Consolidation--Moguls of M&A

Norton: Nationwide Graphics will usually base its purchase price on earnings before interest, taxes, depreciation and amortization after adding back mutually acceptable, nonrecurring expenses (the "adjusted EBITDA"). Then, depending on numerous factors including depth of management, historical growth rate, profit margins, geographical locale, etc., Nationwide will multiply the adjusted EBITDA by a multiple. Thereafter, Nationwide will reduce that product by the aggregate amount of interest-bearing debt and capital leases. This will result in the proposed purchase price.