Net Adjustment. (a) At least two Business Days prior to the Closing Date, Seller shall deliver to Purchaser a statement (the "Estimated Assumed Current Assets Statement") of the estimated Assumed Current Assets of the Business as of the Closing Date (the "Estimated Assumed Current Assets"). As used herein, "Assumed Current Assets" shall be equal to the sum of Seller's net Inventory (valued at cost on a FIFO basis) and cash on hand in the Seller's restaurants on the Closing Date. The Purchase Price payable pursuant to Section 1.3.1 hereof shall be increased or decreased dollar for dollar by the amount of the difference between the Estimated Assumed Current Assets and base amount set forth on Schedule 1.3.3 (a) On the Closing Date, Seller shall take a complete physical count of the Inventory of the Business and Purchaser or its representatives shall be permitted to observe such physical count being taken. Set forth on Schedules 1.4.1(a)(ii) and (iii) (collectively the "Liabilities Schedules") are the estimated liabilities of Seller for gift certificates and accrued vacations as of the Closing Date (the "Estimated Assumed Closing Date Liabilities"). To the extent the aggregate liabilities for gift certificates and accrued vacations as of the Closing Date (the "Assumed Closing Date Liabilities") are different from those set forth on the Liabilities Schedules, the Purchase Price payable pursuant to Section 1.3.1 shall be increased or decreased dollar for dollar by the amount of such difference. Within fifteen (15) days after the Closing Date, Seller shall deliver to Purchaser a statement (the "Assumed Closing Statement") indicating the actual Assumed Current Assets as of the Closing Date (the "Closing Assumed Current Assets") and the actual Assumed Closing Date Liabilities. Purchaser and its representatives shall have the right to review all work papers, data, programs and procedures used to prepare the Assumed Closing Statement and shall have the right to perform any other reasonable procedures necessary to verify the accuracy thereof. Each Party shall bear its own expenses incurred in connection with the above procedures. (b) Unless Purchaser, within fifteen (15) days after delivery to Purchaser of the Assumed Closing Statement, notifies Seller in writing that it objects to the Assumed Closing Statement, and specifies the basis for such objection, such Assumed Closing Statement shall become final, binding and conclusive upon the Parties for purposes of this Agreement. If Purchaser and Seller are unable to resolve any objections to the Assumed Closing Statement within fifteen (15) days after any such notification has been given by Purchaser, any Party hereto shall have the option to refer the dispute to Deloitte & Touche (the "Independent Accounting Firm"). If for any reason the Independent Accounting Firm is unavailable to resolve such dispute between Purchaser and Seller and if Purchaser and Seller are also unable to mutually agree upon the designation of a nationally recognized public accounting firm within five (5) days after the dispute has been referred to the Independent Accounting Firm pursuant to the preceding sentence, any Party hereto may thereafter request that the American Arbitration Association ("AAA") make such designation. The accounting firm so designated will make a determination as to each of the items in dispute, which determination shall be final, conclusive and binding upon each of the Parties hereto. Purchaser and Seller shall cooperate with each other and with each other's authorized representatives in order to resolve any and all matters in dispute under this Section 1.3.3 as soon as practicable, and Purchaser and Seller shall share equally the fees and expenses of the Independent Accounting Firm and, if applicable, the accounting firm mutually agreed by the Parties or otherwise designated by AAA. (c) If (i) the amount of the Closing Assumed Current Assets are lower than the amount of the Estimated Assumed Current Assets and/or (ii) the Estimated Assumed Closing Date Liabilities are higher than the Assumed Closing Date Liabilities then (iii) the Purchase Price shall be decreased dollar for dollar by the amount of such difference. In such event, at Purchaser's election: (i) Purchaser shall offset such amount by any amounts Purchaser owes Seller in accordance with Section 1.4.1(a)(i), or (ii) Seller shall remit the amount of such difference to Purchaser in cash, in each case with interest at a rate per annum equal to the prime rate announced from time to time by Citibank (the "Agreed Rate") from the Closing Date to the date of payment, within five (5) days after delivery to Purchaser of the Closing Assumed Current Asset Statement as provided above; provided, however, that acceptance by Purchaser of such payment shall not constitute a waiver of Purchaser's right to object to the Closing Assumed Current Asset Statement during the fifteen (15) day period following its delivery. If Purchaser does raise an objection and if resolution of such objection results in a further payment due from Seller to Purchaser, payment of such additional amount, with interest at the Agreed Rate, from the Closing Date to the date of payment, shall be made to Purchaser within five (5) days following final resolution of such objection. (d) If (i) the amount of the Closing Assumed Current Assets exceed the amount of the Estimated Assumed Current Assets and/or (ii) the Estimated Assumed Closing Date Liabilities are lower than the Assumed Closing Date Liabilities then (iii) the Purchase Price shall be increased dollar for dollar by the amount of such excess. In such event, at Seller's election: (i) Seller shall offset such amount by any amounts Seller owes Purchaser or (ii) Purchaser shall within five (5) days after the expiration of the fifteen (15) day period referred to above, or if Purchaser contests the Closing Assumed Current Asset Statement, within five (5) days after final resolution of such objection, remit to Seller the amount of such difference, together with interest thereon at the Agreed Rate, from the Closing Date to the date of payment. (e) The amounts due from Purchaser to Seller or from Seller to Purchaser pursuant to paragraphs (c) and (d) hereof shall be netted to provide for one sum due from one Party to the other. (f) Except as otherwise set forth in this Section 1.3.3, any undisputed or resolved amounts under this Section 1.3.3 shall be payable within five (5) days of the date such amount is determined to be undisputed or resolved, with interest at the Agreed Rate, even if other amounts continue to be disputed and unresolved.
