Common use of Adjustment to Consideration Clause in Contracts

Adjustment to Consideration. (a) Within forty-five (45) days following the Closing Date, Parent may, at its election, cause to be prepared and delivered to the Stockholder Representative an unaudited balance sheet of the Surviving Corporation as of the Closing Date (the "Adjusted Balance Sheet"). The ---------------------- Adjusted Balance Sheet will be prepared in accordance with GAAP (except that such balance sheet will not contain footnotes or year-end adjustments that may be required by GAAP). Based upon the Adjusted Balance Sheet, the Company's "Net --- Liabilities at Closing" shall be calculated in accordance with the following: ---------------------- (A) the Company's total liabilities at the Closing Date as set forth on the Adjusted Balance Sheet minus (B) the Company's total assets at the Closing Date as set forth on the Adjusted Balance Sheet minus (C) the amount of the Company's payments for Severance (or accruals therefore) minus (D) the Additional Liabilities (whether such amount has been paid by the Company prior to the Closing Date or otherwise reserved for by the Company) minus (E) the total amount of normal per diem operating expenses for the period between November 30, 2001 and Closing at a rate of $9,150 per calendar day minus (F) the Third Party Expense Adjustment Amount minus (G) up to $50,000 pursuant to Section 5.5. In ----------- the event that, pursuant to the terms of this Section 7.6, it is determined that ----------- (X) the Company's Net Liabilities at Closing exceeds (Y) the Current Balance Sheet Net Liabilities, then an amount equal to such difference ("Excess ------ Liabilities") shall be paid to Parent out of the Escrow Fund upon the delivery ----------- to the Escrow Agent of an Officer's Certificate in accordance with the terms of Section 7.3(f) hereof. If the Excess Liabilities exceed the amount in the Escrow -------------- Fund, Parent shall be entitled to recover directly from the Principal Stockholders any amount of Excess Liabilities not covered by the Escrow Fund, subject to the limitations set forth in Section 7.5. Following delivery by ----------- Parent to the Stockholder Representative of the Adjusted Balance Sheet, Parent shall give the Stockholder Representative reasonable access during Parent's business hours to those books and records of the Surviving Corporation in the possession of Parent and any personnel which relate to the preparation of the Adjusted Balance Sheet for purposes of resolving any disputes concerning the Adjusted Balance Sheet and the calculation of Net Liabilities at Closing. (b) The Stockholder Representative shall have fifteen (15) days following delivery of the Adjusted Balance Sheet during which to notify Parent in writing (the "Notice of Objection") of any good faith objections to the ------------------- calculation of Net Liabilities at Closing or the Adjusted Balance Sheet, as it affects such calculation, setting forth a reasonably specific and detailed description of its objections and the dollar amount of each objection. If the Stockholder Representative objects to the Adjusted Balance Sheet or Parent's calculation of Net Liabilities at Closing as reflected thereon, Parent and the Stockholder Representative shall attempt to resolve any such objections within fifteen (15) days of the receipt by Parent of the Notice of Objection. (c) If Parent and the Stockholder Representative are unable to resolve any such dispute within the fifteen (15) day period referred to in Section 7.6(b) hereof, Parent and the Stockholder Representative shall submit -------------- the dispute to Deloitte & Touche (the "Independent Accounting Firm"). Each of --------------------------- the parties to this Agreement shall, and shall cause their respective affiliates and representatives to, provide full cooperation to the Independent Accounting Firm. The Independent Accounting Firm shall (x) act in its capacity as an expert and not as an arbitrator, (y) consider only those matters as to which there is a dispute between the parties and (z) be instructed to reach its conclusions regarding any such dispute within thirty (30) days after its appointment and provide a written explanation of its decision. In the event that Parent and the Stockholder Representative submit any dispute to an Independent Accounting Firm, each such party may submit a "position paper" to the Independent Accounting Firm setting forth the position of such party with respect to such dispute, to be considered by such Independent Accounting Firm as it deems fit. The expenses relating to the engagement of the Independent Accounting Firm shall be paid by the party whose position is not the position that substantially prevails. (d) If the Stockholder Representative does not deliver a Notice of Objection in accordance with Section 7.6(b) hereof (i.e., within a fifteen (15) ------------- day period), the Adjusted Balance Sheet (together with Parent's calculation of Net Liabilities at Closing reflected thereon), shall be deemed to have been accepted by all of the parties to this Agreement. In the event that the Stockholder Representative delivers a Notice of Objection in accordance with the provisions above and Parent and the Stockholder Representative are able to resolve such dispute by mutual agreement, the Adjusted Balance Sheet, together with Parent's calculation of Net Liabilities at Closing reflected thereon, to the extent modified by mutual agreement of such parties, shall be deemed to have been accepted by all of the parties to this Agreement. In the event that the Stockholder Representative delivers a Notice of Objection in accordance with the provisions set forth above and Parent and the Stockholder Representative are unable to resolve such dispute by mutual agreement, the determination of the Independent Accounting Firm shall be final and binding on the parties, and the Adjusted Balance Sheet, together with Parent's calculation of Net Liabilities at Closing reflected thereon, to the extent modified by the Independent Accounting Firm, shall be deemed to have been accepted by all of the parties to this Agreement. Subject to the foregoing provisions, the calculation of Net Liabilities at Closing reflected on any such Adjusted Balance Sheet shall be conclusive and binding on all of the parties to this Agreement, no further adjustments shall be made thereto and neither Parent, the Stockholder Representative nor the Principal Stockholders shall have any further right to challenge such calculation of Net Liabilities at Closing, whether pursuant to the terms of Section 7.3 hereof or otherwise. -----------

Adjustment to Consideration. (a) Within forty-five After the Closing, Buyer shall deliver to Seller a statement (45based on draft Tax Returns of Lion and Paline Pipeline Company (and any affiliated, consolidated, combined or unitary group of which either of Lion and Paline Pipeline Company is a member) prepared by PricewaterhouseCoopers LLP, KPMG LLP or another mutually acceptable independent accounting firm) that sets forth the amount of any Taxes that are included in the Paline Taxes, together with reasonable details supporting the calculation of the Paline Taxes (the “Paline Tax Statement”). Seller shall have 45 days following from the Closing Datedate of receipt of the Paline Tax Statement to pay to Buyer an amount equal to any undisputed portion of the Paline Taxes set forth in the Paline Tax Statement by wire transfer of immediately available funds to an account or accounts designated in writing by Buyer. In the event that Seller does not agree with the calculation of the Paline Taxes as set forth in the Paline Tax Statement, Parent maySeller shall so notify Buyer in writing within 10 Business Days after the date of receipt of the Paline Tax Statement, at its election, cause to be prepared setting forth in writing and delivered in reasonable detail the nature of Seller’s objections to the Stockholder Representative an unaudited balance sheet calculation of Paline Taxes as set forth in the Paline Tax Statement. Seller and Buyer shall negotiate in good faith the disputed portion of the Surviving Corporation Paline Taxes calculation. In the event the Parties are unable to reach an agreement within 10 days after Buyer receives written notice of any disputed amount (or such later date as of the Closing Date (the "Adjusted Balance Sheet"). The ---------------------- Adjusted Balance Sheet will be prepared in accordance with GAAP (except that such balance sheet will not contain footnotes or year-end adjustments that may be required agreed by GAAPBuyer and Seller). Based upon , then the Adjusted Balance Sheet, the Company's "Net --- Liabilities at Closing" shall be calculated Parties will resolve such dispute in accordance with the following: ---------------------- procedures set forth in Exhibit N. Any amount to be paid by Seller to Buyer pursuant the dispute resolution process conducted pursuant to Exhibit N shall be paid within 10 Business Days of such determination by wire transfer of immediately available funds to an account or accounts designated in writing by Buyer. (Ab) If, after payment of the Paline Taxes pursuant to Section 2.4(a), there is a subsequent adjustment in the amount of the Paline Taxes as a result of any Proceeding related to Taxes, and (i) if any portion of the Paline Taxes previously paid by Seller pursuant to Section 2.4(a) is finally determined as a result of such adjustment to not have been owing, then Buyer shall pay to Seller such portion that is determined not to be owing or (ii) if the Paline Taxes are finally determined as a result of such adjustment to be in excess of the Paline Taxes originally paid, then Seller shall pay to Buyer such excess amount. Any amount to be paid by Seller or Buyer pursuant to the immediately preceding sentence shall be paid within 10 Business Days of the determination of the adjustment by wire transfer of immediately available funds to an account or accounts designated in writing by the recipient of such payment. (c) If, after payment of the Paline Taxes pursuant to Section 2.4(a), (i) the Company's total liabilities at Tax basis of the Closing Date assets of Paline Pipeline Company following the Paline Pipeline Equity Transfer is reduced as set forth on the Adjusted Balance Sheet minus a result of a Proceeding, (B) the Company's total assets at the Closing Date as set forth on the Adjusted Balance Sheet minus (Cii) the amount of the Company's payments for Severance Paline Taxes would have been reduced had the Paline Taxes been determined based on an amount of consideration payable in the Paline Pipeline Equity Transfer that is consistent with the amount of such reduced Tax basis and (iii) Buyer, the Companies or their Affiliates are entitled to (or accruals thereforeupon filing of an amended Tax Return or other appropriate form would have been entitled to) minus (D) the Additional Liabilities receive a refund (whether by payment, credit, offset or otherwise) related to the Paline Taxes described in clause (ii) of this sentence (a “Paline Refund”), then Buyer shall pay to Seller the amount of the Paline Refund but only to the extent such amount has exceeds any additional Taxes that are incurred (or upon filing of an amended Tax Return or other appropriate form would have been paid incurred) by Buyer, the Company prior to Companies or their Affiliates as a result of reducing the Closing Date or otherwise reserved for by the Company) minus (E) the total amount of normal per diem operating expenses for consideration payable in the period between November 30, 2001 and Closing at Paline Pipeline Equity Transfer in a rate of $9,150 per calendar day minus (F) the Third Party Expense Adjustment Amount minus (G) up to $50,000 pursuant to Section 5.5. In ----------- the event that, pursuant to the terms of this Section 7.6, it manner that is determined that ----------- (X) the Company's Net Liabilities at Closing exceeds (Y) the Current Balance Sheet Net Liabilities, then an amount equal to such difference ("Excess ------ Liabilities") shall be paid to Parent out of the Escrow Fund upon the delivery ----------- to the Escrow Agent of an Officer's Certificate in accordance consistent with the terms of Section 7.3(f) hereof. If the Excess Liabilities exceed the amount in the Escrow -------------- Fund, Parent shall be entitled to recover directly from the Principal Stockholders any amount of Excess Liabilities not covered by the Escrow Fund, subject to the limitations set forth in Section 7.5. Following delivery by ----------- Parent to the Stockholder Representative such reduced Tax basis (including any Taxes resulting from cancellation of the Adjusted Balance Sheet, Parent shall give the Stockholder Representative reasonable access during Parent's business hours to those books and records indebtedness income resulting from such reduction of the Surviving Corporation in the possession of Parent and any personnel which relate to the preparation of the Adjusted Balance Sheet for purposes of resolving any disputes concerning the Adjusted Balance Sheet and the calculation of Net Liabilities at Closing. (b) The Stockholder Representative shall have fifteen (15) days following delivery of the Adjusted Balance Sheet during which to notify Parent in writing (the "Notice of Objection") of any good faith objections to the ------------------- calculation of Net Liabilities at Closing or the Adjusted Balance Sheet, as it affects such calculation, setting forth a reasonably specific and detailed description of its objections and the dollar amount of each objection. If the Stockholder Representative objects to the Adjusted Balance Sheet or Parent's calculation of Net Liabilities at Closing as reflected thereon, Parent and the Stockholder Representative shall attempt to resolve any such objections within fifteen (15) days of the receipt by Parent of the Notice of Objection. (c) If Parent and the Stockholder Representative are unable to resolve any such dispute within the fifteen (15) day period referred to in Section 7.6(b) hereof, Parent and the Stockholder Representative shall submit -------------- the dispute to Deloitte & Touche (the "Independent Accounting Firm"consideration). Each of --------------------------- the parties to this Agreement shallThe Parties shall cooperate, and shall cause their respective affiliates and representatives toAffiliates to cooperate, provide full cooperation in order to the Independent Accounting Firmtake any necessary steps to claim any such refund. The Independent Accounting Firm shall (x) act in its capacity as an expert and not as an arbitrator, (y) consider only those matters as to which there is a dispute between the parties and (z) be instructed to reach its conclusions regarding any such dispute within thirty (30) days after its appointment and provide a written explanation of its decision. In the event that Parent and the Stockholder Representative submit any dispute to an Independent Accounting Firm, each such party may submit a "position paper" to the Independent Accounting Firm setting forth the position of such party with respect to such dispute, to be considered by such Independent Accounting Firm as it deems fit. The expenses relating to the engagement of the Independent Accounting Firm shall be paid by the party whose position is not the position that substantially prevails. (d) If the Stockholder Representative does not deliver a Notice of Objection in accordance with Section 7.6(b) hereof (i.e., within a fifteen (15) ------------- day period), the Adjusted Balance Sheet (together with Parent's calculation of Net Liabilities at Closing reflected thereon), shall be deemed to have been accepted by all of the parties to this Agreement. In the event that the Stockholder Representative delivers a Notice of Objection in accordance with the provisions above and Parent and the Stockholder Representative are able to resolve such dispute by mutual agreement, the Adjusted Balance Sheet, together with Parent's calculation of Net Liabilities at Closing reflected thereon, to the extent modified by mutual agreement of such parties, shall be deemed to have been accepted by all of the parties to this Agreement. In the event that the Stockholder Representative delivers a Notice of Objection in accordance with the provisions set forth above and Parent and the Stockholder Representative are unable to resolve such dispute by mutual agreement, the determination of the Independent Accounting Firm amount of and the timing of any payment under the first sentence of this Section 2.4(c) shall be final and binding based on the parties, and the Adjusted Balance Sheet, together with Parent's calculation of Net Liabilities at Closing reflected thereon, to the extent modified by the Independent Accounting Firm, shall be deemed to have been accepted by all of the parties to this Agreement. Subject to the foregoing provisions, the calculation of Net Liabilities at Closing reflected on any such Adjusted Balance Sheet shall be conclusive and binding on all of the parties to this Agreement, no further adjustments shall be made thereto and neither Parent, the Stockholder Representative nor the Principal Stockholders shall have any further right to challenge such calculation of Net Liabilities at Closing, whether pursuant to the terms principles of Section 7.3 hereof 2.4(a) and without regard to Buyer’s consolidated Tax group’s loss or otherwisecredit carrybacks. -----------Additionally, in the event a Paline Refund has actually been obtained and is subsequently challenged and adjusted as a result of any Proceeding related to Taxes then the principles of Section 2.4(b) and Section 7.6 shall apply to such adjusted Paline Refund.

