Net Working Capital Adjustment Sample Clauses
A Net Working Capital Adjustment clause defines how the purchase price in a transaction will be modified based on the difference between the estimated and actual net working capital at closing. Typically, the buyer and seller agree on a target net working capital amount, and after closing, the actual net working capital is calculated; if it is higher or lower than the target, the purchase price is adjusted accordingly. This clause ensures that both parties are treated fairly by accounting for fluctuations in short-term assets and liabilities, preventing either side from being disadvantaged by unexpected changes in the company's financial position at the time of sale.
POPULAR SAMPLE Copied 45 times
Net Working Capital Adjustment. (a) At least five business days prior to the Closing, the Company shall provide Parent with (i) an estimated balance sheet of the Company as of the Closing Date prepared from the Company’s books and records in a manner consistent with the balance sheet of the Company as of April 30, 2004 and in accordance with GAAP (subject to normal year end adjustments and except for the absence of footnotes) and (ii) a statement showing the Company’s good faith estimate of the net working capital (defined as current assets (less cash), minus current liabilities) of the Company as of the Closing Date prepared in accordance with the Principles and Procedures. At least one business day prior to the Closing, the Company shall provide Parent with (x) a final balance sheet of the Company as of the Closing Date, which shall be prepared from the Company’s books and records in a manner consistent with the balance sheet as of April 30, 2004 and in accordance with GAAP (subject to normal year end adjustments and except for the absence of footnotes) (the “Closing Balance Sheet”) and (y) a final statement (the “Closing NWC Statement”) showing the final net working capital (defined as current assets (less cash), minus current liabilities) of the Company as of the Closing Date (the “Net Working Capital”) prepared in accordance with the principles and procedures set forth on Exhibit 2.8
(a) (the “Principles and Procedures”). Solely for purposes of calculating the Net Working Capital, the bad debt reserve with respect to accounts receivable shall be $611,000. The Closing Balance Sheet and the Closing NWC Statement shall be certified by the Chief Executive Officer and Chief Financial Officer of the Company to be prepared in good faith and, with respect to the Closing Balance Sheet, in accordance with GAAP (subject to normal year end adjustments and except for the absence of footnotes) and, with respect to the Closing NWC Statement, in accordance with the Principles and Procedures. If the Net Working Capital is greater than the Target Net Working Capital, then the Merger Consideration shall be increased, dollar for dollar, by the amount of such excess, and if the Net Working Capital is less than the Target Net Working Capital, then the Merger Consideration shall be decreased, dollar for dollar, by the amount of such shortfall.
(b) Within 60 days after Parent’s receipt of the Closing NWC Statement, Parent shall deliver written notice to the Shareholder Representatives of any items shown in...
Net Working Capital Adjustment. (a) Part 1.6(a) of the Disclosure Letter sets forth an example calculation of Net Working Capital as of June 29, 2013, including the components thereof. Any amount by which the Closing Date Net Working Capital is less than the Net Working Capital Target will reduce the Purchase Price, and any amount by which the Closing Date Net Working Capital is greater than the Net Working Capital Target will increase the Purchase Price.
(b) Within 70 calendar days of the Closing Date, the Seller shall prepare and deliver to the Purchaser a statement setting forth the calculation of the Net Working Capital as of immediately before the Closing, including the components thereof, as calculated on a basis consistent with Part 1.6(a) of the Disclosure Letter (the “Closing Date Net Working Capital”).
(c) The Purchaser will notify the Seller in writing of any objections to the Seller’s computation of Closing Date Net Working Capital within 15 calendar days after the Purchaser receives the statement of Closing Date Net Working Capital. If the Purchaser does not notify the Seller of any such objections by the end of that 15-day period, then the Closing Date Net Working Capital will be considered final at the end of the last day of that 15-day period. If the Purchaser does notify the Seller of any such objections by the end of that 15-day period and the Purchaser and the Seller are unable to resolve their differences within 15 calendar days thereafter, then the Purchaser and the Seller will instruct their respective accountants to use commercially reasonable efforts to resolve such disputed items to their mutual satisfaction and to deliver a final Closing Date Net Working Capital to the Purchaser and the Seller as soon as reasonably possible. If the Purchaser’s accountants and the Seller’s accountants are unable to resolve any such disputed items within 15 calendar days after receiving such instructions, then the remaining disputed items and the value attributable to them by each of the Purchaser and the Seller will be submitted to a nationally recognized accounting firm mutually agreed by the Purchaser and the Seller (the “Accounting Arbiter”) for resolution, and the Accounting Arbiter will be instructed to determine the final Closing Date Net Working Capital to the Purchaser and the Seller as soon as possible. The Accounting Arbiter will consider only those items and amounts in the Purchaser’s and the Seller’s respective calculations of the Closing Date Net Working Capital that...
