Net Working Capital Payment Clause Samples
The Net Working Capital Payment clause defines how adjustments to the purchase price are made based on the difference between the target and actual net working capital at closing. Typically, this involves calculating the net working capital (current assets minus current liabilities) as of the closing date and comparing it to a pre-agreed target; if the actual amount is higher or lower than the target, the purchase price is increased or decreased accordingly. This mechanism ensures that the buyer receives the business with an expected level of working capital, preventing either party from being unfairly advantaged or disadvantaged by fluctuations in short-term assets and liabilities.
Net Working Capital Payment. (a) Within thirty (30) days after the Distribution Date, WHI shall cause to be prepared and delivered to CS&L a combined balance sheet of the CS&L Business as of 12:01 a.m. on the Distribution Date (the “Closing Balance Sheet”) and a statement derived from the Closing Balance Sheet (the “Closing Statement”) setting forth the Net Working Capital of the CS&L Business as of 12:01 a.m. on the Distribution Date (“Closing Net Working Capital”). The Closing Balance Sheet and Closing Statement shall be prepared in accordance with GAAP and the sample calculation set forth in Schedule 8.9 hereto and, to the extent not inconsistent therewith, all accounting principles, practices, methodologies and policies used in the preparation of the financial statements included in the Information Statement.
(b) Following the Distribution Date, each of WHI and CS&L shall give the other party and its representatives access at all reasonable times to the properties, books, records, working papers and personnel of the CS&L Business to the extent required to prepare and review the Closing Balance Sheet and the Closing Statement. CS&L shall have thirty (30) days following the delivery of the Closing Balance Sheet and the Closing Statement during which to notify WHI of any dispute of any item contained in the Closing Statement, which notice shall set forth in reasonable detail the nature and amount of any such dispute. If CS&L fails to notify WHI of any such dispute within such thirty (30) day period, the Closing Statement delivered to CS&L shall be deemed to be final, conclusive and binding on the parties hereto. In the event that CS&L shall so notify WHI of a dispute within such thirty (30) day period, WHI and CS&L shall cooperate in good faith to resolve such dispute as promptly as practicable.
(c) If WHI and CS&L do not resolve any such disputed item within thirty (30) days after the delivery by CS&L of its notice of dispute, such disputed item shall be resolved by an internationally recognized accounting firm mutually selected and agreed upon by WHI and CS&L. In connection therewith, the accounting firm shall address only items disputed by the parties and may not assign an amount to any disputed item greater than the greatest amount for such item that is claimed by a party or less than the lowest amount for such item that is claimed by a party. The accounting firm shall make its determinations with respect to any such disputed item as promptly as practicable and such determination...
Net Working Capital Payment. The “Net Working Capital Payment” will be equal to the net aggregate of the Initial Net Working Capital Payment and the Net Working Capital Adjustment, which in the aggregate are intended to reflect the positive or negative Net Working Capital as of the Valuation Time. The Net Working Capital Payment will be computed and paid as follows:
(a) At the Closing, Buyer will pay (or receive as a credit against the other elements of the Closing Payment) as part of the Net Working Capital Payment, an amount (the “Initial Net Working Capital Payment”) equal to Sellers’ good faith estimate of the aggregate Net Working Capital of the HPL Entities expected as of the Valuation Time determined in accordance with Exhibit 2.2.3. Such estimate will be based on pro forma balance sheets of the HPL Entities as of the Valuation Time, to be prepared by Sellers in accordance with GAAP and in consultation with Buyer, in the same format and level of detail as the Final Balance Sheet, and to be delivered to Buyer no later than 2 Business Days before the scheduled Closing Date.
