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The document specifies a $5.0 million cash purchase price at closing, subject to purchase price adjustments including a working capital target of $1.75 million and a net debt framework, plus a $500,000 escrow. 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(“ABC” or the “Company”) . Our transaction structure is meant to meet your personal goals and to provide a solid platform for the continued growth and success of the business.  \nPurchase Consideration:  \nSubject to the terms and conditions of this letter of intent, a new corporate entity to be formed by Hadley Capital for the purpose of acquiring ABC (“Newco”) will acquire substantially all of the assets of ABC for $5.0 million in cash at closing, subject to certain purchase price adjustments described below and a $500,000 escrow.  \nIn addition, Newco will enter into employment agreements with you that will include contingent bonus payments valued at up to $1.0 million in total. The annual bonus payments shall be calculated as follows: On an annual basis for the five (5) years following the closing of the transaction, you will receive 50% of Newco’s EBITDA in excess of $1.0 million. The bonus payments will have an annual cap of $200,000 and a lifetime cap of $1.0 million. Payments will be treated as compensation, not purchase price.  \nAssets Being Purchased:  \nNewco will acquire all of the assets associated with ABC, including all ofits on and off balance sheet assets such as accounts receivable, inventories (including written off inventory), materials, computer hardware and software, intellectual property and know-how (including patents, trademarks, trade names, website URL’s, etc.), tooling, prepaid expenses, furniture, fixtures, equipment, leased equipment, formulas, engineering designs and drawings, customer lists, customer contracts, certain employment agreements (if any), agency affiliations, vehicles, buildings, and all other tangible and intangible assets. The only assets Newco will not acquire are ABC’s cash, employee advances, past due receivables (that are mutually determined to be uncollectible) and certain other expressly mutually agreed upon items (for example company owned vehicles used for personal use) . All assets must be free and clear of any liens or encumbrances.  \nLiabilities Being Assumed:  \nNewco will assume only current accounts payable incurred by ABC in the ordinary course of business. Newco will not assume or purchase any other liabilities. All such un-assumed liabilities will be satisfied by you at closing. For example and without limitation, all liabilities associated with income or sales taxes, taxes arising out of the sale of the company (including state sales tax or transfer taxes, if any), accrued expenses, debt of any kind, commissions or bonus payments to employees, accrued liabilities or any liabilities associated with environmental contamination, product liability or warranty issues, litigation of any kind, employee pensions (including contributions owing to employees that accrued prior closing), or any other such liabilities will be satisfied by you at closing or will remain with them after closing.  \nPurchase Price Adjustments:  \nThe closing purchase price will be adjusted for the following items:  \nWorking Capital Adjustment:  \nThe purchase price will be adjusted upward or downward in an amount equal to the difference between a working capital target of $1.75 million and the actual working capital delivered at closing. The actual working capital amount shall be calculated as follows per the closing balance sheet: Current accounts receivable (defined as excluding mutually determined uncollectible receivables) plus inventories less accounts payable per the closing balance sheet. The closing balance sheet will be calculated in a manner consistent with historical practices and according to GAAP.  \nThus, if ABC’s actual working capital at closing is greater than $1.75 million then the c","cbCaiaivE7eZK9xK","https://ap.wps.com/l/cbCaiaivE7eZK9xK","pdf",43203,"English","# Purchase Consideration\n## Purchase Price Adjustments","[{\"question\":\"What is the proposed purchase consideration and how is the closing price determined?\",\"answer\":\"Newco will acquire substantially all of ABC’s assets for $5.0 million in cash at closing, subject to purchase price adjustments. Adjustments include working capital differences versus a $1.75 million target and reductions for certain net debt items, with a $500,000 escrow.\"},{\"question\":\"Which assets will Newco acquire and which will be excluded?\",\"answer\":\"Newco will acquire substantially all ABC assets, including tangible and intangible assets such as receivables, inventories, equipment, intellectual property, customer lists, and related contracts. Exclusions include ABC cash, employee advances, past due receivables deemed uncollectible, and certain expressly agreed items (e.g., company-owned vehicles used personally).\"},{\"question\":\"What liabilities will Newco assume at closing?\",\"answer\":\"Newco will assume only current accounts payable incurred in the ordinary course of business. Other liabilities—including taxes, accrued expenses, debt, and various contingent or non-assumed liabilities—are to be satisfied by the seller at closing or remain with them after closing.\"}]","Letter of Intent - Asset Acquisition Terms and Purchase Price Adjustments | PDF",1789524837]