Common use of Determination of Earn-Out Payment Clause in Contracts

Determination of Earn-Out Payment. If the Closing occurs (a) prior to the expiry of the Earn-Out Period, Buyer shall prepare and deliver (or cause to be prepared and delivered) to Seller, not later than sixty (60) days following the completion of Parent’s first quarterly audit following December 31, 2022, a statement setting forth Buyer’s good faith calculation of the Adjusted EBITDA and determination as to whether the Earn-Out Milestone was achieved, and, if applicable, the Earn-Out Payment calculation, together with all supporting calculations and reasonable detail related thereto and calculated in accordance with Exhibit B-1 or (b) after the expiry of the Earn-Out Period, Seller shall prepare and deliver (or cause to be prepared and delivered) to Buyer, not later than sixty (60) days after the expiry of the Earn-Out Period, a statement setting forth Seller’s good faith calculation of the Adjusted EBITDA and determination as to whether the Earn-Out Milestone was achieved, and, if applicable, the Earn-Out Payment calculation, together with all supporting calculations and reasonable detail related thereto and calculated in accordance with Exhibit B-1 (the relevant statement referred to in clauses (a) and (b), the “Earn-Out Milestone Statement”). In the event Seller delivers the Earn-Out Milestone Statement in accordance with clause (b) above, the review and dispute resolution procedures applicable to Seller with respect to the Earn-Out Milestone Statement and calculation of the Earn-Out Payment set forth in Section 2.5.3 shall apply mutatis mutandis to Buyer. Subject to the last sentence of this Section 2.6.2, within ten (10) Business Days after the Earn-Out Payment and the corresponding Earn-Out Milestone Statement shall have been finally determined in accordance with Section 2.5.3, Buyer shall pay, or cause to be paid, by wire transfer of immediately available funds, (a) to Seller, the Earn-Out Payment less the Earn-Out Employee Portion Amount, and (b) to the Company, the Earn-Out Employee Portion Amount, for further distribution to the applicable recipient (in the amounts to be provided by Seller to Buyer in writing at least five (5) Business Days after the Earn-Out Payment and the corresponding Earn-Out Milestone Statement shall have been finally determined in accordance with Section 2.5.3), net of any applicable withholding Taxes, through the applicable Group Company’s payroll procedure. Notwithstanding anything to the contrary contained herein, (x) the Earn-Out Payment will not be paid in the event that this Agreement is terminated for any reason and the Closing does not occur, and (y) in the event that the Closing occurs following the expiration of the Earn-Out Period, the Earn-Out Payment will be paid at the later of (1) the Closing and (2) ten (10) Business Days after the Earn-Out Payment and the corresponding Earn-Out Milestone Statement shall have been finally determined in accordance with Section 2.5.3.

Determination of Earn-Out Payment. If the Closing occurs (a) prior to the expiry of the Earn-Out Period, Buyer Acquiror shall prepare and deliver (or cause to be prepared and delivered) to Sellerthe Seller Representative, not later than sixty (60) days following the completion end of Parent’s first quarterly audit following December 31, 2022the Earn-Out Period, a statement setting forth BuyerAcquiror’s good faith calculation of the Adjusted EBITDA and determination as to whether Earn-Out Net Sales during the Earn-Out Milestone was achievedPeriod are equal to or greater than the Earn-Out Threshold, and, if applicable, and the amount of the Earn-Out Payment calculationpayable hereunder, including if the amount of such payment is zero dollars ($0), together with all supporting calculations and reasonable detail related thereto and calculated in accordance with Exhibit B-1 or (b) after the expiry of the Earn-Out Period, Seller shall prepare and deliver (or cause to be prepared and delivered) to Buyer, not later than sixty (60) days after the expiry of the Earn-Out Period, a statement setting forth Seller’s good faith calculation of the Adjusted EBITDA and determination as to whether the Earn-Out Milestone was achieved, and, if applicable, the Earn-Out Payment calculation, together with all supporting calculations and reasonable detail related thereto and calculated in accordance with Exhibit B-1 (the relevant statement referred to in clauses (a) and (b), the “Earn-Out Milestone Statement”). In the event The Seller delivers the Earn-Out Milestone Statement in accordance with clause (b) aboveRepresentative may deliver a Purchase Price Dispute Notice, the review and dispute resolution procedures applicable to Seller including with respect to the Earn-Out Milestone Payment set forth therein, to Acquiror within thirty (30) days of receipt of the Earn-Out Statement thereof in accordance with Section 2.4(b), and calculation the dispute resolutions provided in Section 2.4(b) shall apply until the amount of the Earn-Out Payment is finally determined as provided therein. The Earn-Out Payment shall be made by Acquiror to the Company, for payment to the Earn-Out Recipients for payment through the Company payroll (subject to Section 2.6), in accordance with Schedule 2.5(a) and in the respective amounts set forth in Section 2.5.3 shall apply mutatis mutandis writing by the Seller Representative, with such calculations by the Seller Representative to