5Post-Closing Adjustment Clause Samples
The Post-Closing Adjustment clause establishes a process for recalculating the purchase price after the closing of a transaction based on actual financial figures, such as working capital or net assets, as of the closing date. Typically, the parties agree on estimated values at closing, and after the transaction, these estimates are compared to the actual results, with any difference resulting in a payment from one party to the other. This clause ensures that the final purchase price accurately reflects the true financial position of the business at closing, thereby protecting both buyer and seller from discrepancies in estimated versus actual values.
5Post-Closing Adjustment. (a) No more than three (3) Business Days prior to the Closing Date and no more than two (2) Business Days after the Closing Date, an employee of Seller and one or more representatives or employees of Buyer shall calculate the quantity of sulfur, rock, ammonia and finished goods included in the Inventory located at the Facilities based upon a physical examination thereof. As soon as practicable (but in no event more than five (5) Business Days) following such physical examination, such employee of Seller and a representative or employee of Buyer shall summarize such Inventory calculations on a report (the “Inventory Report”) and deliver the Inventory Report to Buyer and Seller. The Inventory Report shall be executed and delivered by each of Buyer and Seller to the other party, and the quantity of such Inventory set forth thereon, absent manifest error, shall be final and binding on Buyer and Seller for purposes of calculating Net Working Capital on the Closing Date under this Section 3.5. The value of the Inventory set forth on the Inventory Report shall be determined in accordance with the accounting methods, practices, policies, procedures and estimation methods used to prepare the Balance Sheet.
(b) As soon as reasonably practicable, but in no event later than ninety (90) days after the Closing Date, Buyer shall prepare and cause to be delivered to Seller a certificate of the Chief Financial Officer of Buyer certifying (i) its good faith calculation of the Purchase Price, setting forth, in reasonable detail, a good faith calculation of each of the adjustments set forth in Section 3.2 (the “Final Purchase Price”) and (ii) a balance sheet for the Business as of immediately prior to the Closing prepared on a basis consistent with the accounting methods, practices, policies, procedures and estimation methods used to prepare the Balance Sheet and including all of the entries contained in Schedule 3.4(a) (the “Final Balance Sheet”).
(i) If the Estimated Purchase Price is greater than the Final Purchase Price, the Purchase Price shall be adjusted downward dollar-for-dollar and Seller shall pay to Buyer the amount of such reduction, and (ii) if the Estimated Purchase Price is less than the Final Purchase Price, the Purchase Price shall be adjusted upward dollar-for-dollar and Buyer shall pay to Seller the amount of such increase (each a “Post-Closing Through these adjustment procedures, the buyer is seeking to get the benefit of its bargain. It pays a purchase p...
5Post-Closing Adjustment. In the event that (i) the Final Purchase Price is greater than the Initial Purchase Price, Purchaser shall pay to GE Tennessee, for the benefit of the Sellers, an amount equal to such difference or (ii) the Initial Purchase Price is greater than the Final Purchase Price, GE Tennessee, on behalf of the Sellers, shall pay to Purchaser an amount equal to such difference. Any payment due under this Section 2.5 shall be paid by wire transfer of immediately available funds to an account designated by GE Tennessee to Purchaser, or an account designated by Purchaser to GE Tennessee, as applicable, within three Business Days after the date on which the Final Purchase Price Statement becomes conclusive and binding on the Parties in accordance with the provisions of Section 2.4.