Common use of Completion Accounts Clause in Contracts

Completion Accounts. The Completion Accounts shall be prepared in accordance with accounting principles and financial reporting standards stipulated under PRC laws and regulations, and shall be prepared on the same basis as the 2003 Audited Financial Statements, except as described in this Schedule. The Completion Accounts will comprise a consolidated balance sheet as at the Completion Accounts Date, and a consolidated profit and loss account for the period from the 2003 Audited Financial Statements Date until the Completion Accounts Date. All connected inter-company transactions and unrealized profits shall be eliminated from the consolidated financial statements. The Completion Accounts will be prepared on the accruals basis and going concern basis. A full inventory of all fixed assets will be made as part of the Completion Accounts process. Items shown in the ledgers which do not physically exist will be fully written off. If the Company can evidence its ownership of items which exist but which are not recorded on the ledgers then those items should be recognised at their depreciated net book value, taking into account the actual date of purchase and subject to review and verification of legal titles therefor. Fixed assets should be shown at their cost or valuation less depreciation. An assessment will be made of whether the valuation of any individual asset is impaired as at the Completion Accounts Date. If there is an indication that the value of an asset has been impaired, then it should be written down to its recoverable amount, being the higher of its value in use and its net selling price. Any encumbrance over any of the fixed assets will be fully disclosed. The cost of construction in progress incurred as at the Completion Accounts Date will be fully accrued. All projects which have been completed (as evidenced by the assets being put into use) shall be classified as "fixed assets" and depreciated from the date they were put into use. All commitments outstanding under contracts in progress will be fully disclosed. Any encumbrance over amounts recorded as "construction in progress" will be fully disclosed. Ownership of all intangible assets will be evidenced by documentation. Land Use Rights will be stated at their cost less amortisation (the amortisation period being the duration of the land use right). The value of other intangible assets will be tested for impairment using the same method as for fixed assets. Cash will be evidenced by bank statements, which will be confirmed with banks at the Completion Accounts Date, and reconciled to the cash balance in the general ledger. Any restrictions over cash will be fully disclosed. **** indicates where a confidential portion has been omitted and filed separately with the Commission Notes receivable will be evidenced by relevant documentation, and should be stated gross at the face value of the note less any provision for doubtful debt. Full disclosure will be made of encumbrances over notes receivable. Accounts receivable will be evidenced by confirmations from debtors. Provision will be made for doubtful debts on the following basis: amounts due for less than 3 months 0%, amounts due for 3-12 months 5%, 1 - 2 years 30%, 2 - 3 years 75%, above 3 years 100% (above 3 years 90% for connected inter-company accounts receivable). Specific provisions will also be made for debts that are known to be in dispute or uncollectible). Ageing will be calculated by reference to the date the goods were dispatched to the customer. Any encumbrances over accounts receivable will be fully disclosed. The internal bank deposit will be evidenced by irrevocable confirmation from the counter-party. Any restrictions on its use will be fully disclosed. Other receivables, prepayments and other current assets will be evidenced by documentation, be recorded on the accruals basis, and be stated at cost less any provision required. Inventory will undergo a full physical inspection as at the Completion Accounts Date at all locations where inventory of the Company is held. The inventory shown on the books will be adjusted to the amount of inventory that physically exists and any difference will be written off. Inventory will be valued at the lower of cost and market value, which will include an assessment of whether individual items are damaged, obsolete, or if their selling prices have declined. All encumbrances over inventory will be fully disclosed. Third-party loans should be stated at the amount of the loan and be evidenced by loan contracts. All security given for such loans, including security given by third parties, should be fully disclosed. All interest on loans should be fully accrued. Notes payable will be evidenced by relevant documentation, and should be stated gross at the face value of the note. Accounts payable should be fully accrued as at the Completion Accounts Date, including for all goods received but not invoiced. All dealer rebates and sales incentives will be fully accrued as at the Completion Accounts Date, including a pro-rata estimate of amounts payable under annual schemes. Dividend payable will be stated at the amount of dividend declared as at the Completion Accounts Date, as evidenced by Board minutes. Taxes payable will be fully accrued as at the Completion Accounts Date. All disputes with, demands or payment requests from the Taxing Authority not accrued shall be disclosed in full. **** indicates where a confidential portion has been omitted and filed separately with the Commission Advances from customers should be evidenced by documentation and reconciled with customer accounts. Salary and welfare payable should be fully accrued for all elements of remuneration, e.g. annual bonuses, sales incentives, overtime, etc. All other present obligations should be fully accrued as accruals. All future commitments should be fully disclosed. Warranty provision will be accrued at 2% of net sales, net of suppliers' reimbursements that are certain to be received. **** indicates where a confidential portion has been omitted and filed separately with the Commission

