the "2006 Earn-Out Target"). If the 2006 Earn-Out Target is not met, then Seller shall be entitled to a 2006 Earn-Out Payment equal to the maximum potential 2006 Earn-Out Payment ($324,000), less the shortfall in the 2006 Earn-Out Target. The 2006 Earn-Out Payment shall be payable as follows: one-half of the 2006 Earn-Out Payment actually earned by Seller, shall be payable in cash (the maximum amount of cash payable to Seller shall be $162,000) (the "Cash Portion of the 2006 Earn-Out Payment") and one-half of the 2006 Earn-Out Payment actually earned by Seller, shall be payable in shares of ▇▇▇▇▇ common stock (the "Stock Portion of the 2006 Earn-Out Payment"), par value $.50 per share (the "▇▇▇▇▇ Stock") (the maximum amount of ▇▇▇▇▇ Stock payable to Seller hereunder shall be, in value (as determined herein) to $162,000). The number of shares of ▇▇▇▇▇ Stock to be issued to Seller in payment of the Stock Portion of the 2006 Earn-Out Payment shall be equal to the quotient obtained by dividing the aggregate Stock Portion of the 2006 Earn-Out Payment to which Seller shall be entitled to receive for such period by the average of the closing sales price of the ▇▇▇▇▇ Stock (or the closing bid price, if no sales were reported) as quoted on the Nasdaq National Market for the 20 trading days immediately prior to the date of issuance of such shares of ▇▇▇▇▇ Stock hereunder (which date of issuance shall be within 60 days of the end of Buyer's 2006 fiscal year). Payment of the Stock Portion of the 2006 Earn-Out Payment payable hereunder, assumes the continuing accuracy and truthfulness of the representations, warranties and covenants set out in Section 3.29 of this Agreement, and the continued availability to ▇▇▇▇▇ of an exemption from registration under the Securities Act for the issuance of the ▇▇▇▇▇ Stock to Seller. In the event Seller shall be entitled to a Stock Portion of the 2006 Earn-Out Payment under this Section 2.3.1(c)(i), Seller shall be required to confirm the accuracy and truthfulness of such representations, warranties and covenants set out in Section 3.29 of this Agre...
Contingent Purchase Price. As contingent consideration for the Shares, Purchaser will pay to Seller, as described below, a three-year cumulative earnout of up to an aggregate of $4,000,000 based on the achievement of specified targets (the “Targets”) of compounded annual growth rate in EBIT (“EBIT CAGR”) of Crosstex (calculated in accordance with Schedule 2.5.2(B)) as measured against the Baseline EBIT, but subject to the terms and conditions of this Section 2.5. The additional contingent consideration (the “Contingent Purchase Price”) shall be determined and payable as follows:
2.5.1. For the purpose of computing the Contingent Purchase Price due with respect to each of the twelve-month periods ending July 31, 2006 (the “First Target Year”), July 31, 2007 (the “Second Target Year”), and July 31, 2008 (the “Third Target Year”), Purchaser will make the computations set forth in Sections 2.5.2(A) and 2.5.2(B), comparing both of the computation methods therein (the “Computation Methods”). The Computation Method yielding the higher Contingent Purchase Price to Seller for the period in question shall be the Computation Method selected with respect to such period so as to maximize the Contingent Purchase Price over the three-year period ending July 31, 2008; provided, however, that except as provided in Section 2.5.2(A)(2), in no event shall the aggregate Contingent Purchase Price payable to Seller hereunder exceed $3,666,667, plus an additional $333,333 if the test under Section 2.5.2(A)(2) is satisfied.. For the First Target Year the Computation Method set forth in Section 2.5.2(A) is the only applicable method for determining the Contingent Purchase Price.
2.5.2. The Computation Methods are as follows:
Contingent Purchase Price. (a) Upon delivery to the Buyer of the Base Financial Statements, the parties shall calculate as a dollar amount the difference between the gross revenues and the cost of goods sold of the Seller for its fiscal year ending June 30, 2004 (the “Base Year Gross Profit”) and the percentage of total revenues of the Seller for such fiscal year represented by the Base Year Gross Profit (the “Base Year Gross Margin”).