Adjustment to Consideration. (a) Within forty-five (45) days following It is acknowledged and agreed that at the Closing Date, Parent may, at its election, cause to be prepared Completion Date the Company shall not have any Debt and delivered to that the Stockholder Representative an unaudited balance sheet Working Capital of the Surviving Corporation as of the Closing Date (the "Adjusted Balance Sheet"). The ---------------------- Adjusted Balance Sheet will be prepared in accordance with GAAP (except that such balance sheet will not contain footnotes or year-end adjustments that may be required by GAAP). Based upon the Adjusted Balance Sheet, the Company's "Net --- Liabilities at Closing" Company shall be calculated in accordance with the following: ---------------------- (A) the Company's total liabilities Euro 0 at the Closing Date as set forth on the Adjusted Balance Sheet minus (B) the Company's total assets at the Closing Date as set forth on the Adjusted Balance Sheet minus (C) the amount Completion. Any actions of the Company's payments for Severance (or accruals therefore) minus (D) the Additional Liabilities (whether such amount has been paid by ▇▇▇▇▇▇▇▇ to achieve the Company prior being free of any Debt or to the Closing Date or otherwise reserved for by the Company) minus (E) the total amount achieve a Working Capital of normal per diem operating expenses Euro 0, shall not have any adverse tax effect of whatsoever nature for the period between November 30Company and for SBS. It is, 2001 furthermore, acknowledged and Closing at a rate of $9,150 per calendar day minus (F) the Third Party Expense Adjustment Amount minus (G) up to $50,000 pursuant to Section 5.5. In ----------- the event that, pursuant to the terms of this Section 7.6, it is determined agreed that ----------- (X) the Company's Net Liabilities at Closing exceeds (Y) the Current Balance Sheet Net Liabilities, then an amount equal to such difference ("Excess ------ Liabilities") shall be paid to Parent out of the Escrow Fund upon the delivery ----------- to the Escrow Agent of an Officer's Certificate in accordance with the terms of Section 7.3(f) hereof. If the Excess Liabilities exceed the amount in the Escrow -------------- Fund, Parent shall be entitled to recover directly from the Principal Stockholders any amount of Excess Liabilities not covered by the Escrow Fund, subject to the limitations set forth in Section 7.5. Following delivery by ----------- Parent to the Stockholder Representative of the Adjusted Balance Sheet, Parent shall give the Stockholder Representative reasonable access during Parent's business hours to those books and records of the Surviving Corporation in the possession of Parent and any personnel which relate to the preparation of the Adjusted Balance Sheet for purposes of resolving any disputes concerning the Adjusted Balance Sheet and the calculation of Net Liabilities at Closing. (b) The Stockholder Representative shall have fifteen (15) days following delivery of the Adjusted Balance Sheet during which to notify Parent in writing (the "Notice of Objection") of any good faith objections to the ------------------- calculation of Net Liabilities at Closing or the Adjusted Balance Sheet, as it affects such calculation, setting forth a reasonably specific and detailed description of its objections and the dollar amount of each objection. If the Stockholder Representative objects to the Adjusted Balance Sheet or Parent's calculation of Net Liabilities at Closing as reflected thereon, Parent and the Stockholder Representative shall attempt to resolve any such objections within fifteen (15) days of the receipt by Parent of the Notice of Objection. (c) If Parent and the Stockholder Representative are unable to resolve any such dispute within the fifteen (15) day period referred to in Section 7.6(b) hereof, Parent and the Stockholder Representative shall submit -------------- the dispute to Deloitte & Touche (the "Independent Accounting Firm"). Each of --------------------------- the parties to this Agreement shall, and shall cause their respective affiliates and representatives to, provide full cooperation to the Independent Accounting Firm. The Independent Accounting Firm shall (x) act in its capacity as an expert and not as an arbitrator, (y) consider only those matters as to which there is a dispute between the parties and (z) be instructed to reach its conclusions regarding any such dispute within thirty (30) days after its appointment and provide a written explanation of its decision. In the event that Parent and the Stockholder Representative submit any dispute to an Independent Accounting Firm, each such party may submit a "position paper" to the Independent Accounting Firm setting forth the position of such party with respect to such dispute, to be considered by such Independent Accounting Firm as it deems fit. The expenses relating to the engagement of the Independent Accounting Firm shall be paid by the party whose position is not the position that substantially prevails. (d) If the Stockholder Representative does not deliver a Notice of Objection in accordance with Section 7.6(b) hereof (i.e., within a fifteen (15) ------------- day period), the Adjusted Balance Sheet (together with Parent's calculation of Net Liabilities at Closing reflected thereon), shall be deemed to have been accepted by all of the parties to this Agreement. In the event that the Stockholder Representative delivers Completion Balance Sheet differs from the Pro Forma Completion Balance Sheet a Notice recalculation shall take place of Objection the Consideration, whereby each item on such balance sheets shall be taken into account and compared. The aggregate amount resulting from such comparison, which would result in an adjustment to the Consideration as set out in clause 6 in accordance with the provisions above of clause 10.10 shall be equal to the amount by which the net asset value as shown in the Completion Balance Sheet shall differ from the net asset value as shown in the Pro Forma Balance Sheet (the Aggregate Amount) and Parent be settled as follows: If the parties did not refer the item or items in dispute of the Pro Forma Completion Balance Sheet (the Disputed Items) to the Independent Accountants in an earlier stage as set out in clause 7.3 the parties shall discuss the Disputed Items and try to reach an understanding regarding the Disputed Items within five Business Days following one year after Signing. If no agreement has been reached the Disputed Items shall be determined by the Independent Accountants, whereupon a comparison between the Pro Forma Completion Balance Sheet and the Stockholder Representative are able to resolve Completion Balance Sheet on an item for item basis shall be made as set forth in this clause 7.5. Upon finalisation of such dispute by mutual agreementcomparison the parties shall enter into discussions regarding the way of settlement of the Aggregate Amount. If parties have not reached an understanding regarding the way of settlement within thirty days following the finalisation of aforementioned comparison, the Adjusted Balance Sheet, together with Parent's calculation of Net Liabilities at Closing reflected thereon, to the extent modified by mutual agreement of such parties, Aggregate Amount shall be deemed to have been accepted by all of the parties to this Agreement. In the event that the Stockholder Representative delivers a Notice of Objection settled either in cash or in kind in accordance with the provisions set forth above and Parent and the Stockholder Representative are unable to resolve such dispute by mutual of clause 10.10 of this agreement, the determination it being understood that there shall be disregard of the Independent Accounting Firm Aggregate Amount in the event such amount is less than Euro 75,000. If the Aggregate Amount is Euro 75,000 or more, this amount shall be final and binding on taken into account when determining whether the partiesthreshold set out in clause 11.1(b) is met, and the Adjusted Balance Sheet, together with Parent's calculation of Net Liabilities at Closing reflected thereon, which threshold shall also apply in relation to the extent modified by settlement of the Aggregate Amount. If the parties had referred the Disputed Items to Independent Accounting FirmAccounts as set out in clause 7.3, the parties shall enter into discussions regarding the way of settlement of the Aggregate Amount one year following the Signing. If parties have not reached an understanding regarding the way of settlement within thirty days following one year after Signing, the Aggregate Amount shall be deemed to have been accepted by all settled either in cash or in kind in accordance with the provisions of clause 10.10 of this agreement, it being understood that there shall be disregard of the parties to Aggregate Amount in the event such amount is less than Euro 75,000. If the Aggregate Amount is Euro 75,000 or more, this Agreement. Subject amount shall be taken into account when determining whether the threshold set out in clause 11.1(b) is met, which threshold shall also apply in relation to the foregoing provisions, the calculation of Net Liabilities at Closing reflected on any such Adjusted Balance Sheet shall be conclusive and binding on all settlement of the parties to this Agreement, no further adjustments shall be made thereto and neither Parent, the Stockholder Representative nor the Principal Stockholders shall have any further right to challenge such calculation of Net Liabilities at Closing, whether pursuant to the terms of Section 7.3 hereof or otherwise. -----------Aggregate Amount.