Completion Accounts. 6.1 Immediately after Completion the Purchaser's Accountants (or their representatives) and the Auditors (or their representatives) shall, if the Purchaser elects, participate in a physical stocktake conducted by the Company at the Properties. 6.2 The Purchaser and the Vendors shall use all reasonable endeavours to procure that draft accounts for the Company in respect of the period from the Accounting Date to the Completion Accounts Date shall be prepared in accordance with accounting principles by the Company as soon as reasonably practicable after such stocktake and financial reporting standards stipulated under PRC laws and regulations, and such accounts: 6.2.1 shall be prepared on the same basis accounting bases and in accordance with the same accounting and valuation principles and practices as the 2003 Audited Financial StatementsAccounts, except as described that the Company's accounting policy for revenue recognition shall be that revenue will be recognised by the Company when the relevant equipment and software are delivered to the customer and the relevant services are rendered to the customer and not when the customer is invoiced for such equipment and services; and 6.2.2 shall in this Schedule. The Completion Accounts will comprise a consolidated balance sheet as at all respects comply with current legislation and standard accounting principles and practice. 6.3 Following the preparation of such draft accounts, the Company shall submit them to the Auditors who shall conduct an audit applying the same bases and principles referred to in Clause 6.2 and produce the Completion Accounts Date, and a consolidated profit and loss account for draft statement as to the period from amount of the 2003 Audited Financial Statements Date until Net Assets (the "NET ASSET STATEMENT") confirming that in their opinion the Completion Accounts Date. All connected inter-company transactions and unrealized profits shall be eliminated from have been prepared in accordance with the consolidated financial statementsprovisions of this Clause 6. The Auditors shall agree in advance with the Purchaser's Accountants what audit procedures should be employed in conducting the audit and shall carry out the audit on that basis. 6.4 The Auditors shall, as soon as reasonably practicable, submit the draft Completion Accounts will be prepared on and draft Net Asset Statement to the accruals basis Purchaser's Accountants for their review to determine if there are any material adjustments required to the draft Completion Accounts and going concern basisthe draft Net Asset Statement. A full inventory of all fixed assets will be The Vendors shall procure that the Auditors' working papers and the Company's books and accounts are made as part available to the Purchaser's Accountants, if required by them in carrying out their review. 6.5 If the Purchaser's Accountants and the Auditors are able to agree the form and content of the Completion Accounts process. Items shown and the Net Asset Statement within 30 days of the date on which the drafts were submitted to the Purchaser's Accountants (or within such other period as the Vendors and the Purchaser may agree in writing), the ledgers which do not physically exist will accounts as so agreed shall be fully written off. If the Company can evidence its ownership of items which exist but which are not recorded on the ledgers then those items should be recognised at their depreciated net book value, taking into account the actual date of purchase and subject to review and verification of legal titles therefor. Fixed assets should be shown at their cost or valuation less depreciation. An assessment will be made of whether the valuation of any individual asset is impaired as at the Completion Accounts Dateand the Auditors shall issue a Net Asset Statement which shall be final and binding on the Parties but such statement shall be without prejudice to the Purchaser's right to claim under the Warranties, the Deed of Indemnity or otherwise in respect of any matter. In carrying out their functions under this Agreement, the Auditors and the Purchaser's Accountants shall be deemed to be acting as experts and not as arbitrators. 