When buying a business (whether in a stock deal or an asset deal), the Buyer will often want protection from unforeseen problems, balance sheet shortfalls, customer attrition or claims against representations and warranties. These adjustments can take the form of holdbacks, by which part of the purchase price is paid 6-18 months after closing and is adjusted pursuant to the purchase agreement or by adjustment to amounts owing under Buyer’s promissory note or installment sale obligations. Sometimes there is a specific metric behind the holdback; these vary by industry and the circumstances of the deal. These factors can be based on financial statement items like EBITDA or Net Worth or can be linked to the level of sales, customer gains (or losses) or post-closing milestones. The holdback can be a funded escrow or a promise by the Buyer to pay the balance of the purchase price later. We have found that baskets or claw backs can sometimes serve to close the gap between the Seller’s price and the willingness of the Buyer to pay.