Glossary Index / Purchase Price Adjustments

Purchase Price Adjustments

Adjustments made to the purchase price after closing that affect how much the seller receives. Purchase price adjustments can include earnout provisions, indemnification claims against seller holdback or seller’s notes, or working capital adjustments.

Such adjustments exist to account for variances between the value of the seller’s startup at closing and its value as stated in the asset purchase agreement and are easy to overlook.