6.6 If there is the Purchaser's Accountants and the Auditors shall not be able to agree the form and content of the Completion Accounts and the Net Asset Statement within 30 days of the date on which the draft accounts were first submitted to the Purchaser's Accountants (or within such other period as the Vendors and the Purchaser may agree in writing) the matter may be referred by the Vendors or the Purchaser to an indication that independent firm of chartered accountants selected by agreement between the value Vendors and the Purchaser or, failing agreement, nominated by the President for the time being of an asset has been impaired, then it should be written down to its recoverable amount, being the higher Hong Kong Society of its value in use and its net selling price. Any encumbrance over Accountants on the application of any of the fixed assets will Vendors or the Purchaser and: 6.6.1 such independent firm of chartered accountants shall be fully disclosed. The cost requested to settle any matter in dispute, applying the same bases and principles as are referred to in Clause 6.2 and (unless both the Vendors and the Purchaser shall otherwise direct in writing) determine the form and content of construction in progress incurred as at the Completion Accounts Date will be fully accrued. All projects which have been completed and the Net Asset Statement; and 6.6.2 the decision of such firm of chartered accountants as to the matter in dispute and their determination (if any) as evidenced by to the assets being put into use) shall be classified as "fixed assets" form and depreciated from the date they were put into use. All commitments outstanding under contracts in progress will be fully disclosed. Any encumbrance over amounts recorded as "construction in progress" will be fully disclosed. Ownership content of all intangible assets will be evidenced by documentation. Land Use Rights will be stated at their cost less amortisation (the amortisation period being the duration of the land use right). The value of other intangible assets will be tested for impairment using the same method as for fixed assets. Cash will be evidenced by bank statements, which will be confirmed with banks at the Completion Accounts Dateand the Net Asset Statement shall, and reconciled to the cash balance in the general ledger. Any restrictions over cash will absence of manifest error, be fully disclosed. **** indicates where a confidential portion has been omitted final and filed separately with binding on the Commission Notes receivable will Parties and such chartered accountants shall be evidenced by relevant documentation, deemed to act as experts and should be stated gross at the face value not as arbitrators. 6.7 The costs of the note less any provision for doubtful debt. Full disclosure will be made Auditors in respect of encumbrances over notes receivable. Accounts receivable will be evidenced by confirmations from debtors. Provision will be made for doubtful debts on the following basis: amounts due for less than 3 months 0%, amounts due for 3-12 months 5%, 1 - 2 years 30%, 2 - 3 years 75%, above 3 years 100% (above 3 years 90% for connected inter-company accounts receivable). Specific provisions will also be made for debts that are known to be in dispute or uncollectible). Ageing will be calculated by reference to the date the goods were dispatched to the customer. Any encumbrances over accounts receivable will be fully disclosed. The internal bank deposit will be evidenced by irrevocable confirmation from the counter-party. Any restrictions on its use will be fully disclosed. Other receivables, prepayments preparation and other current assets will be evidenced by documentation, be recorded on the accruals basis, and be stated at cost less any provision required. Inventory will undergo a full physical inspection as at determination of the Completion Accounts Date at all locations where inventory shall be borne by the Vendors and the costs of the Company is heldPurchaser's Accountants shall be borne by the Purchaser. The inventory shown on the books will be adjusted to the amount of inventory that physically exists and any difference will be written off. Inventory will be valued at the lower of cost and market value, which will include an assessment of whether individual items are damaged, obsolete, or if their selling prices have declined. All encumbrances over inventory will be fully disclosed. Third-party loans should be stated at the amount costs of the loan and be evidenced by loan contracts. All security given for such loansindependent chartered accountant, including security given by third partiesif any, should be fully disclosed. All interest on loans should be fully accrued. Notes payable will be evidenced by relevant documentation, and should be stated gross at the face value of the note. Accounts payable should be fully accrued as at the Completion Accounts Date, including for all goods received but not invoiced. All dealer rebates and sales incentives will be fully accrued as at the Completion Accounts Date, including a pro-rata estimate of amounts payable under annual schemes. Dividend payable will be stated at the amount of dividend declared as at the Completion Accounts Date, as evidenced by Board minutes. Taxes payable will be fully accrued as at the Completion Accounts Date. All disputes with, demands or payment requests from the Taxing Authority not accrued shall be disclosed in full. **** indicates where a confidential portion has been omitted borne by the Vendors and filed separately with the Commission Advances from customers should be evidenced by documentation and reconciled with customer accounts. Salary and welfare payable should be fully accrued for all elements of remuneration, e.g. annual bonuses, sales incentives, overtime, etc. All other present obligations should be fully accrued as accruals. All future commitments should be fully disclosed. Warranty provision will be accrued at 2% of net sales, net of suppliers' reimbursements that are certain to be received. **** indicates where a confidential portion has been omitted and filed separately with the CommissionPurchaser equally.

