Common use of Closing Adjustment Clause in Contracts

Closing Adjustment. (i) At the Closing, the cash amount of the Purchase Price shall be adjusted in the following manner: (A) either (1) an increase by the amount, if any, by which the Estimated Closing Working Capital (as determined in accordance with Section 2.04(a)(ii)) is greater than the top of the range of the Target Working Capital, or (2) a decrease by the amount, if any, by which the Estimated Closing Working Capital is less than the bottom of the range of the Target Working Capital; (B) a decrease by the estimated Closing Indebtedness (“Estimated Closing Indebtedness”); and Securities Purchase Agreement 18 Project Acorn (C) a decrease by the amount of estimated Closing Transaction Expenses (“Estimated Closing Transaction Expenses”). The net amount after giving effect to the adjustments listed above (and exclusive of the the Akerna Loan which will be deemed repaid in full at Closing pursuant to its terms) shall be the “Closing Date Payment.” (ii) At least three (3) Business Days before the Closing, Seller shall prepare and deliver to Buyer a statement setting forth its good faith estimate of Closing Working Capital (the “Estimated Closing Working Capital”), Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses, which statement shall contain an estimated balance sheet of the Company Group as of the Closing Date (without giving effect to the transactions contemplated herein), a calculation of Estimated Closing Working Capital, Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses (the “Estimated Closing Statement”), and a certificate of the Chief Financial Officer of Seller certifying that the Estimated Closing Statement was prepared in accordance with GAAP applied using the same accounting methods, practices, principles, policies and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were used in the preparation of the Annual Financial Statements for the most recent fiscal year end as if such Estimated Closing Statement was being prepared and audited as of a fiscal year end, as adjusted as set forth on Schedule B. The Estimated Closing Statement shall include a reasonably detailed explanation and supporting detail of the calculations thereof.

Closing Adjustment. (i) At Not more than forty-five (45) days after the Closing, the cash amount of the Purchase Price shall be adjusted in the following manner: (A) either (1) an increase by the amount, if any, by which the Estimated Closing Working Capital (as determined in accordance with Section 2.04(a)(ii)) is greater than the top of the range of the Target Working Capital, or (2) a decrease by the amount, if any, by which the Estimated Closing Working Capital is less than the bottom of the range of the Target Working Capital; (B) a decrease by the estimated Closing Indebtedness (“Estimated Closing Indebtedness”); and Securities Purchase Agreement 18 Project Acorn (C) a decrease by the amount of estimated Closing Transaction Expenses (“Estimated Closing Transaction Expenses”). The net amount after giving effect to the adjustments listed above (and exclusive of the the Akerna Loan which will be deemed repaid in full at Closing pursuant to its terms) shall be the “Closing Date Payment.” (ii) At least three (3) Business Days before the Closing, Seller Sellers shall prepare and deliver to Buyer an audited balance sheet of the Company as of the Closing Date (without giving effect to the transactions contemplated herein) (the “Closing Date Balance Sheet”). Buyer agrees to make available to Sellers, upon reasonable request of Sellers post-closing, any books, records, and systems of the Company as reasonably necessary for Sellers to prepare such Closing Date Balance Sheet. (ii) Within thirty (30) days of Buyer’s receipt of the Closing Date Balance Sheet from Sellers, Buyer shall prepare and deliver to Seller a statement setting forth its good faith estimate calculation of Closing Working Capital (the “Estimated Closing Working Capital”), Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses, which statement shall contain an estimated audited balance sheet of the Company Group as of the Closing Date (without giving effect to the transactions contemplated herein), a calculation of Estimated Closing Working Capital, Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses Capital (the “Estimated "Closing Working Capital Statement”), ") and a certificate of the Chief Financial Officer of Seller certifying Buyer that the Estimated Closing Working Capital Statement was prepared in accordance with GAAP applied using and this Agreement. (iii) The "Closing Adjustment" shall be an amount that is equal to (a) the same accounting methodsamount by which Closing Working Capital exceeds the Target Working Capital Range, practicesas of the audited Closing Balance Sheet; or (b) the amount by which Closing Working Capital falls below the Target Working Capital Range, principles, policies and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were used as of the audited Closing Balance Sheet; or (c) in the preparation event Closing Working Capital is within the Target Working Capital Range, $0. In the case of subsection (a) above, the Purchase Price shall be increased by the amount of the Annual Financial Statements for Closing Adjustment, on a dollar-for-dollar basis, and Buyer shall pay to Sellers an amount equal to the most recent fiscal year end as if such Estimated Closing Statement was being prepared and audited as Adjustment. In the case of a fiscal year endsubsection (b) above, as adjusted as set forth on Schedule B. The Estimated Closing Statement the Purchase Price shall include a reasonably detailed explanation and supporting detail be reduced by the amount of the calculations thereofClosing Adjustment, on a dollar-for-dollar basis, and Sellers shall pay to Buyer an amount equal to the Closing Adjustment.

Closing Adjustment. (i) At the Closing, the cash amount of the Purchase Price shall be adjusted in the following manner: (A) either (1) an increase by the amount, if any, by which the Estimated Closing Working Capital (as determined in accordance with Section 2.04(a)(ii)) is greater than the top of the range of the Target Working Capital, or (2) a decrease by the amount, if any, by which the Estimated Closing Working Capital is less than the bottom of the range of the Target Working Capital; (B) a decrease by the estimated Closing Indebtedness (“Estimated Closing Indebtedness”); and Securities Purchase Agreement 18 Project Acorn (C) a decrease by the amount of estimated Closing Transaction Expenses (“Estimated Closing Transaction Expenses”). The net amount after giving effect to the adjustments listed above (and exclusive of the the Akerna Loan which will be deemed repaid in full at Closing pursuant to its terms) shall be the “Closing Date Payment.” (ii) At least three (3) five Business Days before the Closing, Seller shall the Remington Parties will prepare and deliver to Buyer AINC a statement setting forth its good their good-faith estimate of Closing Working Capital (the “Estimated Closing Working Capital”), Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses, which statement shall will contain an estimated balance sheet of the Company Group Remington Companies (other than Marietta Leasehold LP) on a consolidated basis as of the Closing Date (without giving effect to any of the transactions contemplated hereinTransactions), an estimated balance sheet of Marietta Leasehold LP on a consolidated basis as of the Closing Date (without giving effect to any of the Transactions), an estimate of the Non-Current Stock Plan Liability as of the Closing Date, a statement of the Estimated Pro Rated Incentive Fees, a statement of the Estimated Pro Rated Bonus Liabilities, a calculation of Estimated Closing Working Capital, Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses Capital (the “Estimated Closing Working Capital Statement”), and a certificate of the Chief Financial Officer senior accounting officer of Seller certifying Remington that (x) the Estimated Closing Working Capital Statement (other than the Non-Current Stock Plan Liability and Estimated Pro Rated Incentive Fees) was prepared in accordance with GAAP applied using the same accounting methods, practices, principles, policies and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were used in the preparation of the Annual Audited 2018 Carve-Out Financial Statements for (in the most recent fiscal year end case Remington and its consolidated subsidiaries) and the Audited 2018 Marietta Financial Statements (in the case of Marietta Leasehold LP) as if such Estimated Closing Working Capital Statement was were being prepared and audited as of a fiscal year end, as adjusted as and (y) the estimate of the Non-Current Stock Plan Liability was calculated applying the same methods, practices, principles, policies and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were used to calculate the Non-Current Stock Plan Liability set forth on in Schedule B. The Estimated Closing Statement shall include 3.06(a) but with a reasonably detailed explanation and supporting detail determination date as of the calculations thereofClosing Date. (ii) If the Closing Adjustment is a positive number, New Holdco will pay to the ▇▇▇▇▇▇▇▇▇ ▇▇ Parties in cash an amount equal to the Closing Adjustment at the Closing. Subject to Section 11.01, if the Closing Adjustment is a negative number, the ▇▇▇▇▇▇▇▇▇ ▇▇ Parties will pay to New Holdco in cash an amount equal to the Closing Adjustment at the Closing.