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Net Adjustment. (a) At least two Business Days prior to the Closing Date, Seller shall deliver to Purchaser a statement (the "Estimated Assumed Current Assets Statement") of the estimated Assumed Current Assets of the Business as of the Closing Date (the "Estimated Assumed Current Assets"). As used herein, "Assumed Current Assets" shall be equal to the sum of Seller's net Inventory (valued at cost on a FIFO basis) and cash on hand in the Seller's restaurants on the Closing Date. The Purchase Price payable pursuant to Section 1.3.1 hereof shall be increased or decreased dollar for dollar by the amount of the difference between the Estimated Assumed Current Assets and base amount set forth on Schedule 1.3.3
(a) 1.3.3(a). On the Closing Date, Seller shall take a complete physical count of the Inventory of the Business and Purchaser or its representatives shall be permitted to observe such physical count being taken. Set forth on Schedules 1.4.1(a)(ii) and (iii) (collectively the "Liabilities Schedules") are the estimated liabilities of Seller for gift certificates and accrued vacations as of the Closing Date (the "Estimated Assumed Closing Date Liabilities"). To the extent the aggregate liabilities for gift certificates and accrued vacations as of the Closing Date (the "Assumed Closing Date Liabilities") are different from those set forth on the Liabilities Schedules, the Purchase Price payable pursuant to Section 1.3.1 shall be increased or decreased dollar for dollar by the amount of such difference. Within fifteen (15) days after the Closing Date, Seller shall deliver to Purchaser a statement (the "Assumed Closing Statement") indicating the actual Assumed Current Assets as of the Closing Date (the "Closing Assumed Current Assets") and the actual Assumed Closing Date Liabilities. Purchaser and its representatives shall have the right to review all work papers, data, programs and procedures used to prepare the Assumed Closing Statement and shall have the right to perform any other reasonable procedures necessary to verify the accuracy thereof. Each Party shall bear its own expenses incurred in connection with the above procedures.
(b) Unless Purchaser, within fifteen (15) days after delivery to Purchaser of the Assumed Closing Statement, notifies Seller in writing that it objects to the Assumed Closing Statement, and specifies the basis for such objection, such Assumed Closing Statement shall become final, binding and conclusive upon the Parties for purposes of this Agreement. If Purchaser and Seller are unable to resolve any objections to the Assumed Closing Statement within fifteen (15) days after any such notification has been given by Purchaser, any Party hereto shall have the option to refer the dispute to Deloitte & Touche (the "Independent Accounting Firm"). If for any reason the Independent Accounting Firm is unavailable to resolve such dispute between Purchaser and Seller and if Purchaser and Seller are also unable to mutually agree upon the designation of a nationally recognized public accounting firm within five (5) days after the dispute has been referred to the Independent Accounting Firm pursuant to the preceding sentence, any Party hereto may thereafter request that the American Arbitration Association ("AAA") make such designation. The accounting firm so designated will make a determination as to each of the items in dispute, which determination shall be final, conclusive and binding upon each of the Parties hereto. Purchaser and Seller shall cooperate with each other and with each other's authorized representatives in order to resolve any and all matters in dispute under this Section 1.3.3 as soon as practicable, and Purchaser and Seller shall share equally the fees and expenses of the Independent Accounting Firm and, if applicable, the accounting firm mutually agreed by the Parties or otherwise designated by AAA.
(c) If (i) the amount of the Closing Assumed Current Assets are lower than the amount of the Estimated Assumed Current Assets and/or (ii) the Estimated Assumed Closing Date Liabilities are higher than the Assumed Closing Date Liabilities then (iii) the Purchase Price shall be decreased dollar for dollar by the amount of such difference. In such event, at Purchaser's election: (i) Purchaser shall offset such amount by any amounts Purchaser owes Seller in accordance with Section 1.4.1(a)(i), or (ii) Seller shall remit the amount of such difference to Purchaser in cash, in each case with interest at a rate per annum equal to the prime rate announced from time to time by Citibank (the "Agreed Rate") from the Closing Date to the date of payment, within five (5) days after delivery to Purchaser of the Closing Assumed Current Asset Statement as provided above; provided, however, that acceptance by Purchaser of such payment shall not constitute a waiver of Purchaser's right to object to the Closing Assumed Current Asset Statement during the fifteen (15) day period following its delivery. If Purchaser does raise an objection and if resolution of such objection results in a further payment due from Seller to Purchaser, payment of such additional amount, with interest at the Agreed Rate, from the Closing Date to the date of payment, shall be made to Purchaser within five (5) days following final resolution of such objection.
(d) If (i) the amount of the Closing Assumed Current Assets exceed the amount of the Estimated Assumed Current Assets and/or (ii) the Estimated Assumed Closing Date Liabilities are lower than the Assumed Closing Date Liabilities then (iii) the Purchase Price shall be increased dollar for dollar by the amount of such excess. In such event, at Seller's election: (i) Seller shall offset such amount by any amounts Seller owes Purchaser or (ii) Purchaser shall within five (5) days after the expiration of the fifteen (15) day period referred to above, or if Purchaser contests the Closing Assumed Current Asset Statement, within five (5) days after final resolution of such objection, remit to Seller the amount of such difference, together with interest thereon at the Agreed Rate, from the Closing Date to the date of payment.
(e) The amounts due from Purchaser to Seller or from Seller to Purchaser pursuant to paragraphs (c) and (d) hereof shall be netted to provide for one sum due from one Party to the other.
(f) Except as otherwise set forth in this Section 1.3.3, any undisputed or resolved amounts under this Section 1.3.3 shall be payable within five (5) days of the date such amount is determined to be undisputed or resolved, with interest at the Agreed Rate, even if other amounts continue to be disputed and unresolved.
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Sources: Asset Purchase Agreement (Chart House Enterprises Inc)