Completion Accounts. The Completion Accounts (a) MPT shall be prepared in accordance with accounting principles and financial reporting standards stipulated under PRC laws and regulations, and shall be prepared on the same basis as the 2003 Audited Financial Statements, except as described in this Schedule. The Completion Accounts will comprise ensure that a consolidated balance sheet as at the Completion Accounts Date, and a consolidated profit and loss account for the period from the 2003 Audited Financial Statements Date until the Completion Accounts Date. All connected inter-company transactions and unrealized profits shall be eliminated from the consolidated financial statements. The Completion Accounts will be prepared on the accruals basis and going concern basis. A full inventory of all fixed assets will be made as part draft of the Completion Accounts process. Items shown is prepared by MPT as soon as possible after Completion, in English as if a fiscal year had ended on the relevant Completion Date in the ledgers following manner (the “Draft Completion Accounts”): (i) in accordance with the applicable provisions of Luxembourg law, especially the generally accepted accounting principles in Luxembourg (Law of 19th December, 2002 on the register of commerce and companies and the accounting and annual accounts); and (ii) maintaining formal and material accounting consistency, in particular applying the valuation principles, uses of estimates as well as options to capitalise or to include items consistently with past practices. (b) Furthermore, MPT shall prepare the calculation of the Net Asset Value (the “Net Asset Value Statement”) as soon as reasonably practicable after Completion in accordance with the specific policies and adjustments set out in Part A of Schedule 4 and with the method set out in Part B of Schedule 4. In any event, the Draft Completion Accounts and the calculation of the Net Asset Value shall be provided to the Auditor on or before the date falling 60 Business Days after Completion. The Auditor shall audit the Draft Completion Accounts by applying the principles set forth in ISA 800 for compliance with the provisions of this Agreement and issue an unqualified auditor certificate (Prüfungsvermerk). Furthermore, the Auditor shall review the draft calculation of the Net Asset Value and issue an unqualified auditor certificate (Prüfungsvermerk). The Parties shall ask the Auditor to issue such certificates as soon as practicable and, to the extent possible, within thirty (30) Business Days after being provided with the Draft Completion Accounts. (c) The audited Draft Completion Accounts and the reviewed calculation of the Net Asset Value shall be delivered to PRIMOTOP on or before the date falling 5 Business Days after the date on which do the Auditor has issued the unqualified auditor certificates (Prüfungsvermerks) referred to in Clause 7.1(b). (d) MPT and PRIMOTOP shall co-operate with each other with regard to the preparation, review, agreement or determination of the audited Draft Completion Accounts and reviewed calculation of the Net Asset Value. (e) MPT and the Company shall, subject to reasonable notice, make available during normal office hours to PRIMOTOP and its representatives and accountants all books, records and information (including access to personnel) as PRIMOTOP may reasonably require until the date that the Completion Accounts and the Net Asset Value are agreed or determined in accordance with this Agreement. (f) PRIMOTOP shall notify MPT in writing whether or not physically exist will be fully written offit accepts the audited Draft Completion Accounts and calculation of the Net Asset Value by no later than the date falling 30 Business Days after the date on which the audited Draft Completion Accounts and the calculation of the Net Asset Value are delivered to PRIMOTOP (the “CA Notice”). If the Company can evidence its ownership CA Notice confirms that PRIMOTOP agrees entirely with the audited Draft Completion Accounts and calculation of items which exist but which are not recorded the Net Asset Value, then they shall be final and binding on the ledgers Parties for all purposes (and shall respectively constitute the Completion Accounts and calculation of the Net Asset Value for the purposes of this Agreement). If the CA Notice sets out that PRIMOTOP disagrees with the audited Draft Completion Accounts and calculation