Adjustment to Consideration. (a) Within forty-five (45) days following the Closing Date, Parent may, at its election, cause to be prepared and delivered to the Stockholder Representative an unaudited balance sheet sheets of the Surviving Corporation and its Subsidiaries as of the Closing Date (the "“Adjusted Balance Sheet"Sheets”). The ---------------------- Adjusted Balance Sheet Sheets will be prepared in accordance with GAAP (except that such balance sheet will not contain footnotes or year-end adjustments that may be required by GAAP). Based upon the Adjusted Balance Sheet, the Company's "Net --- Liabilities at Closing" shall be calculated in accordance consistently applied on a basis consistent with the following: ---------------------- (A) the Company's total liabilities at the Closing Date as set forth on the Adjusted Balance Sheet minus (B) the Company's total assets at the Closing Date as set forth on the Adjusted Balance Sheet minus (C) the amount of the Company's payments for Severance (or accruals therefore) minus (D) the Additional Liabilities (whether such amount has Financials and shall include without limitation all Estimated Third Party Expenses that have been accrued but that have not been paid by the Company prior to the Effective Time, any payments to Terminating Employees for severance or similar payments and any other payments triggered or accelerated by or contingent upon the Closing Date or otherwise reserved for by the Company) minus (E) the total amount of normal per diem operating expenses for the period between November 30, 2001 and Closing at a rate of $9,150 per calendar day minus (F) the Third Party Expense Adjustment Amount minus (G) up to $50,000 pursuant to Section 5.5Merger. In ----------- the event that, pursuant to the terms of this Section 7.69.6(a), it is determined that ----------- (Xi) the amount equal to (A) the absolute value of the Company's ’s and its Subsidiaries’ total liabilities (as defined by and as determined in accordance with GAAP and shall include without limitation all Estimated Third Party Expenses that have been accrued but that were not paid prior to the Effective Time and any other payments triggered or accelerated by or contingent upon the Closing or the Merger, but shall exclude deferred revenue and the Specified Liabilities) at the Closing Date as reflected on the Adjusted Balance Sheets minus (B) the absolute value of the Company’s and its Subsidiaries’ total assets (as defined by and as determined in accordance with GAAP) at the Closing Date (collectively, the “Net Liabilities at Closing exceeds Closing”) minus (YC) the Current Balance Sheet Net LiabilitiesAdjustment Amount, is a number greater than the Balance Sheet Target, and/or (ii) the amount equal to (A) the absolute value of the total Specified Liabilities at the Closing Date as reflected on the Adjusted Balance Sheets (collectively, the “Specified Liabilities at Closing”) minus (B) the Specified Liabilities Adjustment Amount, is a number greater than $1,875,849, then an amount of Escrow Shares equal to such difference the sum of the excess amount, if any, determined in accordance with clause ("i) above plus the excess amount, if any, determined in accordance with clause (ii) above (collectively, the “Excess ------ Liabilities"”) shall be paid returned to Parent out of the Escrow Fund upon the delivery ----------- to the Escrow Agent of an Officer's Certificate in accordance with the terms of Section 7.3(f) hereof. If the Excess Liabilities exceed the amount in the Escrow -------------- Fund, Parent shall be entitled to recover directly from the Principal Stockholders any amount of Excess Liabilities not covered by the Escrow Fund, subject to the limitations set forth in Section 7.5Agreement. Following delivery by ----------- Parent to the Stockholder Representative of the Adjusted Balance SheetSheets, Parent shall give the Stockholder Representative reasonable access during Parent's ’s regular business hours to those books and records of the Surviving Corporation in the possession or control of Parent and any personnel which relate to the preparation of the Adjusted Balance Sheet Sheets for purposes of resolving any disputes concerning the Adjusted Balance Sheet Sheets and the calculation of Net Liabilities at Closing. (b) The Stockholder Representative shall have fifteen (15) 15 days following delivery of the Adjusted Balance Sheet Sheets during which to notify Parent in writing (the "“Notice of Objection"”) of any good faith objections to the ------------------- calculation of Net Liabilities at Closing, Specified Liabilities at Closing or the Adjusted Balance SheetSheets, as it affects such calculation, setting forth a reasonably specific and detailed description of its objections and the dollar amount of each objection. If the Stockholder Representative objects to the Adjusted Balance Sheet Sheets or Parent's ’s calculation of Net Liabilities at Closing or Specified Liabilities at Closing as reflected thereon, Parent and the Stockholder Representative shall attempt to resolve any such objections within fifteen (15) 15 days of the receipt by Parent of the Notice of Objection. (c) If Parent and the Stockholder Representative are unable to resolve any such dispute within the fifteen (15) 15 day period following receipt of the Notice of Objection referred to in Section 7.6(b9.6(b) hereof, Parent and the Stockholder Representative shall submit -------------- the dispute to Deloitte & Touche a partner in the audit practice of any nationally recognized accounting firm that is mutually agreeable to both parties (the "“Independent Accounting Firm"”). Each of --------------------------- the parties to this Agreement shall, and shall cause their respective affiliates and representatives to, provide full cooperation to the Independent Accounting Firm. The Independent Accounting Firm shall (xi) act in its capacity as an expert and not as an arbitrator, (yii) consider only those matters as to which there is a dispute between the parties and (ziii) be instructed to reach its conclusions regarding any such dispute within thirty (30) 30 days after its appointment and provide a written explanation of its decision. In the event that Parent and the Stockholder Representative submit any dispute to an Independent Accounting Firm, each such party may submit a "“position paper" ” to the Independent Accounting Firm setting forth the position of such party with respect to such dispute, to be considered by such Independent Accounting Firm as it deems fitappropriate. The Fifty percent (50%) of any expenses relating to the engagement of the Independent Accounting Firm (“Independent Accounting Firm Expenses”) shall be paid by Parent and fifty percent (50%) of such expenses shall be paid by the party whose position is not Stockholders; provided, however, that in the position event any Stockholder fails to timely pay his or her Pro Rata Portion of the Independent Accounting Firm Expenses, the parties agree that substantially prevailsParent may at its option pay such Stockholder’s Pro Rata Portion of the Independent Accounting Firm Expenses and recover an equal amount from such Stockholder’s Pro Rata Portion of the Escrow Fund. (d) If the Stockholder Representative does not deliver a Notice of Objection in accordance with Section 7.6(b9.6(b) hereof (i.e., within a fifteen (15) ------------- day period)hereof, the Adjusted Balance Sheet Sheets (together with Parent's ’s calculation of Net Liabilities at Closing and Specified Liabilities at Closing reflected thereon), shall be deemed to have been accepted by all of the parties to this Agreement. In the event that the Stockholder Representative delivers a Notice of Objection in accordance with the provisions above and Parent and the Stockholder Representative are able to resolve such dispute by mutual agreement, the Adjusted Balance SheetSheets, together with Parent's ’s calculation of Net Liabilities at Closing and Specified Liabilities at Closing reflected thereon, to the extent modified by mutual agreement of such parties, shall be deemed to have been accepted by all of the parties to this Agreement. In the event that the Stockholder Representative delivers a Notice of Objection in accordance with the provisions set forth above and Parent and the Stockholder Representative are unable to resolve such dispute by mutual agreement, the determination of the Independent Accounting Firm shall be final and binding on the parties, and the Adjusted Balance Sheet, together with Parent's ’s calculation of Net Liabilities at Closing and Specified Liabilities at Closing reflected thereon, to the extent modified by the Independent Accounting Firm, shall be deemed to have been accepted by all of the parties to this Agreement. Subject to the foregoing provisions, the calculation of Net Liabilities at Closing and Specified Liabilities at Closing reflected on any such Adjusted Balance Sheet Sheets shall be conclusive and binding on all of the parties to this AgreementAgreement for purposes of this Section 9.6, no further adjustments shall be made thereto and neither none of Parent, the Stockholder Representative nor or the Principal Stockholders shall have any further right to challenge such calculation of Net Liabilities at Closing or Specified Liabilities at Closing, whether pursuant to the terms of Section 7.3 hereof or otherwise. -----------.

Adjustment to Consideration. (a) Within forty-five (45) days following 7.3.1 The consideration payable for the Shares shall be increased by the amount by which the Closing DateWorking Capital Amount exceeds the Base Working Capital Amount, Parent mayand the consideration payable for the Shares shall be decreased by the amount by which the Closing Working Capital Amount is less than the Base Working Capital Amount. Accordingly, at its electionwithin five Business Days after the Working Capital Statement becomes binding pursuant to paragraph 2 of Part 1 of Schedule 4: (i) if the Final Working Capital Adjustment Amount is greater than the Estimated Working Capital Adjustment Amount, cause to be prepared and delivered then the Purchaser shall pay to the Stockholder Representative an unaudited balance sheet Seller by wire transfer of the Surviving Corporation as of the Closing Date (the "Adjusted Balance Sheet"). The ---------------------- Adjusted Balance Sheet will be prepared in accordance with GAAP (except that such balance sheet will not contain footnotes or year-end adjustments that may be required by GAAP). Based upon the Adjusted Balance Sheet, the Company's "Net --- Liabilities at Closing" shall be calculated in accordance with the following: ---------------------- (A) the Company's total liabilities at the Closing Date as set forth on the Adjusted Balance Sheet minus (B) the Company's total assets at the Closing Date as set forth on the Adjusted Balance Sheet minus (C) the amount of the Company's payments for Severance (or accruals therefore) minus (D) the Additional Liabilities (whether such amount has been paid by the Company prior immediately available funds to the Closing Date or otherwise reserved for by the Company) minus (E) the total amount of normal per diem operating expenses for the period between November 30, 2001 and Closing at a rate of $9,150 per calendar day minus (F) the Third Party Expense Adjustment Amount minus (G) up to $50,000 pursuant to Section 5.5. In ----------- the event that, pursuant to the terms of this Section 7.6, it is determined that ----------- (X) the CompanySeller's Net Liabilities at Closing exceeds (Y) the Current Balance Sheet Net Liabilities, then Nominated Account an amount equal to the difference between the Estimated Working Capital Adjustment Amount and the Final Working Capital Adjustment Amount, together with an amount thereon calculated by reference to the PPA Interest Rate from and including the Closing Date to but not including the date of such payment; and (ii) if the Estimated Working Capital Adjustment Amount is greater than the Closing Working Capital Amount, then the Seller shall pay to the Purchaser by wire transfer of immediately available funds to the Purchaser's Nominated Account an amount equal to the difference ("Excess ------ Liabilities") between the Estimated Working Capital Adjustment Amount and the Final Working Capital Adjustment Amount, together with an amount thereon calculated by reference to the PPA Interest Rate from and including the Closing Date to but not including the date of such payment. 7.3.2 The consideration paid pursuant to Clause 6.4 shall be increased by the amount by which the Final Closing Cash Amount exceeds the Estimated Closing Cash Amount, and the consideration paid pursuant to Parent out Clause 6.4 shall be decreased by the amount by which the Final Closing Cash Amount is less than the Estimated Closing Cash Amount. Accordingly, within five Business Days after the Cash Amount Statement becomes binding pursuant to paragraph 2 of Part 1 of Schedule 4: (i) if the Escrow Fund upon Final Closing Cash Amount is greater than the delivery ----------- Estimated Closing Cash Amount, then the Purchaser shall pay to the Escrow Agent Seller by wire transfer of immediately available funds to the Seller's Nominated Account an Officeramount equal to the Final Closing Cash Adjustment Amount, together with an amount thereon calculated by reference to the PPA Interest Rate from and including the Closing Date to but not including the date of such payment; and (ii) if the Final Closing Cash Amount is less than the Estimated Closing Cash Amount, then the Seller shall pay to the Purchaser by wire transfer of immediately available funds to the Purchaser's Certificate in accordance Nominated Account an amount, equal to the Final Closing Cash Adjustment Amount, together with an amount thereon calculated by reference to the terms PPA Interest Rate from and including the Closing Date to but not including the date of Section 7.3(fsuch payment 7.3.3 The consideration paid pursuant to Clause 6.4 shall be increased by the amount by which the Estimated Cash Deferred Income Amount exceeds the Final Cash Deferred Income Amount, and the consideration paid pursuant to Clause 6.4 shall be decreased by the amount by which the Estimated Cash Deferred Income Amount is less than the Final Cash Deferred Income Amount. Accordingly, within five Business Days after the Cash Deferred Income Amount Statement becomes binding pursuant to paragraph 2 of Part 1 of Schedule 4: (i) hereof. if the Estimated Cash Deferred Income Amount is greater than the Final Cash Deferred Income Amount, then the Purchaser shall pay to the Seller by wire transfer of immediately available funds to the Seller's Nominated Account an amount equal to the Final Cash Deferred Income Adjustment Amount, together with an amount thereon calculated by reference to the PPA Interest Rate from and including the Closing Date to but not including the date of such payment; and (ii) if the Final Cash Deferred Income Amount is greater than the Estimated Cash Deferred Income Amount, then the Seller shall pay to the Purchaser by wire transfer of immediately available funds to the Purchaser's Nominated Account an amount equal to the Final Cash Deferred Income Adjustment Amount, together with an amount thereon calculated by reference to the PPA Interest Rate from and including the Closing Date to but not including the date of such payment. 