Closing Consideration Allocation Clause Samples
The Closing Consideration Allocation clause defines how the total purchase price or consideration is distributed among the various assets or parties involved at the closing of a transaction. Typically, this clause outlines the specific amounts or percentages allocated to different asset classes, liabilities, or stakeholders, and may reference an attached schedule or agreement for detailed breakdowns. Its core practical function is to ensure transparency and agreement on how the consideration is divided, thereby preventing disputes and facilitating accurate tax reporting and compliance.
Closing Consideration Allocation. For purposes of applying Section 1060 of the Code and the Treasury Regulations promulgated thereunder and allocating the Closing Consideration for U.S. federal Income Tax purposes, the respective fair market values of the assets of the Group Companies and Blocker as of the Closing Date shall be determined in accordance with the Allocation Schedule. The portion of the Closing Consideration (as finally determined hereunder) (plus any assumed liabilities and other items required to be taken into account for income tax purposes) allocated to the Company Units (other than the Company Units owned by Blocker) shall be allocated among the assets of the Group Companies in accordance with the principles of Code Sections 1060, 743, 754 and 755 and the Treasury Regulations thereunder and the methodology set forth on the Exhibit J (the “Allocation Methodology”). Within ninety (90) days following the Closing Date, the Sellers Representative shall deliver to Buyer a statement setting forth the portion or amount of the Closing Consideration allocated to the sale of the assets of the Group Companies in accordance with the Allocation Methodology (the “Allocation Statement”). Within thirty (30) days after receipt of the Allocation Statement, Buyer shall notify the Sellers Representative of any objection, specifying in reasonable detail the nature and basis of such objection, to any items set forth in the Allocation Statement. If a timely objection has not been made by the Buyer, the Allocation Statement shall become final and binding on the Parties (the Allocation Statement as finally agreed or resolved pursuant to this Section 9.08, the “Final Allocation”). If a timely objection has been made by ▇▇▇▇▇, then ▇▇▇▇▇ and the Sellers Representative agree to consult in good faith to resolve any disputes with respect to the Allocation Statement. If Buyer and the Sellers Representative cannot agree upon the Allocation Statement within fifteen (15) days after Buyer delivers its objection(s) to the Sellers Representative (or such later time as Buyer and the Sellers Representative may agree), the Allocation Statement shall be submitted to the Independent Accountant for determination in accordance the Allocation Methodology and with the dispute resolution processes described in Section 3.05(c) applied mutatis mutandis. Once the Final Allocation is finalized in accordance with the above procedures, no Buyer Party nor any Seller Parties nor any of their respective Affiliates (including t...
Closing Consideration Allocation. (i) The parties hereto agree that the portion of the Closing Consideration that shall be allocated to the Blocker Company shall be equal to the Blocker Company Payment and that the portion of the Closing Consideration allocated to each holder of Units shall be such holder’s portion of the Closing Consideration in accordance with the Distribution Waterfall.
(ii) Within fifteen (15) days following the final determination of the Adjustment Amount, the Acquiror shall prepare and deliver to the Holder Representative for its review an allocation of the purchase price (as determined for U.S. federal and applicable state and local income tax purposes, including assumed liabilities and any other relevant items or adjustments but excluding the Blocker Company Payment), among the assets of the Company for U.S. federal, and applicable state and local, Income Tax purposes in accordance with the principles of Section 755 of the Code and the Treasury Regulations thereunder (the “Closing Consideration Allocation”). The Holder Representative will be entitled to review and comment on such Closing Consideration Allocation, and shall provide the Acquiror with comments within sixty (60) days after the Acquiror’s delivery of the Closing Consideration Allocation to the Holder Representative. The Acquiror shall consider in good faith all of the Holder Representative’s comments to the Closing Consideration Allocation in preparing the final allocation schedule (the “Final Allocation”). If the Holder Representative notifies the Acquiror in writing that Holder Representative objects to one or more items reflected in the Final Allocation, Acquiror and the Holder Representative shall negotiate in good faith to resolve such dispute; provided, however, that if Acquiror and the Holder Representative are unable to resolve any dispute with respect to the Final Allocation within sixty (60) days following the Closing Date, such dispute shall be resolved by the Auditor in accordance with the provisions set forth in Section 2.7(b); provided, however, that the fees and expenses of the Auditor shall be borne equally by Acquiror and the Holder Representative (on behalf of the Escrow Participants). The parties hereto shall file all Tax Returns (including amended returns and claims for refund) and information reports in a manner consistent with the Final Allocation, and none of the parties hereto shall take any Tax position to the contrary on any Tax Return, in any proceeding or audit, or examinatio...
Closing Consideration Allocation. The Seller Representative shall allocate the Closing Consideration, as adjusted for the Net Adjustment Amount (as finally determined) (plus any assumed liabilities and other items required to be taken into account for Income Tax purposes) between the Blocker Interests and the Directly Held Units. The Seller Representative shall further allocate such amount allocated to the Directly Held Units among the assets of the Company (and, as applicable, any Subsidiaries treated as flow-through entities for Income Tax purposes) in accordance with the principles of Sections 743, 751, 755 and 1060 of the Code and the Treasury Regulations thereunder pursuant to a written allocation delivered by the Seller Representative to Buyer within sixty (60) days after the final determination of the Net Adjustment Amount (the “Allocation”). The Buyer shall, within thirty (30) days of receipt of the Seller Representative’s draft of the Allocation, notify the Seller Representative if the Buyer disagrees with the Seller Representative’s determination, in which case the parties shall make a good faith effort to resolve any such dispute, after which any remaining disputed issues shall be resolved by an independent accounting firm of national reputation and with expertise in the matter (the “Tax Arbiter”) in accordance with the dispute resolution procedures of Section 2.07(b), mutatis mutandis. Except to the extent otherwise required by applicable Law, the Parties shall file or cause to be filed all Tax Returns in a manner consistent with the Allocation (as agreed by the Parties or as modified by the Tax Arbiter) and shall not make any inconsistent statement or adjustment on any Tax Return or during the course of any Tax-related matter, or otherwise take any Tax position inconsistent with the Allocation.
Closing Consideration Allocation. EP and EPIL each hold ownership rights in the Purchased Assets to be sold under this Agreement, and specifically EP owns the Product Inventory and Marketing Materials, which will be sold to Buyer for its fair market value as agreed between EP and Buyer. Upon Closing, EPIL shall deduct such amount from the Closing Consideration and remit such amount to EP.