Closing Adjustment. (i) At the Closing, the cash amount of the Purchase Price shall be adjusted in the following manner: (A) either (1) an increase by the amount, if any, by which the Estimated Closing Working Capital (as determined in accordance with Section 2.04(a)(ii)) is greater than the top of the range of the Target Working Capital, or (2) a decrease by the amount, if any, by which the Estimated Closing Working Capital is less than the bottom of the range of the Target Working Capital; (B) a decrease by the estimated Closing Indebtedness (“Estimated Closing Indebtedness”); and Securities Purchase Agreement 18 Project Acorn (C) a decrease by the amount of estimated Closing Transaction Expenses (“Estimated Closing Transaction Expenses”). The net amount after giving effect to the adjustments listed above (and exclusive of the the Akerna Loan which will be deemed repaid in full at Closing pursuant to its terms) shall be the “Closing Date Payment.” (ii) At least three (3) Business Days before the Closing, Seller the Company shall prepare and deliver to Buyer Parent a statement (the “Estimated Closing Statement”) setting forth its good faith estimate estimates of Closing Working Capital each component of the Share Consideration Adjustment Amount Value (the “Estimated Closing Working CapitalShare Consideration Adjustment Amount Value”), Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses, which statement shall contain an estimated unaudited balance sheet of the Company Group as of the Closing Date (without giving effect to the transactions contemplated herein), a calculation of Estimated Closing Working Capital, Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses (the “Estimated Closing Statement”), and a certificate of the Chief Financial Officer Vice President of Seller certifying Finance of the Company that the Estimated Closing Statement was prepared in accordance with US GAAP applied and using the same accounting methods, practices, principles, policies and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were procedures used in to prepare the preparation of the Annual Financial Statements for (as modified by Schedule 2.19(b)) (the most recent fiscal year end as if such “Accounting Policies”). In the event of any conflicts between US GAAP and the Accounting Policies, US GAAP shall control. The parties hereto agree that the purpose of preparing the Estimated Closing Statement was being prepared and audited determining Current Assets and Current Liabilities pursuant to this Section 2.19 is to adjust for inaccuracies in the estimates in the amounts of Closing Working Capital, Current Assets, Current Liabilities, Excess Cash, Company M&A Fund Cash Amount, and Closing Indebtedness as of a fiscal year endthe Closing, and such processes are not intended to permit the introduction of different judgments, accounting methods, policies, principles, practices, procedures, classifications or estimation methodologies for the purpose of preparing the estimates of Closing Working Capital, Current Assets, Current Liabilities, Excess Cash, Company M&A Fund Cash Amount and Closing Indebtedness as adjusted of the Closing. The Company shall cooperate with Parent in supplying any other information Parent may reasonably request in order to verify the amounts reflected on the Estimated Closing Statement. The estimates of Closing Working Capital, Excess Cash, Company M&A Fund Cash Amount and Closing Indebtedness as of the Closing set forth on Schedule B. The the Estimated Closing Statement Statement, with any changes thereto as agreed by Parent and the Company prior to the Closing, will be used for purposes of calculating the Closing Merger Consideration absent manifest error. (ii) The “Estimated Closing Adjustment” shall include a reasonably detailed explanation and supporting detail be that number of shares of Parent Common Stock equal to the calculations thereofEstimated Share Consideration Adjustment Amount Value divided by the Parent Stock Signing Price.

Closing Adjustment. (ia) At Schedule 2.07 sets forth a classification of the Closingasset and Liability line items and general ledger accounts that constitute the Current Assets, the cash Current Liabilities, the Closing Inventory and the Overdue Liabilities and a sample calculation of each such amount as of the Purchase Price shall be adjusted in date set forth on such schedule (the following manner: (A) either (1) an increase by the amount, if any, by which the Estimated “Sample Closing Working Capital (as determined in accordance with Section 2.04(a)(ii)) is greater than the top of the range of the Target Working Capital, or (2) a decrease by the amount, if any, by which the Estimated Closing Working Capital is less than the bottom of the range of the Target Working Capital; (B) a decrease by the estimated Closing Indebtedness (“Estimated Closing Indebtedness”); and Securities Purchase Agreement 18 Project Acorn (C) a decrease by the amount of estimated Closing Transaction Expenses (“Estimated Closing Transaction ExpensesStatement”). The net amount after giving effect to the adjustments listed above (and exclusive of the the Akerna Loan which will be deemed repaid in full at Closing pursuant to its terms) shall be the “Closing Date Payment.” (ii) At least three (3) Business Days before prior to the Closing, Seller Company shall prepare and deliver to Buyer Purchaser a statement setting forth its good good-faith estimate (which shall include an estimate of Closing Working Capital all of its component parts) of the Adjustment Amount (such estimate, the “Estimated Closing Working CapitalAdjustment Amount” and, together with the estimates of its component parts, the “Estimated Amounts”), Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses, which statement shall contain an estimated balance sheet of the Company Group as of the Closing Date (without giving effect to the transactions contemplated herein), a calculation of each of the Estimated Closing Working Capital, Estimated Closing Indebtedness, Amounts and Estimated Closing Transaction Expenses the Payment Waterfall (the “Estimated Closing Statement”), reasonable supporting detail and a certificate of the Chief Financial Officer of Seller certifying Company that the Estimated Closing Statement was prepared in accordance with GAAP applied using the same accounting methodsTransaction Accounting Principles. Company shall provide Purchaser with reasonable access to the books and records of Company, practicesand other Company documents, principles, policies and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were used to verify the information set forth in the preparation Closing Statement before the Closing Date. Not less than one (1) Business Day before the anticipated Closing Date, Purchaser shall notify Company if Purchaser disputes any aspect of the Annual Financial Statements Estimated Amounts or the calculations thereof, and Purchaser and Company shall negotiate in good faith to resolve any such dispute (or any aspect thereof). The amount so agreed shall be the Estimated Amounts for purposes of the Closing. If Purchaser and Company are unable to resolve such dispute, the Estimated Amounts set forth in the Closing Statement shall be the Estimated Amounts for the most recent fiscal year end as if such Estimated purposes of the Closing. (b) No later than thirty (30) days after the Closing Date, Purchaser will cause to be prepared and delivered to Owner a statement setting forth (i) an updated Inventory Statement, which shall reflect any and all adjustments or revisions made by Purchaser to correct errors or omissions in the Inventory Statement delivered by Company at the Closing and (ii) Purchaser’s calculation of the Adjustment Amount, which statement shall contain a calculation of the Adjustment Amount and all of its component parts (clauses (i) and (ii), the “Post-Closing Statement”), reasonable supporting detail and a certificate of Purchaser that the Post-Closing Statement was being prepared in accordance with the Transaction Accounting Principles. Upon receipt of the Post-Closing Statement, Owner (and audited to the extent reasonably requested, its representative) will be given reasonable access, upon reasonable notice, to Purchaser’s relevant books, records, workpapers and personnel related to the Adjustment Amount (subject to customary confidentiality relating to such access) during business hours for the limited purpose of verifying the contents of the Post-Closing Statement. If the Adjustment Amount set forth in the Post-Closing Statement, as finally determined pursuant to this Section 2.07, is less than the Estimated Adjustment Amount, then Owner and Beneficial Owner shall pay to Purchaser an amount equal to their pro rata share of such difference. If the Adjustment Amount set forth in the Post-Closing Statement, as finally determined pursuant to this Section 2.07, exceeds the Estimated Adjustment Amount, then Purchaser shall pay to Owner and Beneficial Owner, an amount equal to their pro rata share such excess. Owner’s and Beneficial Owner’s pro rata shares shall be as set out on the Payment Waterfall. (c) Within thirty (30) days after receipt by Owner of the Post-Closing Statement, Owner shall deliver written notice to Purchaser of any dispute Owner has with respect to the calculation, preparation or content of the Post-Closing Statement (the “Dispute Notice”); provided, that if Owner does not deliver any Dispute Notice to Purchaser within such thirty (30)-day period, the Post-Closing Statement will be final, conclusive and binding on each of the Parties. The Dispute Notice shall set forth in reasonable detail (i) any item on the Post-Closing Statement that Owner disputes and (ii) the correct amount of such item. All undisputed amounts will be final, conclusive and binding on each of the Parties. Upon receipt by Purchaser of a fiscal year endDispute Notice, Purchaser and Owner shall negotiate in good faith to resolve any dispute set forth therein. If Purchaser and Owner resolve any such dispute within fifteen (15) days after delivery of the Dispute Notice (the “Reconciliation Period”), then the Adjustment Amount shall be adjusted by such resolution, and the resolution of each such dispute shall become final, conclusive and binding on each of the Parties. If Owner and Purchaser cannot resolve all disputes during with Reconciliation Period, then Purchaser and Owner jointly shall engage, within ten (10) business days following the expiration of the Reconciliation Period, the Independent Accountant to resolve any remaining dispute. The Independent Accountant shall be directed to render a written resolution of each disputed item as promptly as practicable, and in any event not more than fifteen (15) days following the engagement of the Independent Accountant. Purchaser and Owner shall each furnish to the Independent Accountant such work papers, schedules and other documents and information related to the disputed items as the Independent Accountant may reasonably request. The Independent Accountant shall resolve all remaining undisputed items based solely on the applicable definitions and other terms in this Agreement and the materials furnished by Purchaser and Owner without independent review. All determinations made by the Independent Accountant, and the Post-Closing Statement, as adjusted modified by the Independent Accountant, will be final, conclusive and binding on the Parties. All amounts that are final, conclusive and binding on the Parties pursuant to this Section 2.07 shall be enforceable in a court of law absent manifest error and fraud. The Parties agree that any adjustment as set forth determined pursuant to this Section 2.07(c) shall be treated as an adjustment to the Purchase Price, except as otherwise required by applicable Law. All fees and expenses relating to the work, if any, to be performed by the Independent Accountant shall be borne equally by each Purchaser, on Schedule B. The Estimated Closing Statement shall include a reasonably detailed explanation the one hand, and supporting detail Owner, on the other hand, in relate to the proportion of the calculations thereofvalue of the disputed amounts determined in favor of the other Party. (d) All payments required to be made pursuant to this Section 2.07 shall be made by wire transfer of immediately available funds within five (5) Business Days of the date on which the Adjustment Amount is finally determined.