7.3.4 If the Excess Liabilities exceed Final Cash Deferred Income Amount is less than either (i)(pound)27,900,000 (twenty seven million, nine hundred thousand pounds Sterling) (if Closing occurs on or prior to 31 August 2004, representing the amount in forecast Cash Deferred Income at such date); or (ii)(pound)23,900,000 (twenty three million, nine hundred thousand pounds Sterling) (if Closing occurs on or prior to 30 September 2004 but after 31 August 2004, representing the Escrow -------------- Fund, Parent forecast Cash Deferred Income at such date) then the Final Working Capital Adjustment Amount shall be entitled to recover directly from the Principal Stockholders any amount of Excess Liabilities not covered increased by the Escrow Funddifference between the Final Cash Deferred Income Amount (at such date) and either (i)(pound)27,900,000 (twenty seven million, subject nine hundred thousand pounds Sterling) (if Closing occurs on or prior to 31 August 2004); or (ii)(pound)23,900,000 (twenty three million, nine hundred thousand pounds Sterling) (if Closing occurs on or prior to 30 September 2004 but after 31 August 2004). For the avoidance of doubt, if the Final Cash Deferred Income Amount is either greater than (i) (pound)27,900,000 (twenty seven million, nine hundred thousand pounds Sterling) (if Closing occurs on or prior to 31 August 2004); or (ii) (pound)23,900,000 (twenty three million, nine hundred thousand pounds Sterling) (if Closing occurs on or prior to 30 September 2004 but after 31 August 2004) then there shall be no corresponding adjustment to the limitations set forth in Section 7.5. Following delivery by ----------- Parent to the Stockholder Representative of the Adjusted Balance Sheet, Parent shall give the Stockholder Representative reasonable access during Parent's business hours to those books and records of the Surviving Corporation in the possession of Parent and any personnel which relate to the preparation of the Adjusted Balance Sheet for purposes of resolving any disputes concerning the Adjusted Balance Sheet and the calculation of Net Liabilities at ClosingFinal Working Capital Adjustment Amount. (b) 7.3.5 The Stockholder Representative Purchaser agrees that following the Closing and until the Completion Statements become binding pursuant to paragraph 2 of Part 1 of Schedule 4, it shall have fifteen (15) days following delivery of the Adjusted Balance Sheet during which to notify Parent in writing (the "Notice of Objection") of not take any good faith objections to the ------------------- calculation of Net Liabilities at Closing or the Adjusted Balance Sheet, as it affects such calculation, setting forth a reasonably specific and detailed description of its objections and the dollar amount of each objection. If the Stockholder Representative objects to the Adjusted Balance Sheet or Parent's calculation of Net Liabilities at Closing as reflected thereon, Parent and the Stockholder Representative shall attempt to resolve any such objections within fifteen (15) days of the receipt by Parent of the Notice of Objection. (c) If Parent and the Stockholder Representative are unable to resolve any such dispute within the fifteen (15) day period referred to in Section 7.6(b) hereof, Parent and the Stockholder Representative shall submit -------------- the dispute to Deloitte & Touche (the "Independent Accounting Firm"). Each of --------------------------- the parties to this Agreement shall, and shall cause their respective affiliates and representatives to, provide full cooperation to the Independent Accounting Firm. The Independent Accounting Firm shall (x) act in its capacity as an expert and not as an arbitrator, (y) consider only those matters as to which there is a dispute between the parties and (z) be instructed to reach its conclusions regarding any such dispute within thirty (30) days after its appointment and provide a written explanation of its decision. In the event that Parent and the Stockholder Representative submit any dispute to an Independent Accounting Firm, each such party may submit a "position paper" to the Independent Accounting Firm setting forth the position of such party actions with respect to such dispute, to the Books and Records with the result that the Completion Statements cannot be considered by such Independent calculated consistent with the Accounting Firm as it deems fit. The expenses relating to the engagement of the Independent Accounting Firm shall be paid by the party whose position is not the position that substantially prevailsPolicies. (d) If 7.3.6 The parties may agree to net the Stockholder Representative does not deliver a Notice of Objection in accordance with Section 7.6(b) hereof (i.e., within a fifteen (15) ------------- day period), the Adjusted Balance Sheet (together with Parent's calculation of Net Liabilities at Closing reflected thereon), shall be deemed to have been accepted by all of the parties to this Agreement. In the event that the Stockholder Representative delivers a Notice of Objection in accordance with the provisions above and Parent and the Stockholder Representative are able to resolve such dispute by mutual agreement, the Adjusted Balance Sheet, together with Parent's calculation of Net Liabilities at Closing reflected thereon, to the extent modified by mutual agreement of such parties, shall be deemed to have been accepted by all of the parties to this Agreement. In the event that the Stockholder Representative delivers a Notice of Objection in accordance with the provisions set forth above and Parent and the Stockholder Representative are unable to resolve such dispute by mutual agreement, the determination of the Independent Accounting Firm shall be final and binding on the parties, and the Adjusted Balance Sheet, together with Parent's calculation of Net Liabilities at Closing reflected thereon, to the extent modified by the Independent Accounting Firm, shall be deemed to have been accepted by all of the parties to this Agreement. Subject amounts payable pursuant to the foregoing provisionsprovisions of this Clause 7.3 against each other, the calculation of Net Liabilities at Closing reflected on any such Adjusted Balance Sheet shall be conclusive and binding on all that settlement of the parties to this Agreement, no further adjustments shall adjustment amounts described herein may be made thereto and neither Parent, the Stockholder Representative nor the Principal Stockholders shall have any further right to challenge effected by one wire transfer in respect of all such calculation of Net Liabilities at Closing, whether pursuant to the terms of Section 7.3 hereof or otherwise. -----------amounts.

Adjustment to Consideration. (a) Within forty-five (45) days following The parties agree that the consideration set forth in Section 2.1 was determined as if the combined net working capital of Company and MCS was going to be $1.00 at the close of business on the Closing Date. Accordingly, Parent may, at its election, cause the parties agree that the consideration set forth in Section 2.1(a) shall be adjusted on the Adjustment Date to be prepared reflect the actual combined net working capital of Company and delivered to the Stockholder Representative an unaudited balance sheet of the Surviving Corporation as of MCS on the Closing Date (the "Adjusted Balance SheetActual Net Working Capital"). The ---------------------- Adjusted Balance Sheet will , as shown on the balance sheet to be prepared in accordance with GAAP (except that such balance sheet will not contain footnotes or year-end adjustments that may be required by GAAP)Section 10.2 hereof. Based upon If the Adjusted Balance SheetActual Net Working Capital so reflected is greater than $1.00 on the Closing Date, then the Company's "Net --- Liabilities at Closing" consideration paid pursuant to Section 2.1(a) shall be increased dollar for dollar for each dollar the Actual Net Working Capital exceeds $1.00 on the Closing Date. If the Actual Net Working Capital so reflected is less than $1.00 on the Closing Date, then the consideration paid pursuant to Section 2.1(a) shall be decreased dollar for dollar for each dollar the Actual Net Working Capital falls below $1.00 on the Closing Date. For purposes of this Agreement, Actual Net Working Capital shall mean the combined current assets of Company and MCS on the Closing Date minus all combined current liabilities of Company and MCS on the Closing Date, calculated in accordance with generally accepted accounting principles ("GAAP"). In order to facilitate the following: ---------------------- (A) contemplated adjustment to purchase price on the Company's total liabilities at Adjustment Date, between the date hereof and the Closing Date the parties will prepare and agree upon an estimated combined net working capital balance for Company and MCS as set forth on the Adjusted Balance Sheet minus (B) the Company's total assets at the Closing Date as set forth on the Adjusted Balance Sheet minus (C) the amount of the Company's payments for Severance (or accruals therefore) minus (D) the Additional Liabilities (whether such amount has been paid by the Company prior to the Closing Date or otherwise reserved for by the Company) minus (E) the total amount of normal per diem operating expenses for the period between November 30May 31, 2001 and Closing at a rate of $9,150 per calendar day minus (F) the Third Party Expense Adjustment Amount minus (G) up to $50,000 pursuant to Section 5.5. In ----------- the event that, pursuant to the terms of this Section 7.6, it is determined that ----------- (X) the Company's Net Liabilities at Closing exceeds (Y) the Current Balance Sheet Net Liabilities, then an amount equal to such difference ("Excess ------ Liabilities") shall be paid to Parent out of the Escrow Fund upon the delivery ----------- to the Escrow Agent of an Officer's Certificate in accordance with the terms of Section 7.3(f) hereof. If the Excess Liabilities exceed the amount in the Escrow -------------- Fund, Parent shall be entitled to recover directly from the Principal Stockholders any amount of Excess Liabilities not covered by the Escrow Fund, subject to the limitations set forth in Section 7.5. Following delivery by ----------- Parent to the Stockholder Representative of the Adjusted Balance Sheet, Parent shall give the Stockholder Representative reasonable access during Parent's business hours to those books and records of the Surviving Corporation in the possession of Parent and any personnel which relate to the preparation of the Adjusted Balance Sheet for purposes of resolving any disputes concerning the Adjusted Balance Sheet and the calculation of Net Liabilities at Closing. (b) The Stockholder Representative shall have fifteen (15) days following delivery of the Adjusted Balance Sheet during which to notify Parent in writing 1998 (the "Notice of Objection") of any good faith objections to the ------------------- calculation of Net Liabilities at Closing or the Adjusted Balance Sheet, as it affects such calculation, setting forth a reasonably specific and detailed description of its objections and the dollar amount of each objection. If the Stockholder Representative objects to the Adjusted Balance Sheet or Parent's calculation of Net Liabilities at Closing as reflected thereon, Parent and the Stockholder Representative shall attempt to resolve any such objections within fifteen (15) days of the receipt by Parent of the Notice of Objection. (c) If Parent and the Stockholder Representative are unable to resolve any such dispute within the fifteen (15) day period referred to in Section 7.6(b) hereof, Parent and the Stockholder Representative shall submit -------------- the dispute to Deloitte & Touche (the "Independent Accounting FirmEstimated Working Capital"). Each In the event of --------------------------- the parties to this Agreement shall, and shall cause their respective affiliates and representatives to, provide full cooperation to the Independent Accounting Firm. The Independent Accounting Firm shall (x) act in its capacity as an expert and not as an arbitrator, (y) consider only those matters as to which there is a dispute between the parties and (z) be instructed as to reach its conclusions regarding any the Actual Net Working Capital, the parties will have 30 days to resolve the dispute among themselves. If the parties have not resolved such dispute within thirty (such 30) -day period, then the parties shall select an arbitrator who shall decide the dispute within 30 days after its appointment being selected. If the parties cannot agree on an arbitrator, then Buyer and provide Stockholder shall each select an arbitrator and the two arbitrators so selected shall select a written explanation third arbitrator. The parties hereto each agree to be bound by the decision of its decisionthe arbitrator(s). In the event that Parent three arbitrators are chosen, a majority decision will be required. Each arbitrator can be any natural person above the age of 18 and the Stockholder Representative submit need not have any dispute to an Independent Accounting Firm, each such party may submit a "position paper" to the Independent Accounting Firm setting forth the position of such party with respect to such dispute, to be considered by such Independent Accounting Firm as it deems fitspecific qualification. The expenses relating to the engagement All costs of the Independent Accounting Firm arbitration shall be paid by the party whose position is not the position that substantially prevailssplit equally between Buyer and Stockholder. (d) If the Stockholder Representative does not deliver a Notice of Objection in accordance with Section 7.6(b) hereof (i.e., within a fifteen (15) ------------- day period), the Adjusted Balance Sheet (together with Parent's calculation of Net Liabilities at Closing reflected thereon), shall be deemed to have been accepted by all of the parties to this Agreement. In the event that the Stockholder Representative delivers a Notice of Objection in accordance with the provisions above and Parent and the Stockholder Representative are able to resolve such dispute by mutual agreement, the Adjusted Balance Sheet, together with Parent's calculation of Net Liabilities at Closing reflected thereon, to the extent modified by mutual agreement of such parties, shall be deemed to have been accepted by all of the parties to this Agreement. In the event that the Stockholder Representative delivers a Notice of Objection in accordance with the provisions set forth above and Parent and the Stockholder Representative are unable to resolve such dispute by mutual agreement, the determination of the Independent Accounting Firm shall be final and binding on the parties, and the Adjusted Balance Sheet, together with Parent's calculation of Net Liabilities at Closing reflected thereon, to the extent modified by the Independent Accounting Firm, shall be deemed to have been accepted by all of the parties to this Agreement. Subject to the foregoing provisions, the calculation of Net Liabilities at Closing reflected on any such Adjusted Balance Sheet shall be conclusive and binding on all of the parties to this Agreement, no further adjustments shall be made thereto and neither Parent, the Stockholder Representative nor the Principal Stockholders shall have any further right to challenge such calculation of Net Liabilities at Closing, whether pursuant to the terms of Section 7.3 hereof or otherwise. -----------

