Common use of Estimated Net Working Capital Calculation Clause in Contracts

Estimated Net Working Capital Calculation. On the Closing Date, Seller shall prepare and deliver to Purchaser an estimated balance sheet as of the end of the day on October 25, 2011 (the “Estimated Working Capital Statement”) setting forth Seller’s good faith estimation of the Net Working Capital of Seller as of such date (the “Estimated Closing Working Capital”). In determining the Estimated Closing Working Capital, the parties agree that the Inventory value estimate shall be determined as provided in Section 3.2(a) above and both parties will exercise their reasonable best efforts to ensure that such Inventory estimate is as close to a final valuation as is practical under the circumstances. In no event, however, will the methodology used to calculate labor and overhead be subject to any post-Closing revision. In the event the Estimated Closing Working Capital is less than $5,800,000 (the “Target Working Capital”), the Purchase Price will be decreased, on a dollar for dollar basis, by the amount of such shortfall. In the event the Estimated Closing Working Capital exceeds the Target Working Capital, the Purchase Price will be increased, on a dollar for dollar basis, by the amount of such excess. The resulting shortfall or excess is referred to as the “Initial Working Capital Adjustment”.

Estimated Net Working Capital Calculation. On the Closing Date, Seller shall prepare and deliver to Purchaser an estimated balance sheet as of the end of the day on October 25, 2011 Closing Date (the “Estimated Working Capital Statement”) setting forth Seller’s good faith estimation of the Net Working Capital of Seller as of such date the Closing Date (the “Estimated Closing Working Capital”). In determining the Estimated Closing Working Capital, the parties agree that the Inventory value estimate shall be determined as provided in Section 3.2(a) above and both parties will exercise their reasonable best efforts to ensure that such Inventory estimate value is as close to a final valuation as is practical under the circumstances. In no event, however, will the methodology used to calculate labor and overhead be subject to any post-Closing revision. In the event the Estimated Closing Working Capital is less than $5,800,000 3,434,967 (the “Target Working Capital”), the Purchase Price will be decreased, on a dollar for dollar basis, by the amount of such shortfall. In the event the Estimated Closing Working Capital exceeds the Target Working Capital, the Purchase Price will be increased, on a dollar for dollar basis, by the amount of such excess. The resulting shortfall or excess is referred to as the “Initial Working Capital Adjustment”.