(b) Within 90 days after January 31, 2006, the Buyer shall calculate the difference between the gross revenues and the cost of goods sold of the Buyer’s Rochester Clothing Division for its 2006 fiscal year (the “2006 Gross Profit”) and the percentage of total revenues of the Buyer’s Rochester Clothing Division for such fiscal year represented by the 2006 Gross Profit (the “2006 Gross Margin”). Seller shall be entitled to an earn-out payment in an amount equal to 60% of the amount by which the 2006 Gross Profit exceeds the Base Year Gross Profit up to a maximum earn-out payment of $1,333,333 with respect to such period; provided, however, that no earn-out payment shall be due in the event that the 2006 Gross Margin is less than the difference between (i) the Base Year Gross Margin less (ii) 2.0%.
(c) Within 90 days after January 31, 2007, the Buyer shall calculate the difference between the gross revenues and the cost of goods sold of the Buyer’s Rochester Clothing Division for its 2007 fiscal year (the “2007 Gross Profit”) and the percentage of total revenues of the Buyer’s Rochester Clothing Division for such fiscal year represented by the 2007 Gross Profit (the “2007 Gross Margin”). Seller shall be entitled to an earn-out payment in an amount equal to 60% of the amount by which the sum of the 2006 Gross Profit and the 2007 Gross Profit exceeds the sum of (A)(i) the Base Year Gross Profit, times (ii) two (2), plus (B) $1,500,000, which 2007 contingent payment is being reduced by the amount of any earn-out payment made with respect to the 2006 fiscal year and up to a maximum earn-out payment of $2,666,667 for the 2006 and 2007 fiscal years; provided, however, that no earn-out payment shall be due with respect to the 2007 fiscal year in the event that the average of the 2006 Gross Margin and the 2007 Gross Margin is less than the difference between (i) the Base Year Gross Margin less (ii) 2.0%.
(d) Within 90 days after January 31, 2008, the Buyer shall calculate the difference between the gross revenues and the cost of goods sold of the Buyer’s Rochest...
Contingent Purchase Price. Buyer shall pay the Company a Contingent Purchase Price computed in accordance with and subject to each of the conditions of Exhibit A of this Agreement, which is hereby incorporated by reference in, and made a part of this Agreement.
Contingent Purchase Price. The Contingent Purchase Price means the sum of the Initial Contingent Purchase Price and the Second Contingent Purchase Price determined and paid as follows:
Contingent Purchase Price. On the Final Settlement Date, the Buyer shall pay the Lessee Representative, on behalf of the Lessees, in accordance with the Waterfall, the Contingent Purchase Price. In the event the Buyer does not have sufficient Available Funds to pay the Contingent Purchase Price solely as a result of (i) Marketing Services Provider’s failure to timely pay to the Buyer the Device Net Sale Proceeds in accordance with the Support Services Agreement or in respect of Marketing Services Provider’s collection of Device Net Sale Proceeds occurring after the Final Settlement Date and/or (ii) Forward Purchaser’s failure to timely pay to the Buyer all amounts due and owing under the Forward Purchase Agreement (the “Insufficient Amount”), the Lessees hereby agree that the Contingent Purchase Price shall be reduced by the Insufficient Amount (so long as the Contingent Purchase Price shall not be less than zero after giving effect to such reduction) and the Buyer shall transfer any claim it has to the Insufficient Amount to the Lessee Representative and agrees to cooperate with Lessee Representative in connection with pursuing any claim for the Insufficient Amount as reasonably requested by Lessee Representative from time to time.
Contingent Purchase Price. (1) Tenant shall have the right to receive the Contingent Purchase Price by delivering the Conversion Notice to Company; provided that (i) the Tenant under the Lease at the Property shall have paid Percentage Rent on an annual basis for the prior calendar year, and (ii) at least one-half (1/2) of the increase in the Adjusted Net Operating Income from the Base Year to the Conversion year is attributable to an increase in Gross Operating Revenue (not including food and beverage operations and sale of merchandise), as reasonably determined by Company. The Contingent Purchase Price shall equal the Net Incremental Income Available for Contingent Purchase Price divided by the Conversion Date Capitalization Rate.
(2) Within forty-five (45) days of the Conversion Date, Company shall deliver to Tenant the number of Owner's Units in Company that equals the Contingent Purchase Price divided by the per share common stock price of the Company on the Conversion Date.
