Working Capital Determination Clause Samples
The Working Capital Determination clause defines how the working capital of a business will be calculated, typically at the time of a transaction such as a merger or acquisition. It outlines the specific components to be included or excluded in the calculation, such as current assets and liabilities, and may set forth the methodology or reference date for the assessment. This clause ensures both parties have a clear, agreed-upon process for determining working capital, which is crucial for adjusting the purchase price and preventing disputes over post-closing financial adjustments.
Working Capital Determination. The Purchaser shall, as soon as practicable after the Closing Date, prepare in accordance with GAAP, a report containing the Closing Balance Sheet together with a statement based upon such report which (1) states that such balance sheet was prepared in accordance with this Agreement, (2) sets forth the Closing Date Working Capital (including any differences between (i) the Estimated Company Transaction Expenses and actual Company Transaction Expenses, (ii) the Estimated Assumed Indebtedness and actual Assumed Indebtedness and (iii) the Estimated Closing Cash and actual Closing Cash) and (3) sets forth all adjustments required to be made to such balance sheet in order to make the calculation of the Closing Date Working Capital (the “Working Capital Determination”). The Purchaser shall have the option, in its sole discretion, to instruct an accounting firm chosen by the Purchaser (the “Accountants”) to audit the Closing Balance Sheet and to determine the scope of such audit. If the Seller does not agree that the Working Capital Determination correctly states the Closing Date Working Capital, the Seller shall promptly (but not later than 30 days after the delivery to the Seller of the Working Capital Determination) give written notice to the Purchaser of any exceptions thereto (in reasonable detail describing the nature of the disagreement asserted). If the Seller and the Purchaser reconcile their differences, the Closing Date Working Capital calculation shall be adjusted accordingly and shall thereupon become binding, final and conclusive upon all of the parties hereto and enforceable in a court of law. If the dispute relates to an accounting issue and if the Seller and the Purchaser are unable to reconcile their differences in writing within 30 days after written notice of exceptions is delivered to the Purchaser (the “Reconciliation Period”), the accounting items in dispute shall be submitted to a mutually acceptable accounting firm selected from any of the four largest accounting firms in the United States in terms of gross revenues (the “Independent Auditors”) for final determination; provided, however, that prior to such submission, a third party that is creditworthy, in the reasonable determination of the Purchaser, has guaranteed in writing the timely payment of any fees that may become due by Seller pursuant to Sections 2.2.4 and 2.2.5. The Closing Date Working Capital calculation shall be deemed adjusted in accordance with the determination of the I...
Working Capital Determination. (a) Not more than 60 days after the Closing Date (i) Seller shall deliver to Buyer the balance sheet for Seller with respect to the Business as of the Cut-Off Point (the "CLOSING BALANCE SHEET"). The Closing Balance Sheet shall be prepared using the same methodologies and assumptions used in connection with the preparation of the Interim Balance Sheet, except as modified herein. The amount of the Medicare Reconciliation Note shall be determined from the Closing Balance Sheet.
Working Capital Determination. Within thirty (30) days after the Closing, Buyer and Seller shall jointly prepare a calculation of the Working Capital Surplus, if any, and Working Capital Deficit, if any, in each case as of the Closing (the “Closing Statement”). The Closing Statement, and the components thereof, will be determined using generally accepted accounting methods as historically applied by Seller.
Working Capital Determination. ▇▇▇▇▇*s shall, as soon as reasonably practical after January 31, 2006 and in any event not later than March 15 , 2006, determine the amount of Cash and Cash Equivalents on its balance sheet as of January 31, 2006 in accordance with generally accepted accounting principles consistently applied (“GAAP”), assuming for purposes of such calculation that the full amount of the $20,000,000 to be raised via the Rights Offering has actually been received by ▇▇▇▇▇*s as of such date, regardless of the actual amount, if any, as shall actually been received, and shall deliver a copy of such determination (the “Determination”) to Alloy. In addition, ▇▇▇▇▇*s shall, determine the amount of Working Capital on its balance sheet as of January 31, 2006 in accordance GAAP and applied on a consistent basis, and shall deliver a copy of such determination (the “Working Capital Determination”) to Alloy along with a “Working Capital Statement” setting forth in reasonable detail its good faith calculation of the Working Capital. To the extent the Working Capital Determination exceeds or is less than the Working Capital Target ($5,600,000), the Year-End Cash True Up shall be adjusted by the amount by which the Working Capital Determination exceeds or is less than the Working Capital Target. If the amount of Working Capital shown on the Working Capital Statement is in excess of negative $5,600,000, such amount will be subtracted from the $30,000,000 in order to calculate the amount of the Year-End Cash True Up. Should the Working Capital Determination be less than negative $5,600,000, however, such amount will be added to the $30,000,000 in order to calculate the amount of the Year-End Cash True Up. The Year-End Cash True Up shall be made as follows: based on the calculations as set forth in this paragraph should any amount of cash be required to be adjusted, such adjustment and the related transfer of funds shall be done within 15 days of the Determinations being received by Alloy, and in any event not later than March 30, 2006 (i.e., if the actual Cash and Cash Equivalents on the ▇▇▇▇▇*s balance sheet, as so adjusted, is less than the targeted amount, Alloy shall pay ▇▇▇▇▇*s the full amount of such shortfall, while if the actual Cash and Cash Equivalents on the ▇▇▇▇▇*s balance sheet, as so adjusted, is greater than the targeted amount, ▇▇▇▇▇*s shall pay Alloy the full amount of such excess).