Adjustment to Consideration. (a) Within forty-five (45) 60 days following the Closing Date, Parent shall determine whether there are any Excess Liabilities or Excess Assets as of the Closing and give the Shareholder Representative notice of such determination. For purposes of making such calculation, Parent may use either the Closing Balance Sheet or the Adjusted Balance Sheet. For purposes of this Agreement, the amount by which (i) the Company's total assets (as defined by and determined in accordance with GAAP and consistent with past practices) as of the Closing Date minus (ii) the Company's total liabilities (as defined by and determined in accordance with GAAP and consistent with past practices) as of the Closing Date is less than or exceeds $7,000,000.00 shall be the "Excess Liabilities" or "Excess Assets," as the case may be; provided, however, that to the extent not paid prior to or at the Closing, all Third Party Expenses and Contingent Closing Payments shall be considered as liabilities of the Company as of the Closing for purposes of the above calculation. As noted above, instead of using the Closing Balance Sheet for purposes of making the Excess Liabilities/Excess Assets calculation, Parent may, at its election, cause to be prepared and delivered to the Stockholder Representative an unaudited balance sheet of the Surviving Corporation as of the Closing Date (the "Adjusted Balance Sheet"). The ---------------------- If Parent elects to prepare the Adjusted Balance Sheet will Sheet, such document shall be prepared in accordance with GAAP (except that such balance sheet will not contain footnotes or year-end adjustments that may be required by GAAP). Based upon the Adjusted Balance Sheet, the Company's "Net --- Liabilities at Closing" shall be calculated in accordance on a basis consistent with the following: ---------------------- (A) the Company's total liabilities at the Closing Date as set forth on the Adjusted Balance Sheet minus (B) the Company's total assets at the Closing Date as set forth on the Adjusted Balance Sheet minus (C) the amount most recent regularly prepared financial statements of the Company's payments for Severance (or accruals therefore) minus (D) the Additional Liabilities (whether such amount has been paid by the Company prior to the Closing Date or otherwise reserved for by the Company) minus (E) the total amount of normal per diem operating expenses for the period between November 30, 2001 and Closing at a rate of $9,150 per calendar day minus (F) the Third Party Expense Adjustment Amount minus (G) up to $50,000 pursuant to Section 5.5. In ----------- the event that, pursuant to the terms of this Section 7.6, it is determined that ----------- (X) the Company's Net Liabilities at Closing exceeds (Y) the Current Balance Sheet Net If there are any Excess Liabilities, then an the amount equal to such difference ("Excess ------ Liabilities") Liabilities shall be paid to Parent out of the Escrow Fund upon the delivery ----------- to the Escrow Agent of an Officer's Certificate in accordance with the terms of Section 7.3(f) 8.3 hereof. If there are Excess Assets, within 10 days after the Excess Liabilities exceed date Parent has made the amount calculations set forth in the Escrow -------------- Fundthis Section 8.6 and any disputes regarding such calculations have been finally resolved as provided below, Parent shall be entitled pay to recover directly from each Shareholder who has surrendered such Shareholder's Certificates as provided in Section 7.1(a) above such Shareholder's Pro Rata Portion of the Principal Stockholders any amount of Excess Assets. If Parent calculates whether there are any Excess Liabilities not covered by or Excess Assets using the Escrow FundAdjusted Balance Sheet, subject then Parent shall deliver to the limitations set forth in Section 7.5Shareholder Representative such Adjusted Balance Sheet within 60 days following the Closing Date. Following delivery by ----------- Parent to the Stockholder Shareholder Representative of the Adjusted Balance Sheet, Parent shall give the Stockholder Shareholder Representative reasonable access during Parent's regular Illinois business hours to those books and records of the Surviving Corporation Company in the possession of Parent and any personnel which relate to the preparation of the Adjusted Balance Sheet for purposes of resolving any disputes concerning the Adjusted Balance Sheet and the calculation of Net any Excess Liabilities at Closingor Excess Assets. If Parent uses the Closing Balance Sheet for purposes of making such calculation, subsections 8.6(b) -- (d) shall not be applicable. (b) The Stockholder If Parent has elected to use the Adjusted Balance Sheet to calculate whether there are any Excess Liabilities of Excess Assets, the Shareholder Representative shall have fifteen (15) 30 days following delivery of the Adjusted Balance Sheet during which to notify Parent in writing (the "Notice of Objection") of any good faith objections to the ------------------- calculation of Net Excess Liabilities at Closing or the Adjusted Balance Sheet, as it affects such calculationExcess Assets, setting forth a reasonably specific and detailed description of its objections and and, if known, the dollar amount of each objection. If the Stockholder Shareholder Representative objects to the Adjusted Balance Sheet or Parent's calculation of Net Excess Liabilities at Closing as reflected thereonor Excess Assets, Parent and the Stockholder Shareholder Representative shall attempt to resolve any such objections within fifteen (15) 30 days of the receipt by Parent of the Notice of Objection. (c) If Parent and the Stockholder Shareholder Representative are unable to resolve any such dispute within the fifteen (15) 10 day period following receipt of the Notice of Objection referred to in Section 7.6(b8.6(b) hereof, Parent and the Stockholder Shareholder Representative shall submit -------------- the dispute to Deloitte & Touche a partner in the audit practice of any nationally recognized accounting firm that is mutually agreeable to both parties (the "Independent Accounting Firm"). Each of --------------------------- the parties to this Agreement shall, and shall cause their respective affiliates and representatives to, provide full cooperation to the Independent Accounting Firm. The Independent Accounting Firm shall (x) act in its capacity as an expert and not as an arbitrator, (y) consider only those matters as to which there is a dispute between the parties and (z) be instructed to reach its conclusions regarding any such dispute within thirty (30) 30 days after its appointment and provide a written explanation of its decision. In the event that Parent and the Stockholder Shareholder Representative submit any dispute to an Independent Accounting Firm, each such party may submit a "position paper" to the Independent Accounting Firm setting forth the position of such party with respect to such dispute, to be considered by such Independent Accounting Firm as it deems fitappropriate. The All expenses relating to the engagement of the Independent Accounting Firm ("Independent Accounting Firm Expenses") shall be paid fifty percent (50%) by Parent and fifty percent (50%) of such expenses shall be paid by the party whose position is not Shareholders; provided, however, that in the position event any Shareholder fails to timely pay his or her Pro Rata Portion of the Independent Accounting Firm Expenses, the parties agree that substantially prevailsParent may at its option pay such Shareholder's Pro Rata Portion of the Independent Accounting Firm Expenses and recover an equal amount (which shall be deemed a Loss) from such Shareholder's Pro Rata Portion of the Escrow Fund. (d) If the Stockholder Shareholder Representative does not deliver a Notice of Objection in accordance with Section 7.6(b8.6(b) hereof (i.e., within a fifteen (15) ------------- 10 day period), the Adjusted Balance Sheet (together with Parent's calculation of Net Excess Liabilities at Closing or Excess Assets reflected thereon), shall be deemed to have been accepted by all of the parties to this Agreement. In the event that the Stockholder Shareholder Representative delivers a Notice of Objection in accordance with the provisions above and Parent and the Stockholder Shareholder Representative are able to resolve such dispute by mutual agreement, the Adjusted Balance Sheet, together with Parent's calculation of Net Excess Liabilities at Closing or Excess Assets reflected thereon, to the extent modified by mutual agreement of such parties, shall be deemed to have been accepted by all of the parties to this Agreement. In the event that the Stockholder Shareholder Representative delivers a Notice of Objection in accordance with the provisions set forth above and Parent and the Stockholder Shareholder Representative are unable to resolve such dispute by mutual agreement, the determination of the Independent Accounting Firm shall be final and binding on the parties, and the Adjusted Balance Sheet, together with Parent's calculation of Net Excess Liabilities at Closing or Excess Assets reflected thereon, to the extent modified by the Independent Accounting Firm, shall be deemed to have been accepted by all of the parties to this Agreement. Subject to the foregoing provisions, the calculation of Net Excess Liabilities at Closing or Excess Assets reflected on any such Adjusted Balance Sheet shall be conclusive and binding on all of the parties to this AgreementAgreement for purposes of this Section 8.6, no further adjustments shall be made thereto and neither none of Parent, the Stockholder Shareholder Representative nor or the Principal Stockholders Shareholders shall have any further right to challenge such calculation of Net Excess Liabilities at Closingor Excess Assets, whether pursuant to the terms of Section 7.3 8.3 hereof or otherwise. -----------.

Adjustment to Consideration. (a) Within forty-five (45) If, within 15 days following the Closing Date, Parent mayor the Stockholder Representative (each, at its electionan “Electing Party”) notifies the other party (the “Non- Electing Party”) that it is disputing the results of the Closing Date Balance Sheet that was used to determine the Balance Sheet Adjustment Amount pursuant to Section 1.6(a), such Electing Party shall, within 45 days following the Closing Date, cause to be prepared and delivered to the Stockholder Representative Non- Electing Party, an unaudited balance sheet of the Surviving Corporation as of the Closing Date (the "“Adjusted Balance Sheet"”). The ---------------------- Adjusted Balance Sheet will be prepared in accordance with GAAP (except that such balance sheet will not contain the Adjusted Balance Sheet may omit footnotes or year-end adjustments and other presentation items that may be required by GAAP). Based upon GAAP and shall include the Adjusted Balance Sheet, the Company's "Net --- Liabilities at Closing" adjustments set forth in Schedule 1.6(a)(i) hereto and in all events shall be calculated in accordance consistent with the following: ---------------------- (Alast two sentences of the definition of Balance Sheet Adjustment Amount above) consistently applied on a basis consistent with the Company's total liabilities at calculation of the Closing Date Trial Run and presenting such Electing Party’s good faith estimate of the balance sheet of the Surviving Corporation as set forth of the close of business on the Adjusted Balance Sheet minus (B) the Company's total assets at the Closing Date as set forth on the Adjusted Balance Sheet minus (C) the amount of the Company's payments for Severance (or accruals therefore) minus (D) the Additional Liabilities (whether such amount has been paid by the Company day immediately prior to the Closing Date or otherwise reserved for by the Company) minus (E) the total amount of normal per diem operating expenses for the period between November 30, 2001 and Closing at a rate of $9,150 per calendar day minus (F) the Third Party Expense Adjustment Amount minus (G) up to $50,000 pursuant to Section 5.5Closing. In ----------- the event that, pursuant to the terms of this Section 7.68.6, it is finally determined that ----------- the amount of (Xi) the Company's ’s total current assets (as defined by and as determined in accordance with GAAP) at the Closing Date as reflected on the Adjusted Balance Sheet minus (ii) the Company’s current liabilities (as defined by and as determined in accordance with GAAP ) at the Closing Date as reflected on the Adjusted Balance Sheet (collectively, the “Net Liabilities Assets at Closing Closing”) exceeds (Yiii) the Current Balance Sheet Net LiabilitiesAdjustment Amount, then an amount equal to such difference ("the “Excess ------ Assets”) shall be paid to the Stockholders pursuant to Section 1.6(c). In the event that, pursuant to the terms of this Section 8.6 it is determined that the Net Assets at Closing is less than the Balance Sheet Adjustment Amount, then an amount equal to such difference (the “Excess Liabilities"”) shall be paid to Parent out of the Escrow Fund upon the delivery ----------- to the Escrow Agent of an Officer's Certificate in accordance with the terms of Section 7.3(f) hereof. If 8.4 hereof on a dollar-for-dollar basis, and the Deductible Amount shall not apply to Parent’s right to payment for Excess Liabilities exceed the amount in the Escrow -------------- Fund, Parent shall be entitled to recover directly from the Principal Stockholders any amount of Excess Liabilities not covered by the Escrow Fund. Parent shall, subject to at the limitations set forth in Section 7.5. Following delivery by ----------- Parent to request of the Stockholder Representative of if the Stockholder Representative is the Electing Party, prepare the Adjusted Balance Sheet, Sheet on behalf of the Electing Party. Parent shall give and shall cause the Surviving Corporation to give the Stockholder Representative and its accountant reasonable access during Parent's ’s regular business hours to those books and records and work papers of the Surviving Corporation in the possession or control of Parent and or the Surviving Corporation and, in the event that the Stockholder Representative is the Non- Electing Party, any personnel which relate to of Parent or the preparation of Surviving Corporation who prepared the Adjusted Balance Sheet Sheet, for purposes of resolving any disputes concerning the Adjusted Balance Sheet and the calculation of the Net Liabilities Assets at Closing. (b) The Stockholder Representative Non- Electing Party shall have fifteen (15) 45 days following delivery of the Adjusted Balance Sheet during which to notify Parent the Electing Party in writing (the "“Notice of Objection"”) of any good faith objections to the ------------------- calculation of Net Liabilities at Closing or the Adjusted Balance SheetSheet or the Net Assets at Closing, as it affects such calculation, setting forth a reasonably specific and detailed description of its objections and the dollar amount of each objection. If the Stockholder Representative Non- Electing Party objects to the Adjusted Balance Sheet or Parent's the Electing Party’s calculation of Net Liabilities Assets at Closing as reflected thereon, Parent and the Stockholder Representative shall attempt to resolve