Contingent Purchase Price. The Buyer will pay the Selling Shareholders additional consideration for the Company Stock (the "Contingent Purchase Price") as follows:
2.3.1. If the Company's EBITDA (as hereinafter defined) for the twelve months ended September 30, 1999 is equal to or greater than (A) $7,000,000, Buyer will pay the Selling Shareholders $5,000,000; (B) $6,500,000 but less than $7,000,000, Buyer will pay the Selling Shareholders $3,500,000 plus $3 for each dollar that EBITDA exceeds $6,500,000 for such period, up to a maximum of an additional $1,500,000; and (C) $5,500,000 but less than $6,500,000, Buyer will pay the Selling Shareholders $2,000,000.
2.3.2. If the Company's EBITDA (as hereinafter defined) for the twelve months ended September 30, 2000 is equal to or greater than (A) $7,000,000, Buyer will pay the Selling Shareholders $3,000,000 or (B) $6,500,000 but less than $7,000,000, Buyer will pay the Selling Shareholders $1,500,000 plus $3 for each dollar that EBITDA exceeds $6,500,000 for such period, up to a maximum of an additional $1,500,000.
2.3.3. If the Company's EBITDA for the twenty-four month period ending September 30, 2000 (the "Earnout Period") is (A) greater than or equal to $16,000,000, Buyer will pay the Selling Shareholders $6,000,000 (in addition to the amounts payable pursuant to clauses 2.3.1 and 2.3.2 above) or is (B) greater than or equal to $15,000,000 but less than $16,000,000, Buyer will pay the Selling Shareholders $3,000,000 (in addition to the amount payable pursuant to clause 2.3.1 and 2.3.2 above).
2.3.4. The Company's EBITDA shall be calculated based on the financial statements prepared by the Buyer's regular accountants in accordance with GAAP, consistently applied and this Section 2.3. As used in Section 2.3, the term "EBITDA" shall mean the net earnings (or losses), excluding extraordinary gains (or losses), before all interest, income (federal and state) taxes, Michigan single business taxes, franchise taxes, depreciation, and amortization of the Company, computed on the accrual basis of accounting in accordance with GAAP consistently applied, except that the following provisions shall govern the computation of EBITDA for purposes of this Section 2.3:
(1) All accounting assumptions, procedures, and methodologies shall be implemented on a consistent basis. If Buyer makes a material change in the accounting principles of the Business (other than such changes which are required by law or financial reporting purposes in accordance with ...
Contingent Purchase Price. The “Contingent Purchase Price” will be an amount equal to (i) Twenty-Three Million and 00/100 Dollars ($23,000,000.00) minus (ii) any Accelerated Purchase Amount paid to Seller at the Closing pursuant to Section 2(a)(ii) of the Agreement. The Contingent Purchase Price will be payable only upon:
(a) the award to Company of the follow-on of the NVESD Contract and expiration of all protest periods related thereto and resolution of any protests in favor of Company, if such award occurs on or prior to December 31, 2009, on substantially the economic terms and conditions set forth in Company’s final price proposal, which price proposal shall be prepared in accordance with Section 3 of this Exhibit A and with the past practice of Company and which proposal, if successful, would not, or could not be reasonably be expected to, change the financial prospects or performance of Company, or
(b) Purchaser having caused Seller and Company to waive the condition set forth in Section 7.8 of the Agreement in accordance with Section 7.8 and either: (A) (i) the final price proposals for award of the follow-on of the NVESD Contract are due to the Government after the Closing, (ii) Company fails to submit a final price proposal solely because it is unable to self-certify that it meets the applicable NAICS small business size standard for award of the follow-on of the NVESD Contract (except where such inability is a result of circumstances that cause any of the representations or warranties of Seller and Company in Section 3 to have been inaccurate or untrue when made) and (iii) the follow-on of the NVESD Contract is awarded to a third party prior to December 31, 2009; or (B) (i) the final price proposals for award of the follow-on of the NVESD Contract are due to the Government after the Closing, (ii) Company submits its final price proposal for award of the follow-on of the NVESD Contract and self-certifies that it meets the applicable NAICS small business size standard for award of the follow-on of the NVESD Contract, (iii) prior to December 31, 2009, the NVESD Agency awards to Company or announces that it will award to Company the follow-on of the NVESD Contract, (iv) the award to Company of the follow-on of the NVESD Contract is either terminated or the follow-on of the NVESD Contract is never formally awarded to Company due solely to Company's failure to meet the applicable NAICS small business size standard, as determined and announced by the NVESD Agency (except where s...