Buyer. Subject be provided to Acquiror on the last sentence date that is the earlier of this Section 2.6.2, within ten (10i) Business Days after thirty (30) calendar days following the final determination of the amount of the Earn-Out Payment and the corresponding Earn-Out Milestone Statement shall have been finally determined in accordance with Section 2.5.3, Buyer shall pay, or cause to be paid, by wire transfer of immediately available funds, (a2.4(b) to Seller, the Earn-Out Payment less the Earn-Out Employee Portion Amount, and (bii) to the CompanyJune 7, the Earn-Out Employee Portion Amount, for further distribution to the applicable recipient (in the amounts to 2024. Such payment shall be provided made by Seller to Buyer in writing at least five (5) Business Days after the Earn-Out Payment and the corresponding Earn-Out Milestone Statement shall have been finally determined in accordance with Section 2.5.3), net of any applicable withholding Taxes, through the applicable Group Company’s payroll procedure. Notwithstanding anything to the contrary contained herein, (x) the Earn-Out Payment will not be paid in the event that this Agreement is terminated for any reason and the Closing does not occur, and (y) in the event that the Closing occurs Acquiror as soon as reasonably practicable following the expiration Seller Representative’s delivery of the final determination of the amount of the Earn-Out PeriodPayments, the Earn-Out Payment will which such payment shall be paid at the made no later of (1) the Closing and (2) ten (10) Business Days after the Earn-Out Payment and the corresponding Earn-Out Milestone Statement shall have been finally determined in accordance with Section 2.5.3than June 15, 2024.

Determination of Earn-Out Payment. If Parent shall, on not less than a quarterly basis during the Closing occurs (a) First Tranche Period and the Second Tranche Period, as soon as practicable following the date that Parent shall publicly announce its earnings for the applicable quarter, provide the Stockholder Representative with interim written reports with respect to Net Sales, Cost of Goods Sold and Gross Profit for the immediately preceding quarter, together with reasonably detailed documentary evidence supporting the basis for such calculation, and shall, upon the request of the Stockholder Representative, meet with the Stockholder Representative once per quarter at a mutually agreed upon time and location to discuss such information. In addition, prior to the expiry of the Earn-Out Period, Buyer shall prepare and deliver (or cause to be prepared and delivered) to Seller, not later than sixty (60) days following the completion of Parent’s first quarterly audit following December 31, 2022, a statement setting forth Buyer’s good faith calculation of the Adjusted EBITDA and determination as to whether the Earn-Out Milestone was achieved, and, if applicable, the making any Earn-Out Payment calculationunder the First Tranche or Second Tranche, together with all supporting calculations as applicable, to the Payment Agent, Parent shall deliver to the Stockholder Representative as soon as practicable, and reasonable detail related thereto and calculated in accordance with Exhibit B-1 or (b) after any event, no later than March 15, 2005, in the expiry case of the Earn-Out PeriodFirst Tranche, Seller shall prepare and deliver (or cause to be prepared and delivered) to BuyerMarch 15, not later than sixty (60) days after 2006, in the expiry case of the Earn-Out PeriodSecond Tranche, a statement schedule setting forth Seller’s good faith calculation the computation of the Adjusted EBITDA and determination as to whether the Earn-Out Milestone was achieved, and, if applicable, the Earn-Out Payment calculation, together with all supporting calculations and reasonable detail related thereto and calculated in accordance with Exhibit B-1 (the relevant statement referred to in clauses (a) and (b), the “Earn-Out Milestone Statement”). In the event Seller delivers the Earn-Out Milestone Statement in accordance with clause (b) above, the review and dispute resolution procedures applicable to Seller with respect to the Earn-Out Milestone Statement and calculation of the Earn-Out Payment set forth in Section 2.5.3 shall apply mutatis mutandis to Buyer. Subject to the last sentence of this Section 2.6.2, within ten (10) Business Days after the Earn-Out Payment and a copy of the corresponding Earnfinancial information used in making such computation, together with reasonably detailed documentary evidence supporting the basis for such calculation. If applicable, such schedule shall also set forth any proposed set-Out Milestone Statement shall have been finally determined off for Excess Losses in accordance with Section 2.5.37.6(b) and the net aggregate amount, Buyer shall payif any, or cause of such Earn-Out Payment, after giving effect to such set-off, to be paid, by wire transfer distributed to the former Company Stockholders. Parent’s computation of immediately available funds, (a) to Seller, the gross amount of any Earn-Out Payment less (prior to any possible set-off for Excess Losses) under this Section 1.9 shall be conclusive and binding upon the parties hereto unless, within thirty (30) days following the Stockholder Representative’s receipt of such schedule, the Stockholder Representative notifies Parent in writing that it disagrees with Parent’s computation of the applicable Earn-Out Employee Portion AmountPayment. Such