any such objections within fifteen (15) 15 days of the receipt by Parent the Electing Party of the Notice of Objection. (c) If Parent the Electing Party and the Stockholder Representative Non- Electing Party are unable unable, using their commercially reasonable efforts, to resolve any such dispute within the fifteen (15) 15 day period following receipt of the Notice of Objection referred to in Section 7.6(b8.6(b) hereof, Parent the Electing Party and the Stockholder Representative Non-Electing Party shall submit -------------- the dispute to Deloitte & Touche a partner in the audit practice of any nationally recognized accounting firm that is mutually and reasonably agreeable to both parties (who shall not have any material relationship to either party) (the "“Independent Accounting Firm"”). Each of --------------------------- the parties to this Agreement shall, and shall cause their respective affiliates and representatives to, provide full cooperation to the Independent Accounting Firm. The Independent Accounting Firm shall (xi) act in its capacity as an expert and not as an arbitrator, (yii) consider only those matters as to which there is a dispute between the parties and (ziii) be instructed to reach its conclusions regarding any such dispute within thirty (30) 30 days after its appointment and provide a written explanation of its decision. In the event that Parent the Electing Party and the Stockholder Representative Non- Electing Party submit any dispute to an Independent Accounting Firm, each such party may submit a "“position paper" ” to the Independent Accounting Firm setting forth the position of such party with respect to such dispute, to be considered by such Independent Accounting Firm as it deems fitappropriate. The Any expenses relating to the engagement of the Independent Accounting Firm (the “Independent Accounting Firm Expenses”) shall be paid by Parent and fifty percent (50%) of such expenses shall be paid by the party whose position is not Stockholders; provided, however, that in the position event any Stockholder fails to timely pay his or her Pro Rata Portion of the Independent Accounting Firm Expenses, the parties agree that substantially prevailsParent may at its option pay such Stockholder’s Pro Rata Portion of the Independent Accounting Firm Expenses and recover an equal amount (which shall be deemed an Agreed- Upon Loss) from such Stockholder’s Pro Rata Portion of the Escrow Fund. Other than the manner of payment of the Independent Accounting Firm Expenses, the Electing Party shall be responsible for all other fees and expenses of such Electing Party, all reasonable fees and expenses incurred in the preparation and delivery of the Adjusted Balance Sheet, and all reasonable fees and expenses of the Non- Electing Party to respond and, if applicable, object to the Adjusted Balance Sheet or the Net Assets at Closing. (d) If the Stockholder Representative Non- Electing Party does not deliver a Notice of Objection in accordance with Section 7.6(b8.6(b) hereof (i.e., within a fifteen (15) ------------- 15 day period), the Adjusted Balance Sheet (together with Parent's the Electing Party’s calculation of Net Liabilities Assets at Closing reflected thereon), shall be deemed to have been accepted by all of the parties to this Agreement. In the event that the Stockholder Representative Non- Electing Party delivers a Notice of Objection in accordance with the provisions above and Parent the Electing Party and the Stockholder Representative Non- Electing Party are able to resolve such dispute by mutual agreement, the Adjusted Balance Sheet, together with Parent's the calculation of Net Liabilities Assets at Closing reflected thereon, to the extent modified by mutual agreement of such parties, shall be deemed to have been accepted by all of the parties to this Agreement. . (e) In the event that the Stockholder Representative Non- Electing Party delivers a Notice of Objection in accordance with the provisions set forth above and Parent the Electing Party and the Stockholder Representative Non- Electing Party are unable to resolve such dispute by mutual agreement, the determination of the Independent Accounting Firm shall be final and binding on the parties, and the Adjusted Balance Sheet, together with Parent's the Electing Party’s calculation of Net Liabilities Assets at Closing reflected thereon, to the extent modified by the Independent Accounting Firm, shall be deemed to have been accepted by all of the parties to this Agreement. . (f) Subject to the foregoing provisions, the calculation of Net Liabilities Assets at Closing reflected on any such Adjusted Balance Sheet shall be conclusive and binding on all of the parties to this AgreementAgreement for purposes of this Section 8.6, no further adjustments shall be made thereto and neither none of Parent, the Stockholder Representative nor or the Principal Stockholders shall have any further right to challenge such calculation of Net Liabilities Assets at Closing, whether pursuant to the terms of this Section 7.3 hereof 8.6 or otherwise. -----------.

Adjustment to Consideration. (a) Within forty-five (45) days following Pursuant to the Closing DateMajority SPA, Parent maythe Buyer and the Majority Sellers must comply with their respective obligations under Clauses 3.5 to 3.9 of and Schedule 8 to the Majority SPA, at its election, cause pursuant to which the Completion Accounts are to be prepared and delivered to become final and binding on the Stockholder Representative an unaudited balance sheet Buyer and the Majority Sellers and, by operation of the Surviving Corporation as of the Closing Date (the "Adjusted Balance Sheet"). The ---------------------- Adjusted Balance Sheet will be prepared in accordance with GAAP (except that such balance sheet will not contain footnotes or year-end adjustments that may be required by GAAP). Based upon the Adjusted Balance Sheetthis clause 3, the Company's "Net --- Liabilities at Closing" shall be calculated in accordance with Option Sellers. (b) On the following: ---------------------- (A) date falling five Business Days after the Company's total liabilities at date on which the Closing Date as set forth on the Adjusted Balance Sheet minus (B) the Company's total assets at the Closing Date as set forth on the Adjusted Balance Sheet minus (C) the amount of the Company's payments for Severance (or accruals therefore) minus (D) the Additional Liabilities (whether such amount has been paid by the Company prior to the Closing Date or otherwise reserved for by the Company) minus (E) the total amount of normal per diem operating expenses for the period between November 30, 2001 Completion Accounts become final and Closing at a rate of $9,150 per calendar day minus (F) the Third Party Expense Adjustment Amount minus (G) up to $50,000 pursuant to Section 5.5. In ----------- the event that, pursuant to the terms of this Section 7.6, it is determined that ----------- (X) the Company's Net Liabilities at Closing exceeds (Y) the Current Balance Sheet Net Liabilities, then an amount equal to such difference ("Excess ------ Liabilities") shall be paid to Parent out of the Escrow Fund upon the delivery ----------- to the Escrow Agent of an Officer's Certificate binding in accordance with the terms of Section 7.3(fthe Majority SPA; (i) hereof. If if the Excess Liabilities exceed Net Working Capital and Cash as set out in the Completion Accounts exceeds the Target Net Working Capital and Cash, the Buyer shall release the Adjustment Payment Holdback Amount to the Option Sellers and, provided the excess is not less than an amount equal to the Threshold, in addition, shall pay to the Option Sellers an amount equal to the Optionholder Proportion of the excess above the Threshold and the percentage of the aggregate amount payable under this Clause 3.2(b)(i) that is payable to each Option Seller shall be equal to such Option Sellers’ Proportion; (ii) if the Net Working Capital and Cash as set out in the Completion Accounts is less than the Target Net Working Capital and Cash by a figure exceeding the Threshold, then: (A) if the Optionholder Proportion of the shortfall (that is an amount that exceeds the Threshold) is equal to or in excess of the Adjustment Payment Holdback Amount then the Buyer shall be permitted to retain the Adjustment Payment Holdback Amount; (B) if the Optionholder Proportion of the shortfall (that is an amount that exceeds the Threshold) is less than the Adjustment Payment Holdback Amount then the Buyer shall be permitted to withhold an amount equal to such shortfall from the Adjustment Payment Holdback Amount and thereafter pay the remaining amount to the Option Sellers in accordance with the Option Seller’s Proportion; and (C) if the Optionholder Proportion shortfall (that is an amount that exceeds the Threshold) is more than the Adjustment Payment Holdback Amount then, in addition to the Buyer retaining the Adjustment Payment Holdback Amount pursuant to (A) above, the Option Sellers shall pay the remaining amount of the Optionholder Proportion of the shortfall (above the amount in of the Escrow -------------- Fund, Parent Threshold) to the Buyer and the percentage payable under this Clause 3.2(b)(ii)(C) by each Option Seller shall be entitled equal to recover directly from the Principal Stockholders any amount of Excess Liabilities not covered by the Escrow Fund, subject to the limitations set forth in Section 7.5. Following delivery by ----------- Parent to the Stockholder Representative of the Adjusted Balance Sheet, Parent shall give the Stockholder Representative reasonable access during Parent's business hours to those books and records of the Surviving Corporation in the possession of Parent and any personnel which relate to the preparation of the Adjusted Balance Sheet for purposes of resolving any disputes concerning the Adjusted Balance Sheet and the calculation of Net Liabilities at Closing. (b) The Stockholder Representative shall have fifteen (15) days following delivery of the Adjusted Balance Sheet during which to notify Parent in writing (the "Notice of Objection") of any good faith objections to the ------------------- calculation of Net Liabilities at Closing or the Adjusted Balance Sheet, as it affects such calculation, setting forth a reasonably specific and detailed description of its objections and the dollar amount of each objection. If the Stockholder Representative objects to the Adjusted Balance Sheet or Parent's calculation of Net Liabilities at Closing as reflected thereon, Parent and the Stockholder Representative shall attempt to resolve any such objections within fifteen (15) days of the receipt by Parent of the Notice of ObjectionOption Seller’s Proportion. (c) If Parent To the extent that the aggregate of the amounts owed to HSBC UK Bank plc under the Company’s international business overdraft facility and asset finance facility are less than the Stockholder Representative are unable to resolve any such dispute within HSBC Debt Amount on the fifteen (15) day period referred to in Section 7.6(b) hereofCompletion Date, Parent and the Stockholder Representative Buyer shall submit -------------- the dispute to Deloitte & Touche (the "Independent Accounting Firm"). Each of --------------------------- the parties to this Agreement shall, and shall cause their respective affiliates and representatives to, provide full cooperation pay to the Independent Accounting Firm. The Independent Accounting Firm shall (x) act in its capacity as Option Sellers an expert and not as an arbitrator, (y) consider only those matters as to which there is a dispute between the parties and (z) be instructed to reach its conclusions regarding any such dispute within thirty (30) days after its appointment and provide a written explanation of its decision. In the event that Parent and the Stockholder Representative submit any dispute to an Independent Accounting Firm, each such party may submit a "position paper" amount equal to the Independent Accounting Firm setting forth the position of such party with respect to such dispute, to be considered by such Independent Accounting Firm as it deems fit. The expenses relating to the engagement Optionholder Proportion of the Independent Accounting Firm shall be paid by difference on the party whose position is not the position that substantially prevailsCompletion Accounts Agreement Date in accordance with Clause 3.2(d) and in accordance with each Option Sellers’ Proportion. (d) If Payment of any amount due to the Stockholder Representative does not deliver a Notice Option Sellers pursuant to this Clause 3.2 shall be paid in aggregate by the Buyer to the Company’s Bank Account, proof of Objection in accordance with Section 7.6(bpayment of which shall be an effective discharge of the Buyer’s obligation to pay such amounts under this Clause 3.2. (e) hereof (i.e., within a fifteen (15) ------------- day period), the Adjusted Balance Sheet (together with Parent's calculation of Net Liabilities at Closing reflected thereon), The Optionholder Consideration shall be deemed to have been accepted be adjusted by all an amount equal to: (i) the aggregate amount of any payment made by any Option Seller to the parties Buyer in respect of any Claim; (ii) the aggregate amount of any payment made by the Buyer to any Option Seller in respect of any breach of this Agreement. In ; (iii) the event aggregate of any amounts paid to the Option Sellers by the Buyer pursuant to Clause 3.2(c); (iv) the aggregate amount of any Adjustment Payment made to the Buyer by the Option Sellers pursuant to Clause 3.2(b)(ii); and (v) the aggregate amount of any Adjustment Payments made to the Option Sellers by the Buyer pursuant to Clause 3.2(b)(i), and any adjustment shall be apportioned between the Parties as appropriate in the context, provided that the Stockholder Representative delivers a Notice of Objection in accordance with the provisions above and Parent and the Stockholder Representative are able to resolve such dispute by mutual agreement, the Adjusted Balance Sheet, together with Parent's calculation of Net Liabilities at Closing reflected thereon, to the extent modified by mutual agreement of such parties, Optionholder Consideration shall not be deemed to have been accepted by all of the parties to this Agreement. In the event that the Stockholder Representative delivers a Notice of Objection in accordance with the provisions set forth above and Parent and the Stockholder Representative are unable to resolve such dispute by mutual agreement, the determination of the Independent Accounting Firm shall be final and binding on the parties, and the Adjusted Balance Sheet, together with Parent's calculation of Net Liabilities at Closing reflected thereon, to the extent modified by the Independent Accounting Firm, shall be deemed to have been accepted by all of the parties to this Agreement. Subject to the foregoing provisions, the calculation of Net Liabilities at Closing reflected on any such Adjusted Balance Sheet shall be conclusive and binding on all of the parties to this Agreement, no further adjustments shall be made thereto and neither Parent, the Stockholder Representative nor the Principal Stockholders shall have any further right to challenge such calculation of Net Liabilities at Closing, whether pursuant to the terms of Section 7.3 hereof or otherwise. -----------reduced below zero.