Closing Adjustment. (i) At the Closing, the cash amount of the Purchase Price shall be adjusted in the following manner: (A) either (1) an increase by the amount, if any, by which the Estimated Closing Working Capital (as determined in accordance with Section 2.04(a)(ii)) is greater than the top of the range of the Target Working Capital, or (2) a decrease by the amount, if any, by which the Estimated Closing Working Capital is less than the bottom of the range of the Target Working Capital; (B) a decrease by the estimated Closing Indebtedness (“Estimated Closing Indebtedness”); and Securities Purchase Agreement 18 Project Acorn (C) a decrease by the amount of estimated Closing Transaction Expenses (“Estimated Closing Transaction Expenses”). The net amount after giving effect to the adjustments listed above (and exclusive of the the Akerna Loan which will be deemed repaid in full at Closing pursuant to its terms) shall be the “Closing Date Payment.” (ii) At least three (3) Business Days before the Closing, Seller shall prepare and deliver to Buyer a statement setting forth its good faith estimate of Closing Working Capital (the “Estimated Closing Working Capital”), Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses, which statement shall contain an estimated consolidated balance sheet of ▇▇▇▇▇▇▇▇ and the Company Group as of the Closing Date (without giving effect to the transactions contemplated herein) and a separate statement of the amount of cash in ▇▇▇▇▇▇▇▇’▇ and the Company’s bank accounts as of the Closing Date and a description of the dollar amount of each such account (the “Actual Closing Cash”), a calculation of Estimated Closing Working Capital, Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses Capital (the “Estimated Closing Working Capital Statement”), and a certificate of the Chief Financial Officer of Seller certifying that the Estimated Closing Working Capital Statement was prepared in accordance with Exhibit C and GAAP applied using the same accounting methods, practices, principles, policies and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were used in the preparation of the Annual Financial Statements for the most recent fiscal year end as if such Estimated Closing Working Capital Statement was being prepared and audited as of a fiscal year end. The Actual Closing Cash shall include cash held in ▇▇▇▇▇▇▇▇’▇ and the Company’s bank accounts of at least $650,000 (“Required Closing Cash”) (and which, as adjusted as set forth on Schedule B. for great certainty and without duplication, shall be included in the Closing Working Capital). If the Actual Closing Cash is less than the Required Closing Cash at Closing then Seller shall pay to Buyer at Closing an amount equal to the difference between the Required Closing Cash and the Actual Closing Cash (the “Closing Cash Deficiency”). (ii) The “Closing Adjustment” shall be an amount equal to the Estimated Closing Statement Working Capital minus $9,850,000 (the “Target Working Capital”). If the Closing Adjustment is a positive number, the Cash Consideration shall include a reasonably detailed explanation and supporting detail be increased by the amount of the calculations thereofClosing Adjustment. If the Closing Adjustment is a negative number, the Cash Consideration shall be reduced by the amount of the Closing Adjustment.

Closing Adjustment. (i) At the Closing, the cash amount of the Purchase Price shall be adjusted in the following manner: (A) either (1) an increase by the amount, if any, by which the Estimated Closing Working Capital (as determined in accordance with Section 2.04(a)(ii)) is greater than the top of the range of the Target Working Capital, or (2) a decrease by the amount, if any, by which the Estimated Closing Working Capital is less than the bottom of the range of the Target Working Capital; (B) a decrease by the estimated Closing Indebtedness (“Estimated Closing Indebtedness”); and Securities Purchase Agreement 18 Project Acorn (C) a decrease by the amount of estimated Closing Transaction Expenses (“Estimated Closing Transaction Expenses”). The net amount after giving effect to the adjustments listed above (and exclusive of the the Akerna Loan which will be deemed repaid in full at Closing pursuant to its terms) shall be the “Closing Date Payment.” (ii) At least three (3) Business Days before the Closing, Seller shall prepare and deliver to Buyer a statement setting forth its good faith estimate of Closing Working Capital (the “Estimated Closing Working Capital”), Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses, which statement shall contain an estimated balance sheet of the Company Group as of the Closing Date (without giving effect to the transactions contemplated herein) and a separate statement of the amount of cash in the Company’s bank accounts as of the Closing Date and a description of the dollar amount of each such account (the “Actual Closing Cash”), a calculation of Estimated Closing Working Capital, Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses Capital (the “Estimated Closing Working Capital Statement”), and a certificate of the Chief Financial Officer of Seller certifying that the Estimated Closing Working Capital Statement was prepared in accordance with Exhibit C and GAAP applied using the same accounting methods, practices, principles, policies and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were used in the preparation of the Annual Financial Statements for the most recent fiscal year end as if such Estimated Closing Working Capital Statement was being prepared and audited as of a fiscal year end. The Actual Closing Cash shall include cash held in the Company’s bank accounts of at least $650,000 (“Required Closing Cash”) (and which, as adjusted as set forth on Schedule B. for great certainty and without duplication, shall be included in the Closing Working Capital). If the Actual Closing Cash is less than the Required Closing Cash at Closing then Seller shall pay to Buyer at Closing an amount equal to the difference between the Company’s Required Closing Cash and the Actual Closing Cash (the “Closing Cash Deficiency”). (ii) The “Closing Adjustment” shall be an amount equal to the Estimated Closing Statement Working Capital minus $9,850,000 (the “Target Working Capital”). If the Closing Adjustment is a positive number, the Cash Consideration shall include a reasonably detailed explanation and supporting detail be increased by the amount of the calculations thereofClosing Adjustment. If the Closing Adjustment is a negative number, the Cash Consideration shall be reduced by the amount of the Closing Adjustment.

