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Receivables - Working Capital and Indemnity Holdback Related to the Asset Sale
3 Months Ended
Sep. 30, 2014
Working Capital And Indemnity Holdback Related To Asset Sale Receivable [Abstract]  
Receivables - Working Capital and Indemnity Holdback Related to Asset Sale

(3) Receivables – Working Capital and Indemnity Holdback Related to the Asset Sale

 

On August 22, 2014, the Company completed the previously announced sale of substantially all of its assets used to conduct the Company's former ASO business unit to Lockheed Martin Corporation for an agreed upon purchase price of $61.0 million, less a working capital adjustment. As of September 30, 2014, the estimated purchase price is $59.3 million, which includes a working capital adjustment of $1.7 million. As of September 30, 2014, the Company has received cash of $52.6 million and has recorded receivables of $0.6 million for the working capital holdback, which is classified in other current assets, and $6.1 million for the indemnity holdback.

 

The working capital holdback will be settled in the next twelve months, once both sides agree on the final net working capital amount as of the date of the transaction. If the final net working capital amount is greater than the estimated net working capital amount, the difference shall be paid to the Company by the Buyer with simple interest thereon from the closing date to the date of payment at a floating rate per annum equal to the Interest Rate and such payment shall include the adjustment holdback amount and interest from the closing date in the manner calculated for the difference. If the final net working capital amount is less than the estimated net working capital amount, the difference shall be paid to Buyer by the Company with simple interest thereon from the closing date to the date of payment at a floating rate per annum equal to the Interest Rate first, out of the adjustment holdback amount, and if there are insufficient funds in the adjustment holdback amount, directly by the Company. Any such payment shall be made in immediately available funds not later than five business days after the determination of the final net working capital amount by wire transfer to a bank account designated in writing by the party entitled to receive the payment.

 

The indemnity holdback of $6.1 million is being held in escrow under the terms of an escrow agreement until February 2016 (the 18-month anniversary of the consummation of the transaction). Within three business days after the 18-month anniversary of the closing date, the then-available indemnity escrow holdback (less any pending Buyer claims), will be released and paid to the Company. The Company is currently not aware of any pending Buyer claims.