Working Capital Determination. (a) Within one hundred twenty (120) days after the Closing Date, the Purchaser shall prepare or cause an internationally recognized accounting firm selected by the Purchaser (the “Accountants”) to prepare and deliver to the Seller a statement setting forth its calculation of Closing Working Capital, which statement shall contain (i) a balance sheet of the Transferred Business as of the opening of business on the Closing Date (the “Closing Balance Sheet”), and (ii) a calculation of Closing Working Capital (the “Working Capital Determination”), which shall be made as if such Working Capital Determination was being prepared as of a fiscal year end (i.e., all year-end audit adjustments have been made). If the Closing Date does not occur on the last day of a calendar month, then the Closing Working Capital will be calculated utilizing the month-end balance sheets of the Transferred Business prior and subsequent to the Closing Date, which shall be prepared using a full close and in accordance with GAAP, consistently applied, while taking into account any activity occurring between the prior month-end balance sheet date and the Closing Date.
(b) If the Seller or, to the extent the Accountants prepared the Working Capital Determination, the Seller or the Purchaser does not agree that the Working Capital Determination correctly states the Closing Working Capital, the Seller or the Purchaser, as the case may be, may promptly (but not later than thirty (30) days after the delivery to it of the Working Capital Determination) give written notice to the other party of any exceptions thereto (in reasonable detail describing the nature of the disagreement asserted). If the Seller and the Purchaser reconcile their differences, the Working Capital Determination shall be adjusted accordingly and shall thereupon become binding, final and conclusive upon all of the parties hereto and enforceable in a court of law. If the Seller and the Purchaser are unable to reconcile their differences in writing within thirty (30) days after written notice of exceptions is delivered to the other party (the “Reconciliation Period”), the accounting items in dispute shall be submitted to a firm of reputable international independent public accountants (other than the Accountants) to be jointly and in good faith selected by the Seller and the Purchaser (the “Independent Auditors”) for final determination, and the Working Capital Determination shall be deemed adjusted in accordance with the deter...
Working Capital Determination. (a) At least 5 business days prior to the Closing Date, Seller shall prepare and deliver to Buyer in writing a good faith estimate of the Company’s Working Capital (the “Working Capital Estimate”) as of the Closing Date. The Working Capital Estimate shall reflect Working Capital consistent with financial reporting policies and procedures used by the Company prior to the Closing, which policies and procedures are set forth in Exhibit C to this Agreement. As used in this Agreement, “Working Capital” means the amount of current assets of the Company (excluding current assets relating to deferred manufacturing costs, income taxes and intercompany accounts) minus the amount of the components of current liabilities of the Company (excluding all current liabilities relating to income taxes and intercompany accounts), each as of the Closing Date determined in accordance with generally accepted accounting principles in the United States (“GAAP”) and calculated in a manner consistent with Exhibit C to this Agreement. The Working Capital Estimate shall be accompanied by such working papers and other documents as were utilized by Seller in preparing the Working Capital Estimate.
Working Capital Determination. (a) Not more than 60 days after the Closing Date (i) Seller shall deliver to Buyer the balance sheet for SCH with respect to the Business as of the Effective Time for accounting purposes (the "CLOSING BALANCE SHEET"). The Closing Balance Sheet shall be prepared using the same methodologies and assumptions used in connection with the preparation of the Interim Balance Sheet, except as modified herein.
Working Capital Determination. The Purchase Price shall be decreased by an amount equal to Seller's working capital deficit, if any, in excess of $125,000 ("Section 2.3 Deficit"), calculated on the day immediately prior to the Closing Date (the "Section 2.3
Working Capital Determination. (a) Not more than 60 days after the Closing Date (i) Seller shall deliver to Buyer the balance sheet for BCG with respect to the Business as of the Effective Time (the "CLOSING BALANCE SHEET"). The Closing Balance Sheet shall be prepared using the same methodologies and assumptions used in connection with the preparation of the Interim Balance Sheet, except as modified herein.
Working Capital Determination. (a) As promptly as practicable after the Closing Date (but in no event later than 45 days after the Closing Date), the Surviving Corporation shall prepare and deliver to the Representative a balance sheet of the Surviving Corporation and its consolidated Subsidiaries which shall be reviewed by PricewaterhouseCoopers, (the “Closing Balance Sheet”), which shall set forth the amount of Working Capital (including the balances of each Back to Contents line item included within the definition of Current Assets and Current Liabilities) as of 11:59 p.m. on the date immediately prior to the Closing Date (“Closing Working Capital”). The Closing Balance Sheet shall be prepared in accordance with this Agreement and GAAP applied in a manner consistent with the preparation of the Balance Sheet, except as otherwise contemplated by this Agreement. Following the delivery of the Closing Balance Sheet to the Representative, Parent and the Surviving Corporation shall afford the Representative and its representatives the opportunity to examine the Closing Balance Sheet and such supporting schedules, analyses, workpapers, including the underlying records or documentation as are reasonably necessary and appropriate to verify the amounts reflected in the Closing Balance Sheet. Parent and the Surviving Corporation shall cooperate fully and promptly with the Representative and its representatives in such examination, including providing answers to questions asked by the Representative and its representatives, and Parent and the Surviving Corporation shall promptly make available to the Representative and its representatives any records under Parent’s or the Surviving Corporation’s reasonable control that are requested by the Representative and its representatives.
(b) If within 45 days following delivery of the Closing Balance Sheet to the Representative, the Representative has not delivered to Parent written notice (the “Objection Notice”) of its objections to the Closing Balance Sheet (such Objection Notice must contain a statement describing in reasonable detail the basis of such objections), then Closing Working Capital as set forth in such Closing Balance Sheet shall be deemed final and conclusive and shall be “Final Working Capital.” If the Representative delivers the Objection Notice within such 45-day period, then Parent and the Representative shall endeavor in good faith to resolve the objections, for a period not to exceed 15 days from the date of delivery of the Objectio...