notice shall include a schedule setting forth the Stockholder Representative’s computation of the payment together with a copy of any information, and (b) to the Company, the Earn-Out Employee Portion Amount, for further distribution to the applicable recipient (in the amounts to be other than that previously provided by Seller to Buyer Parent, used in writing at least five (5) Business Days after the Earn-Out Payment and the corresponding Earn-Out Milestone Statement shall have been finally determined in accordance with Section 2.5.3), net of any applicable withholding Taxes, through the applicable Group Company’s payroll procedure. Notwithstanding anything to the contrary contained herein, (x) the Earn-Out Payment will not be paid in the event that this Agreement is terminated for any reason and the Closing does not occur, and (y) in the event that the Closing occurs following the expiration of the Earn-Out Period, the Earn-Out Payment will be paid at the later of (1) the Closing and (2) ten (10) Business Days after the Earn-Out Payment and the corresponding Earn-Out Milestone Statement shall have been finally determined in accordance with Section 2.5.3making such computation.

Determination of Earn-Out Payment. If the Closing occurs (ai) prior to the expiry of the Earn-Out PeriodOn or before March 15, Buyer 2022, ECS shall prepare and deliver to Carlisle a written statement (or cause to be prepared the “Earn-out Statement”) setting forth, in reasonable detail and delivered) to Sellerwith reasonable supporting documentation, not later than sixty (60) days following the completion of Parent’s first quarterly audit following December 31, 2022, a statement setting forth Buyer’s its good faith calculation calculations of (A) the Adjusted EBITDA and determination as (B) the resulting Earn-out Payment (the “Proposed Earn-out Calculation”). (ii) If Carlisle does not give written notice of any dispute (an “Earn-out Dispute Notice”) to whether ECS within 45 days of receiving the Proposed Earn-out Calculation, the Parties agree that the Proposed Earn-out Calculation shall be deemed to be the final Adjusted EBITDA and Earn-out Payment and the Earn-Out Milestone was achievedout Statement shall become final and binding upon the Parties. Prior to the end of such 45-day period, and, if applicable, Carlisle may accept the Proposed Earn-out Calculation and the Earn-Out out Statement by delivering written notice to that effect to ECS, in which case the Earn-out Payment calculationwill be finally determined, and the Proposed Earn-out Calculation and the Earn-out Statement shall become final and binding on the Parties, when such notice is given. Any Earn-out Dispute Notice shall specify in reasonable detail, to the extent available or known at such time, the item(s), dollar amount(s), nature and basis of any disagreement so asserted, together with all supporting calculations Carlisle’s alternative calculation of each disputed item. If Carlisle delivers an Earn-out Dispute Notice to ECS within such 45-day period, then ECS and reasonable detail related thereto and calculated Carlisle shall negotiate in accordance with Exhibit B-1 or (b) after good faith to attempt to resolve the expiry of dispute during the 30-day period commencing on the date ECS receives the Earn-Out Periodout Dispute Notice from Carlisle. Any item set forth in the Proposed Earn-out Calculation or the Earn-out Statement and not objected to in the Earn-out Dispute Notice shall be final and binding on the Parties. If Carlisle and ECS reach agreement on the final resolution of any matter specified in the Earn-out Dispute Notice during such 30-day period, Seller the resolution of such matter shall prepare be in writing signed by Carlisle and deliver ECS and shall be final and binding upon the Parties. If Carlisle and ECS do not agree upon a final resolution with respect to any disputed items specified in the Earn-out Dispute Notice within such 30-day period, then, at the election of either Party, the remaining items in dispute shall be submitted as promptly as practicable to the Accounting Firm, the determination of the Accounting Firm being conclusive and binding on the Parties and shall not be subject to court review or otherwise appealable. The Accounting Firm shall be instructed, and Carlisle and ECS shall (and ECS shall cause the Buyers and the Acquired Business to) use commercially reasonable efforts to cause the Accounting Firm, to render a determination (acting as an arbitrator and not as an expert) of the applicable dispute within 45 days after referral of such matters to the Accounting Firm, which determination must be in writing and must set forth, in reasonable detail, the basis therefor. In a potential dispute resolution procedure referred to the Accounting Firm pursuant to this Section 2.9(b), all prior discussions related thereto shall, unless otherwise agreed by Carlisle and ECS, be governed by Rule 408 of the Federal Rules of Evidence and neither party may discuss, use or cause to be prepared and deliveredrely upon the other party’s conduct or statements during such dispute resolution or in any communication with the Accounting Firm. (iii) to Buyer, not later than sixty (60) Within 15 days after the expiry engagement of the Earn-Out PeriodAccounting Firm, a statement setting forth Seller’s good faith calculation of the Adjusted EBITDA Carlisle and determination as to whether the Earn-Out Milestone was achieved, and, if applicable, the Earn-Out Payment