Closing Adjustment. (i) At the Closing, the cash amount of the Purchase Price shall be adjusted in the following manner: (A) either (1) an increase by the amount, if any, by which the Estimated Closing Working Capital (as determined in accordance with Section 2.04(a)(ii)) is greater than the top of the range of the Target Working Capital, or (2) a decrease by the amount, if any, by which the Estimated Closing Working Capital is less than the bottom of the range of the Target Working Capital; (B) a decrease by the estimated Closing Indebtedness (“Estimated Closing Indebtedness”); and Securities Purchase Agreement 18 Project Acorn (C) a decrease by the amount of estimated Closing Transaction Expenses (“Estimated Closing Transaction Expenses”). The net amount after giving effect to the adjustments listed above (and exclusive of the the Akerna Loan which will be deemed repaid in full at Closing pursuant to its terms) shall be the “Closing Date Payment.” (ii) At least three (3) Business Days before the Closing, Seller Sellers shall prepare and deliver to Buyer a statement setting forth its their good faith estimate of (A) Closing Working Capital (the “Estimated Closing Working Capital”), Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses, which statement shall contain an estimated balance sheet of the Company Group as of the Closing Date (without giving effect to the transactions contemplated herein, except for the Controller Termination Payment, which shall reduce the Closing Working Capital by the amount of the Controller Termination Payment on a dollar for dollar basis ), a calculation of Estimated Closing Working Capital, Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses Capital (the “Estimated Closing Working Capital Statement”), and a certificate of the Chief Financial Officer of Seller certifying the Company that the Estimated Closing Working Capital Statement was prepared in accordance with GAAP applied using the same accounting methods, practices, principles, policies and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were used in the preparation of the Annual Unaudited Financial Statements for the most recent fiscal year end as if such Estimated Closing Working Capital Statement was being prepared and audited as of a fiscal year end, as adjusted as set forth on Schedule B. The and (B) Closing Plant, Property and Equipment (the “Estimated Closing Statement Plant, Property and Equipment”), which statement shall include a reasonably detailed explanation and supporting detail contain an original cost list of the calculations thereofCompany’s Estimated Plant, Property and Equipment as of the Closing Date prepared using the same valuation methodologies that were used in the preparation of the Unaudited Financial Statements for the most recent fiscal year end and the Interim Financial Statements(the “Estimated Closing Plant, Property and Equipment Statement”).Notwithstanding the foregoing, the Company shall purchase the three new trailers and one yard crane listed on Section 2.04(a) of the Disclosure Schedules (collectively, the “Excluded Equipment”) for the Company’s Andrews, Texas location prior to Closing, the Company shall be responsible for paying the costs of the Excluded Equipment (which shall total approximately $260,000), and the Excluded Equipment shall not be contained on the Estimated Closing Plant, Property and Equipment Statement.

Closing Adjustment. (ia) At Estimated Closing Balance Sheet and Net Equity Statement. Three --------------------------------------------------------- days prior to the ClosingClosing of the Merger, the cash amount of the Purchase Price Company shall be adjusted in the following manner: (A) either (1) an increase by the amount, if any, by which the Estimated Closing Working Capital (as determined in accordance with Section 2.04(a)(ii)) is greater than the top of the range of the Target Working Capital, or (2) a decrease by the amount, if any, by which the Estimated Closing Working Capital is less than the bottom of the range of the Target Working Capital; (B) a decrease by the estimated Closing Indebtedness (“Estimated Closing Indebtedness”); and Securities Purchase Agreement 18 Project Acorn (C) a decrease by the amount of estimated Closing Transaction Expenses (“Estimated Closing Transaction Expenses”). The net amount after giving effect to the adjustments listed above (and exclusive of the the Akerna Loan which will be deemed repaid in full at Closing pursuant to its terms) shall be the “Closing Date Payment.” (ii) At least three (3) Business Days before the Closing, Seller shall prepare and deliver to Buyer a statement setting forth its good faith estimate of Closing Working Capital (the “Estimated Closing Working Capital”), Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses, which statement shall contain Parent an estimated balance sheet of the Company Group dated as of the Closing Date (without giving effect to the transactions contemplated herein"Estimated Closing Balance Sheet"), prepared in accordance with United States generally accepted accounting principles ("GAAP"), consistently applied, and (ii) a calculation statement setting forth the Net Members' Equity (as defined below) of Estimated the Company as of the Closing Working CapitalDate (the "Net Equity Statement"). For purposes of this Section 2.5, Estimated Closing "Net Members' Equity" means as of the date of determination the amount determined by subtracting (a) all indebtedness, obligations and liabilities of the Company, including all Company Indebtedness, all determined in accordance with GAAP, consistently applied; from (b) the total net book value of all assets of the Company, less (i) any amounts attributable to goodwill and Estimated Closing Transaction Expenses intangible items (such as unamortized debt discount and expense, patent, trade and service marks, trade names, copyrights, licenses, organizational expenses, and research and development expenses, except for prepaid expenses), (ii) all appropriate deductions which are either required by or reflected in the “Estimated Closing Statement”Company Financial Statements (as defined in Section 3.8) (including allowances for doubtful accounts and bad debt, returns, depreciation and obsolescence), and (iii) reserves not already deducted from assets. The Estimated Closing Balance Sheet and the Net Equity Statement, when delivered to Parent, shall be accompanied by a certificate of the Chief Financial Executive Officer of Seller certifying the Company, representing and warranting to Parent that the Estimated Closing Balance Sheet and the Net Equity Statement was are each true and complete in all material respects, have been prepared in accordance with GAAP applied using the same accounting methods, practices, principles, policies and procedures, on a basis consistent with consistent classifications, judgments and valuation and estimation methodologies that were used in the for preparation of the Annual Company Financial Statements for Statements, and fairly present the most recent fiscal year end financial position of the Company as if of the Estimated Closing Date (the "Estimated Closing Balance Sheet Certificate"). The representations in such Estimated Closing Statement was being prepared Balance Sheet Certificate and audited as of a fiscal year end, as adjusted as set forth on Schedule B. The the accompanying Estimated Closing Balance Sheet and the Net Equity Statement shall include a reasonably detailed explanation and supporting detail be deemed representations of the calculations thereofCompany for purposes of Article 12.

Closing Adjustment. (a) Not less than five (5) Business Days prior to the anticipated Closing Date, Parent shall provide Purchaser with a written statement setting forth Parent’s good faith estimate of (i) At Working Capital of the ClosingTransferred Companies and their respective Subsidiaries as of the close of business on the Closing Date, (ii) Indebtedness of the cash Transferred Companies as of the close of business on the Closing Date, and (iii) Cash (including the amounts of Operating Cash and Trapped Cash) of the Transferred Companies and their respective Subsidiaries as of the close of business on the Closing Date (the “Statement of Estimated Closing Working Capital and Net Indebtedness”), which shall be accompanied by a notice (the “Closing Notice”) that sets forth (x) Parent’s determination of the Closing Adjustment and the Purchase Price after giving effect to the Closing Adjustment and (y) the account or accounts to which Purchaser shall transfer funds pursuant to Section 2.3. (b) The Closing Notice shall specify an amount (the “Closing Adjustment”) that shall be equal to (w) the amount of Working Capital of the Transferred Companies and their respective Subsidiaries set forth in the Statement of Estimated Closing Working Capital and Net Indebtedness less (x) the Target Working Capital Amount less (y) the amount of Indebtedness of the Transferred Companies set forth in the Statement of Estimated Closing Working Capital and Net Indebtedness plus (z) the amount of (A) Operating Cash, and (B) Excess Cash other than Trapped Cash, of the Transferred Companies and their respective Subsidiaries set forth in the Statement of Estimated Closing Working Capital and Net Indebtedness. If the Closing Adjustment is a positive amount, then the Purchase Price shall be adjusted in equal to (i) the following manner: (A) either (1) an increase Pre-Adjustment Amount increased by the amountabsolute value of the Closing Adjustment, (ii) less, if anythe Acceptance Notice is not delivered by Parent to Purchaser prior to the Closing Date, the amount by which the Purchase Price is decreased pursuant to Section 2.10, and (iii) less the amount (if any) by which the Purchase Price is decreased pursuant to Section 5.21 of the Seller Disclosure Schedule. If the Closing Adjustment is a negative amount, then the Purchase Price shall be equal to (I) the Pre-Adjustment Amount decreased by the absolute value of the Closing Adjustment, (II) less, if the Acceptance Notice is not delivered by Parent to Purchaser prior to the Closing Date, the amount by which the Purchase Price is decreased pursuant to Section 2.10, and (III) less the amount (if any) by which the Purchase Price is decreased pursuant to Section 5.21 of the Seller Disclosure Schedule. (c) The Statement of Estimated Closing Working Capital (as determined in accordance with Section 2.04(a)(ii)) is greater than the top of the range of the Target Working Capital, or (2) a decrease by the amount, if any, by which the Estimated Closing Working Capital is less than the bottom of the range of the Target Working Capital; (B) a decrease by the estimated Closing and Net Indebtedness (“Estimated Closing Indebtedness”); and Securities Purchase Agreement 18 Project Acorn (C) a decrease by the amount of estimated Closing Transaction Expenses (“Estimated Closing Transaction Expenses”). The net amount after giving effect to the adjustments listed above (and exclusive of the the Akerna Loan which will be deemed repaid in full at Closing pursuant to its terms) shall be the “Closing Date Payment.” (ii) At least three (3) Business Days before the Closing, Seller shall prepare and deliver to Buyer a statement setting forth its good faith estimate of Closing Working Capital (the “Estimated Closing Working Capital”), Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses, which statement shall contain an estimated balance sheet of the Company Group as of the Closing Date (without giving effect to the transactions contemplated herein), a calculation of Estimated Closing Working Capital, Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses (the “Estimated Closing Statement”), and a certificate of the Chief Financial Officer of Seller certifying that the Estimated Closing Statement was prepared in accordance with GAAP the Working Capital Principles attached as Schedule III hereto (the “Working Capital Principles”), applied using the same accounting methods, practices, principles, policies and procedures, consistently with consistent classifications, judgments and valuation and estimation methodologies that were used their application in connection with the preparation of the Annual most-recent Audited Financial Statements for the most recent fiscal year end as if such Estimated Closing Statement was being prepared and audited as of a fiscal year end, as adjusted as set forth on Schedule B. The Estimated Closing Statement shall include a reasonably detailed explanation and supporting detail of the calculations thereofStatements.