Adjustment to Consideration. (a) Within forty-five (45) days following The Parties agree that the Closing Date, Parent may, at its election, cause to be prepared and delivered to Purchase Price was determined as if the Stockholder Representative an unaudited balance sheet net working capital of the Surviving Corporation as was $1,000,000 at the close of business on the Closing Date (the "Adjusted Balance SheetCONSIDERATION NET WORKING CAPITAL"). The ---------------------- Adjusted Balance Sheet will be prepared in accordance with GAAP (except Parties agree that such balance sheet will not contain footnotes or year-end adjustments that may be required by GAAP). Based upon the Adjusted Balance Sheet, estimate of net working capital at the Company's "Net --- Liabilities at Closing" shall be calculated in accordance with the following: ---------------------- (A) the Company's total liabilities at close of business on the Closing Date as set forth is $1,044,000 (the "ESTIMATED NET WORKING CAPITAL"). Accordingly, the Parties agree that the Purchase Price shall be increased on the Adjusted Balance Sheet minus (B) the Company's total assets at the Closing Date as set forth on by $22,000 (the Adjusted Balance Sheet minus (C) the amount of the Company's payments for Severance (or accruals therefore) minus (D) the Additional Liabilities (whether such amount has been paid by the Company prior to the Closing Date or otherwise reserved for by the Company) minus (E) the total amount of normal per diem operating expenses for the period between November 30, 2001 and Closing at a rate of $9,150 per calendar day minus (F) the Third Party Expense Adjustment Amount minus (G) up to $50,000 pursuant to Section 5.5. In ----------- the event that, pursuant to the terms of this Section 7.6, it is determined that ----------- (X) the Company's Net Liabilities at Closing exceeds (Y) the Current Balance Sheet Net Liabilities, then an amount equal to such difference ("Excess ------ LiabilitiesUPWARD ADJUSTMENT AMOUNT") shall be paid to Parent out of the Escrow Fund upon the delivery ----------- to the Escrow Agent of an Officer's Certificate in accordance with the terms of Section 7.3(f) hereof. If the Excess Liabilities exceed the amount in the Escrow -------------- Fund, Parent shall be entitled to recover directly from the Principal Stockholders any amount of Excess Liabilities not covered by the Escrow Fund, subject to the limitations set forth in Section 7.5. Following delivery by ----------- Parent to the Stockholder Representative of the Adjusted Balance Sheet, Parent shall give the Stockholder Representative reasonable access during Parent's business hours to those books and records of the Surviving Corporation in the possession of Parent and any personnel which relate to the preparation of the Adjusted Balance Sheet for purposes of resolving any disputes concerning the Adjusted Balance Sheet and the calculation of Net Liabilities at Closing). (b) The Stockholder Representative shall have fifteen Parties agree to make a subsequent adjustment to the Purchase Price on the Adjustment Date (15as that term is defined in Section 6.1) days following delivery to reflect the actual net working capital of the Adjusted Balance Sheet during which to notify Parent in writing Corporation on the Closing Date (the "Notice of ObjectionACTUAL NET WORKING CAPITAL") of any good faith objections to the ------------------- calculation of Net Liabilities at Closing or the Adjusted Balance Sheet), as it affects such calculation, setting forth a reasonably specific and detailed description of its objections and shown on the dollar amount of each objection. If the Stockholder Representative objects balance sheet to the Adjusted Balance Sheet or Parent's calculation of Net Liabilities at Closing as reflected thereon, Parent and the Stockholder Representative shall attempt to resolve any such objections within fifteen (15) days of the receipt by Parent of the Notice of Objection.be prepared in accordance with paragraph 3.5 (c) If Parent and the Stockholder Representative are unable to resolve any such dispute within the fifteen (15) day period referred to in Section 7.6(b) hereof, Parent and as follows: (i) Subject to paragraph 3.5(b)(ii): (a) if the Stockholder Representative amount obtained by subtracting the Consideration Net Working Capital from the Actual Net Working Capital exceeds the Upward Adjustment Amount, then the Purchaser shall submit -------------- the dispute to Deloitte & Touche (the "Independent Accounting Firm"). Each of --------------------------- the parties to this Agreement shall, and shall cause their respective affiliates and representatives to, provide full cooperation pay such excess to the Independent Accounting Firm. The Independent Accounting Firm shall (x) act Vendors, allocated as specified in its capacity as an expert and not as an arbitratorSchedule "A", (y) consider only those matters as to which there is a dispute between the parties and (z) be instructed to reach its conclusions regarding any such dispute within thirty (30) days after its appointment and provide a written explanation of its decision. In the event that Parent and the Stockholder Representative submit any dispute to an Independent Accounting Firm, each such party may submit a "position paper" to the Independent Accounting Firm setting forth the position of such party with respect to such dispute, to be considered by such Independent Accounting Firm as it deems fit. The expenses relating to the engagement five Business Days of the Independent Accounting Firm shall be paid by Adjustment Date (or such later date when the party whose position Actual Net Working Capital is not the position that substantially prevails. (d) If the Stockholder Representative does not deliver a Notice of Objection settled in accordance with Section 7.6(b3.5(c)); or (b) hereof if the amount obtained by subtracting the Consideration Net Working Capital from the Actual Net Working Capital so reflected is less than the Upward Adjustment Amount, then the Vendors shall pay (i.e., in the proportions as specified in Schedule "A") such deficiency to the Purchaser within a fifteen (15) ------------- day period), the Adjusted Balance Sheet (together with Parent's calculation of Net Liabilities at Closing reflected thereon), shall be deemed to have been accepted by all five Business Days of the parties to this Agreement. Adjustment Date (or such later date when the Actual Net Working Capital is settled in accordance with Section 3.5(c)); and (ii) In the event that the Stockholder Representative delivers a Notice Actual Net Working Capital is less than the Consideration Net Working Capital, then, within five Business Days of Objection the Adjustment Date (or such later date when the Actual Net Working Capital is settled in accordance with Section 3.5(c)), the provisions above and Parent Vendors shall pay (in the proportions as specified in Schedule "A") to the Purchaser an amount equal to the Upward Adjustment Amount plus the amount of the difference between the Actual Net Working Capital and the Stockholder Representative are able to resolve such dispute by mutual agreement, the Adjusted Balance Sheet, together with Parent's calculation of Consideration Net Liabilities at Closing reflected thereon, to the extent modified by mutual agreement of such parties, shall be deemed to have been accepted by all of the parties to this Agreement. In the event that the Stockholder Representative delivers a Notice of Objection in accordance with the provisions set forth above and Parent and the Stockholder Representative are unable to resolve such dispute by mutual agreement, the determination of the Independent Accounting Firm shall be final and binding on the parties, and the Adjusted Balance Sheet, together with Parent's calculation of Net Liabilities at Closing reflected thereon, to the extent modified by the Independent Accounting Firm, shall be deemed to have been accepted by all of the parties to this Agreement. Subject to the foregoing provisions, the calculation of Net Liabilities at Closing reflected on any such Adjusted Balance Sheet shall be conclusive and binding on all of the parties to this Agreement, no further adjustments shall be made thereto and neither Parent, the Stockholder Representative nor the Principal Stockholders shall have any further right to challenge such calculation of Net Liabilities at Closing, whether pursuant to the terms of Section 7.3 hereof or otherwise. -----------Working Capital.

Adjustment to Consideration. 4.1 Estimated Adjustment Amount (a) Within forty-five (45) days following Simultaneously with the Closing Date, Parent may, at its election, cause to be prepared and delivered delivery of the Completion Notice by the Seller to the Stockholder Representative an Purchaser pursuant to Clause 5.5, the Seller shall deliver to the Purchaser (i) the general ledger of the School Holding Companies and School Entities and all bank statements of all bank accounts maintained by the School Holding Companies and School Entities; and (ii) the unaudited balance sheet of each School Holding Company and School Entity and the Surviving Corporation as unaudited consolidated balance sheet of the Closing Date (the "Adjusted Balance Sheet"). The ---------------------- Adjusted Balance Sheet will be prepared in accordance with GAAP (except that such balance sheet will not contain footnotes or year-end adjustments that may be required by GAAP). Based upon the Adjusted Balance Sheet, the Company's "Net --- Liabilities at Closing" shall be calculated in accordance with the following: ---------------------- (A) the Company's total liabilities at the Closing Date as set forth on the Adjusted Balance Sheet minus (B) the Company's total assets at the Closing Date as set forth on the Adjusted Balance Sheet minus (C) the amount School Holding Companies and School Entities for each of the Company's payments for Severance (or accruals therefore) minus (D) monthly periods from 1 July 2014 to the Additional Liabilities (whether such amount has been paid end of the calendar month immediately preceding the date on which the Completion Notice is given by the Company prior to the Closing Date or otherwise reserved for by the Company) minus Seller (E) the total amount of normal per diem operating expenses for the period between November 30, 2001 and Closing at a rate of $9,150 per calendar day minus (F) the Third Party Expense Adjustment Amount minus (G) up to $50,000 pursuant to Section 5.5. In ----------- the event that, pursuant to the terms of this Section 7.6, it is determined that ----------- (X) the Company's Net Liabilities at Closing exceeds (Y) the Current Balance Sheet Net Liabilities, then an amount equal to such difference ("Excess ------ Liabilities") shall be paid to Parent out of the Escrow Fund upon the delivery ----------- to the Escrow Agent of an Officer's Certificate in accordance with the terms of Section 7.3(f) hereof. If the Excess Liabilities exceed the amount in the Escrow -------------- Fund, Parent shall be entitled to recover directly from the Principal Stockholders any amount of Excess Liabilities not covered by the Escrow Fund, subject to the limitations set forth in Section 7.5. Following delivery by ----------- Parent to the Stockholder Representative of the Adjusted Balance Sheet, Parent shall give the Stockholder Representative reasonable access during Parent's business hours to those books and records of the Surviving Corporation in the possession of Parent and any personnel which relate to the preparation of the Adjusted Balance Sheet for purposes of resolving any disputes concerning the Adjusted Balance Sheet and the calculation of Net Liabilities at Closingboth inclusive). (b) The Stockholder Representative shall have fifteen Within five (155) days following delivery Business Days after the receipt of the Adjusted Balance Sheet during which Completion Notice by the Purchaser, the Purchaser shall deliver to notify Parent in writing the Seller a statement (the "Notice of Objection"“Purchaser’s Statement”) of any setting out the Purchaser’s good faith objections estimate of the Final Adjustment Amount (“Estimated Adjustment Amount”) which shall be determined according to Clause 4.2 and the amount of the Initial Cash Consideration to be paid by the Purchaser to the ------------------- calculation of Net Liabilities Seller at Closing or the Adjusted Balance Sheet, as it affects such calculation, setting forth a reasonably specific and detailed description of its objections and the dollar amount of each objection. If the Stockholder Representative objects Completion pursuant to the Adjusted Balance Sheet or Parent's calculation of Net Liabilities at Closing as reflected thereon, Parent and the Stockholder Representative shall attempt to resolve any such objections within fifteen (15) days of the receipt by Parent of the Notice of ObjectionClause 3.2(a)(i). (c) If Parent and the Stockholder Representative are unable to resolve any such dispute within Estimated Adjustment Amount is a positive number, then the fifteen (15) day period referred to in Section 7.6(b) hereof, Parent and Initial Cash Consideration payable by the Stockholder Representative shall submit -------------- the dispute to Deloitte & Touche (the "Independent Accounting Firm"). Each of --------------------------- the parties to this Agreement shall, and shall cause their respective affiliates and representatives to, provide full cooperation Purchaser to the Independent Accounting FirmSeller at Completion shall be increased by fifty percent (50%) of the Estimated Adjustment Amount. If the Estimated Adjustment Amount is a negative number, then the Initial Cash Consideration payable by the Purchaser to the Seller at Completion shall be decreased by the Estimated Adjustment Amount. If the Estimated Adjustment Amount is zero, then there shall be no adjustment to the Initial Cash Consideration payable by the Purchaser to the Seller at Completion. 