of the Net Asset Value, it will include reasonable details of the reasons for any disagreement and any suggested adjustment, together with, to the extent available, reasonable supporting evidence for each adjustment, including any relevant working papers (a “CA Objection Notice”). (g) If a CA Objection Notice is so served by PRIMOTOP during such 30 Business Day period, MPT and PRIMOTOP shall attempt in good faith to resolve any matters in dispute and agree a final form of the Draft Completion Accounts and the calculation of the Net Asset Value on or before the date falling 15 Business Days after the date on which MPT receives such CA Objection Notice. If the Draft Completion Accounts and the calculation of the Net Asset Value are so agreed by MPT and PRIMOTOP in such period, then those items should they shall be recognised final and binding on the parties for all purposes and the Completion Accounts as so agreed shall then constitute the Completion Accounts for the purposes of this Agreement. In the absence of agreement between MPT and PRIMOTOP within that time period (or such longer time period as MPT and PRIMOTOP may agree) (such period being the “Resolution Period”) an independent firm of chartered accountants of international standing as agreed to by MPT and PRIMOTOP (or failing agreement on the identity of such independent firm of chartered accountants within 5 Business Days from the end of the Resolution Period, such independent firm of chartered accountants of international standing appointed on the application of MPT or PRIMOTOP to the President for the time being of the Institut des Réviseurs d’Entreprises de Luxembourg) (the “Dispute Auditor”) shall be instructed to deliver a determination of the matters remaining in dispute and a calculation of the Net Asset Value and revised Draft Completion Accounts adjusted only to take account of the matters determined by the Dispute Auditor within 40 Business Days (or such later date as MPT, PRIMOTOP and the Dispute Auditor agree in writing) of confirmation and acknowledgment by the Dispute Auditor of its appointment. The following shall apply once the Dispute Auditor has been appointed: (i) MPT and PRIMOTOP shall each prepare a written statement within 15 Business Days of the Dispute Auditor’s appointment on the matters in dispute which (together with the relevant supporting documents) shall be submitted to the Dispute Auditor for determination and copied at the same time to the other; (ii) following delivery of their depreciated net book valuerespective submissions, taking MPT and PRIMOTOP shall each have the opportunity to comment once only on the other’s submission by written comment delivered to the Dispute Auditor not later than 10 Business Days after receipt of the other’s submission and, thereafter, neither MPT nor PRIMOTOP shall be entitled to make further statements or submissions except insofar as the Dispute Auditor so requests (in which case it shall, on each occasion, give the other Party (unless otherwise directed) 10 Business Days to respond to any statements or submission so made); and (iii) in giving its determination, the Dispute Auditor shall state what adjustments (if any) are necessary, solely for the purposes of this Agreement, to the Draft Completion Accounts in respect of the matters in dispute in order to comply with the requirements of this Agreement and to determine finally the Completion Accounts. (h) As so revised, the Draft Completion Accounts and the calculation of the Net Asset Value shall then constitute the Completion Accounts and the Net Asset Value for the purposes of this Agreement. (i) Within 20 Business Days following the Completion Accounts and the calculation of the Net Asset Value becoming final for the purposes of this Agreement, the Seller shall provide PRIMOTOP with a copy of the Business Plan updated in order to take into account the actual date of purchase and subject to review and verification of legal titles therefor. Fixed assets should be shown at their cost or valuation less depreciation. An assessment will be made of whether the valuation of any individual asset is impaired as at the Completion Accounts Date. If there is an indication that the value of an asset has been impaired, then it should be written down to its recoverable amount, being the higher of its value in use and its net selling price. Any encumbrance over any of the fixed assets will be fully