Closing Adjustment. (i) At the Closing, the cash amount of the Purchase Price shall be adjusted in the following manner: : (A) either (1) an increase by the amount, if any, by which the Estimated Closing Net Working Capital (as determined in accordance with this Section 2.04(a)(ii)2.7) is greater than the top of the range of the Target Net Working Capital, or (2) a decrease by the amount, if any, by which the Estimated Closing Net Working Capital is less than the bottom of Target Net Working Capital (in either case, the range of the Target Working Capital; “Estimated Adjustment Amount”); (B) a decrease by the estimated outstanding Debt of the Sellers and the LicenseCos (not including the Intraparty Obligations) and Mission Maryland as of the close of business on the Closing Indebtedness (“Estimated Closing Indebtedness”)Date; and Securities Purchase Agreement 18 Project Acorn (C) a decrease by the amount of estimated unpaid Transaction Costs as of the close of business on the Closing Transaction Expenses (“Estimated Closing Transaction Expenses”)Date. The net amount after giving effect to the adjustments listed above (and exclusive of the the Akerna Loan which will be deemed repaid in full at Closing pursuant to its terms) shall be the “Closing Date Payment.” (ii) ” At least three one (31) Business Days before Day prior to the ClosingClosing Date, Seller the Sellers and Mission Maryland shall prepare in good faith and deliver to Buyer the Buyers a statement setting forth its good faith estimate of Closing Working Capital report (the “Estimated Closing Working CapitalReport”), Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses, which statement shall contain ) setting forth (1) an estimated consolidated balance sheet of the Company Group Sellers and the LicenseCos and Mission Maryland as of the Closing Date (without giving effect to the consummation of the transactions contemplated hereinhereby), including the Sellers’ and Mission Maryland’s good faith estimate of the Net Working Capital (the “Estimated Net Working Capital”), (2) the Sellers’ and Mission Maryland’s good faith estimate of the Debt of the Sellers and the LicenseCos (not including the Intraparty Obligations) and Mission Maryland, and Transaction Costs and each of the components thereof, and (3) based upon the foregoing, a calculation of Estimated the Closing Working Capital, Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses Date Payment based thereon (the “Estimated Closing StatementDate Payment”), and a certificate including the Sellers’ good faith estimate of the Chief Financial Officer portion of Seller certifying that the Estimated Closing Statement was Date Payment payable to each Seller in accordance with the Allocation Schedule. The preparation of the Closing Report and the calculation of the components thereof shall be prepared in accordance with GAAP applied using the same accounting methods, practices, principles, policies and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were procedures used in calculating the preparation sample calculation of the Annual Financial Statements for the most recent fiscal year end as if such Estimated Closing Statement was being prepared and audited as of a fiscal year end, as adjusted Net Working Capital as set forth on Schedule B. The Estimated 2.7(a), and shall (i) be signed by the Sellers and shall certify that the components of the Closing Statement shall Report and the calculations therein were prepared in good faith based on the books and records of the Sellers and the LicenseCos and Mission Maryland, and (ii) include a reasonably detailed explanation and supporting detail documents for the calculation of the calculations thereofcomponents of the Closing Report.

Closing Adjustment. (a) No later than five (5) Business Days prior to the Closing Date, the Sellers shall deliver to the Purchaser a certificate executed by the President or Chief Executive Officer of each of the Sellers dated as of the date of delivery, certifying as to a good faith estimate of the following (the “Pre-Closing Adjustment Notice”): (i) At the ClosingClosing Net Working Capital, reflecting the cash amount exclusion of the Excluded Assets, Excluded Liabilities, Retained Assets and Retained Liabilities (the “Estimated Closing Net Working Capital”) and the Estimated Closing Net Working Capital Adjustment, (ii) the Closing Indebtedness (the “Estimated Closing Indebtedness”). The Estimated Closing Net Working Capital and Estimated Closing Indebtedness shall be calculated on a consistent basis with the principles set forth in Section 2.7(a) of the Seller Disclosure Schedule (the “Reference Calculation”). The Cash Purchase Price shall to be paid by the Purchaser at the Closing pursuant to Section 2.10(b) will be adjusted in the following manner: as follows: (A) either up for the Estimated Closing Net Working Capital Adjustment Amount (if such amount is positive) or down for the Estimated Closing Net Working Capital Adjustment Amount (if such amount is negative); and (B) down for the absolute value of the Estimated Closing Indebtedness. For the purposes of this Agreement, the “Estimated Closing Net Working Capital Adjustment” means (1) an increase by the amount, if any, by which the Estimated Closing Net Working Capital exceeds the Closing Net Working Capital Target Amount, an amount equal to such excess (as determined in accordance with Section 2.04(a)(iithe “Estimated Closing Net Working Capital Surplus”) provided such Estimated Closing Net Working Capital Surplus shall not exceed $2,000,000 (two million dollars)) is greater than the top of the range of the Target Working Capital, or and (2) a decrease by the amount, if any, by which the Estimated Closing Net Working Capital is less than the bottom of the range of the Target Working Capital; (B) a decrease by the estimated Closing Indebtedness (“Estimated Closing Indebtedness”); and Securities Purchase Agreement 18 Project Acorn (C) a decrease by the amount of estimated Closing Transaction Expenses (“Estimated Closing Transaction Expenses”). The net amount after giving effect to the adjustments listed above (and exclusive of the the Akerna Loan which will be deemed repaid in full at Closing pursuant to its terms) shall be the “Closing Date Payment.” (ii) At least three (3) Business Days before the Closing, Seller shall prepare and deliver to Buyer a statement setting forth its good faith estimate of Closing Net Working Capital (the “Estimated Closing Working Capital”)Target Amount, Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses, which statement shall contain an estimated balance sheet of the Company Group as of the Closing Date (without giving effect amount equal to the transactions contemplated herein), a calculation of Estimated Closing Working Capital, Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses (the “Estimated Closing Statement”), and a certificate of the Chief Financial Officer of Seller certifying that the Estimated Closing Statement was prepared in accordance with GAAP applied using the same accounting methods, practices, principles, policies and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were used in the preparation of the Annual Financial Statements for the most recent fiscal year end as if such Estimated Closing Statement was being prepared and audited as of a fiscal year end, as adjusted as set forth on Schedule B. The Estimated Closing Statement shall include a reasonably detailed explanation and supporting detail of the calculations thereofdeficiency.

