Working Capital Amount Clause Samples
The Working Capital Amount clause defines the specific level of working capital that a company must have at the time of closing a transaction, typically in mergers or acquisitions. This clause sets a target amount, often based on historical averages or agreed-upon calculations, and compares it to the actual working capital at closing to determine if adjustments to the purchase price are necessary. Its core function is to ensure that the business is transferred with a normal and agreed-upon level of liquidity, preventing either party from being unfairly advantaged or disadvantaged by fluctuations in short-term assets and liabilities.
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Working Capital Amount. Exhibit H attached hereto sets forth a specified list of Seller’s vendors and customers for the Subsidiaries and the respective accounts payable and invoiced accounts receivable associated with such vendors and customers that Seller anticipates will be reflected on its June 30, 2006 consolidated balance sheet for such vendors and customers of the Subsidiaries having aggregate amounts in excess of US$25,000. The aggregate amount of accounts payable shown as Exhibit H as originally prepared shall be referred to herein as the “Initial Aggregate Accounts Payable” and the aggregate amount of invoiced accounts receivable shown as Exhibit H as originally prepared shall be referred to herein as the “Initial Aggregate Accounts Receivable.” Within ten (10) Business Days after Closing, Seller will update Exhibit H to reflect the actual accounts payable and invoiced accounts receivable associated with such vendors and customers that are reflected on its June 30, 2006 consolidated balance sheet, along with any other accounts payable and invoiced accounts receivable that are reflected on its June 30, 2006 consolidated balance sheet and that are in excess of US$25,000 and that are associated with vendors and customers of the Subsidiaries that were not listed on Exhibit H as originally prepared. The aggregate amount of accounts payable shown on Exhibit H as updated shall be referred to herein as the “Updated Aggregate Accounts Payable” and the aggregate amount of invoiced accounts receivable shown on Exhibit H as updated shall be referred to herein as the “Updated Aggregate Accounts Receivable.” The amount by which the Updated Aggregate Accounts Payable exceeds the Initial Aggregate Accounts Payable, if any, shall be referred to herein as the “Accounts Payable Excess” and the amount by which the Initial
Working Capital Amount. At Closing, the Acquiring Parties shall hold in escrow in a segregated account for the benefit of Acquiror an amount in cash equal to $2,500,000 (the “Working Capital Amount”). Subsequent to Closing, prior to Acquiror or any Transferor Party paying any payables or otherwise making payments to satisfy Liabilities related to the Business, Acquiror shall submit a reasonably detailed invoice to Parent for approval and authorization for the release of payment amounts from the Working Capital Amount. The Working Capital Amount shall be used solely and exclusively for the payment by Acquiror of the payables arising from the day-to-day operations of the Business set forth on Schedule 2.9 (excluding any fees or costs for attorneys, accountants, or financial advisors engaged by a Transferor Party, whether engaged in connection with the negotiation, execution and delivery of the Transaction Documents, and the advice related thereto, or otherwise, regardless of whether such fees or costs are set forth on Schedule 2.9). The Working Capital Amount shall be held by Parent in a segregated account until Parent receives written instructions executed by ▇▇▇▇▇ ▇▇▇▇▇▇ or ▇▇▇▇▇▇ ▇▇▇▇▇▇, which instructions shall (i) set forth the amount to be released from escrow and (ii) not be unreasonably withheld, conditioned or delayed. Upon receipt of such instructions, Parent shall release and deliver to Acquiror an amount from the Working Capital Amount being held in escrow equal to the amount set forth in the instructions. The Parties acknowledge and agree that, as described in Section 2.5, $1,000,000 of the Consideration for the Transferred Assets is being held in escrow by Parent as a portion of the Working Capital Amount to be used solely and exclusively for the payment by Acquiror of payables arising from the day-to-day operations of the Business as set forth in this Section 2.9. On June 19, 2013, any remaining amounts comprising the Working Capital Amount remaining in escrow, up to $1,000,000, shall be released and delivered to Transferor, and any portion of the Working Capital Amount, in excess of $1,000,000, remaining in escrow on June 19, 2013, shall be released and delivered to Parent. The Parties also acknowledge and agree that, for the avoidance of doubt and in consideration for Parent’s agreement to pay certain payables of the Business as set forth in this Section 2.9, Parent shall be entitled to all Receivables. Notwithstanding anything to the contrary set forth in this Sec...
Working Capital Amount. The Borrower shall maintain the Working Capital Amount in the Earnings Account PROVIDED THAT the Borrower may apply the Working Capital Amount towards the Operating Expenses if the prior written consent of the Agent is obtained which the Agent shall be entitled to withhold if any sums made or previously made available to the Borrower pursuant to Clause 10.11 have been used for purposes other than Operating Expenses.
Working Capital Amount. The parties shall have agreed on the normalized working capital amount as contemplated by Section 3.5(b).
Working Capital Amount. Target shall have delivered to Acquiror the Estimated Closing Certificate and the Estimated Closing Balance Sheet.
Working Capital Amount. The parties acknowledge and agree that in the ---------------------- event that it is discovered at any time following the Closing that the Accounts Receivable or the prepaid expenses acquired pursuant to Sections 1.1.10 or 1.1.11 of this Agreement were invalid or that the liabilities assumed pursuant to Section 2.1(v) were understated such that the working capital amount that should have been a part of the Purchase Price at Closing differed from the Working Capital Amount actually included, and the difference provided a benefit to Sellers, Purchaser shall be entitled to promptly receive from Sellers the amount that was incorrectly attributable to the Working Capital Amount in favor of Sellers. The parties further acknowledge and agree that in the event that any Accounts Receivable assumed by Purchaser pursuant to Section 1.1.10 of this Agreement have not been collected within 120 days of the Closing Date that, upon written notice from Purchaser detailing the amount of such uncollected Accounts Receivable, Sellers shall promptly pay to Purchaser an amount equal to the amount of such uncollected Accounts Receivable and, in the event of any subsequent collection of the uncollected Accounts Receivable by Purchaser, Purchaser shall promptly remit such funds to Sellers.
Working Capital Amount. The “Working Capital Amount,” as determined and agreed to by the Parties is $179,643.00, which represents and reflects the only and final adjustment related to pre- and post-Effective Date expenses and revenue related to the Assets. In calculating the Working Capital Amount, the Parties agree that Schedule 2.3 reflects accounts payable to be retained by the Seller. The Parties agree and covenant that after the Closing Date, Purchaser shall be entitled to receive all income, proceeds, receipts, and credits with respect to the Assets, and shall be responsible for all payments related to the Assets, for the periods of time prior to, on, and after the Effective Date.
Working Capital Amount. As of the Closing Date, the Working Capital Amount, after excluding the $34,600,000 debt obligation incurred under the UBS Facility in connection with the September, 2007 acquisition of Wimco Operating Company, Inc. and certain of its Affiliates, shall be at least $135,000,000.
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Working Capital Amount. The Assets to be acquired from Epic shall include all of the assets used in or necessary to the operation of the business or proposed business of Epic, and shall include the assets identified on Schedule 2.1.