Use this button to switch between dark and light mode.

Show Me the Money! Purchase Price Adjustments in M&A

March 12, 2024 (2 min read)

Valuation of a target must account for many factors, and transaction parties want to ensure the price accurately reflects the true value of the business. A purchase price adjustment provision is a mechanism by which the purchase price may be increased or decreased as a result of changes to the target company’s financial condition or other specific factors between signing and closing. The adjustment operates to better reflect the often-changing value of the business in the interim period. Explore common purchase price adjustment mechanisms in this comprehensive practice note.

Read now »

Related Content

  • Earn-Out Clauses
    Assess whether an earn-out mechanism fits your private deal with this practice note.
  • Pricing Collars
    Understand the use of pricing collars in public company acquisition agreements. 

Practical Guidance Updates
Featuring the latest updates from your Practical Guidance account.

  • Read the new edition of the Practical Guidance Journal featuring key considerations in mergers and acquisitions due diligence in the context of artificial intelligence technologies.
  • Generative Artificial Intelligence (AI) Resource Kit is a collection of current guidance on generative AI, ChatGPT, and similar tools.
  • Check out our Practical Guidance Author Center! Learn about the 2000+ leading attorney authors contributing to our 26 practice areas, and find out how you can Become a Practical Guidance Author. Practical Guidance is committed to amplifying diverse voices of attorneys across all differences, including gender and race.
  • Legal Developments provide the latest updates and analyses of emerging topics impacting your practice area. Visit the Legal Developments page to see the latest topics, which also include breaking legal news and related Practical Guidance content.
  • Document alerts allow you to stay current on legal developments that affect your practice. Find out how to set up your document alerts.
  • Public Interest, Pro Bono, and Non-Profit Resource Kit offers valuable guidance for those providing pro bono legal services and assisting non-profit organizations and public interest groups. It includes useful content on topics including tenant's rights, fair housing and lending, discrimination, immigration, and general non-profit resources.
  • Click here to review the robust and growing collection of more than 150+ data points from publicly filed transactions available in Market Standards.


Experience results today with practical guidance, legal research, and data-driven insights—all in one place.

Experience Lexis+