Closing Adjustment. (i) At the Closing, the cash amount of the Purchase Price shall be adjusted in the following manner: (A) either (1) an increase by the amount, if any, by which the Estimated Closing Working Capital (as determined in accordance with Section 2.04(a)(ii)) is greater than the top of the range of the Target Working Capital, or (2) a decrease by the amount, if any, by which the Estimated Closing Working Capital is less than the bottom of the range of the Target Working Capital; (B) a decrease by the estimated Closing Indebtedness (“Estimated Closing Indebtedness”); and Securities Purchase Agreement 18 Project Acorn (C) a decrease by the amount of estimated Closing Transaction Expenses (“Estimated Closing Transaction Expenses”). The net amount after giving effect to the adjustments listed above (and exclusive of the the Akerna Loan which will be deemed repaid in full at Closing pursuant to its terms) shall be the “Closing Date Payment.” (ii) At least three five (35) Business Days before the Closing, Seller the Company shall prepare and deliver to the Buyer a statement setting forth its the Company’s good faith estimate estimates of (i) the Closing Net Working Capital (the “Estimated Closing Net Working Capital”), ) and (ii) the Closing Net Indebtedness (the “Estimated Closing Net Indebtedness” and, and together with the Estimated Closing Transaction ExpensesNet Working Capital, the “Estimated Amounts”), which statement shall contain an estimated balance sheet of the Company Group as of the Closing Date (without giving effect to the transactions contemplated herein), a calculation of Estimated Closing Net Working Capital, Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses Capital (the “Estimated Closing Net Working Capital Statement”) and a calculation of Estimated Closing Net Indebtedness (the “Estimated Closing Net Indebtedness Statement”), and a certificate of the Chief Financial Officer of Seller certifying Company that the Estimated Closing Net Working Capital Statement was and the Estimated Closing Net Indebtedness Statement were prepared in accordance with GAAP applied using the same accounting methodsdefinitions thereof. Not less than two (2) Business Days prior to the anticipated Closing Date, practices, principles, policies and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were used the Buyer shall notify the Company in the preparation event that it disputes any aspect of the Annual Financial Statements for the most recent fiscal year end as if such Estimated Closing Statement was being prepared and audited as of a fiscal year end, as adjusted as set forth on Schedule B. The Estimated Closing Statement shall include a reasonably detailed explanation and supporting detail of Amounts or the calculations thereof. Prior to the Closing Date, the Buyer and the Company shall negotiate in good faith to resolve any such dispute (or any aspect thereof). The amount so agreed following such negotiations (or as otherwise so agreed) shall be the Estimated Amounts for purposes of the Closing. If the Buyer and the Company are unable to resolve such dispute, the Estimated Amounts set forth in the Estimated Closing Net Working Capital Statement and the Estimated Closing Net Indebtedness Statement shall be the Estimated Amounts for the purposes of the Closing. (B) The difference between the Estimated Closing Net Working Capital and the Target Net Working Capital shall be referred to as the “Estimated Working Capital Surplus” in the event that the Estimated Closing Net Working Capital is greater than the Target Net Working Capital, and the “Estimated Working Capital Deficit” in the event that the Estimated Closing Net Working Capital is less than the Target Net Working Capital. The “Closing Adjustment” shall be an amount equal to zero plus (i) the Estimated Working Capital Surplus, if any, minus (ii) the Estimated Working Capital Deficit, if any, plus (iii) the Estimated Closing Net Indebtedness (which may be a negative amount, and in which case it would be reduced). If the Closing Adjustment is a negative number, the amount of the Acquisition Consideration shall be reduced by the absolute value of the Closing Adjustment. If the Closing Adjustment is a positive number, the amount of the Acquisition Consideration shall be increased by the absolute value of the Closing Adjustment.

Closing Adjustment. Not later than four (i) At the Closing, the cash amount of the Purchase Price shall be adjusted in the following manner: (A) either (1) an increase by the amount, if any, by which the Estimated Closing Working Capital (as determined in accordance with Section 2.04(a)(ii)) is greater than the top of the range of the Target Working Capital, or (2) a decrease by the amount, if any, by which the Estimated Closing Working Capital is less than the bottom of the range of the Target Working Capital; (B) a decrease by the estimated Closing Indebtedness (“Estimated Closing Indebtedness”); and Securities Purchase Agreement 18 Project Acorn (C) a decrease by the amount of estimated Closing Transaction Expenses (“Estimated Closing Transaction Expenses”). The net amount after giving effect to the adjustments listed above (and exclusive of the the Akerna Loan which will be deemed repaid in full at Closing pursuant to its terms) shall be the “Closing Date Payment.” (ii) At least three (34) Business Days before prior to the ClosingClosing Date, Seller the Company shall prepare and deliver to Buyer the Parent a statement setting forth its good faith estimate of Closing Working Capital (the “Estimated Closing Working CapitalAdjustment Statement”), setting forth the Estimated Closing IndebtednessAdjustment, and Estimated Closing Transaction Expenses, which statement shall contain including an estimated consolidated balance sheet of the Company Group and its Subsidiaries as of the Closing Date (without giving effect immediately prior to the transactions contemplated herein)Effective Time, a calculation of together with relevant backup materials, in detail reasonably acceptable to Parent. The Estimated Closing Working Capital, Estimated Closing Indebtedness, Adjustment Statement and Estimated Closing Transaction Expenses (the “Estimated Closing Statement”), and a certificate of the Chief Financial Officer of Seller certifying that the Estimated Closing Statement was such consolidated balance sheet shall be prepared in accordance with GAAP applied using on a basis consistent with the same accounting methods, practices, principles, policies and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were used in the preparation of the Annual Financial Statements for application thereof to the most recent fiscal year end as if such audited financial statements included in the Company Financial Statements (to the extent consistent with GAAP). From the delivery of the Estimated Closing Adjustment Statement was being prepared and audited until such time as the calculation of a fiscal year end, as adjusted as set forth on Schedule B. The the Estimated Closing Adjustment has been finally determined pursuant to this Section 2.6, Parent and its accountants shall, upon reasonable notice and during normal business hours, be permitted to discuss with the Company and its accountants the Estimated Closing Adjustment Statement and shall include a reasonably detailed explanation be provided complete and accurate copies of, and have reasonable access, upon reasonable notice at reasonable times during normal business hours, to the work papers and supporting detail records of the calculations thereofCompany and its accountants so as to allow Parent and its accountants to verify the accuracy of the Estimated Closing Adjustment Statement. If Parent objects to the Estimated Closing Adjustment Statement, the Company and Parent will work together in good faith to resolve the issues in dispute. If all disputed issues are resolved, the amounts as agreed upon by Parent and the Company shall be used to determine the Estimated Closing Adjustment. If Parent and the Company are unable to resolve all such disputed issues within four (4) Business Days following ▇▇▇▇▇▇’s receipt of the Estimated Closing Adjustment Statement, the Estimated Closing Adjustment shall be as determined by the Company. For clarity, in the event of any inaccuracy or error with respect to the Estimated Closing Adjustment, Parent shall be entitled to make a claim for indemnification pursuant to, and in accordance with, Article VII, including Section 7.1(d). Notwithstanding anything to the contrary in this Agreement, to the extent any Closing Indebtedness is (or at the Closing will be) taken into account in the calculation of the Aggregate Consideration, any such Closing Indebtedness shall be disregarded and not taken into account in determining whether the Company has complied with its obligations under this Agreement or the accuracy of the representations and warranties made by the Company under this Agreement, and neither the Company nor any Company Equityholder shall have any liability or obligation relating to this Agreement with respect to any such Closing Indebtedness.

