Purchase Price Adjustment
/ˈpɜːrtʃəs praɪs əˈdʒʌstmənt/
Definitions
- (n.) A contractual mechanism in mergers and acquisitions that adjusts the purchase price post-closing based on specified financial benchmarks or representations to reflect the target’s actual value.
The purchase price adjustment clause required recalculating the price after the final audit.
Forms
- purchase price adjustment
- purchase price adjustments
Related terms
See also
Commentary
Purchase price adjustments help allocate risk between buyer and seller by addressing value changes discovered after closing.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.