Net Working Capital Adjustment. (i) As promptly as practicable, but in no event later than 30 days after the Closing Date, the Purchaser shall prepare and deliver to the Seller a balance sheet of the Company as of the open of business on the Closing Date prepared in accordance with GAAP with no Change in Accounting Principles from those utilized in preparing the Financial Statements (the "Closing Balance Sheet"), together with a schedule setting forth in reasonable detail the Purchaser's good faith calculation of the Net Working Capital at Closing.
(ii) The Purchaser and its accountants shall permit the Seller and their representatives to have full access to the books, records and other documents (including work papers) pertaining to or used in connection with preparation of the Closing Balance Sheet and the Purchaser's calculation of the Net Working Capital at Closing and provide the Seller and their representatives with copies thereof (as reasonably requested by the Seller). If the Seller disagrees with the Purchaser's calculation of the Net Working Capital at Closing as set forth on the schedule attached to the Closing Balance Sheet or with any other aspect of the Closing Balance Sheet for any purpose under this Agreement, the Seller shall notify the Purchaser in writing of such disagreement (the "Objection Notice") (such Objection Notice setting forth the basis for such disagreement in reasonable detail) within 30 Business Days after the Purchaser's delivery of the Closing Balance Sheet to the Seller, which time period shall be extended by any delays resulting from the Purchaser's failure to deliver or make available to Seller, at Seller's request, all necessary materials. The Purchaser and the Seller thereafter shall negotiate in good faith to resolve any such disagreements with respect to the computation of the Net Working Capital at Closing or any other aspect of the Closing Balance Sheet. If the Purchaser and the Seller reach an agreement as to the computation of the Net Working Capital at Closing, such agreement shall be conclusive and binding upon the Purchaser and the Seller and constitute the Net Working Capital at Closing for purposes of this Agreement. If the Purchaser and the Seller are unable to resolve any such disagreements within 30 Business Days after the delivery of the Objection Notice to the Purchaser by the Seller, the Purchaser and the Seller shall submit the dispute to a national public accounting firm (or a successor thereto) jointly selected by the Purchaser a...
Net Working Capital Adjustment. (a) At least two (2) Business Days prior to the Closing Date, Seller shall deliver to Buyer a certificate of an executive officer of Seller (the “Estimated Net Working Capital Statement”) that sets forth Seller’s good faith estimate of each of (x) the Norway Net Working Capital and (y) the Sweden Net Working Capital, in each case, as of the Closing, together with a calculation of the sum of the estimated Norway Net Working Capital and estimated Sweden Net Working Capital (such sum, the “Estimated Closing Net Working Capital”). At the Closing:
(i) if the Estimated Closing Net Working Capital is less than the sum of (A) the Norway Target Net Working Capital and (B) the Sweden Target Net Working Capital, the Base Purchase Price shall be decreased by an amount equal to such deficiency; and
(ii) if the Estimated Closing Net Working Capital exceeds the sum of (A) the Norway Target Net Working Capital and (B) the Sweden Target Net Working Capital, the Base Purchase Price shall be increased by an amount equal to such excess.
(b) Except as may otherwise be agreed by the parties, as promptly as practicable, but in no event later than sixty (60) days after the Closing Date, Buyer shall in good faith prepare and deliver to Seller (i)(A) an unaudited consolidated balance sheet of the Norway Company as of the Closing prepared in accordance with GAAP (except for the absence of notes) (the “Norway Closing Balance Sheet”), and (B) a statement (the “Norway Closing Net Working Capital Statement”) setting forth Buyer’s calculation of the Norway Net Working Capital as of the Closing, based on such Norway Closing Balance Sheet and calculated on a basis consistent with Schedule A (the “Norway Closing Net Working Capital”), (ii)(A) an unaudited consolidated balance sheet of the Sweden Company and the Sweden Subsidiary as of the Closing prepared in accordance with GAAP (except for the absence of notes) (the “Sweden Closing Balance Sheet”), and (B) a statement (the “Sweden Closing Net Working Capital Statement” and together with the Norway Closing Net Working Capital Statement, the “Closing Net Working Capital Statement”) setting forth Buyer’s calculation of the Sweden Net Working Capital as of the Closing, based on such Sweden Closing Balance Sheet and calculated on a basis consistent with Schedule B (the “Sweden Closing Net Working Capital”) and (iii) the sum of the Norway Closing Net Working Capital and the Sweden Closing Net Working Capital (the “Closing Net Working Capital”).