Closing Adjustment. (i) At the Closing, the cash amount of the Purchase Price shall be adjusted in the following manner: (A) either (1) an increase by the amount, if any, by which the Estimated Closing Working Capital (as determined in accordance with Section 2.04(a)(ii)) is greater than the top of the range of the Target Working Capital, or (2) a decrease by the amount, if any, by which the Estimated Closing Working Capital is less than the bottom of the range of the Target Working Capital; (B) a decrease by the estimated Closing Indebtedness (“Estimated Closing Indebtedness”); and Securities Purchase Agreement 18 Project Acorn (C) a decrease by the amount of estimated Closing Transaction Expenses (“Estimated Closing Transaction Expenses”). The net amount after giving effect to the adjustments listed above (and exclusive of the the Akerna Loan which will be deemed repaid in full at Closing pursuant to its terms) shall be the “Closing Date Payment.” (ii) At least three ten (310) Business Days before prior to the ClosingClosing Date, Seller Company shall prepare and deliver to Buyer Acquiror a statement setting forth in reasonable detail its good faith estimate calculation of Closing the estimated Net Working Capital (the “Estimated Closing Working Capital”), Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses, which statement shall contain an estimated balance sheet of the Company Group as of the Closing Date (without giving effect to the transactions contemplated herein), a calculation of Estimated Closing Working Capital, Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses (the “Estimated Closing Statement”), . The Chief Executive Officer and a certificate of the Chief Financial Officer of Seller certifying Company shall certify on behalf of Company, and not in any personal capacity, that the Estimated Closing Statement was accurately reflects the calculation of the estimated Net Working Capital, and Company shall deliver the Estimated Closing Statement together with such certification to Acquiror. Company shall, upon request from Acquiror, provide Acquiror with reasonable access to all relevant backup materials, schedules and other records of Company and its Subsidiaries, in detail reasonably acceptable to Acquiror, concurrently with the delivery of such estimates until the Closing. The Estimated Closing Statement, together with the calculations of the estimated Net Working Capital, shall have been prepared in accordance with GAAP GAAP, applied using the same accounting methods, practices, principles, policies and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were used in the preparation of the Annual 2022 Audited Financial Statements for the most recent fiscal year end as if such Estimated Closing Statement was being prepared and audited as of a fiscal year end, as adjusted as set forth on Schedule B. The year-end (except that such Estimated Closing Statement will not contain footnotes). At Closing, (i) if the Net Working Capital Target exceeds the Net Working Capital, an amount of cash equal to the Net Working Capital Deficiency (the “Estimated NWC Deficiency Cash”) shall include a reasonably detailed explanation be deducted in calculating the Aggregate Cash Consideration to be received by the Members at the Closing in accordance with each such Members’ Pro Rata Share; provided, that, if the Aggregate Cash Payments is zero, the Members shall promptly, and supporting detail in any event within three (3) Business Days after receiving notice from the Acquiror that the Aggregate Cash Payments is zero, deliver an amount in cash equal to their Pro Rata Shares of Estimated NWC Deficiency Cash to Acquiror; and (ii) if the Net Working Capital exceeds the Net Working Capital Target, the Members shall receive an amount of cash equal to the Net Working Capital Excess (the “Estimated NWC Excess Cash”) to be distributed prior to the Closing Date in accordance with each such Members Pro Rata Share; provided, that, if the combined cash balance of Acquiror and the Company, after taking into account all payments, fees and expenses contemplated herein is less than $10,000,000, then payment of the calculations thereofEstimated NWC Excess Cash shall be deferred and paid by the Company as soon as practicable thereafter, but in any event, within one hundred and eighty (180) calendar days of the Closing (the adjustments set forth in this Section 2.5(a), the “Net Working Capital Adjustment”).

Closing Adjustment. (i) At the For purposes of Closing, the cash amount of the Purchase Price shall be adjusted in the following manner: (A) either (1) an increase by the amount, if any, by which the Estimated Closing Working Capital (as determined in accordance with Section 2.04(a)(ii)) is greater than the top of the range of the Target Working Capital, or (2) a decrease by the amount, if any, by which the Estimated Closing Working Capital is less than the bottom of the range of the Target Working Capital; (B) a decrease by the estimated Closing Indebtedness (“Estimated Closing Indebtedness”); and Securities Purchase Agreement 18 Project Acorn (C) a decrease by the amount of estimated Closing Transaction Expenses (“Estimated Closing Transaction Expenses”). The net amount after giving effect to the adjustments listed above (and exclusive of the the Akerna Loan which will be deemed repaid in full at Closing pursuant to its terms) shall be the “Closing Date Payment.” (ii) At least three (3) Business Days before the Closing, Seller Company shall prepare and deliver to Buyer Parent at least five Business Days prior to the Closing Date, together with reasonable supporting documentation and any additional information reasonably requested by Parent (A) a statement setting forth its the Company’s good faith estimate of Closing Working Capital (the “Estimated Closing Working Capital”)Cash, Estimated Transaction Expenses, Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses, which statement shall contain an estimated balance sheet of the Company Group as of the Closing Date Working Capital (without giving effect to the transactions contemplated hereincalculated in accordance with Exhibit I), a calculation of Estimated Closing Working Capitalin each case, Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses consistent with the terms set forth in this Agreement (the “Estimated Closing Statement”), and (B) a statement (the “Funds Flow”) that sets forth (i) the wire transfer or other payment instructions with respect to the payments to be made to the Company, Paying Agent, and the applicable recipients of Transaction Expenses and Closing Indebtedness, (ii) the number, series and class of Company Shares held by each Stockholder immediately prior to the Effective Time, (iii) the amount of Closing Merger Consideration payable to each such Stockholder at the Closing, (iv) for each Stockholder, such Stockholder’s Participation Percentage (assuming for such purposes all Stockholders are Participating Stockholders) and Per Share Portion, (v) for each Optionholder, (A) each Optionholder’s Participation Percentage and Per Share Portion, (B) the number of Company Shares underlying each Vested In-the-Money Option held by such Optionholder as of immediately prior to the Effective Time, (C) the exercise price per Company Share purchasable under each such Vested Option, and (D) the aggregate Option Closing Amount payable to such Optionholder, (vi) the amounts payable, with appropriate wire instructions, for each recipient of Transaction Expenses, and (vii) the amounts payable, with appropriate wire instructions for each holder of Closing Indebtedness to be repaid at Closing. The Company shall consider in good faith Parent’s comments to the Estimated Closing Statement and Funds Flow and make such modifications thereto (and to the Funds Flow resulting therefrom) as the Company determines in good faith are necessary to achieve conformity with the requirements of this Agreement. Each of the Parties hereby acknowledges and agrees that (i) the preparation and accuracy of the Funds Flow and the allocation and calculations set forth therein are the responsibility of the Company, the Securityholders’ Representative and/or the Stockholders of the Company involved in preparation thereof, and (ii) Parent and Merger Sub and their respective Affiliates and Representatives shall be entitled to rely thereon without independent verification, and to make payments in accordance therewith, without any obligation to investigate or verify the accuracy or correctness thereof or the calculations set forth therein. The Estimated Closing Statement shall be prepared and delivered in good faith, based on the books and records of the Company and its Subsidiaries and in accordance with this Agreement, GAAP and applicable Laws, and shall be accompanied by a statement and a certificate of the Chief Financial Officer of Seller certifying Securityholders’ Representative that the Estimated Closing Statement was prepared in accordance with GAAP applied using the same accounting methods, practices, principles, policies applicable provisions of Section 2.9 and procedures, with consistent classifications, judgments the definitions and valuation and estimation methodologies that were used in exhibits referred to herein. The amount included on the preparation of the Annual Financial Statements for the most recent fiscal year end as if such Estimated Closing Statement was being prepared and audited as with respect to clause (b) of a fiscal year endthe definition of Indebtedness with respect to Excluded Earnouts shall be $0 (which for the avoidance of doubt, as may be adjusted as set forth on Schedule B. in the Post-Closing Adjustment to reflect the actual amount of Indebtedness due at or in connection with Closing with respect thereto). ▇▇▇▇-▇▇▇▇-▇▇▇▇.4 (ii) The “Closing Adjustment” shall be an amount equal to the Estimated Closing Statement Working Capital minus Target Working Capital. If the Closing Adjustment is a positive number, the Merger Consideration payable to the Securityholders at Closing shall include a reasonably detailed explanation and supporting detail be increased by the absolute value of the calculations thereofClosing Adjustment. If the Closing Adjustment is a negative number, the Merger Consideration payable the Securityholders at Closing shall be reduced by the absolute value of the Closing Adjustment.