4.2 The Independent Accounting Firm amount of the final adjustment amount to the Initial Cash Consideration (“Final Adjustment Amount”) shall be calculated as: (xa) act all cash on hand or credited to an account with a bank or other financial institution opened in its capacity the name of the Target Group Entities as an expert and not of the Effective Time as an arbitrator, shown in the Completion Accounts; (yb) consider only those matters as all accounts receivable in relation to the 2014/2015 Financial Year to which there is a dispute between the parties and (z) be instructed to reach its conclusions regarding any such dispute within thirty (30) days after its appointment and provide a written explanation of its decision. In the event that Parent and the Stockholder Representative submit any dispute to an Independent Accounting Firm, each such party may submit a "position paper" to the Independent Accounting Firm setting forth the position of such party with respect to such dispute, to be considered by such Independent Accounting Firm Target Group Entities are beneficially entitled as it deems fit. The expenses relating to the engagement of the Independent Accounting Firm shall be paid by Effective Time as shown in the party whose position is not Completion Accounts; (c) the position that substantially prevails.Deposits as shown in the Completion Accounts; (d) advances or prepayments on procurement contracts as shown in the Completion Accounts; (e) operating expenses in relation to the 2014/2015 Financial Year paid in the normal course of business from 1 July 2014 up to the Effective Time as shown in the Completion Accounts; (f) capital expenditure in relation to the 2014/2015 Financial Year incurred from 1 July 2014 up to the Effective Time, subject to approval by the Purchaser as shown in the Completion Accounts; (g) tuition fees for the 2014/2015 Financial Year and beyond paid and received in advance and to be paid and received by the School Entities up to the Effective Time as shown in the Completion Accounts; (h) refundable deposits from the children and students of the School Entities as of the Effective Time as shown in the Completion Accounts; (i) accounts payable by the Target Group Entities in relation to the period up to the Effective Time as shown in the Completion Accounts; (j) accrued expenses by the Target Group Entities in relation to the period up to the Effective Time as shown in the Completion Accounts; (k) Taxes payable by the Target Group Entities in relation to the period up to the Effective Time as shown in the Completion Accounts; (l) end-of-contract bonus payable to ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, the CEO of the Target Group Entities, as of the Effective Time as shown in the Completion Accounts; and (m) provision for unemployment funds and severance allowance for the Target Group Entities as of the Effective Time as shown in the Completion Accounts. 4.3 The Initial Cash Consideration shall be adjusted by an amount equal to (i) the Final Adjustment Amount minus (ii) the Estimated Adjustment Amount (the “Subsequent Adjustment Amount”). If the Stockholder Representative does not deliver Subsequent Adjustment Amount is a Notice positive number, then the Purchaser shall pay to the Seller, as an increase to the Initial Cash Consideration, a sum equal to fifty percent (50%) of Objection the Subsequent Adjustment Amount, on the Subsequent Adjustment Payment Date to the bank account designated by the Seller in accordance with Section 7.6(bwriting at least five (5) hereof Business Days prior to the Subsequent Adjustment Payment Date. If the Subsequent Adjustment Amount is a negative number, then the Seller shall pay to the Purchaser, as a reduction to the Initial Cash Consideration, a sum equal to the Subsequent Adjustment Amount on the Subsequent Adjustment Payment Date to the bank account designated by the Purchaser in writing at least five (i.e.5) Business Days prior to the Subsequent Adjustment Payment Date. If the Subsequent Adjustment Amount is zero, within a fifteen (15) ------------- day period), the Adjusted Balance Sheet (together with Parent's calculation of Net Liabilities at Closing reflected thereon), there shall be deemed to have been accepted by all of the parties to this Agreement. In the event that the Stockholder Representative delivers a Notice of Objection in accordance with the provisions above and Parent and the Stockholder Representative are able to resolve such dispute by mutual agreement, the Adjusted Balance Sheet, together with Parent's calculation of Net Liabilities at Closing reflected thereon, no adjustment to the extent modified by mutual agreement of such parties, shall be deemed to have been accepted by all of the parties to this Agreement. In the event that the Stockholder Representative delivers a Notice of Objection in accordance with the provisions set forth above and Parent and the Stockholder Representative are unable to resolve such dispute by mutual agreement, the determination of the Independent Accounting Firm shall be final and binding on the parties, and the Adjusted Balance Sheet, together with Parent's calculation of Net Liabilities at Closing reflected thereon, to the extent modified by the Independent Accounting Firm, shall be deemed to have been accepted by all of the parties to this Agreement. Subject to the foregoing provisions, the calculation of Net Liabilities at Closing reflected on any such Adjusted Balance Sheet shall be conclusive and binding on all of the parties to this Agreement, no further adjustments shall be made thereto and neither Parent, the Stockholder Representative nor the Principal Stockholders shall have any further right to challenge such calculation of Net Liabilities at Closing, whether pursuant to the terms of Section 7.3 hereof or otherwise. -----------Initial Cash Consideration.

Adjustment to Consideration. (a) Within forty-five (45) 45 days following the Closing Date, Parent may, at its election, cause to be prepared and delivered to the Stockholder Representative an unaudited balance sheet of the Surviving Corporation as of the Closing Date (the "“Adjusted Balance Sheet"”). The ---------------------- Adjusted Balance Sheet will be prepared in accordance with GAAP (except that such balance sheet will not contain footnotes or year-end adjustments that may be required by GAAP). Based upon the Adjusted Balance Sheet, the Company's "Net --- Liabilities at Closing" shall be calculated in accordance consistently applied on a basis consistent with the following: ---------------------- (A) the Company's total liabilities at the Closing Date as set forth on the Adjusted Balance Sheet minus (B) the Company's total assets at the Closing Date as set forth on the Adjusted Balance Sheet minus (C) the amount of the Company's payments for Severance (or accruals therefore) minus (D) the Additional Liabilities (whether such amount has been paid by the Company prior to the Closing Date or otherwise reserved for by the Company) minus (E) the total amount of normal per diem operating expenses for the period between November 30, 2001 and Closing at a rate of $9,150 per calendar day minus (F) the Third Party Expense Adjustment Amount minus (G) up to $50,000 pursuant to Section 5.5Financials. In ----------- the event that, pursuant to the terms of this Section 7.67.6(a), it is determined that ----------- the amount equal to (Xi) the absolute value of the Company's Net Liabilities ’s total current assets (as defined by and as determined in accordance with GAAP but excluding cash and cash equivalents) at the Closing exceeds Date as reflected on the Adjusted Balance Sheet minus (Yii) the Current absolute value of the Company’s total current liabilities (as defined by and as determined in accordance with GAAP but excluding deferred revenue and the amount of any indebtedness for borrowed money) at the Closing Date as reflected on the Adjusted Balance Sheet (collectively, the “Net LiabilitiesAssets at Closing”) plus (iii) the Balance Sheet Adjustment Amount is a number less than the Balance Sheet Target, then an amount equal to such difference ("“Excess ------ Liabilities"”) shall be paid to Parent out of the Escrow Fund upon the delivery ----------- to the Escrow Agent of an Officer's Certificate in accordance with the terms of Section 7.3(f7.4(e) hereof. If For purposes of this calculation, Third Party Expenses shall not be considered as part of the Excess Liabilities exceed the amount in the Escrow -------------- Fund, Parent shall be entitled to recover directly from the Principal Stockholders any amount of Excess Liabilities not covered by the Escrow Fund, subject to the limitations set forth in Section 7.5total current liabilities. Following delivery by ----------- Parent to the Stockholder Representative of the Adjusted Balance Sheet, Parent shall give the Stockholder Representative reasonable access during Parent's ’s regular California business hours to those books and records of the Surviving Corporation in the possession or control of Parent and any personnel which relate to the preparation of the Adjusted Balance Sheet for purposes of resolving any disputes concerning the Adjusted Balance Sheet and the calculation of Net Liabilities Assets at Closing. (b) The Stockholder Representative shall have fifteen (15) 30 days following delivery of the Adjusted Balance Sheet during which to notify Parent in writing (the "“Notice of Objection"”) of any good faith objections to the ------------------- calculation of Net Liabilities Assets at Closing or the Adjusted Balance Sheet, as it affects such calculation, setting forth a reasonably specific and detailed description of its objections and the dollar amount of each objection. If the Stockholder Representative objects to the Adjusted Balance Sheet or Parent's ’s calculation of Net Liabilities Assets at Closing as reflected thereon, Parent and the Stockholder Representative shall attempt to resolve any such objections within fifteen (15) 30 days of the receipt by Parent of the Notice of Objection. (c) If Parent and the Stockholder Representative are unable to resolve any such dispute within the fifteen (15) 30 day period following receipt of the Notice of Objection referred to in Section 7.6(b) hereof, Parent and the Stockholder Representative shall submit -------------- the dispute to Deloitte & Touche a partner in the audit practice of any nationally recognized accounting firm that is mutually agreeable to both parties (the "“Independent Accounting Firm"”). Each of --------------------------- the parties to this Agreement shall, and shall cause their respective affiliates and representatives to, provide full cooperation to the Independent Accounting Firm. The Independent Accounting Firm shall (xi) act in its capacity as an expert and not as an arbitrator, (yii) consider only those matters as to which there is a dispute between the parties and (ziii) be instructed to reach its conclusions regarding any such dispute within thirty (30) 30 days after its appointment and provide a written explanation of its decision. In the event that Parent and the Stockholder Representative submit any dispute to an Independent Accounting Firm, each such party may submit a "“position paper" ” to the Independent Accounting Firm setting forth the position of such party with respect to such dispute, to be considered by such Independent Accounting Firm as it deems fitappropriate. The Fifty percent of any expenses relating to the engagement of the Independent Accounting Firm (“Independent Accounting Firm Expenses”) shall be paid by Parent and 50% of such expenses shall be paid by the party whose position is not Indemnifying Parties; provided, however, that in the position event any Indemnifying Party fails to timely pay his or her Pro Rata Portion of the Independent Accounting Firm Expenses, the parties agree that substantially prevailsParent may at its option pay such Indemnifying Party’s Pro Rata Portion of the Independent Accounting Firm Expenses and recover an equal amount from such Indemnifying Party’s Pro Rata Portion of the Escrow Fund. (d) If the Stockholder Representative does not deliver a Notice of Objection in accordance with Section 7.6(b) hereof (i.e., within a fifteen (15) ------------- 30 day period), the Adjusted Balance Sheet (together with Parent's ’s calculation of Net Liabilities Assets at Closing reflected thereon), shall be deemed to have been accepted by all of the parties to this Agreement. In the event that the Stockholder Representative delivers a Notice of Objection in accordance with the provisions above and Parent and the Stockholder Representative are able to resolve such dispute by mutual agreement, the Adjusted Balance Sheet, together with Parent's ’s calculation of Net Liabilities Assets at Closing reflected thereon, to the extent modified by mutual agreement of such parties, shall be deemed to have been accepted by all of the parties to this Agreement. In the event that the Stockholder Representative delivers a Notice of Objection in accordance with the provisions set forth above and Parent and the Stockholder Representative are unable to resolve such dispute by mutual agreement, the determination of the Independent Accounting Firm shall be final and binding on the parties, and the Adjusted Balance Sheet, together with Parent's ’s calculation of Net Liabilities Assets at Closing reflected thereon, to the extent modified by the Independent Accounting Firm, shall be deemed to have been accepted by all of the parties to this Agreement. Subject to the foregoing provisions, the calculation of Net Liabilities Assets at Closing reflected on any such Adjusted Balance Sheet shall be conclusive and binding on all of the parties to this AgreementAgreement for purposes of this Section 7.6, no further adjustments shall be made thereto and neither none of Parent, the Stockholder Representative nor or the Principal Stockholders Indemnifying Parties shall have any further right to challenge such calculation of Net Liabilities Assets at Closing, whether pursuant to the terms of Section 7.3 7.4 hereof or otherwise. -----------.