Net Working Capital Adjustment. (a) At least three (3) Business Days, but no more than seven (7) Business Days, prior to the Closing Date, Representative shall cause to be prepared and delivered to Purchaser a good faith estimate of the Net Working Capital immediately prior to the Closing (subject to the last sentence hereof, the “Estimated Net Working Capital”), which shall be certified by a duly authorized officer of the Company as the Sellers’ good faith estimate of the Net Working Capital as of immediately prior to the Closing, which statement shall quantify in reasonable detail the estimates of each item included in such calculation, in each case calculated in accordance with the provisions of this Agreement. The Parties shall cooperate with one another in connection with the preparation and evaluation of such estimate. The Company Parties shall promptly provide Purchaser and its representatives access to all personnel, relevant documents, and information reasonably requested by Purchaser or its representatives in connection with their review of the Estimated Net Working Capital (including all components thereof). Prior to the Closing Date, Purchaser shall notify Representative of any objections to the Estimated Net Working Capital (including any component thereof), and the Parties shall work in good faith to resolve such objections and agree upon a final Estimated Net Working Capital for purposes of Closing, and such agreed upon estimate shall be deemed the Estimated Net Working Capital. (b) Within ninety (90) days after the Closing Date, Purchaser shall prepare and deliver to Representative a statement (the “Closing Statement”) calculating the Net Working Capital as of immediately prior to the Closing (the “Closing Net Working Capital”) as well as the adjustments to the Purchase Price which shall be made pursuant to this Section 1.3; provided, however, that a failure by Purchaser to deliver the Closing Statement within such ninety (90) day period will not impair Purchaser’s rights under this Section 1.3, except to the extent that Seller has been prejudiced by such failure. Sellers shall cooperate with Purchaser in its preparation of the Closing Statement. Upon delivery of the Closing Statement, Purchaser shall promptly provide Representative access to all personnel, relevant documents and information to the extent they relate to the Closing Statement (or preparation thereof) reasonably requested by Representative in connection with its review of the Closing Statement and Purchaser...
Net Working Capital Adjustment. (a) The amount of the Base Purchase Price set forth in Section 2.4.1 was determined, in part, based upon the assumption that the Closing Date Net Working Capital will be Six Million Dollars ($6,000,000.00) (the "Assumed Closing Date Net Working Capital"). Following the Closing, in accordance with this Section 2.4.2, if applicable, the Purchase Price shall be adjusted to reflect the actual Net Working Capital as of 12:01 a.m. on the Closing Date ("Closing Date Net Working Capital") (provided that any Employee Liabilities which are paid out in cash by Seller or its Affiliates on or after the Closing Date shall not be included in the calculation of Closing Date Net Working Capital). This adjustment process shall be referred to as the "True Up." The True Up shall work as follows: if the Closing Date Net Working Capital is greater than Six Million Dollars ($6,000,000.00), then the Purchase Price shall be adjusted upward in an amount equal to the dollar amount by which the Closing Date Net Working Capital is greater than Six Million Dollars ($6,000,000.00). If the Closing Date Net Working Capital is less than Six Million Dollars ($6,000,000.00), the Purchase Price will be adjusted downward in an amount equal to the dollar amount by which the Closing Date Net Working Capital is less than Six Million Dollars (($6,000,000.00), provided that any downward adjustment shall be limited to a maximum of Six Million Dollars ($6,000,000.00). If the amount of the Purchase Price is adjusted upward from the Base Purchase Price pursuant to this Section 2.4.2, then within ten (10) Business Days after the final determination of the Closing Date Net Working Capital is made hereunder, Buyer shall pay to Seller an amount equal to the amount by which the Purchase Price exceeds the Base Purchase Price. If the amount of the Purchase Price is adjusted downward from the Base Purchase Price, then within ten (10) Business Days after the final determination of the Closing Date Net Working Capital is made hereunder, Seller shall pay to Buyer an amount equal to the amount by which the Purchase Price is less than the Base Purchase Price. For purposes of illustration only, if as of the Closing Date the Trade Receivables are $7,000,000, the prepaid expenses are $1,000,000, and the Employee Liabilities are $500,000, then the Closing Date Net Working Capital would be $7,500,000, and Buyer would accordingly make an additional payment of $1,500,000 to Seller.
(b) Within thirty (30) Business Days fol...
Net Working Capital Adjustment. (a) Within forty-five (45) days following the Closing Date, Buyer shall deliver to Sellers a calculation of the Net Working Capital Adjustment (in its final and binding form, the “Net Working Capital Adjustment Statement”) as of immediately preceding the Closing, setting forth the Closing Net Working Capital and the Net Working Capital Adjustment Amount. The Net Working Capital Adjustment Statement shall (i) include correction of all errors regardless of materiality and (ii) be prepared on a basis consistent with the Company’s historical financial statements. Sellers shall cooperate as reasonably requested in connection with the preparation of the Net Working Capital Adjustment Statement.