calculation, together with all supporting calculations and reasonable detail related thereto and calculated in accordance with Exhibit B-1 (the relevant statement referred to in clauses (a) and (b), the “Earn-Out Milestone Statement”). In the event Seller delivers the Earn-Out Milestone Statement in accordance with clause (b) above, the review and dispute resolution procedures applicable to Seller ECS shall present their respective positions with respect to the matters in dispute referred to the Accounting Firm in the form of a written report, a copy of which shall be delivered to the other party, and no ex parte conferences, oral examinations, testimony, depositions, discovery or other form of evidence gathering or hearings shall be conducted or allowed; provided, however, that at the Accounting Firm’s request, or as mutually agreed by Carlisle and ECS, Carlisle and ECS may meet with the Accounting Firm so long as representatives of both Carlisle and ECS are present. The Accounting Firm’s determination shall be based solely on (A) the written reports submitted to the Accounting Firm by Carlisle and ECS (B) if agreed between the Parties, oral submissions by Carlisle and ECS at meetings held in compliance with the prior sentence (i.e., not on independent review) and (C) on the definitions and other terms included herein; provided, however, that in resolving a disputed item, the Accounting Firm may not assign a value to any particular item greater than the greatest value for such item or less than the smallest value for such item, in each case, claimed by ECS or Carlisle in the Proposed Earn-Out Milestone Statement and calculation of out Calculation or the Earn-Out Payment out Dispute Notice. The Accounting Firm’s decision with respect to the matters in dispute referred to it shall be final, conclusive and binding on the Parties, and any Party may seek to enforce such decision in a court of competent jurisdiction. (iv) The terms of appointment and engagement of the Accounting Firm shall be as agreed upon between Carlisle and ECS. Any associated engagement fees of the Accounting Firm shall initially be borne 50% by Carlisle and 50% by ECS and all other costs and expenses incurred by the Parties in connection with resolving any dispute hereunder before the Accounting Firm shall initially be borne by the Party incurring such cost and expense; provided, however, that such fees, costs and expenses shall ultimately be borne as set forth below. The fees, costs and expenses of the Accounting Firm shall ultimately be allocated between Carlisle and ECS in Section 2.5.3 shall apply mutatis mutandis to Buyer. Subject the same proportion that the aggregate amount of the disputed items submitted to the last sentence Accounting Firm that are unsuccessfully disputed by each such Party (as finally determined by the Accounting Firm) bears to the total amount of this Section 2.6.2, within ten (10) Business Days after such disputed items so submitted. Such determination of the Accounting Firm shall be conclusive and binding upon the Parties. The Proposed Earn-out Calculation and the Earn-Out Payment and out Statement shall be revised as appropriate to reflect the corresponding resolution of any objections thereto pursuant to this Section 2.9(b) and, as so revised, such Proposed Earn-Out Milestone Statement shall have been finally determined in accordance with Section 2.5.3, Buyer shall pay, or cause to be paid, by wire transfer of immediately available funds, (a) to Seller, out Calculation and the Earn-Out Payment less out Statement shall be deemed to set forth the final Adjusted EBITDA and Earn-out Payment, in each case, for all purposes hereunder. (v) The Buyers, on the one hand, shall, and shall cause the Acquired Business to, and the Sellers, on the other hand, shall, provide to each other (and their respective accountants and other representatives) such data and information as the other Party may reasonably request (including reasonable access to the Acquired Business’s personnel involved with the preparation of the Proposed Earn-out Calculation) in connection with preparation and review of the Proposed Earn-out Calculation and the Earn-Out Employee Portion Amount, out Statement (and (beach Party and its accountants and other representatives shall be permitted to make copies as they see reasonably necessary) to at reasonable times at any time during preparation and review of the Company, Proposed Earn-out Calculation and the Earn-Out Employee Portion Amount, for further distribution to the applicable recipient (in the amounts to be provided by Seller to Buyer in writing at least five (5) Business Days after the Earn-Out Payment out Statement and the corresponding Earn-Out Milestone Statement shall have been finally determined in accordance with Section 2.5.3), net resolution of any applicable withholding Taxes, through the applicable Group Company’s payroll procedure. Notwithstanding anything to the contrary contained herein, (x) the Earn-Out Payment will not be paid in the event that this Agreement is terminated for any reason and the Closing does not occur, and (y) in the event that the Closing occurs following the expiration of the Earn-Out Period, the Earn-Out Payment will be paid at the later of (1) the Closing and (2) ten (10) Business Days after the Earn-Out Payment and the corresponding Earn-Out Milestone Statement shall have been finally determined in accordance objections or disputes with Section 2.5.3respect thereto.