disclosed. The cost of construction in progress incurred as at the Completion Accounts Date will be fully accrued. All projects which have been completed (as evidenced by the assets being put into use) shall be classified as "fixed assets" and depreciated from the date they were put into use. All commitments outstanding under contracts in progress will be fully disclosed. Any encumbrance over amounts recorded as "construction in progress" will be fully disclosed. Ownership of all intangible assets will be evidenced by documentation. Land Use Rights will be stated at their cost less amortisation (the amortisation period being the duration of the land use right). The value of other intangible assets will be tested for impairment using the same method as for fixed assets. Cash will be evidenced by bank statements, which will be confirmed with banks at the Completion Accounts Date, and reconciled to the cash balance in the general ledger. Any restrictions over cash will be fully disclosed. **** indicates where a confidential portion has been omitted and filed separately with the Commission Notes receivable will be evidenced by relevant documentation, and should be stated gross at the face value of the note less any provision for doubtful debt. Full disclosure will be made of encumbrances over notes receivable. Accounts receivable will be evidenced by confirmations from debtors. Provision will be made for doubtful debts on the following basis: amounts due for less than 3 months 0%, amounts due for 3-12 months 5%, 1 - 2 years 30%, 2 - 3 years 75%, above 3 years 100% (above 3 years 90% for connected inter-company accounts receivable). Specific provisions will also be made for debts that are known to be in dispute or uncollectible). Ageing will be calculated by reference to the date the goods were dispatched to the customer. Any encumbrances over accounts receivable will be fully disclosed. The internal bank deposit will be evidenced by irrevocable confirmation from the counter-party. Any restrictions on its use will be fully disclosed. Other receivables, prepayments and other current assets will be evidenced by documentation, be recorded on the accruals basis, and be stated at cost less any provision required. Inventory will undergo a full physical inspection as at the Completion Accounts Date at all locations where inventory of the Company is held. The inventory shown on the books will be adjusted to the amount of inventory that physically exists and any difference will be written off. Inventory will be valued at the lower of cost and market value, which will include an assessment of whether individual items are damaged, obsolete, or if their selling prices have declined. All encumbrances over inventory will be fully disclosed. Third-party loans should be stated at the amount of the loan and be evidenced by loan contracts. All security given for such loans, including security given by third parties, should be fully disclosed. All interest on loans should be fully accrued. Notes payable will be evidenced by relevant documentation, and should be stated gross at the face value of the note. Accounts payable should be fully accrued as at the Completion Accounts Date, including for all goods received but not invoiced. All dealer rebates and sales incentives will be fully accrued as at the Completion Accounts Date, including a pro-rata estimate of amounts payable under annual schemes. Dividend payable will be stated at the amount of dividend declared as at the Completion Accounts Date, as evidenced by Board minutes. Taxes payable will be fully accrued as at the Completion Accounts Date. All disputes with, demands or payment requests from the Taxing Authority not accrued shall be disclosed in full. **** indicates where a confidential portion has been omitted and filed separately with the Commission Advances from customers should be evidenced by documentation and reconciled with customer accounts. Salary and welfare payable should be fully accrued for all elements of remuneration, e.g. annual bonuses, sales incentives, overtime, etc. All other present obligations should be fully accrued as accruals. All future commitments should be fully disclosed. Warranty provision will be accrued at 2% of net sales, net of suppliers' reimbursements that are certain to be received. **** indicates where a confidential portion has been omitted and filed separately with the CommissionAccounts.