(b) During the 45-day period immediately following Sellers’ receipt of the Net Working Capital Adjustment Statement, Sellers shall be permitted to review Buyer’s working papers and trial balance related to the preparation of the Net Working Capital Adjustment Statement, the Closing Net Working Capital and the Net Working Capital Adjustment Amount. The Net Working Capital Adjustment Statement shall become final and binding upon the parties 30 days following Sellers’ receipt thereof, unless Sellers shall give written notice (in the manner described in this Section 2.3(b)) of its disagreement (a “Notice of Disagreement”) to Buyer prior to such date. Any Notice of Disagreement shall specify in reasonable detail the nature and dollar amount of any disagreement so asserted and shall be delivered only if (and to the extent that) Sellers reasonably and in good faith determine that the Net Working Capital Adjustment Statement calculated is incorrect. Following delivery of a Notice of Disagreement, Buyer and its agents and representatives shall be permitted to review Sellers’ and their agents’ and representatives’ working papers relating to the Notice of Disagreement. If a timely Notice of Disagreement is received by Buyer, then the Net Working Capital Adjustment Statement (as revised in accordance with clause (x) or (y) below) shall become final and binding upon the parties on the earlier of (x) the date the parties resolve in writing any differences they have with respect to the matters specified in the Notice of Disagreement or (y) the date all matters in dispute are finally resolved in writing by the Accounting Firm (defined below). During the thirty (30) days following delivery of a Notice of Disagreement, the parties shall seek in good faith to resolve in writing any differen...
Net Working Capital Adjustment. (i) For purposes of this Agreement, "Net Working Capital" shall equal (i) cash, money market accounts, accounts receivable (net of reasonable provisions for doubtful accounts), cash surrender value of life insurance policies, and prepaid expenses including rental payments if paid in advance, as of Closing less (ii) all current liabilities of the Company as of Closing, including but not limited to liabilities for inventory, office supplies, ordinary compensation payables, employee benefits and taxes (excluding accrued paid time off for vacation and sick leave), bonuses (including all related payroll taxes and employee benefits), personal and real property taxes, water, gas, electric and other utility charges, business and other license fees and taxes (excluding fees for audiology and hearing aid dispensing licenses), merchants' association dues, rental payments under any leases, any customer refunds for hearing aids delivered prior to Closing, and all other operating liabilities (including legal, accounting, and other professional fees and expenses incurred in the ordinary course of business), vendor accounts payable and intercompany accounts. In computing Net Working Capital, (i) all hearing aids ordered but not fitted to the patient as of the Closing date will not be included in accounts receivable and (ii) all payments made by Company with respect to such hearing aid orders shall be treated as prepaid items.
Net Working Capital Adjustment. Within fourteen (14) days after the Closing Date (the “Net Working Capital Review Period”), the Parties shall work in good faith to jointly prepare a statement setting forth their calculation of Net Working Capital, which statement shall contain a balance sheet of the Company estimated in good faith as of the Closing Date (without giving effect to the transactions contemplated herein), and a good faith calculation of Closing Working Capital (the “Net Working Capital Statement”). If Net Working Capital is positive, on or prior to the end of the Net Working Capital Review Period, Buyer shall pay Sellers an amount equal to the Net Working Capital relating to (x) prepaid expenses and (y) accounts receivable and inventory which have been paid or sold, respectively, after Closing but prior to the end of the Net Working Capital Review Period. On a monthly basis thereafter, to the extent Net Working Capital was not paid in full in accordance with the preceding sentence, Sellers may submit to Buyer a statement calculating the amount of accounts receivable and inventory that have been paid or sold, respectively, after the Net Working Capital Review Period. No later than ten (10) business days after receipt of each such statement, Buyer shall pay Sellers an amount equal to the portion of Net Working Capital which relates to accounts receivable and inventory that has been paid or sold, respectively, after the Net Working Capital Review Period, which has not yet been paid; provided that, Buyer’s payments hereunder shall in no event exceed the Net Working Capital as determined in the Net Working Capital Statement. For the avoidance of doubt, the amounts payable hereunder are in addition to the amounts payable with respect to the Purchase Price and Earn- Out Payment.
Net Working Capital Adjustment. The Purchase Price shall be adjusted as follows: (i) in the event that the Net Working Capital as of the Closing Date exceeds the Net Working Capital Target by more than $10,000, then the Purchase Price shall be adjusted upward by an amount equal to one-half (1/2) of the difference between the excess amount and $10,000, in which case Buyer shall promptly, but in any event within five (5) business days following the determination in accordance with Section 2.3(b) hereof, increase the principal balance of the Note by one-half (1/2) of the difference between the excess amount and $10,000; or (ii) in the event that the Net Working Capital as of the Closing Date is less than the Net Working Capital Target by more than $10,000, then the Purchase Price shall be adjusted downward in an amount equal to one-half (1/2) of the difference between the deficiency amount and $10,000, in which case Buyer shall offset such difference between the deficiency amount and $10,000 against the principal balance of the Note.