(b) Within 90 days following the Closing Date, Buyer will prepare and deliver to Sellers (i) unaudited balance sheets of each of the HPL Entities as of the Valuation Time (each a “Final Balance Sheet”), prepared in accordance with GAAP consistently applied, and (ii) a detailed computation of the Net Working Capital of each of the HPL Entities as of the Valuation Time, reconciled to those balance sheets and (iii) a computation of the amount, if any, (the “Net Working Capital Adjustment”) by which the aggregate Net Working Capital of the HPL Entities as of the Valuation Time, as so computed, exceeds or is less than the Initial Net Working Capital Payment. Sellers will provide Buyer and its representatives and advisors (and if appropriate, the Independent Accounting Firm), at no expense to Buyer, with all accounting services, assistance, and access to data during normal business hours to the working papers, accounting, operating, and other books and records of Sellers, and the appropriate personnel to the extent required to complete the preparation of the Final Balance Sheets and the related computations, and any deadline imposed by this Agreement on Buyer for the computation or payment of the Net Working Capital Adjustment will be extended as appropriate in light of any party’s failure to promptly make such information available. Pursuant to the Transition Services Agreement, Sellers shall also ensure that the e...
Net Working Capital Payment. If the Net Working Capital as of the Closing Date is a positive amount, Buyer shall make an additional payment to Seller in an amount equal to the Net Working Capital, and if the Net Working Capital as of the Closing Date is a negative amount, Seller shall make a payment to Buyer in an amount equal to the Net Working Capital, in each case as calculated in accordance with this Section 2.6, together with interest thereon at the Applicable Rate from and including the Closing Date to but excluding the date of payment, which payment shall be made by wire transfer or delivery of other immediately available funds on or before the fifth Business Day after the final determination of the Net Working Capital in accordance with this Section 2.6. The payment to be made by Buyer or by Seller, as applicable, is herein called the “Net Working Capital Payment”. For purposes of payment only, the Net Working Capital Payment (if a negative amount) may be netted by Buyer against the Final Feedstock and Product Sales Price (as such term is defined in the Feedstock and Product Inventory Sales Agreement); provided that the Final Feedstock and Product Sales Price has been finally determined pursuant to the Feedstock and Product Inventory Sales Agreement as of the date that the Net Working Capital Payment is due pursuant to this Agreement.
(a) Except as otherwise provided in this Section 2.6(a), or in the definitions of Current Assets and Current Liabilities, the items included in the components of Current Assets and Current Liabilities shall be determined, and the amounts of such items shall be calculated, in the same manner as the corresponding line items were determined and calculated, and using the same policies, practices, assumptions, procedures, classifications, methods, estimates and judgments as were used in preparing the Balance Sheet. Parts and Supplies shall be included in Current Assets at book value.
(b) Seller shall initially calculate the Net Working Capital and shall deliver to Buyer a statement (the “Net Working Capital Statement”) setting forth the amount of Net Working Capital, together with supporting calculations and information, on or before the 90th day after the Closing Date. From the Closing Date through the final determination of Net Working Capital in accordance with this Section 2.6 (b), Buyer shall cause the Company and its employees to give Seller and its advisors access at all reasonable times to the personnel, properties and books and records of the...
Net Working Capital Payment. As part of the Purchase Price, on the Closing Date the Buyer agrees to pay to Sellers (except to GEFCO, which portion will be deposited in the Salim Escrow Account) ten million, seven hundred and fifty nine thousand, seven hundred ninety Reais (R$ 10,759,790.00) which represents forty percent (40%) of the net working capital of PGS on March 31, 2013, as calculated per the formula in Exhibit 3.2 (“NWC Payment”). This NWC Payment is included in the Purchase Price, as reflected in Section 3.1. Within forty-five (45) days of Closing, Buyer will provide Sellers with the final calculation of the October 31, 2013 NWC of PGS (“Final NWC”). To the extent that 40% of the Final NWC is greater than the NWC Payment (“Excess NWC”), Buyer agrees to pay to Sellers, proportionately per Exhibit 2.3, the Excess NWC within five (5) business days to the accounts provided to Buyer, net of any closing fee payable to Olimpia Partners under the agreement mentioned in Exhibit 5.27 and the respective applicable taxes and withholdings, which shall be deposited in Indemnity Escrow Account on the Closing Date.
Net Working Capital Payment. If the amount of the Final Net Working Capital determined pursuant to Section 2.3 of the Purchase Agreement is less than the Estimated Net Working Capital, Representative and Buyer shall jointly instruct Escrow Agent to pay to Buyer, from the Primary Escrow Account, by wire transfer of immediately available funds an amount equal to the lesser of (i) the excess of the Estimated Net Working Capital over the Final Net Working Capital and (ii) One Million Dollars ($1,000,000).