Determination of Earn-Out Payment. If the Closing occurs (a) prior to the expiry of the Earn-Out Period, Buyer Acquiror shall prepare and deliver (or cause to be prepared and delivered) to Sellerthe Seller Representative, not later than sixty (60) days following the completion end of Parent’s first quarterly audit following December 31, 2022the Earn-Out Period, a statement setting forth BuyerAcquiror’s good faith calculation of the Adjusted EBITDA and determination as to whether Earn- Out Net Sales during the Earn-Out Milestone was achievedPeriod are equal to or greater than the Earn-Out Threshold, and, if applicable, and the amount of the Earn-Out Payment calculationpayable hereunder, including if the amount of such payment is zero dollars ($0), together with all supporting calculations and reasonable detail related thereto and calculated in accordance with Exhibit B-1 or (b) after the expiry of the Earn-Out Period, Seller shall prepare and deliver (or cause to be prepared and delivered) to Buyer, not later than sixty (60) days after the expiry of the Earn-Out Period, a statement setting forth Seller’s good faith calculation of the Adjusted EBITDA and determination as to whether the Earn-Out Milestone was achieved, and, if applicable, the Earn-Out Payment calculation, together with all supporting calculations and reasonable detail related thereto and calculated in accordance with Exhibit B-1 (the relevant statement referred to in clauses (a) and (b), the “Earn-Out Milestone Statement”). In the event The Seller delivers the Earn-Out Milestone Statement in accordance with clause (b) aboveRepresentative may deliver a Purchase Price Dispute Notice, the review and dispute resolution procedures applicable to Seller including with respect to the Earn-Out Milestone Payment set forth therein, to Acquiror within thirty (30) days of receipt of the Earn- Out Statement thereof in accordance with Section 2.4(b), and calculation the dispute resolutions provided in Section 2.4(b) shall apply until the amount of the Earn-Out Payment is finally determined as provided therein. The Earn-Out Payment shall be made by Acquiror to the Company, for payment to the Earn-Out Recipients for payment through the Company payroll (subject to Section 2.6), in accordance with Schedule 2.5(a) and in the respective amounts set forth in Section 2.5.3 shall apply mutatis mutandis writing by the Seller Representative, with such calculations by the Seller Representative to Buyer. Subject be provided to Acquiror on the last sentence date that is the earlier of this Section 2.6.2, within ten (10i) Business Days after thirty (30) calendar days following the final determination of the amount of the Earn-Out Payment and the corresponding Earn-Out Milestone Statement shall have been finally determined in accordance with Section 2.5.3, Buyer shall pay, or cause to be paid, by wire transfer of immediately available funds, (a2.4(b) to Seller, the Earn-Out Payment less the Earn-Out Employee Portion Amount, and (bii) to the CompanyJune 7, the Earn-Out Employee Portion Amount, for further distribution to the applicable recipient (in the amounts to 2024. Such payment shall be provided made by Seller to Buyer in writing at least five (5) Business Days after the Earn-Out Payment and the corresponding Earn-Out Milestone Statement shall have been finally determined in accordance with Section 2.5.3), net of any applicable withholding Taxes, through the applicable Group Company’s payroll procedure. Notwithstanding anything to the contrary contained herein, (x) the Earn-Out Payment will not be paid in the event that this Agreement is terminated for any reason and the Closing does not occur, and (y) in the event that the Closing occurs Acquiror as soon as reasonably practicable following the expiration Seller Representative’s delivery of the final determination of the amount of the Earn-Out PeriodPayments, the Earn-Out Payment will which such payment shall be paid at the made no later of (1) the Closing and (2) ten (10) Business Days after the Earn-Out Payment and the corresponding Earn-Out Milestone Statement shall have been finally determined in accordance with Section 2.5.3than June 15, 2024.