Closing Adjustment. (i) At the Closing, the cash amount of the Purchase Price shall be adjusted in the following manner: (A) either (1) an increase by the amount, if any, by which the Estimated Closing Working Capital (as determined in accordance with Section 2.04(a)(ii)) is greater No later than the top of the range of the Target Working Capital, or (2) a decrease by the amount, if any, by which the Estimated Closing Working Capital is less than the bottom of the range of the Target Working Capital; (B) a decrease by the estimated Closing Indebtedness (“Estimated Closing Indebtedness”); and Securities Purchase Agreement 18 Project Acorn (C) a decrease by the amount of estimated Closing Transaction Expenses (“Estimated Closing Transaction Expenses”). The net amount after giving effect to the adjustments listed above (and exclusive of the the Akerna Loan which will be deemed repaid in full at Closing pursuant to its terms) shall be the “Closing Date Payment.” (ii) At least three (3) Business Days before the ClosingClosing Date, Seller shall will prepare and deliver to Buyer a statement setting forth its good faith estimate of Closing Working Capital (the “Estimated Closing Working Capital”), Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses, which statement shall contain A) an estimated unaudited consolidated balance sheet of the Company Group at and as of 12:01 A.M. Central time on the Closing Date (without giving effect to the transactions contemplated herein), a calculation of "Estimated Closing Balance Sheet") and (B) a statement setting forth Seller's good faith estimate of each of (i) the amount of the Closing Cash, (ii) any Closing Working CapitalCapital Surplus, Estimated (iii) any Closing IndebtednessWorking Capital Deficiency, (iv) the Transaction Expenses, (v) the amount of Closing Indebtedness and Estimated (vi) the Closing Transaction Expenses Adjustment Amount resulting therefrom (such statement, the “"Estimated Closing Statement”"), and a certificate . Upon delivery of the Chief Financial Officer Estimated Closing Statement, Buyer and its Representatives, including Buyer's independent accountants, will be entitled to review, during normal business hours and upon reasonable advance notice, the books and records of Seller certifying that the Acquired Companies relevant to the preparation of the Estimated Closing Balance Sheet and the Estimated Closing Statement was prepared as Buyer may reasonably request, and to discuss such books and records with senior management of the Acquired Companies for the purpose of reviewing the Estimated Closing Balance Sheet or Estimated Closing Statement, and Seller shall consider in accordance good faith any comments from Buyer with GAAP applied using respect to the same accounting methodsamounts and calculations contained therein. To the extent that, practicesprior to Closing, principles, policies Buyer and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were used Seller agree in writing on any changes to the amounts set forth in the preparation of Estimated Closing Balance Sheet or the Annual Financial Statements Estimated Closing Statement, the Estimated Closing Balance Sheet or the Estimated Closing Statement, as applicable, shall be revised to reflect such agreed-upon amounts; for the most recent fiscal year end as avoidance of doubt (but without limiting Section 1.2(c)), if such Buyer and Seller are unable to resolve any differences with respect to the amounts set forth in the Estimated Closing Balance Sheet or the Estimated Closing Statement was being prepared and audited prior to the Closing, then with respect to any amounts which remain in dispute, the amounts of Closing Cash, Closing Working Capital Surplus, Closing Working Capital Deficiency, Transaction Expenses, Closing Indebtedness or the Closing Adjustment Amount as of a fiscal year end, as adjusted as set forth on Schedule B. The reflected in the Seller's initial Estimated Closing Statement shall include a reasonably detailed explanation be used for purposes of calculating the Estimated Purchase Price on the Closing Date. From and supporting detail after 12:01 A.M. Central time on the Closing Date through the Closing, no Acquired Company shall pay or otherwise remit or distribute any Cash to any Person (other than payments to unaffiliated third-party trade creditors in the ordinary course of business in respect of liabilities included in Closing Working Capital taken into account in calculating the calculations thereofClosing Working Capital Surplus or Closing Working Capital Deficiency, as applicable).

Closing Adjustment. (ia) At Not less than five Business Days prior to the Closinganticipated Closing Date, the cash amount Parent shall provide Purchaser Parent with an estimated statement of the Purchase Price shall be adjusted in the following manner: (A) either (1) an increase by the amount, if any, by which the Estimated Closing Working Capital (as determined in accordance with Section 2.04(a)(ii)) is greater than the top of the range of the Target Working Capital, or (2) a decrease by the amountClosing Cash, if any, by which the Estimated Closing Working Capital is less than the bottom of the range of the Target Working Capital; (B) a decrease by the estimated Closing Indebtedness (“Estimated Closing Indebtedness”); and Securities Purchase Agreement 18 Project Acorn (C) a decrease by the amount of estimated Closing Transaction Expenses (“Estimated Closing Transaction Expenses”). The net amount after giving effect to the adjustments listed above (and exclusive of the the Akerna Loan which will be deemed repaid in full at Closing pursuant to its terms) shall be the “Closing Date Payment.” (ii) At least three (3) Business Days before the Closing, Seller shall prepare and deliver to Buyer a statement setting forth its good faith estimate of Closing Working Capital (the “Estimated Closing Working Capital”), Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses, which statement shall contain an estimated balance sheet of including reasonable detail supporting the Company Group as of the Closing Date (without giving effect to the transactions contemplated herein), a calculation of Estimated Closing Working Capital, Estimated Closing Indebtedness, and Estimated Closing Transaction Expenses thereof (the “Estimated Closing Statement”), and which shall be accompanied by a certificate notice (the “Closing Notice”) signed by an authorized signatory of Parent that sets forth (i) Parent’s good faith determination of the Chief Financial Officer Closing Adjustment and the Purchase Price after giving effect to the Closing Adjustment and (ii) the account or accounts to which Purchaser Parent shall cause the Purchasing Entities or one or more of Seller certifying that Purchaser Parent’s designees to transfer the Estimated Closing Statement was prepared in accordance with GAAP applied using the same accounting methods, practices, principles, policies and procedures, with consistent classifications, judgments and valuation and estimation methodologies that were used in the preparation of the Annual Financial Statements for the most recent fiscal year end as if such Estimated Closing Statement was being prepared and audited as of a fiscal year end, as adjusted as set forth on Schedule B. Purchase Price pursuant to Section 2.03. (b) The Estimated Closing Statement shall include a specify an amount (which may be positive or negative) (the “Closing Adjustment”) that shall be equal to (i) the estimated amount of Working Capital, less (ii) the Target Working Capital Amount, plus (iii) the estimated amount of Closing Cash, less (iv) the estimated amount of Closing Indebtedness, less (v) the estimated amount of Closing Transaction Expenses. Parent shall use its commercially reasonable efforts to make its representatives reasonably detailed explanation available to Purchaser Parent and supporting detail its representatives prior to the Closing following delivery of the calculations thereofClosing Notice to discuss its calculation of the Closing Adjustment and shall consider Purchaser Parent’s reasonable comments in good faith. (c) The Estimated Closing Statement shall be prepared in accordance with the accounting principles, classifications, practices, policies, bases, categorizations, management judgments and estimation methodologies set forth on Schedule II hereto (the “Accounting Principles”) and the terms of this Agreement. For illustrative purposes, Annex I to Schedule II sets forth a calculation of the Working Capital as if the Closing had occurred on January 31, 2019 (the “Illustrative Working Capital Statement”). (d) Notwithstanding anything to the contrary in this Agreement, in no event will the acceptance or the use of the Estimated Closing Statement for the purposes of the Closing be deemed to constitute the agreement of Purchaser Parent to any of the estimates or amounts set forth therein, and in no way will the delivery of the Estimated Closing Statement or the consummation of the Closing be construed as a waiver by Purchaser Parent of its rights under Section 2.05.